Exterior Landscape Companies Offering Interior Services

THE HIGH END. On the extreme side of entering the interior market is going into the business full bore as Milwaukee, Wisc.-based Kujawa Enterprises Inc. (KEI) has. Founded in the mid-1960s, KEI started out offering only exterior services but started to offer interior services around 1988. The decision to become more involved in interior services occurred in 1996 and was based on customer demand, according to Chris Kujawa, executive vice president. "Some of our exterior clients called up and sort of demanded that we do it," he said.

Now KEI offers a wide range of interior services, including design, installation and maintenance of plants and trees, seasonal color changeouts (i.e. lilies at Easter and poinsettias at Christmas) and decoration displays. Installations and color changeouts involve irrigation setup and placement of plants in soil beds or their own containers. Decoration displays, such as Santa’s workshop, Easter designs or a polar bear scene, involve the use of several building materials, including wood, PVC pipe, Styrofoam, foamcore and chicken wire. Kujawa said the company creates mostly original decorations for its clients but sometimes throws in a complete piece found at a craft show or retail outlet.

KEI’s all-inclusive range of interior services keeps the interior staff busy year-round and also allows for some off-season income for the exterior staff. The exterior employees help out during the Christmas rush by delivering materials, helping with the post-holiday teardown and hanging exterior lights, which is actually a service managed by KEI’s interior division. The exterior employees also help out year-round on large installations by delivering and moving larger plant materials.

THE MIDDLE GROUND. Compared to KEI, North Haven Gardens in Dallas, Texas, is essentially in the middle ground for the offering of interior services. The company does not do the display decorating that KEI does, but it is heavy into plant installations and their subsequent maintenance.

Actually, North Haven did do Christmas display work for about 10 years, but eventually dropped that side of the business. Stacy Richie, new business development for the company, explained that the company’s decorating division had grown so large that a decision had to be made whether to devote the time and resources to develop it further. "We finally decided we are a horticultural company and not a display company," she explained. Now the only Christmas displays the company does are live plant and flower arrangements.

Because the company is horticultural-based, the focus is on design, installation and maintenance with live plants and sometimes with artificial, or permanent, plants. The company also performs seasonal color changeouts that typically change every two to four weeks, depending on a client’s budget. "On interior when you do a guaranteed service it means that you’re guaranteeing that the plants will stay beautiful and new all the time. And that means that you’re doing replacements on plants as needed," explained Richie.

In addition to replacements, maintenance indoors is similar to outdoors with spraying, treating for disease and insects, grooming and irrigation. Currently North Haven’s irrigation systems consist of the company’s maintenance technicians and watering cans. However, Richie said sub-irrigation and other self-containerized watering methods are on the plate for the near future. "We have found that it decreases your labor and increases the chances of the plants surviving the initial installation," she said.

According to Richie, North Haven was one of the first companies in Dallas to start doing interiors back in the 1970s. She explained that interior landscaping was just getting started around that time in the form of interior-only companies. This early involvement made the company a trendsetter. "In the mid-1980s, when Orkin and Rentokil began to invest in interior landscape companies by buying them up, that’s when you began to see exterior companies take up interiorscaping to compete with the nationals," Richie explained.

THE LOW END. On the low end of interior service offering is Marvin’s Gardens and Landscape Service Inc., located in Sarasota, Fla. Owner Marvin Gross explained that the company’s interior services consist of only plant installation on an as-needed basis. He leaves the maintenance to other local interior-only companies. Years ago he offered a full array of both exterior and interior services, but he cited low profit margins as the main reason for dropping the interior maintenance.

Gross said that interior plantscaping is very similar no matter what part of the country you look at. He said that interior plants consist of predominantly tropical plants that need to be manipulated to grow in an indoor environment. Up north where KEI is located, these plants are exotic and need to be shipped from far away; however, where Marvin’s Gardens is located, the plants used inside are the same native plants used outside.

One would think the familiarity of the plant material would be an advantage for southern contractors compared to northern contractors. However, Gross explained that shipping costs were the only advantage because one still has to get the plants to grow in a different environment. "One challenge is the light it takes to grow plants and keep them in pretty good shape on the inside," he explained. "Another is getting the proper soils to keep plants healthy and viable."

DIFFERENCES BETWEEN INDUSTRIES. Although the same companies are offering interior and exterior services, Kujawa from KEI said there is a big difference between the two business. "Both businesses are totally different animals altogether. Exterior is very equipment-intensive," he said. "Interior, on the other hand, is much more personal, much more labor-intensive."

Richie from North Haven also agrees on the differences between the two industries. "With landscaping you’re looking at a bigger scale project. When you’re looking at interior, the details kind of go away, whereas with interior, you’re looking at dust on a plant, yellow tips on the leaves. It’s just much more minute grooming detail and work," she said.

The labor between exterior and interior is vastly different. North Haven Gardens uses one-man crews to service most interior properties. The service professional is called a technician, and that person will service a property usually once a week by contacting the client, replacing plants, watering, grooming and other maintenance. With some of the company’s larger clients, it is possible to have one technician do a large facility all week long, but that 40 man hours compares to one day for a group of five laborers on a landscaping crew.

CLIENT BASES. Due to the nature of the business, interiorscaping has a predominantly commercial client base. However, North Haven Gardens does have a few residential customers that are presidents or CEOs of companies that use North Haven’s interior services. The commercial client base for all three of the aforementioned companies include hospitals, office parks, property management companies, retail centers, malls, shopping centers and manufacturing plants.

Because the companies offer both interior and exterior services, there is a potential to cross market the services. In fact, about half of KEI’s clients take advantage of both realms of service. For North Haven only a small percentage of clients use both services. But that is due to the company’s lack of marketing. "We’re just starting to take our client lists and make phone calls," explained Richie. "We already have the relationships, so it’s just contacting them and getting the word out that we do all of these services."

With cross marketing efforts, discounts for using both services could be a possibility, but none of the above companies use this ploy. Kujawa explained that because the services were so different, only multiple year contracts or volume discounts would be a feasible way to offer dual-service incentives.

The potential to have several clients in one building is also an appeal of the interior business. In addition to the lobby area of a building, there are tenants who need plants, too. "It’s possible to have 20 or 30 clients in one location for interior and keep your overhead down. On landscaping, of course, for each facility or building, there’s one landscape," explained Richie.

INDUSTRY TRENDS. Although consolidation and increased competition are hot topics, a specific trend in the interior/exterior market is tough to find when speaking with the three companies. They all disagree.

Kujawa said the big industry consolidators aren’t going to succeed. "I don’t think this is a business that is conducive to consolidation," he said. "The consolidators are so price focused that they start losing people. They don’t understand how to provide good quality service at a fair price."

Gross, on the other hand, said, "Until [consolidation] proves itself that it’s not going to be tremendously workable, it will continue to go."

Richie, however, explained that consolidation is slowing down on the interior side. "The interiorscape consolidation really hit its peak in early to mid-1990s and the landscape consolidation is what you’re seeing now. I think the landscape companies are going to be deciding if interiorscape is a business that fits well."

Kujawa sees the possibility of more exterior companies getting into the interior business as a future trend. "They’re going to find out that this is something they can do, and it doesn’t require a huge investment," he said.

Gross disagrees. "I think it’s too specialized. I think those people who are in there on the ground floor are doing a real good job with it. And I think that those people who want to go into business within the green industry – if they have a good feeling about interior – then that’s where they’ll go. But you have to be smart today," he said.