I was in Portland last month, so I called up Bob Grover for a private tour of some of his company’s coolest projects.
We’ve got a big sustainability issue coming up this winter, and I wanted to get a jump on it. I wore my nicest flannel shirt and Bob picked me up in his standard issue bright orange Pacific Landscape Management polo.
For a few hours, Bob showed me around the city, pointing out some of the latest in water gardens, bioswales and other green landscape improvements. We saw projects downtown and more traditional installations at office parks out in the suburbs. He showed me the good, the bad and the ugly.
Throughout, Bob kept returning to his focus on practicality in the landscape. He wants to strike a balance between no-input installations that become eyesores and highly designed projects that are pretty, but require untenable amounts of maintenance and attention.
As we were driving around, Bob made a great analogy: “When you look at a LEED certified building, it still looks like a building,” he told me. “A Prius still looks like a car. A landscape can be attractive and functional.”
He described a swing in the approach to landscapes in the Northwest. Years ago, projects were 100 percent input-based and built with no regard to what plants will work, or how the design should be maintained. Now, landscapes in the area are designed with too much attention paid to the plants’ provenance. People think “native” plants means “never maintain or think about again” plants.
Bob and his team at Pacific Landscape Management have made a name for themselves by preaching this smart sustainable message. But even with their success, he told me that he likely couldn’t expand even into Seattle, just a couple hours north. The market’s too different, he said, and he has enough opportunity to keep growing in Portland.
At the end of the day, what Bob and smart contractors across the country are advocating for is a practical approach to sustainability – one that helps the planet, but also makes sense for the businesses involved.
So, propane-powered mowers? Yes. Replacing all traditional herbicides with vinegar? No.
I don’t think Bob’s approach will work in every market – and neither does he. But his way of thinking could. His market and customers respond to the message of smart sustainability, and the idea that their property is helping to save water and reduce emissions. There’s a message like that for every market, you just have to figure out what it is.
– Chuck Bowen
If you like …
Hey, most of have interests outside of the green industry. It’s OK to admit it. We won’t hold it against you. So why not try and make some money off those interests?
We gave Paul R. Segreto, president & CEO, Franchise Foundry, a list of hobbies, and he gave us franchises you might want to investigate.
“My advice is not to always look at the obvious as the connection between what you like or enjoy, and what you’d like to do in a business,” Segreto says. “Often, it’s what the business provides to specific target audiences that may be more in line with what you love or what you’re passionate about. Think outside the box to explore those opportunities.”
Sports or Hunting
You should look into franchise opportunities of either a competitive nature or whose environment takes you outdoors. Sports-type franchises are truly the best of both worlds. Since the spirit of competition can remind you of your younger days, consider a youth sports franchise. I9 Sports is one franchise opportunity that immediately comes to mind. It offers sports leagues, camps, clinics and after-school programs. Activities include flag football, soccer, basketball, t-ball, cheerleading and more.
Even parked, a sparkling Ferrari just looks fast. If you’re a gearhead at heart, look at franchise opportunities focused on car appearance. Franchises like Ziebart and AltaMere immediately come to mind.
Ziebart has been around a long time but its service has evolved. No longer just a rust protection service, the company offers professional detailing, paint protection, underbody sound barrier, sprayed-on bed liners, automotive glass repair, architectural film, window tint, truck accessories, electronics, and scratch and scuff repair services.
Alta Mere is an auto window tinting and high-tech accessories franchise. Its typical customer loves his car and wants it to look and sound great.
You should focus on one of the many fitness franchises popping on the scene including Snap Fitness or Anytime Fitness.
But there are many other less obvious choices focused on specific demographic groups. That is where an individual who likes fitness should direct their attention to specific target audiences they would be inclined to work with, including fitness franchises focused on women (Lucille Roberts and Curves), children (Gymboree and The Little Gym) and moms (Fit4Mom), or specific training such as kickboxing (CKO Kickboxing) or boxing (Title Boxing).
A statement in Kiplingers on this franchise segment puts the growing trend in perspective, “America’s health and fitness kick – partially a response to mounting concerns about obesity, bad eating habits, and high health care costs – is fueling solid growth opportunities for franchises that focus on healthy living and well-being.”
There are many franchise opportunities to explore. But it's the unique concepts that I would recommend focusing on. Many have been developed with focus on health, ethnic fare, convenience and of course, let's not forget food trucks. Americans are passionate about the food they eat and more so when there's an experience to go along with it. A few franchises that come to mind are Garbanzo Mediterranean Grill, Sub-Zero Ice Cream and Sweeto Burrito. The QSR (Quick Service Restaurant) space is ripe with new, unique opportunities. If you're interested in getting in on the ground floor and possibly being affiliated with the next Five Guys Burgers, then I highly recommend a QSR franchise for your future.
You should avoid what might be a fad or with something that might be outgrown rather quickly. Think eBay-related franchises. And, also think about the changing world of print franchises.
Instead, I’d suggest focusing on franchises where technology is part of the offering services. One that clearly comes to mind is PostNet as this brand has evolved with the times and utilizes technology to assist small businesses.
New Way Landscape has been servicing properties for more than 30 years.
When Randy Newhard blew into California in 1976 riding a Yamaha 360 Enduro motorcycle, he began working for the largest landscape company in the United States – now a competitor. Today, 33 years after starting his business, New Way Landscape and Tree Services, he employs more than 200 workers, runs 75 trucks and has 11 satellite offices throughout California.
A robust, real-time reporting system, developed by company president, Kathryn DeJong, gives the company a competitive advantage because property managers can gain full access to status reports and even file service requests online.
But despite all this, New Way still runs like a homegrown family business, and that’s why talented employees stay on board and longtime clients continue working with the company.
When asked about how he finds good people, Newhard says, “A lot of people want to work for us. At some of the national companies, they feel like they are just a number. Kathryn and I treat people the way they want to be treated – we let employees know we care.”
Newhard is just a positive guy. He reads inspirational books and shares enlightening nuggets with the entire staff via email. “I sent my staff a little story this morning about how we need to think positive no matter what comes up, whether it’s our clients or their boss or whoever throwing challenges at them – they can attack those challenges and work around those roadblocks if they feel empowered,” he says.
A new start. “Things are always better when you have a positive attitude,” Newhard says. This attitude is exactly what led Newhard to follow his dream of opening a business in 1980.
Kathryn DeJong, company president and Newhard’s daughter, was key in the company’s technology advancements.
The previous four years, he had been working in the landscape industry for a competitor, and then for the Port of San Diego, City of San Diego in Balboa Park, and Mission Bay Park. He began to take on residential landscape maintenance jobs on the side – and this extra work quickly grew to a substantial $1,000 or so per month. When his job changed from gardener to landscape maintenance at the city (and his new role included cleaning bathrooms), he decided to make a go at landscaping on his own full time.
He quickly grew his residential business, servicing celebrity athletes like San Diego Padres baseball player Steve Garvey and the late Capt. Mike the Weatherman, a famous San Diego T.V. meteorologist. Then, New Way began to grow the commercial side of the business, with a focus on municipal work.
“That is the type of work I did when I first moved to town, so our company used to do almost every city in San Diego County for a while,” Newhard says, adding that this business sector became increasingly cutthroat with competitors driving down prices and margins. “We slowly moved over to commercial and homeowners association work.”
Today, the landscape division of New Way – which is 90 percent of the business – is equally divided in thirds: commercial, homeowners’ association and military housing. The other 10 percent of the overall operation is New Way’s separate tree care business, called New Way Tree Services. The growth in the military housing sector has been promising over the years, even during the economic downturn.
“We work through a private property management company and the properties are ‘off-base,’ so we do not deal directly with the government,” Newhard says.
Inspiring the Team
Randy Newhard is an avid reader, and he often highlights a line or two from a book he’s got on his bookshelf and emails the inspiring tidbit to his entire staff at New Way Landscape. “That helps keep people motivated,” Newhard says.
A couple of his favorite titles include:
The company currently services the largest military housing property in the country, with 2,200 units. “It’s one location and about 10,000 people live there,” Newhard says. “It’s very rewarding to help take care of those military families and reduce their stress during the times when their loved ones are away. We take pride in taking care of those families.”
Turning to tech. Before “paperless” was a common business practice, New Way was scanning documents and innovating its technology. The bulk of these efforts were led by DeJong, who joined her father’s business at age 18. She worked her way up to President (in 2006) after serving as receptionist and filling four other positions before reaching that top rung.
During that time, DeJong began to master databases. “I really spent all of my free time learning about database management, taking courses and learning about functionalities and how to do graphs, get percentages and make the most of the information,” she says.
What resulted from these efforts is New Way’s evolving Service Request System, which has been in place for about 10 years. Clients can book services online or view the status of jobs on their properties. The extensive reporting system requires participation from technicians, who input property data via iPhone.
For example, a technician on a property might notice a broken irrigation head or beds that require maintenance. Then the client may file a service request for mulching. All of this is tracked. “We can run reports that tell us what percentage of a project is irrigation, what percentage is trees – so it gives us information on what needs to assess on the property,” DeJong says.
The custom database system is a highly effective customer relationship builder and sales tool. Property managers are given a password to access their account online – and they can choose whether to share this with an HOA board or grounds crew, for example. All parties have access to what the property needs and what has been accomplished.
“The system establishes trust,” DeJong says. “You can show a client that you recognize a deficiency on the property and come up with a plan of how to fix it. Then, they believe your best interests are their property and taking care of them.”
Technicians input information via iPhone, and a customer service representative back at the office inputs the data. After the system is updated, field technicians can access the system and update clients on site – or they can email reports to customers.
“Being proactive is part of what we do,” Newhard says. “When we can show customers what we have to do on their properties and they can see the updates, it provides a great value-add to them.”
Photos courtesy of New Way Landscape
Certainty. If there is one reason why entrepreneurs invite me into their business life, it’s to help them to develop certainty. Certainty leads to confidence. That’s why I call my initial consultation with a new client “Bidding with Confidence.” It’s an intuitive rather than an analytical thing. You may not know why but you know if you are confident or not.
The primary tool that I use to develop certainty and confidence is the annual estimating budget. This is not a tax budget or a cash flow budget. Rather I call it a fair-market-value (FMV) estimating budget. The figures that I include in it are neither driven by the tax code nor cash flow requirements. They are driven by what the realistic costs necessary to run a business are. It does not include accelerated depreciation or tax driven deductions.
Yes, the paragraph above contains words that makes some of you want to turn the page. Don’t.
Budgeting isn’t all that bad if you have some assistance and the right tools for doing so. Mastering the art of properly formatted and prepared budgets is one of an entrepreneur’s most important tools. It allows him or her to benchmark a company, set goals, track progress, delegate the business process to division managers, and so forth.
A few years ago, a CPA for a large irrigation company in New York almost had convinced an entrepreneur to get rid of his service division because it wasn’t making him any money. Fortunately, I was able to show him that his service division was making him money – lots of money. The CPA, of all people, didn’t know how to properly benchmark such a business. This entrepreneur didn’t get rid of his service division but he did get rid of his CPA.
First we review past performance and financial statements as we make realistic projections for the upcoming year. The budget is usually divided into divisions for revenue and direct costs (material, field labor, labor burden owned and rented equipment and subcontractor costs). G&A overhead costs are then calculated and allocated to individual divisions.
This process allows us to benchmark not only the whole company but individual divisions. It’s during this review process that we identify division margins – where the company is making and possibly losing money.
The labor burden and G&A overhead calculations help you to price it (jobs and services) right. An accurate estimate allows you to job cost in order to see if you are producing the work right. The division sales and billable labor hour projections allow you to track work and to see if you are producing enough of it. Jobs (the little picture) may be coming in on budget but if you do not have enough of them (the big picture), you’re going be in sorry shape at year’s end.
JIM HUSTON runs J.R. Huston Consulting, a green industry consulting firm. See www.jrhuston.biz; mail email@example.com.
Scott Frith has pushed the 45-year-old Lawn Doctor brand toward a new model of expansion, targeting “empire builder” owners who view lawn care less as a calling and more of an investment. But he’s gotten there with the old-fashioned work ethic and focus on relationships his father, Russ, taught him.
We operated out of a farmhouse. That was one of the first headquarters for the company when we started the franchise. We started in a hardware store on Main Street in Matawan, N.J., selling product, and became the franchise leader in our space.
Lawn care franchising grew up as very much an owner-operator kind of model. We’ve gotten much more sophisticated.
There’s a lot more people over the last five years looking at lawn care franchising that probably never would have considered it in the past. And they’re looking to be that empire builder where they want five, six, seven, 10 franchises.
They really don’t have a lot of interest in providing the lawn care service themselves. So somebody that maybe would have under a different kind of circumstance been investing a restaurant, they’re now looking at a service.
If I invest $100,000 or $200,000 in the equity market, what’s my likely return on investment, and what’s my risk? If I invest it in the debt market, what’s my return there, and what’s my risk?
The biggest challenge is going to be change management. We’re upgrading our infrastructure and we’ve got a new accounting package. We’ve got a new ERP package. We’ve got to look at production at our manufacturing facility that’s just much more volume. We’re bringing more franchisees into the system than ever before.
We’re the same company we were before. We’ve been around for 45 years. We have the same kind of value system, the same core values as an organization.
I’ve said this to you before, it’s a foot in the past, a foot in the future. Stay focused on the things that are important for the organization. Innovate a little bit quicker. Just move the ball.
There’s a lot that I learned from my father. Nothing worthwhile comes without working. I came to understand that anything worthwhile required a lot of effort and it was important to fully apply yourself.
You have to show up every day. You have to give it 100 percent. You surround yourself with good people, you work really hard toward a common vision, great things happen.
The value of relationships is something I learned from my father really early on. You can take the most convenient path, or the one that’s most advantageous under a particular set of circumstances at that moment, or you can do the right thing for all the people involved. Opportunities come and go, but character is lasting.
You want to always innovate. You want the brand to stay very relevant to the customer. And you want to meet the changing needs of the franchisee. But you can’t push it too far or you find that you’re outstripping the franchisee’s ability to implement these innovations. That’s not good for the company, either.
It’s the passion of the franchisee. They want the customer to be satisfied. They want the repeat business. They want the referral business. And at the end of the day, they have to put food on the table based on their ability to do the right things in the marketplace. And I think that’s why they outperform.
It’s the best of both worlds. And that’s what makes franchising exciting, and that’s what gets me up in the morning.
Some companies want to be the low-cost producer, and do it at the absolute lowest cost, and they want to drive a lot of volume. And that has pros and cons. That has certain implications. Others want to be the premium-priced business that delivers the absolute best experience to the customer. Others want to be the Apple in the lawn care industry, and have a very different kind of brand, a very different culture that’s either cool or quirky.
Whoever you decide to be, just be who you are.