Second-Stage Business Blues
Ohio landscape pro learns that reaching each goal brings new challenges
Groundscape Maintenance LLC relies on a self-qualifying job application and pre-employment drug testing to get good workers. Job descriptions and guidelines in an employee handbook clarify what's expected of them.
Photos courtesy of Groundscape Maintenance LLC.
Jeff Hahn knew that if his start-up company was to be successful at all, it would have to achieve its "second stage" of growth by hitting around $1 million in revenues. Last year, after 13 years in business, his company, Groundscape Maintenance, Dayton, Ohio, topped $950,000 in sales.
What Hahn didn't anticipate was that when his company did hit that second stage of growth, the work didn't become any easier.
"I still wasn't sleeping at night. I was still leaving really early in the morning and coming home late at night six days a week," he says. "I was always worried about how we were going to get all our work done to sustain or surpass that $1 million mark when we didn't have enough guys there to do the work. I was constantly changing work schedules and working my main guys into the ground. I kept asking more and more of them and not rewarding them for their extra hard work. Most mornings I would arrive in a bad mood so they assumed I didn't like or appreciate them."
Groundscape Maintenance LLC
President/CEO Jeff Hahn
Headquarters: Dayton, Ohio
Markets: Northeast Ohio
Services: Lawn care, design/build, hardscapes, irrigation services, hedge and shrubbery maintenance and snow removal
Employees: 6 full time, 12 seasonal
The transition from being a hands-on owner to becoming a business owner that gives responsibility to others proved to be more stressful for Hahn than it needed to be. "Creating systems by trial and error while still managing day-to-day operations and problems was the order of the day," he says.
Hahn knew he needed to make a change. So, with the assistance of Steven Cohen of GreenMark Consulting Group, he started to put systems and processes in place to handle the growth.
"We are conducting an organizational assessment/brand and market analysis," explains Hahn. "This is an ongoing process, but already we have more clarity as to where we are as a company and what is needed to get us to the next level. By putting a plan in place, we have a clearer direction on organizational infrastructure and the market growth process. Dealing with these initiatives now will allow us to be a stronger company in the future."
Adds Cohen: "Hahn realized that his landscape contracting company couldn't grow without having good systems to follow. With good systems, his company now has the means to add quality full-time crews, grow and still produce optimum results."
Hahn is now sleeping easier and spending more time with his family. When he goes into the office, he is more relaxed and worrying less about his employees not liking him. He is keeping his good employees happy and hiring better qualified staff to do the extra work coming in. Overall, he has become more focused and goal-oriented for 2014 and beyond.
The following are some of the key critical moves Hahn either has made or is in the process of taking, together with some of the lessons learned when shifting from what many landscaping industry entrepreneurs refer to as "The Pits of Start-up Hellfire" to the "Pearly Gates of Second-Stage Growth Heaven."
Jeff Hahn reduced his stress level when he started running his business with processes and numbers.
Focus on what you do best
When Groundcape was at a phase in the commercial market competing against larger companies and getting beat up on price, Hahn believed it was time to shift many of its resources to residential services. He wanted to try the residential market because he thought that a residential client would focus more on quality than price.
Hahn found that it took a lot more internal staff to properly manage a residential than a commercial division. He also learned that he needed more workers with a broader range of skills beyond mowing, edging and blowing.
"Come Monday morning we had to have two people answering the phones just because homeowners watched an interesting HGTV show requesting an estimate on how much it would cost to do what they saw on the show," Hahn recalls. "We simply didn't have the right people or processes in place to execute this shift."
Reward key employees
Groundscape Maintenance had a few key outstanding employees leave the company over the years often because they couldn't see how the company and industry could support them or their family.
"We could have kept these people, capitalizing on their capabilities together, if we had the right compensation and loyalty system in place," realizes Hahn.
Hahn was also overburdened with the hiring process until systematic changes were made. Examples included a new self-qualifying job application, job descriptions, new hire procedures, employee handbook and pre-employment drug testing program.
By providing a more systematic and automatic HR approach, Groundscape is more successfully hiring and retaining good employees while at the same time reducing Hahn's time required in the process.
Jeff Hahn realizes that you need to roll up with nice looking trucks and modern equipment if you're going to service the high-end homeowner market. He also realizes that residential clients expect a high level of service.
Although Groundscape Maintenance regularly donated money to causes when approached by local charitable organizations, Hahn was the only individual involved in the process. Employees did not participate. His company now engages employees in the process by asking for their input on which projects to support, what level of involvement to take and inviting families and friends to participate.
The first couple of community projects have included supplying "mud" for a fun but messy volleyball competition for a local church fundraiser and participating in the spring cleanup of the local Little League ball fields. Employees seem to be enjoying their increased involvement in supporting their business community. "It's always easy for the boss to say, 'We are going to do this today,'" says Hahn. "It's more rewarding, though, when we participate in a community project we all want, especially with families and friends. Anyone can give money and say, 'I helped that cause.' When you invest your own time and resources, it becomes more meaningful."
Groundscape Maintenance employees are skilled in a variety of tasks. Here several employees are installing a pitcher's mound at a local baseball field. Owner Jeff Hahn is making employee retention a priority.
Manage cash flow
Hahn was constantly burdened with managing cash flow. He found staying on top of receivables and invoicing to be difficult and stressful. He says he managed his financials "by gut," not looking at the real numbers. "I realized that while intuition was very important in business, managing by numbers is the best way to make informed business decisions," he says.
Groundscape Maintenance's simplified the management of its equipment by purchasing almost everything it needed outright to perform its grounds maintenance and snow services. Its fleet consists of a mix of GMC light-duty trucks and Ford F550 trucks. It augments its equipment in winter with a few critical pieces of rental equipment, and during the summer the company leases 15 Exmark mowers.
"I like the idea of leasing mowers so I can have the flexibility of replacing them for new ones every couple of years or retaining them when they have suitable life left," he says.
For the past 20 years, Tom Crain, based in Akron, Ohio, has been a regular contributor to B2B publications, including many in the green industry. You can reach him at email@example.com.