For the landscape business owner who is interested in growing, a healthy combination of renewals and new job accounts is key. But keep in mind that it is much easier to renew an existing account than it is to secure new business, so don’t focus all of your efforts on going after new work. It’s important to have a plan in place, says Fred Haskett, a green industry consultant with The Harvest Group. Too often, landscape business owners say, “I want to grow,” but they don’t have a plan in place as to how to do it. There are many evaluations that you can do as you determine that plan to grow.
First and foremost, it’s important to recognize that you should not necessarily renew every single account you have. It’s very important to take a close look at your existing job accounts and see how they are performing before making that decision, Haskett says.
“You must evaluate the performance levels on your existing contracts so that you can know which ones are performing in a profitable manner,” he explains. “However, profitability isn’t the only factor you would necessarily evaluate your accounts on. There are other things to look at.”
Haskett says it’s also beneficial to look at “penetration in the marketplace.” If your account is “borderline profitable,” but they are purchasing quite a bit of enhancement work, then they have a high-penetration rate and may be worth keeping.
In addition to looking at penetration in the marketplace, Haskett says you might also weigh the visibility of the account in determining whether to keep it. If this is a highly visible account that makes you attractive to other players — and secures future work for you — then it may be worth renewing even if it is borderline profitable.
A smooth renewal
When it comes to renewals, timing is important. Ensuring the renewal process goes smoothly means starting early. Jason Wegiel, director of services for Neave Group, headquartered in Wappinger Falls, New York, says landscaping is simply too far removed from clients’ minds if you try to renew their accounts over the winter. More likely than not, they’ll just push the decision off to the spring and, by that time, might choose to go with someone else. Wegiel says that Neave Group’s renewals are typically always somewhere above 90 percent and they make a push to renew early.
The earlier you can get contracts out the better, agrees Bryon Delong, account manager for Bluegrass Landscaping & Maintenance, headquartered in Bridgeton, Missouri, whose renewals are around 93 percent. In the early fall their property still looks great and the grass is green, so lawn maintenance is fresh in their minds.
“But if you wait until winter, everything is dull and gray and everyone else is also beating their doors down for business,” Delong says.
Andy McDuff, vice president of Landscape America in Wrentham, Massachusetts, says they aim to get as many clients to re-sign as early as possible, too. McDuff says it is a combined effort of sending out renewals and following up to try and meet with each person around a week after sending out proposals. That face-to-face time can be the push clients need to sign on.
“We have also offered small tasks as incentives to get commercial properties to sign early,” McDuff says. “If there is some extra pruning that we can easily do in December, for instance, we might offer that as an incentive.” Or we might replace a tree or shrub that is weak or dead. For our residential clients, we offer a discount to pre-pay for their contract by a certain date for the season. Almost half of our clients take advantage of that option now. It helps get the renewals back quickly and also helps with cash flow in the spring.”
John Peterson, landscape designer and project director for Exscape Designs in Novelty, Ohio, says multiyear renewals also help keep the process smooth. The company evaluates their accounts to determine if they are profitable and worth keeping. But once they complete at least one year of work and have a good grip on where things stand with the account, they’ll encourage their profitable accounts to commit to a multiyear contract.
“Rather than having to go through the renewal process every year, once we have a good history on the property and feel secure with our price, we’ll ask the client to consider a two- or three-year contract with us,” Peterson says.
Make a push for new clients
While renewals are critical, securing new work is important, too. Delong says Bluegrass tries to maintain a 15 to 20 percent increase in new customers each year.
“We run a series of marketing campaigns, both digital and traditional, to obtain these customers,” Delong says. “We also work hard to maintain relationships and grow organically. These are the easiest sales to close.”
Peterson agrees, and says that organic growth works well for them. Exscape is constantly trying to convert design/build accounts into maintenance ones. The firm is known for its design work and tends to attract customers to the business through that channel. However, Peterson says they aim to turn each design/build client into an ongoing maintenance client. In turn, that keeps the company fresh in clients’ minds when future design/build work comes up.
“It’s a nice segue way,” he adds. “They already know and trust our company, so they don’t have to go through the process of finding someone new. Every design/build job has a close-out procedure that we go through in which we talk about caring for the new plants and maintaining the lawn. Then we fold in that we do offer landscape maintenance services. A lot of times people didn’t even realize it since we’re more associated with our design/build work.”
In general, Joe Ryder, landscape production manager for Professional Grounds Inc., in Lorton, Virginia, says he believes it’s more important to focus on existing clients rather than potential new ones. He says your existing client base is already your biggest support. They are the ones who are going to help get your company name out there — and, as others have said, that organic growth can be the best kind.
As for chasing after new clients and leads that have come from other means, Ryder says the most important tip he’d offer other business owners is to “qualify your leads.”
“If you are spending your time chasing unideal leads and meeting with the ‘wrong’ customers, then it’s less time you’re spending in front of customers that would be more suited to your business and your work,” Ryder says. “In our industry, we are generally already overwhelmed by the number of hats we put on — managing crews, managing existing customers, enhancements and, of course, sales, among others. The last thing we can afford to do is spend time following up on bad leads.”