Phil Harwood, Pro-Motion Consulting
Jonathan Rigsbee, GrowinGreen in Kernersville, NC
Mike Mason, The Lawn Pro in Louisville, KY
Strong branding can help you look like a national company, and has worked wonders for GrowinGreen.
Back in the good old days, when the landscaping industry was growing at a very rapid rate, many landscape companies jumped from just a single crew to four or five seemingly overnight. They were thrown into the deep end, so to speak, and had to learn how to evolve from owner/operator to primarily owner via trial and error. Needless to say, the business growth was exciting, but also stressful and sometimes downright ugly.
Today's "mid-level" companies—with roughly 10 employees and annual sales around a half million or so—face similar challenges, in addition to some unique ones. On the familiarity front, competition is still fierce, employees are hard to find, regulations are cumbersome, and the cost of doing business is, well, costly. On the unique front, the industry is not growing nearly as quickly as it did a decade or two ago.
Today's mid-level company owners, logic would therefore suggest, have to work harder at growing their companies. This could be a blessing in disguise, actually. When new leads and bid requests aren't pouring in the door, owners have a little more breathing room to strategize. That said, today's mid-level company owners would be well-served to take some plays out of the playbooks of contractors who have been there, done that—and implement some of these career-altering changes while their companies are growing, as opposed to after.
Know your role
Business consultant Phil Harwood of Pro-Motion Consulting has worked with numerous landscape companies that have gone through these types of growth cycles. "There’s a proverbial light bulb that goes on in an owner’s head at some point where they realize the value of their time," Harwood says. "An hour of their time spent performing a low-level task is actually harming their business. Once an owner realizes this, they begin to replace low-level tasks with high-level tasks that add more value."
What is the value of an owner’s time? Is it $50 per hour, $100 or even $300? Harwood says the answer is found by asking this question: If I were to devote my time to the highest-value activity possible, what would it be and what is the value of this activity? If an owner could redirect 10-20 hours per week toward sales and account management, with the result being a higher retention rate and increased sales, the value of this time is easily quantifiable.
"I see many owners who like to go to the bank, open mail and run errands," Harwood cites as an example. "These tasks are easily delegated. And what about scheduling, recruiting, equipment maintenance, dispatching and quality control? These are not low-level tasks, but are easily delegated to the right person."
Contractor Paul Opdyke of Serene Surroundings in Plymouth, MI, started his company in 2004. They grew pretty quickly, hitting the 10-employee mark in just a few years. Growth spiraled after that. Today, Serene Surroundings employs 50.
The year or two following the 10-employee milestone were pivotal. "I was freed up from the field to focus on our growth," Opdyke tells. "And as soon as I got out of the field, we really picked up the pace. I began focusing on company development, marketing, building relationships in the community, and developing foremen and managers. The first year I got out of the field, we grew 50%."
Build your business
That was 2008. The following year, when the industry as a whole took a nose dive, Serene Surroundings still grew 10%. That was largely the result of Opdyke having the freedom to focus on developing business—an important step owners must take when looking to grow beyond the 10-employee mark.
Mike Mason of The Lawn Pro in Louisville, KY, could not agree more. Founded in 1995, The Lawn Pro now employs 22 people. Mason says they hit the 10-employee mark around 2002. After being stuck there for a few years, things started to take off.
"From 2000-2002, I was driving a lot of our growth," Mason shares. "It was shear hard work, but at that time money was also flowing and people were spending. Economically it was a really good time. So I was driving both sales and production. It got really difficult. We had a lot of work, but much of it was the result of personal relationships I had made. The other thing was that I still felt like I needed to be in control on jobsites; it's hard to relinquish control to someone else. But little by little I started to see the rewards of doing that. It took a couple years to figure it out."
But figure it out he did. "I put my focus on business development," Mason says. "Now I focus on commercial maintenance and snow removal, while my general manager focuses on residential accounts and hardscaping." Mason's GM, Jim Hulsmeyer, has been with him for three years. He'd actually had a landscape company of his own. Mason says hiring former company owners to help run your company can be a game changer. "You're bringing people in to help you manage who already think like owners and have a lot of drive," Mason points out.
North Carolina lawn care contractor Jonathan Rigsbee's challenges of growing past the 10-employee mark were compounded by the urgent need to revamp his business model. Rigsbee, the owner of GrowinGreen in Kernersville, NC, always knew that the residential market was where he wanted to be. But GrowinGreen was tightly tied to a commercial lawn maintenance company in the area. "As this company kept growing, we kept growing," Rigsbee tells. "Soon, nearly a third of our revenue was coming from this company. We had too many eggs in one basket."
Then one year that maintenance contractor brought lawn service back in house. GrowinGreen was left hanging. It was a stressful time for Rigsbee, but he was also excited to now have the freedom to focus his attention and resources on his best opportunity: residential lawn care.
Rigsbee got started with a more aggressive marketing effort. "A big part of my job as owner is to run our marketing plan," he says. "I make a calendar every year and track everything we do. I have also established a few important rules to marketing and business development."
For instance, no single customer will ever account for more than 5% of GrowinGreen's total revenue. Secondly, "We don't rely on one-hit wonders," Rigsbee says. "People need to see something five or six times to remember, and there must be a strong call to action. So we created a marketing plan based on those principles."
GrowinGreen continues to advertise on talk radio, which Rigsbee says has been hugely effective. Vehicle wraps and internet marketing also work well, as does direct mail. GrowinGreen uses co-op mailings like Valpak to get their cost-per-household down. "Then we track it," Rigsbee reminds. "We're always asking new clients where they heard of us. You have to get your name out there and look like a national company. Good branding can do that for you."
People opportunity factory
As your company grows, you need people—and not just laborers to perform the work. You need competent people to step up into managerial roles so you can delegate operations-based tasks and focus on business development.
"It's a struggle to find good employees early on," Mason says. "As our company gained size, though, it seemed to get easier. We became a more attractive company to work for. In our earlier days, we'd interview three people and hire two. Once we got past 10 employees, we now interview 10 and hire one. We're much more selective now because there's a certain culture we need to maintain."
At the 10-employee stage, Mason directed his focus to foremen. "I'd initially tried to find a good operations manager, but decided it would be better to find three really good foremen—one overseeing maintenance, another lawn care, and a third installation," Mason says. That way if one foreman quit, for example, Mason simply had to find a replacement who was well-versed in that service segment, as opposed to a single operations manager who needed expertise in all three.
In several instances, Mason had existing employees who stepped up into the role of division foreman. "As our company grew and opportunities presented themselves, we filled a lot of positions from within," Mason says. This is very important as you try to grow past the 10-employee mark. "We never wanted our employees to have a ceiling. That's not a good way to build a company."
Opdyke says he'd always focused on "building his bench" at Serene Surroundings. This paid dividends once he hit the 10-employee mark and growth accelerated. "We needed employees who could grow into another position, and we needed them to know they had that opportunity," Opdyke says.
Delegation, documentation and communication
"The bigger challenge for me was learning to trust my team," Opdyke continues. "That's the hardest part of taking yourself out of the field. I still had to track what was going on and follow up on occasion, but learning how to walk away from sites and trust that projects would be completed as promised to the client was tough."
To facilitate this process, Opdyke developed new processes for communicating how to do jobs and when jobs were completed. "We developed new estimating forms, work orders and field instruction," Opdyke elaborates. "We also changed our software. We switched to something (Real Green) that made it much easier to communicate instructions to our crews."
On the topic of clear communication, Opdyke adds that it is important to clearly define roles in your company with clear job descriptions. That way everyone knows what they are responsible for, and everyone's performance can be measured. This is how you create accountability—an essential element of company culture as you look to catapult past the 10-employee level.
Your job, then, as company owner, is to put the right people in the right positions. "I had an employee, my general manager actually, who'd expressed an interest in scheduling and routing," Rigsbee cites as an example. "I decided to make that part of his job description. It immediately saved me a couple hours a day."
"One of the best things we did was create an employee handbook," Mason shares. He looked to groups like PLANET and SIMA, as well as industry peers, for advice and assistance. "We ultimately had an attorney help us write it," Mason adds.
A few other important considerations
Like Opdyke, Mason is in need of better computer software now that his company is larger and more complex. But unlike Opdyke, Mason hasn't made a decision yet. Since his company offers both maintenance and installation services, not to mention snow removal, finding the right software isn't so easy. "My best advice to other contractors is to really think about what you're doing today and where you think you'll be in a year or two," Mason shares. "Talk to other contractors too. There are a lot of software options out there."
There are also a lot of equipment options for you to choose from. As GrowinGreen has gotten larger, Rigsbee has focused on standardization. He tends to operate the same trucks, sprayers and other essential pieces of equipment from crew to crew. "Being profitable is about efficiency," Rigsbee reminds. "You can't be efficient if you're changing gears all the time."
"No matter what you do, you have to simplify and focus," Rigsbee adds as a final thought. That's the best overall advice for a landscape company owner/operator looking to jump beyond the 10-employee level.
One other sound piece of advice is to pay yourself what you are worth. "I barely paid myself for my first three years in business," Opdyke says. "Finally my accountant told me I had to stop that. First of all, you as a company owner need to make a good living. If you're not, why do this? But also, it's important to get a realistic salary in your budget."
Whether that salary represents $50, $100 or $300 an hour is for you to decide. After all, it's your company.