The secret’s in the system. And that’s exactly why entrepreneurs invest in a franchise. They’re buying a business that can enhance an existing offering or thrive as a stand-alone operation. In the landscape world, there is a range of complementary services that can attract new customers, round out a service mix, separate a firm from its competitors and rake in more revenue.
Of course, the bonus of a franchise is that the plays are already in the book. You can leap over any learning curve because of vast support networks (depending on the franchise you choose). This month, Lawn & Landscape spoke to a few franchisors about their add-on opportunities.
Got the bug
De-bugging outdoor living spaces is a strong business platform, especially because clients that invest in creating a beautiful backyard environment don’t want to be chased out by mosquitos. The solution: mosquito control services.
Mosquito Joe officially launched as a franchise corporation in October 2012. So far, it has sold 10 franchises for 10 territories. Wilson’s goal is to reach 30 franchises and 15 territories by the end of 2013.
The business is an ideal add-on for a landscape owner who wants to attract new customers and cross-sell services, Wilson says.
“Take a look at your customer base and the history of how well and how fast you have been growing,” he says. “If you’re in a zero-sum game, think of a way you can leverage your existing relationships and offer your customers something different that’s not already out there.”
Landscapers can tap into existing customer lists to market the mosquito control service. They also can leverage back-office support.
And, the service is a solid stand-alone that brings new customers to the business, Wilson says. “We found that more people were becoming customers of Mosquito Joe – probably less than 5 percent came from their existing customer base.”
He says the advent of backpack sprayers equipped with reservoir systems that help dispense the product have increased the service’s popularity. “People are starting to realize this service exists,” he says.
Why go with a franchise brand rather than starting your own mosquito division? Wilson argues that a branded concept brings fresh customers to the door and draws attention to the service, too. “With a separate brand, I think you have the potential of getting more customers than you otherwise would,” Wilson says. For example, a landscape competitor’s client might not switch to another landscape firm to get mosquito services.
But that client might decide to go with a mosquito service brand offered by another landscaper – and then recognizing that the core company also offers landscaping, choose to also buy that.
“Our goal is to become a household name over the next five years,” Wilson says. “So, at the end of the day, when people think about mosquito services, they partner with a name they know.”
Josh Skolnick has never cut down a tree in his life. But he is a 28-year old multimillionaire owner of Monster Tree Service, which began rolling out franchises in April this year.
Skolnick’s start-up story is a familiar one. He began mowing lawns as a teenager, grew a successful landscape business in high school with a few crews, and continued to expand his operation after that.
Then, his clients were often asking about tree services – something Skolnick didn’t do. Until one Saturday, he subcontracted a tree pro to take down a large, old tree on a client’s property. That day, he went up and down that street and sold $20,000 in tree work.
“The following Monday, I decided I was in the tree business and I started investing in tree equipment,” says Skolnick, who now manages all tree work in-house and runs multiple crews throughout eastern Pennsylvania. (He is based in Fort Washington.)
One thing Skolnick noticed right away about competing in the tree business is that many other companies were not equipped to efficiently complete the jobs. And, they often lacked customer service and business skills.
“I saw a need for a larger-scale company, and an industry standard,” he says. “I really felt that standard was lacking in the tree care industry.”
Skolnick got to work on developing systems and processes. “What I’m doing is teaching people who don’t have any prior tree care experience how to run and manage a successful business and employ the proper people so they can have a successful business in a profitable industry,” he says.
Skolnick says his margins are higher than other tree care companies because of his equipment investment. “It’s a go big or go home type of thing,” he says of tree care.
“If you are going to do it, you have to invest in the right equipment, because if you do not, you will lose every time to the guys who are in this business full-time.”
Why choose a franchise as an add-on rather than simply providing the service as an aside and marketing one’s own brand? Because clients seek out tree care businesses specifically. They have confidence in a firm that demonstrates expertise and is equipped capitally and professionally to get the job done.
As for profit potential in the tree care industry: “Margins are higher because of supply and demand – it’s not like you’re cutting grass,” Skolnick says.
Eldean Bergman was operating a large siding and replacement window business when he discovered what a continuous concrete edging machine could do. He was on vacation. A light-bulb flickered: “I thought, I could use this machine based off of my existing sales and have my customers come back to us a second or third time for a different service,” he says.
Bergman purchased the machine. “What I did not realize is how fast it would take off,” he says of selling the concrete border service. “We had people calling us who were not necessarily siding customers.”
Bergman realized the business was a potential stand-alone – and the more he began to operate the machine, he also recognized there was room for improvement there. When he purchased the equipment, little training was available. He thought some support mechanisms for users would make the experience a lot more seamless.
And so Bergman opened his own plant, started manufacturing continuous concrete curb machines and selling the Border Magic franchise in 2003. And with it, he built a support system for operators of the machine in the form of a franchise opportunity that requires a ¾- or 1-ton truck, two or three crewmen, a few days of training and an initial $59,400 for franchise startup. That includes equipment, training, a protected territory and ongoing support.
“It’s a good add-on business for landscape contractors because it gives them a chance to stand out from the crowd and offer something new to clients,” Bergman says.
Adding a niche like continuous concrete border can enhance an existing landscape installation business. And the service is efficient because of the machinery and the ready-made systems for installing and operating the division. In the field, Bergman points out, “It dries faster than laying brick paver.”
Expanding off of this concept, Bergman wanted to provide a way for his franchise owners to make money year-round, not just during curb installation season. So, he developed Boulder Designs, which creates customized boulders that can be used as signage. The one-of-a-kind boulders buck some zoning requirements – they are allowed where the typical sign may not be permitted. And, the business model gives owners a way to keep their people and equipment productive year-round. “In the summertime, you make the business about borders, and in winter you focus on manufacturing these small boulders that go in the landscape area,” Bergman says, relating that franchisees cross-sell to border customers.