With a couple of notable exceptions—including Texas, Colorado, Florida and California—the biggest markets for landscaping and lawn care are in the northeastern part of the country. That’s also where the majority of the industry’s snow-removal activity takes place. This winter was a doozy, much to the chagrin of equipment dealers now looking to sell things like lawnmowers, string trimmers and leaf blowers.
“We sell (two prominent commercial/consumer mower brands) and do not have certain inventory to sell,” says a multi-location dealer in the Mid-Atlantic region. “I think the common cause is the snow and extended winter. Both of our mower suppliers (that also manufacture snowthrowers) were trying to capture as much snow business as possible. They opened up new assembly lines to do so, which set them back on lawn and garden. But overall our sales have been very good. Commercial has been slow getting started, but consumer has been very good. I believe May will be very strong for both commercial and consumer.”
That makes a lot of sense, seeing as how landscape/snow contractors have had to stay focused on snow until recently. As one New Jersey contractor commented on our Facebook Page, “We started cleanups April 6, should've started a month earlier. This will back us up for the entire year, same as 2014.”
Now, contractors, dealers and manufacturers alike are just hoping that the back-up also translates into catch-up.
“Let’s hope it’s just a late spring,” says Kris Kiser, CEO and president of the Outdoor Power Equipment Institute (OPEI), an international trade association representing 100 small engine, utility vehicle and outdoor power equipment manufacturers and suppliers. “A lot of contractors who push snow are in a good cash position, so things should start looking better.”
Kiser is referencing the fact that, according to OPEI data, commercial mower shipments through March have been off double digits compared to last year. That comes as a surprise to some, who have been watching most key economic indicators point to a very strong year for the landscaping and lawn care industry in 2015. The depths of this setback, though, vary by region.
“Weather-wise, this year has been much nicer than last,” says dealer Andy Egelhoff of Egelhoff Lawn Mower Service in Thiensville, WI, located roughly 20 miles north of Milwaukee. “It’s been warmer and we’ve had less snow. We are off to a much better start on (lawn and garden) sales, service and parts. Our commercial-unit sales are up 30% from last year. That seems like a big number, but really it’s just how late our season started last year.”
For many dealers in the Northeast, the late start to the lawn and garden season is taking place this year. “Traffic in our second store is up over 20% compared to last year,” says a two-location Ohio dealer. “Overall, store sales are also up 20%. Commercial sales have been softer than we anticipated, however. The season didn’t start until the week of April 6 or 13, three weeks later than normal in our market. Consumer sales were soft as well, but started to gain steam in the second half of April. By the time we review our totals for January 1 through May 31, we are still hoping to see 8-10% growth. Only time will tell.
“At our main location,” the Ohio dealer continues, “commercial sales are up because we gained a couple nice fleet customers. Consumer business has been down, but is coming on strong. The small to mid-size commercial customer business has been real soft so far. We’re hoping to be flat through April vs. last year, and then get more growth of 8-10% by the end of June.”
Down in Louisiana, dealer Lynn Pesson Jr. of Southland Engine just opened his fourth store in March. The dealership had also taken on the Kubota line of construction equipment late last year. “So our numbers are way up over our previous best year,” Pesson shares. Even when you back out the two anomalies—the additional store and addition of Kubota construction equipment—Pesson says his overall sales are up nearly double digits.
“Our spring has been much better than the past two years because of weather,” Pesson explains. “In this business, we’ve found it to be not so much about pricing or your manufacturers, but really the weather (i.e. when it rains it grows, and when it grows people mow). That’s why we decided to take on Kubota construction equipment; to try and level off those bad-weather years.”
Switching gears not always so easy
Whether you’re a dealer, manufacturer or contractor, it’s nice to have a diversity of revenue streams to help balance the seasonality and unpredictability of this business. On that note, there are likely few that would be willing to trade in their lucrative snow seasons for a more punctual start to spring. Revenue is revenue, after all, and you take it when, where and how you can get it. Plus, spring will eventually get here, it’s assumed, and everything will get back on track over the course of the next few months.
The challenge for some, then, is being able to quickly shift gears once the switch flips and new opportunities arise. For instance, Ariens Company spokesperson Ann Stilp points out that a dealer recently said his commercial customers have simply been too busy closing up the snow season to be fully focused on lawn and garden. As the dealer put it, “Great late snow season, but we are paying for it in lawn and garden.” The dealer does think that once spring cleanups start, things will break open and contractor customers will be flush with cash for new equipment.
The challenge for contractors, perhaps, is figuring out whether they need new landscaping equipment now, or new snow equipment later to replace what got beat up this winter. Contractors also need to quickly get their landscaping crews assembled and trained so they can hit the ground running and make up for lost time.
For those contractors who flock to dealerships for new mowers and other landscaping equipment so they can hit that ground running, their dealers are hopefully ready for them. But dealers, too, are having to switch gears quickly. And as pointed out earlier, some dealers are having trouble securing springtime inventory from their manufacturer partners.
“The real challenge for us is product availability,” the Ohio dealer says. “We are a very large (Brand X) dealer and have over 20 models totaling over 90 units still on back order the last week of April. We haven’t even got all of our January/February release yet. Lead times are ranging from 10 days to two months. I’ve been a dealer for almost 30 years, and this is by far the worst I have ever seen availability. I’m hopeful some of these problems get resolved by the first week of May, otherwise our growth opportunities this season could dwindle quickly.”
