Grow in 2022? Get big? Should YOU add more lawn and landscape crews? Should YOU, the owner of your lawn or landscape business, get out of the field?
There are entire landscape conferences dedicated to the idea that if you don’t GROW your landscape company, you’re not keeping up. It’s almost like a manhood testosterone thing. Bigger is better. Mine is bigger than yours. The guy with the highest revenue wins. Not so fast…
Allow me to share relevant facts about growing your lawn or landscape business. I’ve had the blessed opportunity to work for over 400 lawn and landscape business owners since 1998. So I’ve got significant experience on this subject.
First, I’ve never met a lawn or landscape company that could not benefit from a few more dollars in sales. Like, if YOU want to pay yourself a higher wage so YOU can take better care of YOUR family, growing your SALES may be ONE WAY to increase your pay.
Be careful with how you approach the idea of growing your lawn or landscaping business. Growth could lead to a premature death of your company.
Never confuse the fact that there are THREE ways you can choose to measure GROWTH:
- Increases in sales or top line revenue
- Increases in owner salary
- Increases in bottom line net profit
Growing top line revenue is easy. Significant increases to your personal salary and bottom line profits are not so easy. Consider this…
Growing top line revenue is achieved with any of these methods:
- Marketing your company
- Improving your sales processes
- Adding customers
- Increasing the size of your jobs
- Increasing the frequency of purchases from all customers
- Adding new services
- Mergers and acquisitions
You could dedicate your time to master any ONE of these subject areas and I guarantee you that your company sales will grow. There is 100% certainty.
There will be a time that top line revenue growth is needed. But top line revenue growth has the power to destroy your company. The more you grow, the more you have to become a landscape business manager.
Managing cash flow, adding people, training people, retaining people, quality control, job safety, adding equipment, managing debt, government compliance and customer service systems are high-stakes responsibilities. Goof these things up while you’re growing lawn and landscape top line revenue and your company may not survive.
Before you jump on the fast growth – increase my top line revenue band wagon – I’d recommend you consider a different approach.
Consider how you could simply increase your salary AND increase your bottom line net profits. Just as there is a list of activities to master the top line, there’s a list of activities you could master to improve your salary and profits. The list is significantly different from above.
- Price right
- Improve productivity
- Lower costs
Everything that happens inside your company is subservient to how you price your jobs. Seriously, until you learn the skills to price future jobs correctly, correct the prices on your existing services contracts and confidently raise your prices as costs go up…your ability to GROW PROFITS will be in question.
Our work with over 400 lawn and landscape business owners has proven, beyond a shadow of a doubt, that 20% of all lawn and landscape jobs are underpriced. One out of five lawn and landscape jobs is costing you money! These pricing mistakes are never fixed by growing top line revenue. Nope!
Growing top line revenue amplifies pricing mistakes.
Here’s my recommendation.
Until YOU can put together two or three consecutive years of growing your salary or bottom line profits 10% to 30% per year, forget about top line growth. If net profits aren’t growing, there’s a problem that must be corrected. It’s a pricing problem.
And…here’s my warning to you:
You can NEITHER improve productivity NOR can you lower costs as fast (or as easy) as you can fix a pricing problem. Raising prices is as easy as a pen stroke or digital keystroke.
Underpricing just one in five jobs prevents your business from meeting it’s true profit potential. Until you can fix your pricing system, cool it on the growth. Give yourself some time to get the foundation of your business established.
Pricing work correctly is the FIRST skill to master as a lawn and landscape contractor.
We can testify to the facts…no two companies are exactly alike in the costs to provide services. Every company needs their very own pricing system that recovers their unique overhead, their unique pay scale, their unique benefit package, their unique insurance policy, their unique retirement program, their unique equipment list and their unique expectations for personal salary PLUS profits.
If you are reading my message, I’m willing to bet you’re already a pretty good lawn or landscape technician. Most business owners take great pride in doing excellent technical work. You can make yards look good four seasons a year. You can make customers happy with your creative designs and services. And…as you do good work, your company will grow.
But we’re not sure if you are well qualified and confident enough about your pricing system to make the transition to a landscape business manager today. Until we see your salary AND your profits grow 10-30% per year, for two or three years in a row, hold off on the urge to grow top line revenue. You’ll thank me later for this advice.
Tony Bass, founder
When you’re ready, there’s 3 ways we can help you improve lawn and landscaping profits.
1) Get your copy of The E-Myth Landscape Contractor: Why Most Landscape Companies Don’t Work and What To Do About It. Get step-by-step guidance on how systems thinking allows you to build a company that works FOR YOU…not just BECAUSE of you. The video invitation with Michael E. Gerber and Tony Bass is found here: https://landscaperbook.com/
2) Get your copy of The Complete Business Manual by Charles Vander Kooi for home study. Limited availability of this book. Limit one book per company. Includes production rates guide and equipment costing. Watch the video invitation with Charles Vander Kooi and Tony Bass by clicking here: https://landscaperbook.com/estimate/
3) The Profit Builder Training Event is the perfect place for lawn and landscape business owners to learn the skills of budgeting, landscape estimating and business management. This small group training event is limited to just twelve companies per event. You get maximum personal attention while you build your financial foundation. Our graduates learn the skills to adjust their prices without losing half of their customers and they double their profits in twelve to twenty four months. Learn more here: www.superlawntoolkit.com/profit-builder