Setting up a rainy day fund

Setting up a rainy day fund

Features - Company Profile | The Greenskeeper

Through a five-year saving process, The Greenskeeper found a way to reduce debt and reliance on loans for equipment.

April 9, 2019

The Greenskeeper Hardscape Manager Seth Fortney, left, co-owners Eric and Leslie Allebach, and Maintenance Manager Landon Allebach.
Photos courtesy of The Greenskeeper

For the first 15 to 20 years of business, The Greenskeeper relied on loans when making big purchases. Or, any purchases.

“We kind of used owning a business as automatically always having loans for everything,”says Leslie Allebach, vice president of The Greenskeeper.

The company started small – Eric Allebach, Leslie’s husband, started The Greenskeeper in 1987 as a lawn maintenance business after he graduated from college. When he and Leslie were married in 1988, she joined him to help with office work. Both Eric and Leslie had business degrees, which helped with the startup of the business.

Gradually, Eric added other services to the business – like hardscape and installation – as well as more crew members to help with the additional work. Yet as the company increased its customer base, it also increased its debt in equipment purchases.

If they wanted to buy a truck, Leslie says they took out a loan. If they wanted to purchase a trailer, she says they took out a loan.

“We never set out to make a lot of money,” she says. “However, when we started having the livelihood of employees’ resting on our shoulders, we recognized the need to handle our company funds (better) and to be smart.”

About 10 years ago, Leslie read “The Total Money Makeover” by Dave Ramsey. The book addressed improving personal finance – something she initially read to improve the family’s personal finances – but it also offered some tips that were applicable to The Greenskeeper. She also started listening to Ramsey’s podcasts to learn about ways the business could decrease its debt.

“Loans keep you strapped. You naturally have to operate differently if you have to worry so much about money.”

Eric and Leslie weren’t sure if Ramsey’s tips would work, but they decided to try. So, The Greenskeeper buckled down to be debt-free.

The Greenskeeper gets 50 percent of its revenue by completing hardscape jobs.

Becoming a bank.

They first created a savings fund for equipment. Leslie says they wanted to have at least $20,000 in a savings account to purchase equipment as well as bump its savings account for payroll up to $10,000.

To get to that point, she says they refrained from buying much new equipment or trucks for five years.

“I would add that we still did buy some new things, we just bought a lot less,” Leslie says. “We were much more choosy about what we would spend money on versus just buying something new because it was a good deal.”

With making any purchases, she says they often took advantage of 0 percent financing options to get new equipment without paying interest. They made sure to pay these off on schedule so that interest wouldn’t accrue.

Their equipment fund hit the savings goal within five years. Leslie says they feel much more financially free with the fund in place.

Now, The Greenskeeper is its own lender so the company doesn’t need to look to loans for new equipment purchases.

Eric says they can purchase more in cash and resort to loans only for major things like land purchases. He adds that they also try to buy some used equipment where possible to help with costs.

“We’re reaping the benefits of this fund now,” Eric says. “I keep an eye on the fund and if the money is in there, we go ahead and buy what we need.”

Looking ahead.

Since the company’s start, The Greenskeeper has grown steadily. It’s particularly expanded in the last decade as a result of its involvement in hardscape designs at garden expos.

Eric says hardscape now makes up 50 percent of the company’s revenue.

The company also outgrew its original office about 10 years ago, which was part of their house.

“Everything got moved into a (separate) office and out of the house,” he says. “That’s all been part of the growing process.”

With growth and more work coming in, the company added more employees. However, with labor being tight in recent years, Eric says it’s been very important to give back to employees to retain workers. Eric says he initiated an incentive program to help boost morale among employees.

For example, if an employee worked for eight hours but performed 12 hours worth of work, Eric says he would pay them for the 12 hours of work as an incentive. It also encourages employees to work harder.

“It was a way to motivate the guys and a way for them to make extra money without working overtime,” he says.

Today, The Greenskeeper achieves about $3 million in revenue with 20 employees. In recent years, Eric’s son, Landon Allebach, and his son-in-law, Seth Fortney, joined the company. Eric says Landon is helping to lead the company’s maintenance division while Seth is helping to lead the company’s hardscape division.

“When I started, I had no idea where we’d be,” he says. “Our philosophy is to give customers what they want at a fair price; it was never about the dollar thing. Just work long hours and hard days to make enough money. Now, I have the responsibility of all these guys, so I have to worry more about financials than I ever did. But by God’s grace we’ve done well and I can’t complain.”