Consumers are making hard choices when it comes to what they’re spending money on these days. According to data from the National Retail Federation from earlier this year, things like discount apparel, hair cuts, and Internet, cable and cell phone service scored high on the “untouchables” list for consumers. Lawn care services, on the other hand, were ranked among the most expendable—right there with other “luxury” expenditures such as maid services, club memberships, high-end jewelry and facials.
Many landscape contractors say it all depends on who you target and how you market. Some have shifted their sales efforts toward higher-income households and higher-value homes. Some are customizing their service offerings, payment plans and/or incentives in order to generate new leads and maintain the flow of revenue. Whatever the case, there is one constant: The contractors have a plan.
Upselling additional services
Since the recession started in 2008, Robbins Landscaping in Richmond, VA, has seen a fairly dramatic shift of its revenue toward maintenance (from 30% to 45%). Roughly 80% of that maintenance business comes from the residential market.
“We’re getting new leads for residential maintenance, but it sure isn’t what it used to be,” Doug Robbins says. Robbins Landscaping’s maintenance business is now growing in the 5-10% range, about half the pace of a few years ago. “We’re working pretty hard for it too,” Robbins adds.
Some of Robbins Landscaping’s growth has come from upgrading existing client contracts. For instance, the company has recently begun offering in-house irrigation services via a full-time technician who’s now on the staff. “This hasn’t proved to be a ton of revenue yet, but it does add another $25 or $30 to an account each month,” Robbins says.
The point is that you have to be willing to take on new projects and services as they present themselves. “Keeping in touch with the property owner is huge,” Robbins says. “It’s not like it was four or five years ago, but many are still open to certain upgrades. Roughly 85% of our design/build work this year is from existing clients, many of whom are maintenance clients. We’re getting jobs like small patios and areas of the property that were never cleaned up and planted properly.”
Simeon Meyer of Prairie Hill Horticultural Services in Lake Villa, IL, has had some success with invoice stuffers. “We’re including letters to let people know what else we have going on at that given time,” he explains.
It’s beneficial that Prairie Hill is able to offer a full range of mowing, detailing, lawn care and property cleanup services. It helps separate them from the many mow-and-blow operators in the area. One problem Meyer identifies is when the homeowner uses TruGreen for their fertilizer applications.
“Our company uses an organic-based fertilizer which is a little more expensive,” Meyer says. “Some people shy away from our proposals because we are a couple dollars more than TruGreen. There’s a huge difference in the quality, though. We constantly have people coming up to our crews who want an estimate, but many don’t go with us because of the price. I guess they need to see it as worth it in order to have a better-looking lawn than their neighbor. In this economy, unfortunately, that’s not happening as much as in the past.”
On a more positive note, referrals seem to be holding their own for Prairie Hill Horticultural Services. Meyer says being a member of the Better Business Bureau and having an A+ rating helps a lot. Prairie Hill has also worked to improve its website, www.phhort.com, along with its social media presence on Facebook and Twitter.
Invoice stuffers have come into play here as well. “Sometimes I insert flyers that our customers can pass out to other homeowners,” Meyer says. “Another thing that’s working well is referral cards they can fill out for a friend so we can provide them with a free estimate.”