Chartered Financial Analyst specializing in service business and trade finance.
Determine how many jobs your landscaping business must complete per month to cover all costs. Enter any three variables—Monthly Fixed Costs, Avg. Job Price, Avg. Variable Cost, or Breakeven Jobs—to solve for the fourth.
Landscaping Breakeven Calculator
Landscaping Breakeven Formula
The breakeven formula for a landscaping business finds the number of jobs (Q) it must complete for total monthly revenue to equal all fixed and variable costs.
Q = F / (P – V)
Solve for Monthly Fixed Costs (F):
F = Q * (P – V)
Solve for Avg. Job Price (P):
P = (F / Q) + V
Solve for Avg. Variable Cost per Job (V):
V = P – (F / Q)
Variables Explained
- Monthly Fixed Costs (F): Your total, recurring monthly overhead (e.g., truck/equipment payments, insurance, shop rent, salaries).
- Avg. Job Price (P): The average amount you charge for a single landscaping job (e.g., a maintenance visit or small project).
- Avg. Variable Cost per Job (V): The average cost of materials (mulch, plants), fuel, and per-job labor directly tied to one job.
- Breakeven Jobs (Q): The total number of jobs you need to complete to reach $0 in monthly profit.
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What is a Landscaping Business’s Breakeven Point?
A **Landscaping Breakeven Point** is the number of jobs (Q) your business must complete in a month to cover all your total expenses. This is the minimum sales volume you need to achieve to start being profitable.
**Fixed Costs (F)** are your monthly “overhead.” These are the expenses you pay regardless of how many jobs you do. This includes your truck payments, equipment loan payments, insurance (liability, auto), shop/yard rent, and salaries for any office staff or full-time crew leaders.
**Variable Costs (V)** are the costs tied *directly* to each job. This includes materials (plants, mulch, soil), fuel consumed driving to/from and at the job, equipment rental for a specific job, and any hourly labor (crew members) paid only for the time they are at that job.
The **Contribution Margin** (P – V) is the profit from a single job that goes toward paying off your large monthly fixed costs. This calculator finds how many jobs you need to complete to cover your total overhead. Every job completed *after* this point generates your net profit.
How to Calculate Landscaping Breakeven (Example)
Let’s calculate the breakeven point for a small landscaping company.
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Identify Monthly Fixed Costs (F):
The company has $6,000 in monthly truck payments, insurance, and equipment storage rent.
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Identify Avg. Job Price (P):
The average job (e.g., a large cleanup or install) is billed at $450.
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Identify Avg. Variable Cost (V):
The average cost of materials, fuel, and hourly labor per job is $150.
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Apply the Formula: Q = F / (P – V)
First, calculate the contribution margin per job: $450 (P) – $150 (V) = $300.
Next, divide the fixed costs by this margin:
Q = $6,000 / $300 = 20 -
Conclusion:
The landscaping company must complete 20 jobs each month to cover all costs and start making a profit.
Frequently Asked Questions (FAQ)
It depends. If you pay your crew a salary or a guaranteed 40 hours/week, they are a **Fixed Cost (F)**. If you pay them strictly hourly *only* for time spent on a job, their wage is a **Variable Cost (V)**.
Fuel consumed *per job* is a **Variable Cost (V)**. Monthly payments on equipment are a **Fixed Cost (F)**. Depreciation is a non-cash expense but should be included in your fixed costs for a more accurate picture of true profitability.
You must find your “average” job. At the end of the month, divide your total revenue by the total number of jobs to get your (P). Divide your total variable costs (all materials, fuel, job labor) by the total number of jobs to get your (V).
Enter your (F) (e.g., $6,000), (V) (e.g., $150), and your goal for total jobs (Q) (e.g., 25/mo). Solve for (P): `P = ($6,000 / 25) + $150 = $240 + $150 = $390`. This means your average job price must be at least $390 to break even at 25 jobs/month.