Brought to you by The Harvest Group, the Grow Show podcast series will tackle the difficult issues and challenges contractors face day-to-day in their businesses by breaking them down into manageable pieces and sharing a common sense approach to overcoming them.
Its last group of podcasts focused on cultivating the people in your business – from top to bottom – to keep your business running and growing in a positive direction. If you missed any of these podcasts, search this site for the Grow Show and listen to them.
The Harvest Group is starting a group of podcasts designed to discuss current business reality. Without question, the landscaping business is still a challenge, but they want you to know you’re not alone with your frustration, questions and concerns. There are some very common challenges going on in various regions of the U.S.
Listen to the podcast here. Be sure and follow along with the outline below.
So what is going on? In the last three years The Harvest Group has worked with over 50 companies in three countries in what has been the most challenging times the industry has faced. What seems to be changing still remains much the same stuff industry professionls have always been dealing with.
For example – here’s what’s going on.
1. Pricing – Price pressure. Jobs going for lower prices.
2. Marketing and Sales – Many companies have stopped marketing, feeling they can’t afford it.
3. Acquisitions – Some of the large nationals continue to buy. Is this a good time to consider buying?
4. People – Companies have not given raises for some time. How long will this continue? Maybe it’s time to rank your people based on their value and work hard on keeping your key people as the economy gets better. Also, companies are hiring sales people to “bring in the work” with creative compensation programs, have you considered this?
5. Clients – Get the right ones under the right conditions. The best companies are identifying, then meeting and exceeding their expectations.
Prices are going down: how should you deal with the price pressure?
1. Identify your best customers
• Talk to them often; have face to face meetings.
• Verify their current level of satisfaction.
• Know and try and understand their situation; low occupancy, reduced sales, etc.
• Carefully review each job and see if you can re-engineer to save them money without reducing quality, i.e., no mow areas, re-arranging flowers, etc.
• Consider a price reduction in exchange for an extension of your contract.
2. Share some of your customer’s resources
• Consider using and/or sharing their trash receptacles, yard, office and an on-site advertising marker
3. Measure, measure, measure.
• Many companies are not measuring or job costing their jobs. The first step is to measure everything and compare it to your estimates.
• Owners need to free themselves from “the work” and work on their companies. One positive way is to go out and watch your people work.
4. Lose the loser jobs. It’s better to lose under reasonably professional circumstances than to drag out a conflicting non win-win relationship.
• They shop you and work you for everything.
• They shop out the extras.
• They self perform some of the extras - flowers, irrigation etc.
• They require disproportionate effort to their potential.
• They drain morale within the organization.
5. Build an estimating process. Work on building accurate estimates.
• Measure your jobs, compare to your estimates and tighten up your numbers.
• Triangulate from four directions: field, computer, price per square foot and exisiting work
• Know your walk away point.
• Larger jobs are lower margins.
• Don’t try and make it up on volume.