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Business Management Discuss the day to day running of your business here. Discuss accounting, Insurance and staff issues.


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Old 18-04-12   #1 (permalink)
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Budgets.

I know most folk won't like discussing numbers but what percentage do you guys in tree surgery companies spend of different things?

I'm doing my accounts:

5% on advertising
5% on fuel
5% on repairs/new saws and small equipment (two chippers, stumpgrinder, 2 trailers)
4% on insurance
2% on running our 3 trucks (6 tonner, 130 and 4x4)not including fuel and insurance
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Old 18-04-12   #2 (permalink)
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Re: Budgets.

I dont mind:
Fuel 3.6%
Insurance 2.5%
Advertising less than 1%
Machinery repairs and new kit well over 10%

Our vans - I always reckon it costs between 2-2.5k a year to have a fresh well maintained Transit on the road. It's either depreciating at 2k a year or when it get a little older towards 1k on dep and 1k for repairs and servicing -but it always seems to come in around 2-2.5k a year. We run 5 Ford Transits all bought new by us and now of various ages serviced by the Ford main dealer Transit specialist and they rarely miss a beat Been running Transits now for 18 years.
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Last edited by Gareth Dalzell; 18-04-12 at 09:43 PM.. Reason: Forgot a bit
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Old 18-04-12   #3 (permalink)
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Re: Budgets.

What about wages
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Old 18-04-12   #4 (permalink)
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Re: Budgets.

Quote:
Originally Posted by benedmonds View Post
I know most folk won't like discussing numbers but what percentage do you guys in tree surgery companies spend of different things?

I'm doing my accounts:

5% on advertising
5% on fuel
5% on repairs/new saws and small equipment (two chippers, stumpgrinder, 2 trailers)
4% on insurance
2% on running our 3 trucks (6 tonner, 130 and 4x4)not including fuel and insurance
Ben is that 5% fuel just for saws? or trucks as well? I put 100 a week in my pick up no trouble at all, dont spend that on advertising, thats just me though.

Nice to be open with figures, all the top businesses no matter what sector share figures to help improve themselves
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Old 18-04-12   #5 (permalink)
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Re: Budgets.

Quote:
Originally Posted by farmer_ben View Post
Ben is that 5% fuel just for saws? or trucks as well? I put 100 a week in my pick up no trouble at all, dont spend that on advertising, thats just me though.
That's saws, trucks, chippers, tractor, stumpgrinder the lot!
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Old 18-04-12   #6 (permalink)
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Re: Budgets.

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Originally Posted by Tree cutter Stu View Post
What about wages
About 45% including what the partners take out.
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Old 18-04-12   #7 (permalink)
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Re: Budgets.

I ought to look at mine I must admit I don't really have any idea! I'd say my fuel bill would be a lot higher percentage wise that yours tho!!
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Old 18-04-12   #8 (permalink)
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Re: Budgets.

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Originally Posted by benedmonds View Post
About 45% including what the partners take out.
42.1% including directors salary

Our fuel bill is excluding VAT

Curious as to the turnover of other companies and whether the ratio changes much if you are turning over 100k or 500k?
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Old 18-04-12   #9 (permalink)
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Re: Budgets.

I am not going into detail cos I dont have the figures at hand, but for a small company, a third on wages, and a third on costs would be about right. And then of course those costs get broken down into smaller things like fuel etc.

Advertising: 5% is lot to spend on advertising. It makes me laugh when I hear tree companies saying they took out a 800 ad in YP, and got an 800 job from it in the first month so thats that advert paid for!!! Ha, hilarious!!

An 800 ad needs 16K of work to make it 5% of that work. If you get other work to cover it so that advertising ends up as being 5% of all work then your other jobs are paying for your advertising. So most companies get work from word of mouth but still spend 5% or more on advertising, its madness IMO.

If a sole trader can take more than 30-35% of turnover into profit then they are doing ok (as long as turnover is big enough that a third is enough to live on)

As companies get larger then the % profit is less, but 10% of a 1M is better than 35% of 80K if you have the finances to allow you to turn that over without a nervous breakdown!! I get stressed if Im owed 5K so would hate to think what its like being owed 50 odd!!
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Old 18-04-12   #10 (permalink)
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Re: Budgets.

[QUOTE=Rupe;661776]I am not going into detail cos I dont have the figures at hand, but for a small company, a third on wages, and a third on costs would be about right. And then of course those costs get broken down into smaller things like fuel etc.

Advertising: 5% is lot to spend on advertising. It makes me laugh when I hear tree companies saying they took out a 800 ad in YP, and got an 800 job from it in the first month so thats that advert paid for!!! Ha, hilarious!!

An 800 ad needs 16K of work to make it 5% of that work. If you get other work to cover it so that advertising ends up as being 5% of all work then your other jobs are paying for your advertising. So most companies get work from word of mouth but still spend 5% or more on advertising, its madness IMO.

If a sole trader can take more than 30-35% of turnover into profit then they are doing ok (as long as turnover is big enough that a third is enough to live on)

As companies get larger then the % profit is less, but 10% of a 1M is better than 35% of 80K if you have the finances to allow you to turn that over without a nervous breakdown!!
I get stressed if Im owed 5K so would hate to think what its like being owed 50 odd!![/QUOTE]

" It's like a wheel barrow - it's all in front of you." One other point to consider is that when you run multiple squads if you've screwed up the pricing on one squads job, hopefully the other ones will still be ok.
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