BUSINESS OPPORTUNITIES: The Guiding Light

Vince Del Vacchio says the decision to start offering landscaping lighting three years ago was an easy one. With more customers requesting lighting, the president of Del Vacchio Landscapes in Edgemont, Pa., realized the service was a natural fit with the landscapes and hardscapes his company designs and builds. “More people were asking us when we were going to do installations that incorporated lighting,” he says. “We saw a market for it.”

After first fooling around with the lower quality lighting materials available, Del Vacchio decided to get serious about offering the service. When he researched the types of installation and systems, as well as the equipment involved, he discovered he could start a lighting service for a fairly small investment.

Lighting doesn’t really require any special equipment, he says. Most of the tools are the same ones used in landscaping work. One minor investment he made was converting a bed edger he owned into a trenching machine. “But other than that, we pretty much had everything we needed,” he says.

He and his staff then took installation training at seminars offered by the industry and various manufacturers. Once armed with the knowledge and the right equipment, Del Vacchio’s lighting service was ready to go.

The service accounted for only about 8 percent of the company’s total revenue last year, but without it, Del Vacchio says he would lose landscape jobs. “If somebody else came along and offered lighting with an installation project, that could have been a reason for a customer to choose them instead of us,” he says.

SPARKING SALES. Del Vacchio markets lighting the same way he does his other services: by sending four-color mailers, about the size of large postcards, to targeted areas that include existing and potential clients. Mailers promoting the lighting service are usually sent in late spring or early summer. He also mentions the lighting service in all advertising. But he says the best selling tool is the on-site demonstration.

When it comes to lighting, seeing is believing. Customers can’t visualize the final product simply by looking at fixtures, and it’s difficult to explain it to them. That’s why Del Vacchio started offering free overnight demonstrations.

“People aren’t going to see much of the fixtures because they’re hidden pretty well behind bushes,” he says. “When people think they’re not going to see the fixtures, they get kind of worried until you show them the results. When customers see the house lit up, it’s a pretty powerful tool.”

The demonstrations are offered to qualified customers only. During an initial consultation, Del Vacchio will make sure the property is in his company’s service area, is the type of property they want to work on, and that the client’s budget and time line are realistic. For instance, his typical client is residential with a 1-acre property and a home that costs between $600,000 and $750,000. Qualifying customers for a demonstration can prevent hours of wasted time, says Del Vacchio.

Once a customer is qualified, the salesperson will go out and set up the lights. “We’ll leave the lights on the property for at least a few nights and up to a week,” he says. “The longer the lights are there, the more customers miss them when they’re gone.”

But that’s not to say there aren’t challenges to selling the service. Customers want lighting, but not a high price tag. “We decided to go with higher end systems, and they aren’t by any means cheap. People can go buy off-the-shelf stuff for much cheaper,” says Del Vacchio.

He is careful to explain to customers the benefits of having lighting professionally installed. It costs more, but it’s also serviceable, more durable and lasts longer. He usually finds that most customers are all too familiar with the lower quality lighting. “They know it breaks, they know it doesn’t last, and they know the bulbs always burn out,” he says.
 
Del Vacchio says his customers usually fall into two types. The first are people with established landscapes, who are looking to accent their home or landscape, or both. Generally these are older homes, he says, with mature landscapes. “We find these to be our larger sales because they aren’t spending money on hardscaping and landscaping along with the lighting,” he says.

On the other side are customers with newer homes that have little or no mature landscaping. “These are the properties we are creating an overall design for, then installing hardscaping, landscaping and lighting,” he says. “The lighting sale on these properties is generally a little lower because they are spending more on the project overall. But we always build the system so it’s expandable in the future.”

In the last two years, sales in general have been relatively level for Del Vacchio, but he is expecting to grow this year. He hopes to boost sales by offering lighting as an option on every design/build job. “We’ll be pushing it with every job that we do – landscape or hardscape,” he says. “We want to make sure our entire market is aware that we’re doing it.”

The annual growth of the lighting service has been consistent with growth in other divisions of his company, but “in the next two years, we project lighting will be one of two divisions that will grow faster for us,” Del Vacchio says. In fact, he projects the service will be 10 to 12 percent of the company’s total revenue this year.
 
PRICE IS RIGHT. When he started out, Del Vacchio had no idea what to charge for lighting. So he used manufacturer recommendations as a guideline for pricing jobs and has found it useful. “Had we priced it ourselves, we probably would have underpriced ourselves a little bit at first,” he says.

Some manufacturers help out contractors by recommending a minimum price per fixture that factors in all of the costs, including the fixture itself, transformer, wire and labor. The number serves as a good starting point when contractors price lighting jobs. As an example, Steve Parrott, director of marketing, Cast Lighting, Hawthorne, N.J., points to the most common fixture they make. Contractors can buy the fixture for $50, and they recommend contractors sell it for $200, a 25-percent increase when all the costs are added in.

There is a tendency to want to charge a flat price, like $150 per fixture. But Del Vacchio compares price-per-fixture pricing to square-footage pricing for pavers. “We don’t do it because there are too many variables on each job,” he explains.

Once the manufacturer’s pricing is applied, “we always check our estimate to make sure it’s going to be a profitable job,” he says. On average, he charges anywhere from $150 to $250 per fixture, depending on job size, difficulty, labor and fixture type.

With an estimated gross profit of about 15 percent, Del Vacchio says lighting is slightly more profitable than other services his company offers. He contributes this to the higher markup of lighting materials compared with the bigger materials he uses for his landscaping and hardscaping work.

LIGHT LESSONS. Despite the best-laid plans, mistakes will be made. Beginning a lighting service may not be overly complicated, but it does have its challenges. One lesson Del Vacchio learned was the value of a layout. “Ini tially, we didn’t do much layout before we started a job and we found it cost us some time,” says Del Vacchio.

Now his crew lays out jobs two ways. They draw out where everything will go, including fixtures, transformers and hubs, which saves time on the initial installation. This also uncovers any potential problems, such as a client needing a new outlet installed. In addition, the designer will use colored flags to indicate where to install each type of fixture, eliminating the guesswork for the installers.

Lighting can also be a challenge simply because it’s different than installing landscapes or hardscapes. “Lighting involves running little wires and trying to make everything neat and organized,” he says. “Obviously, landscape and hardscape jobs need that too, but on a bigger scale. There’s more finite work involved in lighting. When someone sees wires running into their garage, they want them neat, not sloppy. That’s one of the things that can really set you apart and make a big difference on the installation.”

And all of those details, including voltages, wire type and run lengths, require close attention. If something is overlooked, it can lead to major maintenance problems down the road. “It’s well worth spending the extra time while you’re there,” says Del Vacchio.

Del Vacchio is careful to ensure his lighting work is of the highest quality. “We use a quality check to make sure things are done properly on every job,” he says. Throughout the job, crew leaders will check that voltages are correct. Once a job is finished, either Del Vacchio or an operations manager will again check the voltages and make sure everything looks clean and neat before doing a walk-around with the customer. He says, “Although it’s low voltage, we are playing with electricity so we want to make sure that everything is absolutely perfect.”