© Jon Arman
Last time we checked in:
Wade’s Lawn Service revamped their sales strategy and brought their fleet up to standards. They also ironed out some hiring issues by paying a few dollars more an hour, which has worked with recruitment and retention. The company also over-hired at the start of the season knowing there would be turnover, and co-owner Deborah Wade says they have enough workers and are happy with the staff.
“The amount we are paying them, they are fine and working here,” she says.
Latest update:
Wade’s must get back to basics when it comes to figuring out gross margins, and how much revenue is coming from maintenance and how much is coming from enhancements.
Deborah has hung a whiteboard in her office with all their employees’ names written on it. The board will also have the hours someone worked in maintenance and enhancements and is a straightforward way to keep track of how much time a worker spent in each area.
The workers will write the hours they spent on maintenance work and on enhancement work on their route sheets. Deborah can collect those and then transfer that information to the whiteboard.
“It’s going to help us see where we can tweak some things,” she says. “It’s going to help us get better systems in place as far as labor hours and who needs to be where and doing what. It’s just making sure we have people in the right box.”
Bill and Ed’s take:
Ed and Bill think the Wades are making money on jobs but no one is sure because there is no system to track it on a detailed scale. The whiteboard is a good place to start to find out where revenue and profits are produced. Once a daily revenue number can be established, then a more accurate budget can be built.
“We’re going to track them daily, and then weekly,” Bill says. “Then we’re going to get that weekly into a month. Then we are going to get the month into what we call the mini budget. Then we can have a trajectory to see where we are going with the financials both revenue and gross margins. That’s all we care about is revenue and gross margin.”
Bill and Ed would also like to change the way Wade’s bills for mowing. Instead of charging per mow and billing at the end of the month, they want to figure out how many mows they do in a season for a customer, and average that out on a monthly payment schedule. For example, if a company mows 30 times a year and charges $75 a mow, they can multiply those two numbers and then that by seven (if it’s a seven-month season), which would come out to about $321 a month.
“We are trying to get them to charge that at the beginning of the month, rather than wait until the end of the month, for cash flow,” Bill says. “That’s a big step for these guys and their customers.”