Hurray for HOAs!
N.J.'s Native Fields Landscaping makes a mark in a hard-to-please market
This installation by Native Field Landscaping at an apartment property in Wharton, N.J., featured burning bush, Russian sage, sedum and black-eyed Susans.
Photos by Native Fields Landscaping.
For landscapers, condominium and homeowner association (HOA) contracts are big accounts and represent an ever-growing opportunity. Association-governed communities have grown from 10,000 in 1970 to about 324,000 in 2012, according to publications covering that housing segment. And for HOAs, landscaping is their biggest expense next to insurance.
But many landscapers agree, HOAs are not easy to get. You have to jump through a lot of hoops, and they are also a lot to manage. To be successful not only do you have to have the desire, but you also have to have the resources and provide a variety of services to get the work.
Just ask Kevin Dulio, president and owner of Native Fields Landscaping in northern New Jersey. His firm has about 20 HOAs under his belt and is adding three on average every year. However, that's barely a dent in the market, as New Jersey numbers about 6,400 HOAs, according to sources.
Native Fields Landscaping
Owner: Kevin Dulio
Headquarters: Landing, N.J.
Markets: North New Jersey including Morris, Warren, Sussex and Passaic counties
Services: Turf management, IPM, landscape enhancements, materials and imaging, plant and hardscape installations, drainage remediation, and ice and snow management
Employees: 30 (summer season)
Dulio, who earned a B.S. in ornamental horticulture & environmental design from Delaware Valley College, managed a garden center and served as a branch manager for a landscape company, before founding Native Fields in 2006. Initially, he focused on design/build. That was 75 to 80 percent of his business. Then, a year later, the housing market declined, and since he had a few good maintenance accounts for property managers, he switched to lawn maintenance to increase his cash flow. In his second year in business, he landed his first large condo complex, Village at Convent Station in Morris County. Since this was his most lucrative account, he knew that the HOA market was where he needed to be.
"HOA and condo complex business is a huge market for us, with countless opportunities to grow our client base and expand our services," says Dulio.
One such innovative program Dulio introduces to HOA clients is the Landscape Budget Program. This allows HOAs to plan for the future and keep their cash flow under control. Programs are based on five- to 10-year budgeting cycles and give the HOA the option for 12-month equal billing for all of its landscape and ice/snow management needs.
"We like to build in periodic outdoor renovations and maintenance needs that are five or even 10 years out that could run as high as several thousand dollars for our clients," says Dulio. Berkshire Ridge in Morris County, a 218-unit complex built in the late 1980s, is one such client on the budget program. For the past five years, Native Fields has been providing landscape maintenance, snow/ice management and landscape renovations of each unit in phases.
"We are removing all the old, overgrown evergreens and installing a mix of evergreens, flowering shrubs, ornamental grasses and perennials to create year-round interest," says Dulio.
Emergency response time is another critical issue. If a storm hits and knocks down trees or dumps 6 inches of snow and ice, Dulio knows how critical it is to respond immediately.
Dulio discovered early on that you need good employees, reliable equipment and lots of insurance (e.g., vehicle, indemnity, liability) and state licenses (e.g., pesticides, home improvement and other needs) to stay in the game. "HOAs want you to know plants and trees, irrigation and pest management and snow and ice removal," he says. "They want a one-stop shop vendor."
You must stay in touch
HOA accounts can also be an unpredictable business as board and committee members who represent the residents change as well as their allegiances to service providers. Dulio cites good consistent communication and continued direct participation with boards and committees as keys to hanging on to HOA accounts.
Dulio ensures his attendance at his client's monthly board meetings at least every spring and fall, and whenever requested. He also conducts a spring walk-through at each property with property managers for meaningful face time and encourages board members to also join in, and most do. Dulio also has bilingual foremen at sites where clients communicate with Hispanic work crews.
For the first time this spring, Native Fields exhibited at the New Jersey Cooperator's HOA & Co-Op Expo. He was pleased with the results. He captured more than 50 qualified leads.
"It was a great opportunity for us to meet new clients and spend some time in a relaxed setting with our existing clients," Dulio says. "We were able to discover what's new in the residential housing community and learn about services benefiting board members and homeowners."
Maintained landscapes need updating. Native Field Landscaping removed the overgrown hedges at this apartment and replaced them with perennials, decorative grasses and miniature shrubs.
To cultivate Native Fields' HOA relationships and keep an eagle eye on ROI, Dulio took himself out of day-to-day operations three years ago by hiring additional production and operations managers.
The two biggest challenges facing Dulio is finding good laborers and managing cash flow. "Controlled growth is key for Native Fields right now," he explains. "I have to evaluate every new customer to ensure that we can maximize value out of them. It's imperative for me to pinpoint what they need from us and then how it will work for us."
Still growing strong
Native Fields has grown each year in business. It grew 40 to 50 percent in the first couple years. More recently it's been growing in the 10 to 15 percent range. Within three years it hit $1 million in revenues; within six years it went over $2 million. It added snow removal to its list of services and that has helped its bottom line.
Dulio started his business on a 500-square-foot gravel parking lot. He parked a trailer and truck on it and stored equipment there. He then needed a place to work on the equipment, so he moved into a little office with a single-bay garage. He stayed there for two years. For the past three years, Native Fields has operated in a 16,000-square-foot lot with a 1,500-square-foot garage with two bays and a 600-square-foot office. He says he is outgrowing this space.
Native Fields plans on moving to another facility for additional acreage and a larger maintenance facility looking to triple its size to have enough room for expected growth in the next 10 to 15 years.
Despite Dulio's last six years focusing on growing and managing his company's HOA business, he managed to get married at 35 years of age for the first time this past September. To show his devotion to the landscaping business, he entered a Facebook photo contest where he is currently a top vote getter. The photo features his wedding minister reading a copy of a snow removal management magazine during the wedding vows summing up Dulio's devotion to the industry. His new wife Cheryl is taking it all in stride.
Tom Crain, based in Akron, Ohio, is a regular contributor to B2B publications, including many in the green industry. Contact him at email@example.com.