A common piece of advice for landscape companies is: "Don't put too many eggs in one basket." So how many eggs are too many? That's a great question to which there is no hard and fast rule. But for Manny Carlino of M&R Landscape & Design in Westfield, NJ, 80% feels about right.
Over the past few years, M&R has seen revenue shift from 50/50 (maintenance/construction) to 80/20. All 100% is residential. But as you dig a little deeper, you can see that the company's book of business is highly diversified. M&R provides maintenance, lawn care, tree care, hardscaping, lighting, irrigation (via sister company Spring Showers), and a little bit of snow removal, though it is backing away from that line of work. Furthermore, the 23-year-old company has around 375 accounts.
The majority of those accounts are right in Westfield, an affluent community roughly 45 miles west of New York City. More than 30,000 residents are packed into a 6.7-square-mile area. Median household income is around $128,000. Roughly 22% of residents are age 25-44, and another 30% are age 45-64. Thus, there is plenty of room for M&R Landscape to further grow without having to branch into other geographic markets.
That is music to Carlino's ears, not to mention his loyal employee base. Since the company began narrowing its focus a few years ago, operational efficiency has improved markedly. "Earlier this spring, one of my longtime crew leaders randomly said to me one morning, 'Things are really running smoothly so far, boss,'" Carlino tells. "That really made me feel good. Stress and frustration are not good for anybody."
M&R Landscape & Design was #19 on our 2014 Landscape Industry Hidden Gems list. Sales have grown more than 150% over the past six years. Carlino is currently fielding three 2-man maintenance crews, one 2-man enhancement crew, and one 2- or 3-man construction crew. His wife, Rose, runs the office. His son, Michael, is attending college in Maryland and works part-time in the company during the summer.
Carlino got his start in 1989 while driving truck for a local bread distributor. He typically finished his route and was home mid-morning, so Carlino began filling in his spare time mowing lawns. He enjoyed it and recognized an opportunity to build a nice company. He quit his job as a truck driver and incorporated his lawn maintenance company in 1992. Just a few years later, he was up to roughly 140 residential accounts.
Like many lawn maintenance companies, Carlino was pulled into the hardscape business in the early-2000s. "We were doing a lot of paver installations for a local hardscapes distributor," Carlino recalls. "Soon, half of our business was this type of work." To develop the necessary expertise, Carlino took classes at Rutgers University and attended as many association-sponsored training events as he could.
The paver business, though, was getting far more competitive. "Guys were doing pavers for like $8-10 per square foot, where we had been getting $18-20," Carlino explains. So M&R Landscape slowly started to back away from this type of work. It was a good thing it did, because then 2009 happened.
"The downturn hit pretty hard," Carlino says. "I talked to my wife about our debt situation; how much of our credit line we'd used, what we owed suppliers. I looked at our cash situation and we decided to eliminate our debt. I think that was big for us. It kept us in good standing with our suppliers and took a big weight off of our shoulders. We were then able to hold the line on revenue because we were putting more emphasis on maintenance again. Our company was in good health and well-positioned to take off once the recovery started."
Carlino also made a commitment to his personal health around this time. He underwent gastric bypass surgery and ultimately dropped 180 pounds. Both he and his company were now lean, mean, fighting machines.
"We did continue to do paver and installation work," Carlino points out. "But we were just doing projects for existing maintenance clients; a lot of smaller $800 to $2,000 enhancement jobs."
One other transformative event took place as M&R Landscape endured the economic downturn. "Things got tight for a while," Carlino tells. "I pulled all of my employees together and laid it out there. We had to either lay a couple people off, or everybody had to cut their hours down to 35-38 a week until we got through it. I told my guys to talk about it and think it over, and we'd regroup the following afternoon. Without question they all said they'd cut their hours; they didn't want to see any of their co-workers lose their jobs." (See sidebar for more on M&R Landscape's strong track record of employee retention.)
Carlino knew he had something every business owner longs for: A team that cared as much about the company and each other as the owner did. In turn, Carlino now had a company that could almost run itself.
Getting time on your side
Thanks to this type of culture, along with solid operating systems, M&R Landscape & Design did begin to run itself—and run itself very well. "Time is the most important thing in our industry," Carlino says, while offering some examples of how his company makes good use of it.
Rout density. "Only three or four of the 25 properties each route services are what I'd call one-offs," Carlino says. In other words, about 84% of the daily clients are multiple stops on the same street. This has greatly reduced windshield time for the three maintenance crews.
Clover leaf marketing—putting door hangers on the homes directly adjacent to and across the street from the property you're servicing—has helped build this route density. Yard signs staked after all enhancement jobs has also helped.
Time-saving products. Maintenance/lawn care crews have stopped using tank sprayers. "It's very time-consuming to spray a lawn," Carlino points out. His crews now use granular products, having had good success with Dow's LockUp Specialty Herbicide because, as Carlino points out, it can be used with or without fertilizer. "Then we spot-spray weeds with a Husqvarna pump sprayer as necessary," Carlino adds.
Enhancement and construction crews have begun using EZflow Drainage Systems from a Connecticut-based company called Infiltrator Water Technologies. "It's more expensive than crushed stone, but is much more effective and less time-consuming to install," Carlino says.
Evening prep. Equipment and trailers are set up and ready to go in the evening, "when everyone is already dirty," Carlino points out. Speaking of trailers, each is set up in the same manner, creating consistency from one crew to the next. And to minimize potential downtime, a fully equipped backup trailer sits in the on-deck circle back at the shop.
Diesel fuel has been brought on site. Additionally, filled gas cans are stored in lockers so crew leaders can just grab a can or two on their way out of the yard in the morning.
Dozens of sharpened mower blades are stored on shelves, allowing for swift blade swapping every evening or as conditions warrant.
All of this evening prep allows crews to report to the shop in the morning, grab their route sheets, hop in their trucks, and be on their way in just a couple of minutes.
Fleet maintenance. Back on the topic of mower blades, Carlino likes to wait until there's a decent-size batch to sharpen before he turns his blade-sharpening guru loose—which is why Carlino likes to keep so many blades in inventory. One of his crew leaders, Felix, does the sharpening.
"One day a week, typically Monday, another one of my crew leaders, Javier, stays back at the shop to work on equipment," Carlino points out. "He has a knack for this and likes it, so I encouraged him to talk to our dealers to learn as much as he could. He has really taken ownership of maintaining our equipment fleet, which has been a big plus." On those days when Javier works on equipment, his maintenance crewmate joins up with the enhancement crew while a member of that enhancement crew jumps over to the construction crew. Again, it's all about making the best use of people's time and skills.
Estimating and pricing. Speaking of which, Carlino spends considerably less time putting estimates together these days. "Back when we were 50% construction, I was doing almost 150 estimates every season," Carlino says. Even a solid 3:1 bid-hit ratio didn't erase the enormous amount of time and stress involved with preparing all of those estimates that never bore any fruit.
These days, on the other hand, Carlino is primarily renewing maintenance accounts. "Also, all of our enhancement work is done on a time and material basis where no estimates are needed," Carlino adds. "Most of these I'm simply emailing to people nowadays. In the past four years, I've created a system with all of our clients where we prefer all communication to be done via email rather than call us. Again, it's all about time. Smartphones have helped this process. It's amazing how much our clients enjoy this and really feel important and love the instant customer service when they email us with an issue and receive a quick response, sometimes within minutes."
One other unique thing Carlino has started doing with all maintenance contracts is including a Landscape Maintenance Information Sheet. "This sheet explains all of the services included, why they are important, and why they are priced the way they are," Carlino explains. This is where things like debris removal fees (i.e. grass clippings) and the spring cleanup process are included, along with detailed explanations of how all services are handled.
Fun to do business with
Going back to its roots in residential maintenance has proven to be a wise move for M&R Landscape & Design. Carlino has even resurrected an old slogan that helped put his company on the map some 20 years ago. "Stop breakin' your fanny, call Manny" is now on all of his trailers.
"I stopped using that saying years ago because I thought I needed to be more 'professional,'" Carlino explains. But there is definitely room in this business to let your hair down, have a little fun, be a little different, and focus on what really matters to consumers.
"Many of our clients are in their 30s and appreciate how quickly I get back to them, typically via email," Carlino says. "We have about 90% customer retention. Of the 10% that turns over, half is because the customer sold their home. Only a handful of times is it because of an issue with our service.
"That's why communication and fact finding are so important," Carlino continues. "When we get a new account, I find out exactly why the customer got rid of their old contractor. Some clients don't care if you trim or edge, and others are adamant that the back deck doesn't have a speck of debris on it. We need to know these things so we can make sure they're in the job instructions so crews know exactly what's expected of them. Communication is the key to success for a company like ours—communication with clients, and communication with and between employees."