A tree service business plan is a document that contains the details you need to start your business, such as the services you’ll offer, how you’ll market yourself, and when you’ll turn a profit. It’s a blueprint you can follow to keep things running smoothly, even if unexpected obstacles come up.
Creating a plan is vital for anyone starting a new business because it helps get funding and acts as a roadmap to follow. But it’s especially crucial for arborists who want to start a tree service company.
Read on to learn why and how to create a tree service business plan by following our business plan template.
Do I Need a Tree Care Business Plan?
Many business owners skip this step. It seems time-consuming, and they want to get straight to work making money.
The truth is, most elements of a good business plan can be written down on a single sheet of paper. And the time it does take will be well worth it in the long run.
There are two main reasons you should seriously consider writing a business plan:
1. It Helps You Get Funding
Firstly, starting a tree care business is a significant capital investment compared to other service businesses. It can set you back anywhere from $10,000 to $50,000. Just think of the equipment you need, including chippers, chainsaws, gloves, boots, ropes, etc. And let’s not forget the insurance to protect you and your employees in what is a notoriously dangerous industry.
A business plan helps you get this capital from banks or investors. Banks typically decide whether to loan you money and how much after reviewing your plan to see if you will make enough to pay them back. Investors follow a similar process and evaluate your concept, vision, and financials to determine if your business is a lucrative investment opportunity or not.
2. A Business Plan Gives You Focus
The temptation, as an arborist, may be to simply jump in and start getting your hands dirty without any prior planning. Look, we get it; you love the outdoors, exercise, and helping your clients. But not having a plan reduces your odds of succeeding in a business that relies heavily on trust.
Your business plan acts as a roadmap or blueprint that you can use to intelligently navigate the various startup tasks. This gives you focus and also reduces stress because you’ve thought about what you need to do to start your business, where you’re headed, and how you’ll ultimately get there.
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How Do You Create a Tree Care Business Plan?
The simplest and easiest way is to follow a business plan template. We’ve written a basic template you can use, that includes the eight most important features for tree care businesses.
Keep in mind that when you do eventually write your business plan, you’ll want to keep it simple. Write what comes to mind before editing. Start at the end by writing where you see your business in 5, 10 or 15 years.
And remember, your business plan is a living, breathing document that you should update as your business grows. It does not have to be perfect right out of the gate. It just has to be good enough so that you’re clear on what’s needed to get going.
1. Executive Summary
This is a short summary of your entire business plan. It’s usually no longer than a page and entices the reader to read the rest of your document.
You’ll want to briefly include the following important information:
- Your income and expense forecasts to show that you will be profitable
- If you have partners, introduce them and their experience to instill confidence in investors that you can run the business efficiently together
- How much money you need (if any). For example, you could say, “The purpose of this business plan is to secure $10,000 worth of funding.”
- What makes you different from other tree care businesses (discussed later)
2. Business Overview
Write down all the technical details of your business, including:
- Business structure, e.g., LLC, sole proprietorship, partnership or corporation
- Legal and trade name
- Contact details, e.g., email and telephone number
- Social media profiles and website address
- Type of business, i.e., tree service business
- When you registered your business
This section should be no longer than one page.
3. Business Description
For your business description, write down:
- The services you’ll provide. For example, tree trimming, tree removal, stump grinding, pruning, tree planting, risk assessments, and consulting services.
- Your short and long term goals. Do you want to scale or keep your business small? A bigger business requires more paperwork and strategic thinking and less time climbing trees.
- Where you’ll operate from. A home base or separate office?
- Your mission statement. Describe what you do for your clients, employees, and community. For example:“Joe’s Tree Removal aims to be the go-to tree care business in the area that everyone recommends to others. We will achieve this aim by offering quality work from certified arborists and going above and beyond the normal service norms. To go the extra mile, we will always communicate with our clients before, during, and after a job to make sure they’re happy and so that we can constantly improve our service.”
4. Market Analysis
In your market analysis, you’ll describe who your customers are—maybe it’s residential or commercial properties or both— and what other businesses you’re competing against.
Don’t sugarcoat things.You won’t do yourself any favors. Instead, gather as much information from the market as possible. Speak to potential customers to get a feel for how many tree care companies there are, the size of the market, and how well these companies are serving the market.
For example, if your potential customers have to wait to get served, you know there’s probably a shortage of arborists, which presents an opportunity.
Also, don’t forget to look at market trends. For example, if other businesses in the area are closing, it could either be because they’re not run properly, or a reflection of tough economic times.
Document all this information you find and include it in your business plan. Then, think about your unique selling proposition.
What sets you apart from the competition? Maybe it’s your expertise. Are you, like Matt of Logan Tree Experts, a Board Certified Master Arborist— the highest certification level an arborist can receive? Perhaps it’s the service you offer. Do you provide an in-demand or specialty service that other local businesses don’t?
Finally, write down your weaknesses compared to the competition and how you plan to combat them. For example, if you lack skills in a particular service, you can partner with another tree company to subcontract these services, or set aside time to take a course and get certified.
5. Marketing Plan
You can have the best tree care business idea, but without marketing, you won’t get customers. You need a marketing plan that details the marketing methods you’ll use to grow your business.
For your business plan, limit your marketing strategy to three tactics to start with.
An excellent place to start is to plan to set up a referral program because most tree service businesses rely on word of mouth referrals to grow their business.
When you write about how you will market your business in your business plan, be as specific as possible.
For example, let’s say you start with the three marketing tactics we suggest above. Make sure your business plan includes the following:
- How will your referral program work?
- How much will you spend on Google LSA advertising?
- How will you optimize your Facebook business page to get paying customers?
6. Business operations
In this section, detail what you’ll need to get the work done, including:
- Who you’ll hire, plus their skills and qualifications
- The equipment you’ll need, e.g., chainsaws, brush chippers, climbing boots, mini skid steers, arborist apps, etc.
- The systems you’ll use to book more jobs. For example, how will you collect client information when they first call, build a proposal, schedule the tree care job, create a job order, and invoice and collect payment from the client?
- The software you’ll use to support your system. Will you use tree service management software?
- Whether or not you plan to subcontract certain jobs. For example, let’s say you decide to specialize and only offer tree removal services, and a client contacts you asking about pruning or tree treatment. You can subcontract, or simply refer that customer on to another tree services company in your area.The beauty of this approach is that it works both ways, and you can generate business from two-way referral networks.
7. Financial Plan
Don’t be surprised if a bank manager or investor jumps straight to this section of your business plan to see whether your business can be profitable or not. Make sure you cover the following three key areas:
A. Your startup costs. This can vary depending on the services you provide, the equipment you need, and the size of the operation. As you saw, this can range from $10,000 to $50,000. As a starting point, write down:
- All the equipment you need and the corresponding cost.
- How many employees you need, the types of skills they must have (e.g., skilled tree climber), and their salary. Refer to the U.S. Bureau of Labor Statistics for more salary information.
2. Income and expense forecasts by month and for years one, two, and three. Your startup costs will be part of your expense forecasts. As for your income forecasts, you’ll have to clarify:
- How many jobs you expect to book each month. Assume a close rate of 50% and allow for seasonality.
- How you’ll price your services. Will you price by the hour or project? How much income do you expect from certain types of jobs (e.g., pruning vs. cutting vs. tree treatment)?
3. Break-even point. Break-even is simply the point where income and expenses are the same.
Because your startup costs are high, it can take a while before you reach this point and break even.
But, by mapping out your income and expenses, you should have a reasonably good idea when this will happen.
8. Business Plan Summary
This is the last step – and it’s an easy one. Your summary ties together your entire message, and will reinforce these key points:
- Your unique selling proposition
- Why your tree care business will work
- Your funding requirements.
Also, don’t forget to say “thank you” at the end.
Create Your Tree Service Business Plan
Your tree service business plan helps you get the capital you need to start your business and provides a blueprint you can follow to get going.
It’s undeniably important—and that’s why you need to create one for your business by using the above template.
And remember: Planning will only get you so far. You also need to implement that plan to start your business.
Up Next: 5 Lessons from a Master Arborist
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