Landscape contractors share their field-tested strategies for maximizing profit potential on installation jobs.

Whether you’re a $100,000 or a $10 million landscape firm, in a challenging economic environment the contractor’s focus is to maximize production and profitability and eliminate wasteful practices.
 
This is critical when approaching landscape installation, whether the job involves mulching and planting or the construction of an elaborate backyard living environment. With installation work, the successful contractor practices solid strategies to minimize waste and increase efficiency.

LOGISTICS. Success on the job site starts at the company headquarters. For Lawrence Landscape, installation work begins at the Friday morning manager’s meeting where the jobs for the next week are reviewed and discussed in detail so everyone receives the same information at the same time. “We only plan out a week in advance because any longer than that, certain details begin to get fuzzy,” says Frank Male, co-owner of the $4 million landscape service firm in Lawrence, Kan. “Once we started doing the manager’s meeting a lot of our problems went away because it helped prevent the wrong information from getting spread around to our guys on the job site.”
 
Detailed job packets for each installation are another efficiency tool. Each Lawrence Landscape job packet includes a material list, color-coded installation plans, directions to the job site, customer contact information and other paperwork. “The whole idea of the job packet is that my salesman for that job could be on vacation and we’d still have all of the information to do that job to the customer’s satisfaction,” Male says. “There’s a lot less stress and we operate much more efficiently because there are a lot less unanswered questions.”
 
A job packet also includes printouts of digital images with directions for specific tasks, such as identifying certain rocks to be relocated or to leave specific trees undisturbed. The images are useful in crossing language barriers with Hispanic laborers, Male says. “With the images, it doesn’t matter how bad my Spanish is; I can still get my point across,” he says.
 
The detail and attention devoted to preparation impacts the success of the project’s first day, which Kip Matthews believes is the most important. “It sets the tone for the entire installation project,” says the construction department operations manager at Gardener’s Guild, a Richmond, Calif.-based landscape company that completes about $3.5 million in installation work annually. “You want to get as much done on an installation project as you can that first day. Therefore, you want your first day to be the most successful.”
 
And once an installation project is under way, the production manager and the field staff must communicate   daily to address key issues and change orders, Matthews says. “A timely response is key because it doesn’t take much to hold a project up,” he says. “And it also doesn’t take much to begin performing a bunch of work that isn’t in the contract.”
 
Project managers must constantly reevaluate schedules to keep them from falling fall behind. “Larger projects are easier to manage because of their duration,” Matthews says. “On a small project, you don’t have as much time to adjust to problems. If you don’t have time to make up for your mistakes, it will cost your bottom line.”

EQUIPMENT. Contractors are privy to a wide variety of labor-saving tools and equipment. However, the costs savings are negated when equipment breaks down on the job site, stalling the contractor and his crew.
 
Dan Bishop hired a full-time fleet service mechanic to act as a mobile equipment troubleshooter to its 25 trucks, 13 pieces of construction equipment and eight equipment trailers.
 
“In 2007 we were incurring some hefty costs outsourcing service and repairs,” says the chief operating officer of Las Vegas-based D&K Landscape, which did about $9 million in landscape business last year. “Fixing equipment right on the job site has brought our costs down compared to having to go outside for service and repair.” In the first quarter of 2008, the mechanic reduced Bishop’s equipment repair cost by 40 percent.
 
However, not all installation contractors run such a large fleet. Regardless of a contractor’s size, Ken Pagurek, the president of HPK Property Maintenance, a $2 million full-service landscape firm based in East Norriton, Pa., says immediately addressing equipment issues increases productivity. “What happens is that guys break tools, don’t report it to anyone and then leave them on the trucks,” he says. “You go to start a new installation job and you find out all of your shovels are broken.
 
“We’ve addressed this by painting a spot on the floor of our warehouse that reads: ‘Broken Tools Here!’” Pagurek adds. “Now, at the end of the day, workers place any broken tools there and they get replaced. That way we’re not trying to track replacement equipment down while crews should be working.”
 
MATERIALS. Rob Garpiel reduced material costs by having his project manager order the necessary materials for each of his three installation crews at the start of the work week. “We don’t store material,” says the president of Garpiel Landscaping, a $1 million firm based in Saginaw, Mich. “Instead, we give crews the materials and say this is what it’s going to take to complete the job. It forces whoever is bidding a project to estimate exactly what’s needed so the guys on site have what they need to complete the job. That way installation crews don’t have to keep going back over and over for more material and it doesn’t allow them to waste material unnecessarily. This has helped our bottom line because it makes our guys a little more culpable for what they’re doing on the job.”
 
Similarly, with fuel over the $4-per-gallon mark, it has become cost prohibitive for crews to travel to and from vendors for materials. Bishop negotiates with material vendors and nurseries to deliver as much product to the job site as possible. “If we can plan ahead with our bigger jobs, our purchasing department can get everything dropped right to the curb and our guys park the truck and work for eight hours,” he says. “We can maximize labor and efficiency by not having our guys running around for material and burning up fuel.”
 
Whether it’s mulch, pavers or plant materials, Pagurek won’t dispatch an installation crew until the materials have been delivered to the job site, in some cases a day or two in advance. “I’m not a big fan of guys sitting around and I want my guys working when I’m paying them,” he says. “For example, I’m not going to send 12 guys to a job site to put in 400 yards of mulch and have them standing around because the mulch is late.”

CREWS. Like managing materials, equipment and logistics, understanding the extent of your crew’s capabilities affects efficiency and profitability. “If you don’t have enough guys then your productivity goes down,” Pagurek says. “If you have too many, then your profit margins hurt. Evaluate the size of the crew and know what that crew is capable of accomplishing and what its capabilities are with relation to what is demanded for the project.”
 
Consistency is another critical component, says David Katz, president of Elite Landscaping, a $1 million firm in Wappingers Falls, N.Y. Crew consistency should stem from skill set, repetition and productivity gauges that can be monitored and compared. “If you can keep the same people doing the same job every day, then there will be efficiency,” he says. “If people are doing many different tasks on any given day, then it is nearly impossible to achieve a level of efficiency that someone who only plants or only does stone work is able to achieve.” LL