In case you’ve been living under a rock, there’s a massive labor shortage in the landscape industry. Forty-four percent of contractors say they have at least one open position. Three-quarters say a lack of employees hinders their growth, and a lack of quality help is cited most often as the biggest problem facing the business in the next three years.
Things should be going well. The economy is improving. Many contractors report they’re having one of their best years. Customers are finally spending again after years of a recession-induced hangover.
But that’s just it. Because the economy is improving, entry-level laborers are getting better offers elsewhere. Guys who used to drive mowers can go make more hanging drywall or laying asphalt. Brian Lemmerman, who we interviewed for this month’s Tips from the Top, lost an employee (and not even a good employee) to a road crew, where he turned a stop sign for $15 an hour.
And the H-2B program, which used to be a reliable source of seasonal help for the industry, has been whittled down to nothing but a headache. The 66,000 cap gets met in the blink of an eye. And a shutdown of the program this year – caused by bickering among the federal agencies that oversee it – meant that landscapers who requested help got it weeks late, losing out on hundreds of thousands of dollars in spring revenue.
Leonard Quiroz has taken matters into his own hands. Quiroz, the chief operating officer at Uyeta Landscape & Maintenance near Seattle, is working to get landscaping added to the curriculum at his local vocational school. The goal is to have a two-year program that graduates students trained up in horticulture and the soft skills they need to succeed at a green industry company, and then take that curriculum to schools around the state. It’s not a short-term solution, but it’s something, and it can’t hurt.
“Everybody can win from this. It starts to get us a pool of people who have some experience right out of high school,” Quiroz told me. “We have to solve this problem if we want to grow to where we want to be. Stop flapping your gums. Let’s do something.”
There are many solutions to this labor problem. H-2B is dysfunctional and the industry must move past it, and keep hustling for other sources of labor.
Maybe the answer is cheaper, more-efficient machines to save on back-breaking work. Maybe it’s paying crews more. Maybe it’s time to start poaching your guys back from the construction companies. In reality, it’s some mix of all these things and more.
Landscapers can hustle when it’s time to get something done. If you’re having trouble finding (or keeping) employees, you aren’t alone in asking why. It’s just time to find some better answers.
Each of Robert Groff’s job sites is a magnet: All materials are shipped there instead of his yard, and his crews report directly to the project.
Groff, president at Groff Landscape Design in Fairfax Station, Va., does all design/build work and about $1.4 million a year.
Instead of paying his two crews of five field employees each to spend two hours a day in traffic, Groff has them drive their own vehicles straight to the job site.
He says this keeps them more engaged and focused. They aren’t spending time at the shop gassing up equipment or loading materials. None of the crew members need a CDL and having fewer trucks (and truck drivers) saves wear and tear on Groff’s pick-ups.
“Instead of wasting one to three, four, five, six man-hours a day of travel and load up time, all of the guys are at the job site,” Groff says. All tools and equipment are delivered in one of the company’s 16-foot enclosed trailers by the project manager, left at the site for the duration of the job and removed when the project is finished.
The trailer is organized with anything the crew is going to need for the job: a Troy-Bilt tool box, a rack to hang shovels and rakes, and crates on shelves to hold fittings. Racks on top hold pipes and ladders.
“Anything that we use frequently, it’s in that trailer and nothing more,” Groff says.
“If we need it once a year, we’re not going to put it in there because it’s just wasted space.” Instead, project managers will bring specialty equipment in their trucks as needed.
Groff says the time his employees save using this direct-report system allows them to finish five more jobs each year.
That adds up, especially when Groff figures his average revenue per project is $32,000.
Email clients the day before you’re set to arrive to make sure necessary utilities (like water and electric) are turned on.
Keep extra pieces of key equipment (saws, compressors, drills, etc.) in the trailer.
Have all materials drop-shipped to your job site to save loading time at your yard.
This year has turned out to be a boom year for most green industry contractors. Phones have been ringing off their hooks ever since the first hint of spring and good weather. Just about all facets of the industry are at pre-recession levels. However, the question is: “How long will this boom cycle last?”
Just as water seeks its own level, the economy seeks equilibrium. What goes up cannot keep rising forever. At least this has been our economic history for almost 100 years. While the overall trend is positive as our economy creates and sustains more and more wealth (capital), there are constant boom and bust cycles as the general economy grows.
Too many entrepreneurs ignore these cycles and do not see them as being a good thing – a winnowing process of sorts. They expect the economy to perform like a roller coaster that eternally climbs and never drops.
If you plan properly, you can counter the busts and ride the booms to prosperity. Just as a roller coaster climbs, dips, twists, turns and drops, creating an exhilarating experience, so too can proper planning turn the ebbs and flows of the economic cycle into a constant wealth building experience. Those who plan properly go on to a bigger and better future. Those who don’t often lose their cookies – literally and figuratively.
Strategy for success.
I recently hosted a brainstorming session (see page 10) in the Raleigh, N.C. area. It’s a M.A.D. meeting where we focus on mergers, acquisitions and divestitures.
The meeting primarily revolves around the M.A.D. process and creating a company that has value to prospective buyers. In order to create value, a company has to create sustainability. This means it is able to counter the economic cycles and create wealth for its owners in both good times and bad. It is constant and dependable streams of cash that buyers are looking for.
While no one segment of the green industry is bullet-proof, some get bullet-riddled in a recession. For instance, in a downturn, the first few markets to flush down the toilet are residential installations and commercial home production lots, followed by general commercial installations. Government installation projects are somewhat resilient until they become hyper-competitive when commercial and residential installers with no work jump into it, which is usually about a year into a recession.
Once this happens and the economic pie begins to shrink, companies jump into the maintenance market.
It’s almost too late to change your market course once you’re in a recession. The smart thing is to build a sustainable company while the economy is robust. Smart contractors build on a foundation of repetitive service work. Providing a “full-service” spectrum to residential and/or commercial customers is a good place to start.
You should then try to expand your chemical application lines. Irrigation service is also an excellent area to grow, as is Christmas décor. Tree services and pruning should not be overlooked due to the necessity to prune such for both safety and aesthetic reasons. Enhancements for both residential and commercial maintenance clients should be vigorously pursued as well as fine gardening for homeowners.
It’s not that you want to ignore installation projects. Just be aware that, like the blitz in football, if you live on installation projects alone, you’ll die by them. If all you do is installation projects, it’s not a question if you’re going to get burned, it’s a question of when.
Someone once said that the seeds of an organization’s destruction are sown from within. How true. The good news is that you choose which seeds to sow. You can choose to plant the seeds that lead to long-term sustainability and that counter the economic roller coaster or you can fail to diversify and suffer the consequences.
Roller coasters are specifically designed and built to provide a safe and exhilarating experience based upon gravity and numerous twists, turns, dips and drops. Economic downturns are not. Just as there is no eternally climbing roller coaster, there is no such thing as an eternally growing economy without cycles that go “Boom!” and then go “Bust!” The good news is that you can choose to grow consistently through these cycles if you plan properly. It’s up to you. Choose wisely, my friends.
Bruce Wilson started in the industry like most – he mowed lawns as a kid to make some extra money around his upstate New York home. One of his former clients, who’d hired Wilson to maintain his small greenhouse, recommended the budding horticulturist for a garden club scholarship. Wilson got it, and it led him to SUNY Farmingdale. He transferred to Cornell, where he graduated with a horticulture degree.
After graduating, he got a job at another tree company, climbing trees in the brutal Rye, N.Y. winters. His wife, Gail, thought that was a bit too dangerous. They decided that if his career would be in landscaping, it made sense to move somewhere where he could work full time. So Wilson answered a classified ad and was hired as a spray operator at Green Valley Landscaping in sunny San Jose, Calif.
It was 1971. He was 25 years old, and at the start of a career that would see him run the largest landscape company in the world, establish maintenance as the green industry’s dominant service, and hire, train and consult with dozens of people who would become standout leaders and successful business owners in their own right.
Wilson started his days early – afternoon winds in the Bay area made it hard to spray – so he had a few hours to kill each afternoon at the shop before his wife picked him up after work. So he asked his boss, Joe Marsh, if he could learn more about the other work Green Valley did.
“I got to see all the jobs we did, met all the foremen and managers and got to learn the operation pretty fast,” he says.
That same year, ValleyCrest, which at the time was mainly a construction company, acquired Green Valley to start a maintenance division. Burt Sperber asked Wilson to head to Colorado to open a branch office there, and acted as the branch manager, salesperson mower operator and mechanic.
Then began a series of promotions that would ultimately make Wilson the president of Environmental Care, ValleyCrest’s maintenance division, and put him in a position to lead and teach some of the industry’s greatest luminaries.
When Wilson became president, it had just four branches – in San Diego, Las Vegas, Denver and Phoenix – plus Green Valley, doing about $7 million. “That’s what we had, then we grew from there,” Wilson says.
“Grew it from there” is a bit of an understatement. By the time Wilson retired in 1999, ValleyCrest was doing $140 million a year and had grown to that level almost entirely organically. Wilson had made just one acquisition worth more than $5 million – the Oyler Brothers in Florida.
“We never planned to be a $100 million company. We just grew,” Wilson says. “We budgeted to grow every year, but we didn’t really realize the compounding effect of it. The only thing that was holding us back from growing even more was people.”
And it was with people where Wilson truly excelled. He spent most of his time out of the office, visiting with branch managers across the state and then country, listening to what their problems were and spreading knowledge of what was working elsewhere.
From manager to enabler
My most influential mentor is Joe Trickett, Ph.D., the Dean of the graduate school of business at Santa Clara University. He had a student that we hired do his thesis on our company, and an attitude survey of our field employees and why they stayed with us for years doing what was – and is – perceived as a menial job.
During the process of his verifying if this was a legitimate project, he met with me regularly and we developed a bond. He took a liking to me and we got into numerous philosophical conversations about management. His area of expertise was industrial psychology. One day when he came in he asked me how things were going. We had a problem where some in the company wanted to fire a guy and some did not.
To make this a short story, it came down to what I believed: Did I believe that people got a job to screw up and get fired, or did they want to succeed in some way? I chose succeed. He asked me if I liked being managed. I didn’t, but knew that was part of the deal.
He convinced me to think about instead of being a manager to be an enabler. From that point forward, I saw my role as enabling people to attain the success they wanted. It worked. I enabled many people to achieve more than their dreams. – Bruce Wilson
One of Wilson’s hires was Tom Fochtman, who would go on to run CoCal Landscape (and compete with his former boss) in the Denver market. As vice president of sales and marketing, where he would visit branches throughout California with Wilson.
“He gave me plenty of direction and a lot of autonomy,” Fochtman says. “We had a lot of quality time driving to Palm Desert. I’m confident and I have an ego – he was good at showing me how to keep that in check and how to empower people.”
After growing ValleyCrest to nine-digit revenue, Wilson could have retired. But he got a call from Rich Angelo, the founder of Stay Green in Santa Clarita, Calif. He had hired ValleyCrest to do the tree work on his own maintenance accounts, and after he’d heard that Wilson retired, asked him if he’d come consult with his company.
“I said, ‘I guess so, yeah,” Wilson says. “I hadn’t thought about it until Rich called.”
He teamed up with Tom Oyler, who had joined ValleyCrest after the acquisition, and the two formed the Wilson-Oyler group. It was then that Wilson got involved with peer groups, facilitating meetings among similar-sized but non-competing landscapers around the country.
Wilson didn’t invent peer groups, but he started the most successful ones in the industry. He now runs eight groups, and can count among his clients some of the largest companies and biggest names in landscaping.
One of those clients and friends is Frank Mariani, who was a member of Wilson’s first peer group, Next Level Network, and has hired him as a private consultant for Mariani Landscape. He says Wilson’s best skill is his ability to manage the sometimes-inflated egos of the owners who hire him.
“I think that too many of us believe our own bullshit, excuse my French. He’s not afraid to pop our bubbles. … He’ll call a spade a spade,” Mariani says. “He’s going to give you an answer – to me that is invaluable. You can’t put a price tag on that, because I trust him completely. That’s not to say he’s always right, but I’d be hard pressed to tell you a time he was wrong.”
As a consultant, Wilson helped Mariani improve how it ran its residential maintenance business. He analyzed everything from how crews rolled out in the morning to how the yard was organized to how job sites were set up.
“He was there as early as the earliest guy the next morning. He said, ‘I don’t want you to pick me up at the hotel. I want to see what’s going on,’” says Fred Wacker, Mariani’s president. “He was in our yard at a quarter of six, watching people. He just has an energy level that is inspiring and motivating.”
Bob Grover, president at Pacific Landscape Management in Oregon, is another member of Next Level Network, and says Wilson’s great skill is listening more than he talks.
“No disrespect to anybody else, but there are some very large personalities in our industry,” Grover says. “And I think he is smarter than any of those large personalities. The thing about Bruce that impresses me the most ... he listens. He is one of the best listeners I know because he’s not trying to command the conversation. He truly wants to know what other people are saying and thinking and process that in his mind, and come up with a thought-provoking nugget.”
Wilson, now 68, has found time to run another landscape company.
George Gonzalez hired Wilson in 2005 as a consultant for Sierra Landscape in Palm Springs. During the recession, he was forced to shut it down.
But with Wilson’s help, the two men relaunched the company as Conserve LandCare in 2011, with a stronger focus on maintenance and using technology to run more efficiently.
For years, Gonzalez had seen ValleyCrest grow and dominate the market, especially in California. Though he never met Wilson during his time there, he knew him by reputation.
“In our industry, there’s a bit of a disconnect if you’ve got an owner who doesn’t speak Spanish and all Hispanic field guys. I was born in Cuba, and my first language is Spanish, so I’ve been able to relate to the guys from day one,” Gonzalez says. “When I first met Bruce, knowing his background as president of Environmental Care and corporate structure, I thought ‘This guy is just management only.’”
But he learned quickly – as everyone who meets Wilson does – that he’s just as comfortable in the boardroom as he is in a box truck.
“When we stuck him out there in the middle of a foreman meeting, he did great. The guys really warmed up to him,” Gonzalez says. “And you can’t fake that. … The guys pick up on it. The guy is genuine with that.”
There’s an excess of smartphone apps that let homeowners order lawn mowing services with the tap of their finger. The apps are the next generation of online directories like Angie’s List and Thumbtack, and join tech giants Google and Amazon, which have both invested in their own home services software.
The app LawnStarter announced earlier this year that it’s raised $6 million, and is the latest in a long list of mostly regional apps that are building armies of landscapers in select markets who can provide services – mostly lawn maintenance, but also snow plowing and tree work – for a fixed price. They remove the burden of selling new work and collecting payment, sending vetted leads directly to contractors and paying regularly twice a month.
Steve Schell, who runs Schell’s Lawn Care with his son, Ryan, typifies the contractor who uses these apps. He offers full-service landscaping to a mostly residential customer base. He started his part-time business this year – he does about $10,000 in annual revenue – and relies on an app called Mowz almost entirely for marketing and new business.
“We took off like gangbusters, and a lot of it’s thanks to Mowz, to be honest,” Schell says. “It’s given us a lot of exposure to some interesting neighborhoods we probably wouldn’t have ever thought of.”
Schell says he gets about 30 to 40 leads a day through the app, of which he accepts about four or five. Many of the jobs he accepts are repeat customers, too, as homeowners become more comfortable ordering lawn service via their phone.
“I think this is becoming more the norm. I’ve definitely noticed over this last summer, we’re getting a lot of repeat customers,” he says.
Mowz, which also offers snow plowing services, is the largest app of its kind with 2,500 contractors across 38 markets. Mowdo is beta-testing in Seattle, Austin and Omaha, and works with the website Thumbtack to provide contractor contacts in other markets. CEO Mike Fingado said that when the app launched in Seattle, it got more than 250 requests from contractors to join. He’s currently working with 15, and has requests from 15 other states to expand. Ryan Farley, co-founder at LawnStarter, which just netted $6 million in funding, used to run his own landscaping company in high school. His app has about 100 contractors in Austin, Washington, D.C., and Orlando.
The apps’ algorithms set prices for services, using a combination of the lawn’s size, length of grass, obstacles like fences and some market pricing data. From interviews with contractors, the prices are typically on par with the local market – often between $25 and $40 per cut. And users said they can report back if a homeowner’s report of their lawn’s condition isn’t accurate.
“They set the price until I get there. That’s a big problem with the app – I get there and people say they don’t have a fence. They have a fence. They say their grass is short. I get there and it’s 3 foot tall,” says Lauren Cress, who runs HillCress Lawn Care in Atlanta with his uncle, Christopher Hill.
Cress projects he’ll hit $80,000 this year in total business, and says Mowz jobs bring in about $3,000 to $4,000 a month.
Developers say most contractors on their rolls are one-man operations, or run a couple of crews. They must have some level of general liability insurance and commercial-grade equipment.
Landscapers we spoke with say they use the apps as a turn-key marketing and lead-gen service, picking up new work that helps fill gaps in their schedules and increases route density. There’s no selling involved – leads come right to their phones – and they’re free to accept or reject as they see fit.
“At the end of the month, we send out statements and theoretically people pay in 15 days. That doesn’t mean they all do,” says Erik Carvotta, owner of ETC Services in Hendersonville, Tenn. “I don’t have to sit around printing invoices…. I don’t need to be on the phone hours every day talking to somebody if they had an issue. As far as payments, I don’t have to worry about when we’ll get paid.”
Carvotta has used GreenPal, Mowz and Task Easy to pick up business. GreenPal, which solicits bids from several contractors and allows the homeowner to choose, has been the biggest hit, he says. In July, it added $7,000 to his top line revenue.
Last year, ETC did $270,000 in annual revenue, and Carvotta credits the apps for a good chunk of his growth, and for saving him a lot of aggravation.
“There’s no selling or haggling over prices. They get set by the app,” he says. “I don’t have to go out and hunt down customers. I don’t have to advertise. I don’t have to go out and quote. … I don’t have to chase anyone down.”