Archive for July 2012

What are the 5 Biggest Challenges Facing a Landscape Contractor Today?

By Sitesource · Comments (0)
Thursday, July 19th, 2012

What are the 5 biggest challenges facing a Landscape Contractor today?

1. The uncertainty of government regulation, including taxes, health care etc.

2. The labor market including immigration and labor availability.

3. Raising prices on everything from fuel to seed.

4. Drought condition across America.

5. The lack of available capital for growth.

The uncertainty of government regulation is creating a slow down in the recession recovery. Businesses are unsure what the government will add to the burden of taxes and additional cost to operate. The health care law would appear to be a big burden for small businesses and is yet to be defined as to the costs to employees. This uncertainty is not helping the normally conservative business community. Until this is defined, the concept of business growth and job creation will continue to stall.

The labor market may very well be the largest issue facing landscape contractors. The issue of immigration reform seems to be a political football, with no solution being offer by either side. Add to that the country’s cry for made in America, it is hard to imagine that Landscape Contractor will be able to find the necessary labor to do the work. We all know that the labor force that is currently seeking work will not perform the job functions that the current immigrant labor force is  providing in our industry. Finding new resource of labor pools willing to do the manual labor isn’t easy and at this time, unidentified. This will drive the labor cost up as the demand for labor willing to perform the landscape functions increases.

The inevitable price increases,  due to the drought, world shortage of items like petroleum, will force the price to increase on many items in the next 12 to 24 months. These increases are already visible at the super market and the gas pump.  Although fuel prices have decline in some parts of the country, it is uncertain how long this will last. Inflation seems inevitable because of the raising debt crisis that the country is facing. Until the government finds some way to get a handle on the raising prices, as business people we are left to wonder “what if?”.

The current drought condition across the country affects landscape contractors in many ways.  Less water means less planting, the drought will cause  many clients to reconsider project that they would other wise go forward with and finally, the drought is not just a one season issue it will have affects for years to come. In the west we are already concerned about snow pack for the upcoming winter, and worry about there being sufficient moisture to fill the reservoirs for next season. Many experts have stated that the west is in a 50 year drought cycle with about 40 years remaining on the cycle until it ends. This can and will change the face our our industry, and not just by the ways we use water.

The traumatic swings in the stock market and the recent financial down turn have changed the face of the banking relationship with small business. This change certainly will affect the ability to borrow capital to expand businesses in the future and may affect the creation of new venture going forward. Again looking for alternative means of financing new capital needs is a must. Small business people will not be expanding and will not be hiring unless some plan is developed to encourage banks to lend.

All of this paints a bleak view for the business person, however, it may be a good thing, as it will force businesses and business owner to grow more cautious and be stronger for their effort. Those that plan and develop a strategy that allows for slow but steady growth will be successful in the end. This is why planning your business direction is so important to your future success.  Look at these challenges and how you have considered them in your overall business plan.

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Categories : Business
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When is the Right Time to Make Personnel Changes?

By Sitesource · Comments (0)
Wednesday, July 18th, 2012

Making personnel changes is always a challenge, but in the landscape contracting industry it is more difficult. The short 7 to 9 month season adds a bit of trauma to the decision. If you wait too long the season is gone and the change is for next season, if you do it too quickly you feel like you have not given the employee enough time to learn the position. But the best barometer is your client, how are they working with this employee? Is he or she giving the customer care that your customers expect from your company. Is this employee returning the financial award that you expected from the portifolo of work? Does this employee fit in with the others in the company?

When making personnel changes there is a lot to consider, but I always start with the customer relations. Is this employee taking care of my customer or am I getting complaints and comments from the customer? It does not always need to be direct comments, but if you have a client who purchases a lot of additional work each year and this year the numbesr are down it is time to ask some questions. Is this employee visiting the accounts on a regular basis or are they missing appointments. Look for the little clues not always the elephant in the room.

Look at the financials of these accounts to see if your making your projection and that the job costs are looking good. Ask the other managers about the employee’s performance. Use the financial information to guide your thinking, after all, the name of the game is profit. Employees can show signs and signals that they are unhappy or overwhelmed, learn to recognize these signs. Each person will demonstrate their feelings differently, but most time it is apparent to those around them.

Many times you will find that the under performing employee is withdrawn from the group and not active in the organization or with other employees. Many times they display the emotions more openly than in the past. All of these are signs that something is not right, but the bigger question is what to do about it.

It is my experience that the sooner you make a decision and act the better the organization and the employee will be. The longer you wait to make the decision the more damage that is done to relationships and to the customer that are caught in the middle. Making personnel decisions isn’t very easy, but the sooner you react to your instincts the better for all concerned. Our business is service. If you think that an employee is not delivering the customer service you must react. Considering the compressed time frame that we have to do our work and leave a lasting impression on the customer, the less time to have to think about the change. Admittedly, there are times when you wonder if you made the right decision, but most times you do, don’t dwell on the decision.

Personnel decision are perhaps the most difficult decision that you make as an owner, but go with your gut. Time is short in the landscape season, but memories are hard to erase.

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Categories : Human Resource
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What Are The Keys to Closing Landscape Sales?

By Sitesource · Comments (0)
Tuesday, July 17th, 2012

What are the the key elements to closing landscape sales, whether maintenance or installation? Let’s list 5 factors that affect closing a sale:

Presentation

A sales proposition that is meaningful

Reputation

Commitment

Follow through

Let’s look at each of these elements and define their value to the sale closing.

Presentation is is more than a great brochure, it is how your sales team dresses, how they speak, how they present the information to the customer, it is your company’s image in the community and on the street. All sales people should present a professional image, they should dress appropriately for the position. Clean and neat looking appearance can set the tone for the entire sales process. A collared shirt and clean slacks are important, and a logo on the shirt to help identify your staff and present an image of professionalism to the customer. Using brochures that have your logo, name address and phone number on them, gives an appearance of stability and professionalism. Logo’s on vehicles and equipment add to the level of professionalism. Presentation is much more than a brochure.

Your sales proposition is what defines your company and sets you apart from the competition. For example, “Our company has 99% retention rate of clients from year to year for the past 5 years”,  ”Our company responses to all customer calls the same day with out fail” , “Our company offers 100% satisfaction or you don’t pay”.  These are examples of sales propositions, now it must be something that is true and that you believe in, as an owner and a company. It must set you apart from the other companies and you must follow through on your statement. Also it should be something that is important to the clients you serve. Your statement should be on every piece of literature that you company produces and appear on every graphic you use to sell, including logo’s on the vehicles and equipment. 

Reputation is a key factor in selling services, if you are known for being late to jobs, or if your company is always tacks on charges after the job is sold, you have a problem. That is the public perspective of your company and will tell people how you do business, good or bad. Reputation travels through a community, people talk about their contractors to neighbors, co-workers, anyone that will listen. Make sure what they say about your company is what you want them to say. Reputation can be something that is simple, but defines your company, for example,” The ABC company is expensive, but high quality”, or “The people they send to my job site are always dressed in old dirty clothes.” You can control your reputation!

Client’s want to be sure that you are committed to your company and the promises that are made to the client. Commitment is your passion in the landscape business, if you don’t follow through then someone else will. Clients want to know that you and your staff are committed to fulfilling your promises, but also insuring that the client will be well taken care of. Don’t let them down.

Follow through is important to all clients and potential clients, make sure that what ever commitments you make to a client are fulfilled. There is nothing more problematic than making promises you can’t keep. That includes time lines for proposals to information about the company, always exceed the clients expectations. New clients may even offer small tests to see how you respond to their requests, don’t be fooled it is important that you respond to their requests quickly and completely.

It is important that you follow these steps to insure that your company is providing what you promise. Don’t fail your customer and you will always be successful.

 

 

 

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Categories : sales
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Half way through the season: Is your Company where you want to BE?

By Sitesource · Comments (0)
Saturday, July 14th, 2012

We are half way through the landscape season, and it is time to look at where your company is in relationship to your plan. It has been a busy start to the landscape season for most contractors, with any early season start and favorable weather conditions. But as you look at your plan:

  • Are you meeting the expectations and goals of your plan?
  • Are you reaching your profit goals?
  • Are your revenues at the projected level?

If not, what do you do now? You have 5 months to turn things around, where do you start?

Let’s start at the beginning. As part of your yearly start up, your company should be developing a business budget and a strategic plan for the year. If not, how can you determine if you are successful in your business, and, more importantly, how can you plan for the future of your company? If you have these tools, how do you compare to your plan? Are you producing monthly financial statements to help guide you through the business? The monthly financial statement is your monthly report card. Are you making a profit? If not, why not? Some landscape contractors, and for that matter many business people, tell me “I am too busy to look at these reports” and “I have an accountant who does my financials.” Well, that’s great, but how do you know if you are making money or not? Cash flow is not the way to determine whether you are making money because most likely the cash flow will dry up in August and you will be asking what happened.

I have created a tool that is available to you at no charge, called the Business Health Report. This tool is targeted  at your business and the things that you need and want to be doing in your business to be successful. This tool will ask you simple questions about you business operation, financials, insurance and other business related topics. When you answer the questions, be honest with yourself, then you will see how you compare to successful businesses in the landscape industry. The tool will point to areas where you may be weak and where you need to spend more time in the coming months. I can help you determine the areas that you need to work on and help you get to the results that you planned for. This is not a quick fix, but it will assist you in focusing on the items you need to do to get your business back on track.

download business health report tool

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Categories : Business, planning
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Always be Prepared for the Unexpected in Business

By Sitesource · Comments (0)
Friday, July 13th, 2012

We discuss  the planning process a great deal and how that can help meet the goals of your business. But no matter how prepared you believe you are, there are times when the unexpected does occur. This does not mean that planning is not important or helpful, but instead prepares you and your staff for the things that you don’t expect. The planning process is a tool and like any tool the purpose is to make the job easier. The unexpected can come in many forms, an accident, a client cancellation, or an unexpected illness to a major member of your staff.

Being prepared to deal with these types of issues is about meeting the problem head on and not waiting or delaying a decision. Many times when an a major issue confronts a business, the biggest problem is lack of action or direction from leadership. Leadership is making a decision and moving forward with that decision. You will not always make the best or right decision, but if you select a direction and move forward you have the support of your team and you will find the right direction in due time. Making no decision or waiting can create more turmoil for a business than no action at all. It is impossible to be prepared for every disaster that can befall a business, but knowing how to plan and the way your business works makes the process easier to deal with.

Business is in itself a risk and any risk has it’s unexpected turns. Don’t allow your business to fall victim to that unexpected circumstance. There certainly are a number of disaster planning programs that one can take or drills that are available, but the best plan is the one you make each year and refer to on an on going basis for your day to day operations. This plan will guide your business through the unexpected. The very definition of planning is review circumstances and developing a direction for your company that deals with these issues, whether it is marketing and sales or a client cancellation, knowing that you have a plan and staying the course is very important.

We recently have suffered through a number of wild fires in Colorado, some losing everything that they owned, the true definition of unexpected circumstances. We all think about what if that was me, what would you do? The plan that you developed when you built your home has not changed, perhaps your living circumstances has changed but your original plan mostly likely remains the same. Can you prepare for the unexpected event of a wild fire taking everything that you own?  Sure, but in the larger picture this has not changed your plan, the one that you had before the fire and continue to believe in after the fire.

The unexpected in business is the risk that we all face on a daily basis, how we choose to react to the unexpected defines how we will alter our business and life. Don’t let the unexpected change your life and your business. Plan for the every day events and goals, but be prepared for the unexpected.

 

 

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Categories : planning
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Pricing Maintenance Based on Commercial or Residential

By Sitesource · Comments (0)
Thursday, July 12th, 2012

The discussion of hourly rates continues to surprise me. I recently was reading a discussion in which the hourly rate for commercial vs. residential landscape maintenance was being debated. The amount charged to the customer per hour is not the discussion to have. I believe the discussion should be about return per hour, not rate charged per hour. First, and foremost the two types of services represents apples and oranges. Secondly, the market in which you work will dictate your pricing to some degree. And finally, the quality of your work will allow you to charge more if the customers are happy.

Residential work is much more about service to the customer, your customer is much more involved in the residential landscape. The number of competitors is far less in the residential world because the perception is that residential is harder work. Residential takes a person with an eye for detail and quality. The residential customer is also interested in the people providing the service, they want to know your employees. The amount of time to do a residential landscape is much greater than a commercial project per square foot, just because you are not always able to take short cuts like using chemical treatment to control weeds. There are exceptions to everything, but for the most part the truth is that residential takes more time. The skill level of employee is much greater than with commercial, the attention to detail, the customer service and communication skills are greater and the technical skill is greater at the residential level.

The rate of pay for a residential employee should be greater based on the skill and technical knowledge necessary to perform the job. Commercial landscape contractors are required to perform at a much different level of services than is the residential contractor. The competition is much greater at the commercial level than the residential and I believe the individual employees technical skill level is less than on residential sites. The average commercial employee is not challenged on horticultural knowledge as is the average residential employee. Commercial landscape contractors are victims of their own devices, the current level of pricing is at about 1998 levels, this decline in the pricing is due to the competition and the willingness to let price dominate a community. Surely, we would all agree that the technical levels of skill and improved productivity have not increase that much in the landscape world over the pass 15 years.

The market in which you operate will have an influence over the pricing as well. I found the residential landscape contractor can be a status symbol in a neighborhood. You become conversation at the neighborhood parties. Who has what landscape contractor maintaining  their yard. Believe me, it happens. I have always found that even moving crews from different level of services can create an issue for the crews, not understanding how different levels of service may appear to the customer, much less the crew.

I have always found that the level of customer service you provide to the residential customer is far great than a commercial customer. The level of detail is not the same, the level of interest from the customer is different and the level of communication is much greater at the residential level. I don’t believe that the transition from commercial contracting to residential is very easy and therefore the people that make the move are few. It all comes down to the skill level required.

The price per hour that a company charges is based on that companies overhead, profit desires and wage skill. If you say to me that a residential landscape maintenance contractors charges $50.00 per hour and the commercial contractors charges $35.00, I would believe it, the skill level is just that much greater.The discussion should center around the perceived value of the residential employee vs. the commercial employee, not how much money you charge per hour.

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Categories : Landscape Contracting
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Mid-Season Landscape Blahs, Do You Have Them?

By Sitesource · Comments (0)
Monday, July 9th, 2012

The mid-season landscape blahs are here, do you have them? The landscape business is seasonal even if you live in a warm climate and most customerw think of landscape season during the spring and summer.  About this time every year the crews seem to slow down, the customers are thinking about summer vacation, the warm weather and summer is half over. This year has been especially warm, with above normal temperatures across much of the country, making working outdoors less than pleasant. So what to you do to motive the crews and the customers?

The crews need to get some loving from management, a picnic or a barbecue at the end of the week to show that you care. Have the supervisors deliver cold water to the crews a couple of times a week, something that is out of the ordinary. This is the time when you can ill afford to let your customers down, keeping the crews motivated to do their best is an important challenge at this time of year. Doing things to keep the crews interested in performing at a high service level is key to keeping the customer happy. A let down in performance will be remembered as we head into the renewal season, don’t let it happen.

Motivation for the customers is also important. This is the time of year when many Property Managers are becoming tried of the summer and looking for- ward to the winter season. Remember that it takes a lot of effort to get the landscape looking good and the season has been tough with the drought and the warm temperatures this year. The HOA Boards don’t understand why the landscape doesn’t look as good as they remember it last year. It is time to visit your customer and educate them on the things that are going on in the landscape, let them know the conditions are difficult and what you are doing to combat these conditions. Now is the time to meet them head on and discuss what you are doing just to maintain a quality landscape.

It is also time to think about fall sales, landscape improvements that can help for next season. It is sometimes hard to educate your customer, but the landscape is a growing and living thing, that requires planning and forethought to keep it looking good year after year. Now is the time to make the suggestions and plant the seed for future project that can help improve the value and the look of their landscape. Keeping the landscape in front of the customer is part of your responsibility as the landscape contractor. Communicate, communicate, communicate!

The summer blahs are tough on everyone, but if you work with your staff and customers, you will get through the season. You might even find that you are generating more work and happier customers. Don’t let the blahs get you.

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Categories : sales
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Happy 4th of July

By Sitesource · Comments (0)
Wednesday, July 4th, 2012

 

 

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Categories : Business Coaching and Consulting
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Landscape Contractors Need to Focus on What You Can Control

By Sitesource · Comments (0)
Tuesday, July 3rd, 2012

Landscape Contractors need to focus on what you can control and not become involved in the things you can’t control. For example the Supreme Court ruling on the health care coverage issue, is something that you can’t control. The legislation is still 2 years down the road before it is completely enacted so don’t worry about the unknown. The weather conditions around the country are heating up very quickly, in the west we are in a drought like has not experienced ever before. The Midwest and the East are experiencing the heat and drought conditions as well, we can’t control or change it. The point is what can you control?

You can control your business sales, you can control your labor costs, you can contol your schedules for projects, you can control material expenses for the most part. You have a large number of items that you can control, spend your time working on those things. It is so easy to find yourself dealing with issues that are out of your control because someone wants to make them an issue. Forget it!  Deal with what you can control. Your goal for your business is to make a profit for your company.  How do you do that?  By controlling the controllable.  Things like labor: are you watching that if work slows due to the weather or the drought that you adjust your labor force accordingly? Are you insuring that your crews use only what materials you estimated for a project and no more? It is so easy to over spend on materials by just ordering a little more than what was bid.

This is the time when you should be looking at your financial information to keep close track of expenses and keep them in line with your revenues. When weather starts to play a part in your business that is when you need to be communicating with your customers to insure that they are going to live up to  their commitments on planned  and scheduled projects. If you are fortunate to be scheduled out 8 to 10 weeks, you need to communicate with your clients and keep them interested and excited about the up coming project.  Now is the time when they start thinking that it’s too hot or that they have too many other projects and they start thinking about postponing the project till next summer. These are things that you can control.

Weather, the economy, the government are things that you can’t. Controlling what you can control is about discipline and using the planning tools that you developed at the beginning of the year to help you stay on track. Good companies find ways to control costs and make adjustments when they need to, to insure the profit that you planned for in  your budget. No one said that business was easy and when you planned your year you had no idea that the weather was going to be a factor, but it is and you can control how your business handles this unforeseen circumstance.

It is about mid season, it is time to review your position relative to your plan. Determine whether you are where you wanted to be or make adjustment to the financial position to get back on track. Controlling the things you can control is up to you. You can ignore it or dismiss it, but in the end it is all about what you can control. Don’t waste time worrying about things you can’t control and focus on those you can.

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Categories : planning
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Advantages of the Small Landscape Contractor

By Sitesource · Comments (0)
Monday, July 2nd, 2012

Being small is not a bad thing, it can be used to your advantage at times. In many bid situations customers often compare numbers to select the contractor for their project.  However, customer service, the ability to respond quickly, the idea that you are local and the fact that this customer will be your most important customer, makes you a better choice than the big national contractors.  Selling the customer on the fact that you are a better selection is not always easy, but it is an advantage that you need to highlight for your customers. Let’s face it, would you rather have fewer customesr and make more profit or have more customers and less profit?

Small contractors have true advantages over the large national contractors. Being part of the community that you serve is a huge advantage,  you are the most recognized service provider in your community. You get involved in community projects and support community organization such as Rotary, Boys and Girls Clubs and other charitable groups. Most national contractor don’t take the time to get involved in the community and don’t understand the benefits of that community involvement. But you need to sell this to your market place, explaining what makes you a better selection that a national company. You also are keeping the money earned in the community, not sending your profits back to a national company headquarters thousands of miles away.

Sales is not always about the cheapest price, but about solving a problem for a customer, while providing a value to the customer. This market concept may seem foreign, but think about what you offer that the national company’can’t. Networking in your community and becoming a go-to company when your customers need help, this will build a reputation of customer service. In my community we have a small plumbing contractor who started small and by keeping his name in front of the community and responsing to customers needs he has begun to grow the business to a 3 truck service company. Being small is an advantage learn to use it.

I often hear from small contractors that they can’t compete with the national contractor because their pricing is so much lower. Well, my response is, let’s look at the facts.  Is your overhead head not less than theirs?  Do you not have less equipment to purchase and maintain than the national contractors?  The national contractors tend to drive pricing lower to be come more competitive with each other, but as they drive the pricing down the quality will decline as well, offering you the opportunity to sell your superior customer service. Larger volume does not mean more profit or better service, in many case it means the opposite.

As a small contractor you have the benefit of being known in the community for recruiting as well, while the larger contractors may recruit nationally, your local university and college offers the opportunity to get to know you and your company. The labor issue is so unsettled in the country right now that hometown recruiting is the way many small contractor will find their labor.

In so many ways, the small contractor has the upper hand, as urban communities become the new rage, you as part of the community can take advantage of the social change. Gas prices continue to increase in your location, the closer to your customer the less travel and fuel expense to your customers. Turn the negative into a positive for your company. The large companies are facing a back lash from the middle class, take advantage of this in your marketing.

Small contractors have a distinct advantage, use in your marketing.

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Categories : Marketing Strategy
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