Insurance. It’s a word that makes me uncomfortable only because I personally do not enjoy paying for the “what if” to happen.
I am somewhat of a controller and I felt like Coastal Greenery was being held hostage by insurance companies. All of this thinking had to be altered because doing business as a landscape company means that our company has to be protected. I had to leave my personal issues with insurance behind and make certain that Coastal Greenery was insured and prepared for the day when we would have a claim.
So instead of fighting insurance, I learned all that I could and in doing this I found we were not captives to insurance; we did have choices and options. Coastal Greenery has had some hard lessons learned when it comes to insurance but we were able to take away a few useful tools to help us navigate the insurance world.
Choose a smart broker.
An insurance broker represents your company in purchasing and negotiating with insurance carriers.
Find a broker who knows the landscape business and the situations that you are up against daily. Let’s face the facts. We know landscapes, not insurance so choosing a broker is not an area where you want to tread lightly.
Know your policies.
Your broker should go over every policy and what they mean in layman’s terms with you. This is not a time for you to be quiet. Ask questions.
Our general liability policy had coverage that I finally questioned after a year or two and found out that “terrorism” coverage didn’t have to be included in our policy, thus saving us few dollars.
Understand the types of coverage.
General liability is insurance coverage to protect a company from a variety of losses that can arise while you are in business. Areas that are covered within the GL policy should be designed to fit your company’s needs, so to speak and can include:
Protection of property: The ways in which property can be damaged are endless so it is much easier for you to know what is not covered by your policy than what is covered.
Coinsurance: A clause in a policy which you must know and understand. Coinsurance has a few meanings in the insurance world so make sure you know how it relates to your policy. This is one of those areas where not understanding could leave you penalized in the event of a loss.
Commercial liability: Covers damage to third parties that the company becomes legally obligated to pay. Years ago our company found this coverage to be well worth the money. An employee didn’t dilute a chemical he applied to turf on a property and, needless to say, our commercial GL coverage paid for the labor and materials to re-sod this property. A business owner not carrying this coverage could result in business suicide.
Business automobile: This coverage is the same as personal auto insurance and can include liability, comprehensive and collision. Save some money by taking a look at the trucks within your fleet and determine if the older trucks need full coverage. If totaled, would you receive enough money from the policy to replace the vehicle or is the cost of insurance more than the value of the vehicle?
Inland marine: This coverage involves the tools and equipment a company owns and uses to do business. You will need to have the insurance company define for you what they consider a “tool” and a piece of “equipment.”
Workers’ compensation is insurance provided to employees who sustain a work-related injury. State law requires most employees to carry this coverage. This coverage is another policy that if your business doesn’t have it, you could be committing business suicide.
Umbrella policies are policies that are carried on top of your general liability coverage to increase limits. Umbrella policies are really a determination of the business owner and need to be carefully thought out. A great reason to carry an umbrella policy would be for a business owner to obtain extra personal insurance to cover their personal assets from being targeted from a claim that is attached to their business.
Additional insurance tools.
Have one individual in the company “own” the insurance process and be the “go to” person for insurance.
Keep an inventory of all equipment and include serial numbers, VINs, dates of purchase, purchase price, etc. The more key information you have, the better your chances of recouping your loss on equipment.
Small tools can be inventoried by crew with little information other than type and brand needed.
Keep records of all employees who drive company vehicles. Run a motor vehicle report on driving employees upon hire. Make certain that you have the employee sign an MVR agreement giving you permission to run the report and make a clear copy of the driver’s license.
Have a vendor/contractor agreement signed by all subcontractors that you hire and keep it on file before they step foot on your job site. With this agreement, they agree to carry insurance coverage and will provide you with updated insurance certificates. These agreements release your business from any and all liability if they or their employees are injured on the job.
Keep in mind that any contractor on your job site is considered your employee by WC and you will be charged for their work during your yearly WC audit unless the contractor carries WC insurance.
Make safety training a priority and hold weekly, if not daily, safety meetings. Enforce safety on all job sites and at your facility. Hold all employees accountable for safety violations and reward employees who display safety on the job.
Maintain a drug-free workplace. Test for drugs upon hire, periodically, after accidents and when speculation arises. Maintaining a drug-free workplace will lower your WC insurance in some states.
Each year your company is given an MOD score that reflects the accidents that have occurred in the past year. This “company report card” can affect your WC rates for three years as each incident stays on your MOD for three years.
Since 1994, my view on insurance has changed. Although I do not like paying the high premiums every month, nor do I enjoy being audited every year to basically pay additional premiums, I do feel confident that if and when an accident occurs, we are covered.
It is a must for a business owner to protect their company and employees with the proper insurance coverage. Let’s face it: there are a few certainties in the landscape world, namely weeds, taxes and insurance.
A crisis plan cannot possibly cover every situation, but at its foundation you will know how to respond. Thinking ahead now to when you are served papers, sued or when scandal hits will help you be prepared. Here are some steps to help you formulate the crisis plan.
Go on the offense.
You will need to communicate, but not too much. There is a fine line on answering questions, confirming information and responding.
Remember, silence deems approval. Be prepared to address rumors in an honest, positive and frank manner. It’s up to you to sift out what’s true and what’s not. It’s up to you to know what you want others to know and it’s your job to make sure the point is shouted loud, clear and consistently above all other voices out there.
In this day of quick social media posts, you need to be ahead to decide where and when it’s going to crash. Don’t be afraid to use social media to skillfully get the message out that you need. When you know there’s going to be an unavoidable fallout from the news or crisis, hit it head on, provide the solution or communicate that you are working on a solution and be proactive in your message.
Keep it positive.
You need to make your message honest and truthful while maintaining the positive belief that you’ll come out the backside as a better, stronger person. Responding in a positive manner is an integral part to a successful resolution.
Don’t forget your team is watching you, they’re taking their cue on how to respond from your example. Even when you deliver hard or difficult news, speak clearly and slowly, make sure you make eye contact, use hand gestures that convey warmth and openness.
Emphasize moving forward.
It is essential your entire team understands the “show must go on” and does everything to keep business as usual while pushing the positive message you have identified as the central theme to keeping everyone focused.
Admit your mistakes.
If you’ve made a mistake or error in judgment, be prepared to accept full responsibility, apologize or ask forgiveness and then show the steps you’re taking to rectify the situation.
We’re wired to be gracious when human error occurs and it helps when the person admits with humility and honesty when they’ve made a mistake.
ask for help.
Finding a trusted source can be a tiring process so make sure you have already started the process of vetting that person.
You need to start with defining your ethical, moral, character and value standards and how your trusted source needs to share your views in different areas.
It is wise to ask around, check social media, seek references and then always interview on matters that you will need key advice on.
Ask your peers who they have used and their results. This is where organizations like the National Association of Landscape Professionals deliver such a valuable resource in providing opportunities for green industry professionals to network and connect and find trusted sources.
Don’t be too proud to accept help or ask for help.
use that help.
You have to know who your support system is. This is when the trusted business relationships you have built and managed over the years come into play.
If you have already established a clear and honest communication path with your contacts, then letting them know that what you need and how they can support you through the crisis should be well received.
Using a trusted source as a sounding board is wise and may be a lifesaving experience to offset the high emotional price crises bring. Trusted sources can include clergy and paid professional counselors, not just those within our green industry.
Finally, I would advise you to trust your gut feeling. It’s there for a reason.
Take care of yourself.
You need sleep, rest, exercise and quiet time to get you through high stress situations and you have to make this a key priority.
You won’t be able to think or respond clearly and efficiently if your brain is fighting to stay awake or your body is lethargic due to overloading with bad eating choices.
Your brain needs mental breaks – free from thinking about “it” and whether you can focus on other things during exercise or quiet time, you will be able to focus better on problem solving if you have given your brain a reprise from the stress.
Taking a walk, stretching your body or turning off the light in your office to sit and breathe deeply for a few minutes can be rejuvenating. Your music choice can also play a large part in your brain response, so choose wisely.
Journal what you learned.
Write down the things that worked and the things that failed so when the next crisis hits, you will be better prepared to fight the experience. I find that writing, on paper is therapeutic, but there are some days when pounding out the words on my keyboard is satisfying also.
I have a set quiet time for journaling to allow my mind to reflect, and then record those thoughts, so when the crisis hits you can review the emotions, actions and responses you had.
This will give you strength and hope as you power through and remind yourself you have already made it through a dark time and, when the next crisis hits, you will be prepared.
The author is CMO and executive vice president of Land Care, a landscaping company in North Las Vegas, Nevada.
Years ago, I remember having a conversation with my accountant about how many of her clients would hand her shoe boxes full of receipts at the end of the year and expect her to sort through them in order to prepare their taxes. She expressed frustration over this, and rightly so. In order to run a successful business, we cannot be throwing all of our receipts in a box. Instead, we need to be organized, although I admit that this can be a big challenge.
Many times we are so busy returning phone calls, meeting with customers and doing actual landscaping work, our office takes last place. However, having an organized office saves money by keeping us efficient, diminishes the frustration that naturally comes with disorganization and gives us access to real-time information about our profits and expenses.
You may be thinking that you agree with me. You know that you should organize your office, but you just don’t know where to begin. Hopefully, after reading this article, you will have some ideas to put into practice.
There are a few key things that need to be in place before you get started. First, I would recommend you find a good software program. You will find this is worth every penny of your investment, no matter if you gross $40,000 or $4 million per year. In our company we use QuickBooks as our main accounting software and then two additional landscape-specific programs that link to QuickBooks and help us with routing, designing and billing.
There are a lot of programs out there so be sure to take your time and pick the one that is right for your company. If you choose not to use a computer for your bookwork, then it is critical you head to your local office supply store and invest in what you need for keeping accurate records.
Make the time.
The second key thing every business owner needs to give in order to have an organized office is time. Whether it is your own personal time or the time of a trusted employee, someone needs to be designated to do this job on a consistent basis. It isn’t something that can be done once a month or every other week. Daily is best and weekly is doable.
Once you have figured out what method you are going to use to keep your books and who is going to invest their time to organize the office and then maintain that organization, it is time to take a realistic look at your office and get started. If you have piles and piles of receipts and bills laying around, it is time to buy a good file cabinet, hanging files and file folders.
Pay the bills.
Let’s start with accounts payables. Enter each bill into your accounting software and then file it in a folder labeled ‘unpaid bills.’ Pay bills on a biweekly basis and then file any hard copies in alphabetical folders designated for this use.
Use all 30 days to pay your bills if you so choose, but do not go over the 30 days or you will end up paying a finance charge. There are two options to use when paying bills – computer-printed (or hand-written) checks or automatic payments via credit cards or a deduction from your bank account. Never use a credit card for an automatic payment unless you have the funds to pay it off each month. Doing so sets you up to operate in constant debt. If you set up automatic payments for utilities, cellphone and other regular monthly bills, you will avoid paying finance charges for late payments. Of course, this means you need to always have enough in your checking account to cover these bills.
If you just don’t have the cash flow to pay bills in a timely fashion, it is important to be in communication with the vendor. Offering to pay a small portion of the bill or make monthly payments will aid in keeping your company in good standing with vendors. In our early days, we had some situations like this and we found most vendors to be very amenable to the idea of accepting small installments as we worked to pay an account in full. Never ignore bills or pretend they don’t exist.
One way to make sure you never have to worry about not paying your bills is to make sure you invoice your jobs on time. Cash flow is considerably enhanced when jobs are billed in a timely manner. Using your software (or a handwritten invoice, if you prefer), give your best efforts to invoice your customers within a week for one-time jobs (such as landscape projects) or per month for weekly jobs (such as mowing).
Never demand payment immediately when a job is completed as this indicates you’re a poor money manager and are struggling financially.
Here in our company we are set up on 30 days, but anywhere between 15 and 30 days is best for all involved. It doesn’t appear too demanding but it keeps the cash flow coming in.
Collect your money.
Once you have billed your customers, email or send the invoice and then file any hard copies alphabetically. Be sure to look at your accounts receivable report once a month to make sure customers are paying you in a timely fashion.
If you have a non-paying customer, first, it is important you contact them and make sure there are no problems. If they’re upset about something that’s your responsibility like a dying plant or a broken window, see that it’s fixed before demanding your money. Once you’re assured there aren’t any problems, contact them once a week until payment is made in full. Always be courteous and gentle.
If you are still having trouble receiving payment, you have a few options. In our company, we generally choose to write off anything less than $1,000. If it is over that, we head to small claims court. If you choose to go this direction, it is imperative you have a signed contract stating all the details of the work.
You can also use a collection agency if you would prefer to hand over the hassle to someone else. Thankfully, most customers have integrity and are willing to work things out so court or a collection agency is rarely necessary.
Once you’ve been in business for a while, you may need to hire a few employees. This is one area where you want to make sure you do things properly. When we hired our first employee more than 30 years ago, we had no idea what we were doing and made a mess. It took us a long time to find a contact at the IRS who would help us sort through all of the mistakes we made. This taught us an important lesson to pass along to others just beginning their own companies: Know what you are doing before you hire an employee.
If you’ve already hired one and find yourself in the same fix we did, I suggest you keep calling the IRS until you find someone willing to work with you in a kind and courteous manner. It took many phone calls, but once I found someone who took some interest in my case, she became a lifesaver.
If you have software such as QuickBooks, it will calculate payroll taxes for you. If you do not, you will need to do this on your own. Whichever way you choose, make sure paying your payroll taxes is a priority. Start a savings account just for this, if you need to, so that you have the money available when you need it and aren’t tempted to put it off.
If you decide you don’t want to hassle with calculating payroll, you can contract with a payroll company to do it for you. This is the safest way to keep from making costly errors, but it can be expensive.
If you start putting some of these ideas in place today, you will be well on your way to having your own organized office.