Turf Magazine - March, 2013
Horse Sense in the Bluegrass State
Stephen Hillenmeyer streamlines a historic family business to better serve a changing market
The most famous horse farms in the world are located in the verdant countryside surrounding Lexington, in east central Kentucky. This region of the cleanest and most meticulously maintained barns you'll see anywhere, and gently rolling, grass-covered pastures surrounded by neat white fences is the market that Stephen Hillenmeyer (and generations of his family before him) knows and has served so extremely well.
Stephen Hillenmeyer says his employees are his company's biggest asset, so he makes sure to reward them for their hard work.
Stephen Hillenmeyer Landscape Services
Owner: Stephen Hillenmeyer
Headquarters: Lexington, Ky.
Markets: Lexington and surrounding communities in central Kentucky
Services: Equine farm maintenance, commercial maintenance, Weed Man, The Mosquito Authority, snow removal, landscape design/build, and tree and shrub care
Employees: 70 full time; 180 at full capacity
The Hillenmeyer family has been a staple of the Lexington business community since 1841 when French immigrant Francis Xavier Hillenmeyer started a family nursery with ornamental trees, shrubs and fruit trees.
"It all started with a love of plants, liking to be outside and working with people, and it got passed down through the generations. In my generation, the fifth generation, there is more that has changed in the last 30 years then there has in the previous 140 years," says Stephen Hillenmeyer, who changed the company's name to Stephen Hillenmeyer Landscape Services when he took over.
"The speed of change is much more advanced today," he says in a classic understatement.
The company offers services in equine grounds maintenance, landscape design/build, tree/shrub care, Weed Man Lawn Care and snow removal in and around Lexington.
While his brothers Louie and Chris stayed in the nursery retail business - the company remains the second-oldest continuous nursery operating business in the United States next to Stark Brothers Nurseries in Missouri - Stephen preferred to focus on maintenance.
"As things evolved, the competition made it more difficult to be in those businesses," Hillenmeyer says of the nursery business, noting the greater purchasing and marketing power of big box home improvement stores.
Each generation has been astute about adding new profit centers and eliminating those that no longer work, such as the greenhouse operation. Hillenmeyer now outsources landscape architecture work whereas the company formerly had four architects on staff.
New direction pays off
In directing his efforts to maintenance, Hillenmeyer saw an opportunity to expand into the commercial properties and turned an eye toward Lexington's horse farm market. His company now has 19 horse farm accounts, which provide the largest revenue stream.
"One of those farms is 1,700 acres and we mow the entire 1,700 acres," Hillenmeyer says. "We divide those properties up into common areas, fields and paddocks. A paddock is usually around an acre; these smaller areas are used to isolate a specific horse for whatever reason. A field could be 30 to 40 acres, so you might have 30 horses in a field."
Fields are mowed on a two-week basis, and the common areas are mowed weekly.
"When you look at hundreds and hundreds of acres, they're all mowed just like I mow a front yard: they're striped," he says. "We take a lot of time to do it."
Crews vary from four to 20. While the company is headquartered in one location, crews that service the horse farms operate directly from those farms, with equipment remaining on site and crews reporting to the farms.
Hillenmeyer workers rely on Scag and Exmark mowers. Owner Stephen Hillenmeyer says that good dealers and good dealer support build successful relationships.
The company also does a lot of weed-eating.
"All of these farms that have all of these fields and paddocks have fencing, so every one of those needs weed-eating," Hillenmeyer notes. "We've got one farm where we weed-eat 34 miles a week."
Commercial maintenance includes snow removal. While Lexington does not get as much snow and ice as other parts of the U.S., there are multiple weather events that prompt Hillenmeyer's crews to visit commercial properties in the middle of the night to apply salt on parking lots and sidewalks so that businesses are ready to operate at daybreak.
Going the franchise route
Hillenmeyer also has branched off into two franchise operations: Weed Man and The Mosquito Authority.
"With maintenance contracts that require lawn care, we subcontract to Weed Man to do the fertilization, weed control, grub control and any seeding work that might be done," he says.
The Mosquito Authority enables Stephen Hillenmeyer's company to provide mosquito control for residential homes, special events and parties.
"Mosquitos rest 90 percent of the time, so they need foliage to land on and hide because they have a zero defense mechanism," he says. "You spray the foliage of the property so you're killing what is there. The barrier spray creates a residual effect that prevents them from coming back. Mosquitos in other areas don't want to come into that area."
With standing water, mosquitos hatch in 14 days. If their life cycle is not eliminated, they will return, Hillenmeyer says. The Mosquito Authority uses larvicide "dunks" to immerse into areas that have standing water to kill mosquito eggs, which breaks the life cycle, helping to eliminate further bites. A typical spray program is every 21 days.
In choosing new markets, Hillenmeyer says he believes it takes passion.
"You need to be passionate about whatever it is that you're doing or it's going to turn into work," he says. "I am more passionate about business and entrepreneurship than specifically I'm just absolutely in love with the green industry.
"I make my living off of the green industry and I like being outside. I like being with people. But at the end of the day, what drives me is that I'm building an organization where I'm helping my employees reach some of their goals financially. It just so happens that we're mowing grass, planting trees, spraying bugs and making grass grow."
Employees the biggest asset
Hillenmeyer says what sets his company apart from others is honesty, keeping promises, providing value for the dollar and following through with problems.
Above all, he credits his employees as his company's biggest asset. There is much longevity among the staff and they do good work, he adds.
He makes sure to reward them for their hard work.
"They have fun," he says. "We do picnics and recognize their families. That translates into happy people who take care of our customers."
When Hillenmeyer came into the business, there were employees who had been there for 15 to 40 years.
Stephen Hillenmeyer Landscape Services has 70 full-time employees and 180 at full capacity. Hillenmeyer seeks employees with a positive attitude, similar core values and the desire to do a job right.
He's been inspired by a book, "The X-Factor: Getting Extraordinary Results From Ordinary People" by Ross Reck.
"It's not like you're going to find these great people everywhere," he says. "Occasionally you may, but for the most part, you've got to get good solid people and then you've got to train them, set good expectations and hold them accountable."
The company also uses an H2B program for the seasonal workers. "It's a good source of labor for us because of the seasonality, although it's becoming more difficult because of the regulations," he says.
The season usually ends in December, when much of the staff is laid off. A core group of about 20 people stay on do to snow removal, holiday decorating, planting landscaping projects and equipment maintenance.
While there haven't been a lot of snow removal jobs this season, the warmer weather has directed the staff's efforts to spring clean-ups and bed edging.
Building vendor relationships
The company uses Scag and Exmark equipment. "You have to have good dealers and good dealer support so when you have problems, they'll stand behind you," Hillenmeyer says.
Case in point: during the past season, he had purchased 18 72-inch Exmark mowers for the farm work, each of which cost between $10,000 and $11,000. While he normally gets up to five years out of the mowers, he became concerned that in the third year, his newer mowers were having engine problems.
He brought it up with Exmark, which replaced the engines and gave him extra ones in case there was another problem.
"They exceeded my expectations," Hillenmeyer says. "They admitted they had some problems, but they fixed them. They're going to have a customer for a long time because of that."
Servicing the equipment is important, Hillenmeyer points out.
"Part of why Kohler and Exmark stood behind their product is when they tore all of their stuff apart, they recognized that we had done our part in servicing and taking care of the equipment," he says. "If you're not servicing your equipment, its life is going to decrease and you're going to have a hard time making money in this industry."
Business smarts first
Hillenmeyer is excited about the sixth generation of family being on board, lined up to manage the company in the future. In 2007, his oldest son, Chase, joined the company and is in position to assume the sixth-generation ownership. His brother Seth also recently joined the company.
Hillenmeyer told his sons he didn't care where they went to school as long as they got a business degree. Both now hold business degrees: Chase, the oldest, has a minor in entrepreneurship, and Seth, a minor in finance.
While neither know a lot about plants, Hillenmeyer knows they'll succeed, because like him, they have a passion for business as well as the core values that support the business. "The game of business and growing people's skills in the business is very exciting," he says. "It just happens to be this business. There's an opportunity to grow our repeat businesses and at the end of the day financially, it can be a good thing."
One of the company's major challenges is to survive the U.S. economic cycles. Hillenmeyer's family business has been through both the Great Depression and the Great Recession.
He credits his grandfather's conservative approach in getting through the Great Depression. "You've got to prepare for the rainy days because they're going to happen," Hillenmeyer says. "I would be the first one to tell you I haven't always practiced that. In 2008, when the economy started really changing, we had to think about how we were doing things."
He saw that with the slowdown of the economy, there would be a slowdown in what people considered to be a luxury, such as landscaping. That's when he started to diversify.
"You have to be fiscally responsible, so I've tried to not have all of my eggs in one basket," he says. "If our business hadn't evolved, we would be out of business."
For years, landscaping was the biggest focus of the business. Now, it brings in 20 percent of the revenues, while maintenance pulls in 60 percent. The remaining revenues are derived from the lawn care sector.
Hillenmeyer believes the industry is going to go wherever the economy goes, echoing a contemporary sentiment that "flat is the new up."
He believes the green industry is improving by taking advantage of technology. Like others, he sees increasing competition from new companies having popped up as a result of the bad economy.
"It's an easy access industry, but at the end of the day you have to do good work and take care of your customers and your employees," Hillenmeyer says. "There's always going to be a place for Mom and Pops and those that learn how to run a business are the ones who are going to be in it for the long term."
Carol Brzozowski, Coral Springs, Fla., is a member of the Society of Environmental Journalists and a frequent contributor to Turf magazine. Contact her at email@example.com.