During the National Association of Landscape Professionals‘ (NALP) session at GIE+EXPO, “Town Hall with the Top Thought Leaders of the Industry,” moderator and industry consultant Judy Guido asked four key members of the landscape market tough questions about how they recruit and retain people, key metrics they use in business and how they would compete and price against themselves if they were small business owners.
Learn how to think big in this up close and personal dialogue with Jennifer Lemcke, COO of Weed Man USA/Turf Holdings; Mike Bogan, CEO of TruGreen LandCare; Craig Ruppert, CEO of Ruppert Landscape and Jon Georgio, COO of Gothic Grounds Management.
Judy Guido: What are one or two words that describe your brand?
Jen Lemcke: Integrity. It’s about treating people right whether they are employees or customers. Treat people how you want to be treated.
Craig Ruppert: People-focused. We strive to provide them with the opportunities to grow, learn, take on responsibility or earn more.
Mike Bogan: Care. We look out for our people and create an environment where they feel like they belong.
Jon Georgio: Customer-centric. We have an intense focus on the client. We had a customer once who had 300 guests coming to a party and the caterer didn’t show up. So our crews pulled out grills and fixed burgers and sides, saving the day. We have created a culture where our employees knew they had the autonomy to make that decision. They did it on their own.
Judy Guido: What one word would you use to describe yourself?
Mike Bogan: Passionate.
Jon Georgio: Fun.
Jen Lemcke: Energetic.
Craig Ruppert: Slow … maybe.
Judy Guido: Where do you spend your time and focus as a CEO?
Mike Bogan: When I became involved, the business had a tough time retaining talent. So I wanted to create a brand that could attract talent to the organization. So this is my No. 1 focus because it’s about the people and creating a culture that’s attractive.
Jon Georgio: Walk-around management. I like to see what people are going through, take the pulse of the organization, see what the challenges are and try to address them. Because we have a solid day-to-day team, I try to get in front of them and anticipate where we’re going and how we’re going to get there.
Jen Lemcke: I spend a lot of my time in spreadsheets. I work for the head office of Weed Man so my customers are my franchisees. I try to bring value to the franchisees through metrics and data and analyzing things that will help them move the needle forward. I spend time figuring out ways we can bring customers to franchisees and look at things that impact customer retention. Customer service is a big part of it.
Craig Ruppert: I should be spending time on strategy and culture, but I spend a lot of time on execution. It’s easy having a strategy, but it’s hard to execute on it. My focus is more on the people; it allows me to use my time more efficiently and that has a bigger impact on the customer.
Judy Guido: With labor costs rising the way they are, how are you focusing on recruiting and retaining people and rewarding them from the field side on up?
Jon Georgio: The best way to staff is to not lose staff. We start with retention. We beefed up our staff so we have a couple of people focused on getting the right people in the door and retaining them. When they are on board, we get them the tools they need and make sure they have a clear understanding of their roles and that they are going out and working safely. We provide training for them through Gothic University, which is a certification program through NALP. It’s hard work for them but they get a lot of satisfaction from it. We also have a profit sharing program. The more you learn, the more you earn. You’re not guaranteed compensation when you continue to learn but it slides them into cue for promotions and bigger roles at the company.
Jen Lemcke: We have a profit sharing program where franchise owners are evaluated based on retention, growth of the company and EBITA. We work through a 10-year business plan with owners and give them training tools to retain good talent and create opportunities for their employees.
Craig Ruppert: Retention is No. 1. Lots of our focus goes there. Providing opportunities for growth is at the top of the list. We train people right, respect them, listen to them. We constantly try to improve and question how we can make working here better.
Judy Guido: What are one or two key metrics your company lives by, and how do you enforce and reward those metrics?
Jon Georgio: There are two types of metrics—lagging metrics (revenue, gross profit, etc.) and predictive metrics. We’re more focused on predictive metrics recently. This is how much you book during a month in sales so it gives us a better prediction of how that month will look.
Craig Ruppert: Most important for us is profit because it’s a measure of performance. We also look at turnover—our retention rate with employees and customers. We also look at our backlog in landscape construction—making sure we have the right work at the right time for the future.
Mike Bogan: Client retention, the renewal rate for maintenance customers. If they like you, they come back. The next one for us is profit or gross margin. There are lots of ways to get profit on the bottom line but cutting costs on overhead isn’t always the way to get to profit.
Jen Lemcke: Retention, customer acquisition and EBITA because our managers receive a bonus on those metrics.
Judy Guido: Two of the most significant forces in business today are technology and globalization. What role does technology play in your company?
Jen Lemcke: We are not early adopters of technology. So we’re not a company that wants to change and look at new technology. It’s a little bit on purpose. We don’t need to fix something that’s not broken. Sometimes you can go down a rabbit hole with technology and you have to ask what will it do and what do I need it to do. We also want it to be simple for the user. If it adds another level of complexity to our business, it’s probably not a good fit.
Mike Bogan: We’re not early adopters either. It’s embarrassing that my crews still fill out paper time sheets. We’re doing things not too much differently than we did 20 years ago. It’s nothing I’m proud of. Sometimes we’re our own worst enemy because we limit ourselves. We don’t want our crews to have smartphones because we don’t want them to be on them all day, but we forget that maybe they can use them in smart ways like finding the cheapest gas stations.
Craig Ruppert: We’re struggling here, but we’re adapting quickly because our customers expect us to, and it’s relatively easy to do. Our field managers all carry smartphones. We are filling out reports now and passing on job cost information and directions to the job electronically. I expect it to keep changing and we’ll keep adapting.
Judy Guido: With 58 percent of purchase managers being women and women making 90 percent of all choices in the home, how do you tap into women as customers and employees?
Jen Lemcke: We didn’t always pay a lot of attention to those metrics but we were recently introduced to big data. Part of what we’re looking at doing is relaunching our website and using big data on top of that. Looking at this data will help us focus our marketing efforts based on who we’re marketing to. That will play a big part in our messaging and how we sell our brand.
Jon Georgio: We’re woman-founded so we have an advantage: our culture is based on things she brought to the table. Thirty-three percent of our executive team is female, and we’re proud of that.
Craig Ruppert: We have women in almost every position in the company, but it’s still a huge untapped opportunity for us. They bring an interesting and valuable perspective.
Judy Guido: Knowing what you know today, if you were a small company competing against yourself, what would you do?
Craig Ruppert: Smaller companies have a lot of advantages over bigger ones. Their leadership can be bigger to customers. And smaller companies are easier to manage. All of us have the experience of being much smaller and, in some cases, we still know what it’s like competing against smaller companies. We’ve lost jobs before because our price was too high. I spend a lot of time reminding people to ignore that and don’t pay attention to that as a reason. In many cases, it’s not the truth. We try to take away the excuse and not focus on why we lost the job but instead what we can do to get it.
Mike Bogan: From a competitive standpoint, I would always rather pitch to a customer as a smaller local business than a big company. That way I can say I’m in their community and my kids go to their school and I’m invested in the community and will be there forever – pass along my card and tell them they can call me whenever they need me. But you hit a ceiling when you start to grow to the point where the owner can’t be that person for so many clients. When they can groom employees and create a culture that’s repeatable and take on service relationships, that’s how they continue to expand.
Jon Georgio: If I were out there selling to a residential or business client, there’s a massive need today to emotionally connect with customers more than ever. If you’re smaller and nimbler and quicker, you might have the ability to do that better than the big guys.
Jen Lemcke: Our franchises are smaller and locally owned and operated and part of their communities. We use all of the small business tricks. It gives us a huge advantage. When people call and say, “Can I speak to the owner?” our franchisees usually say, “You’re talking to him.”
Judy Guido: We often hear from small companies that big companies beat them up on price. How do you respond to that?
Mike Bogan: We didn’t set up a new startup with the idea that they’d be loss leaders while stealing everyone’s work. When a big national company comes in, it offers an alternative and it makes things more competitive, and some customers want to try a new choice and will pay their price and force you to get more aggressive in the way you run your business. I’ve had the opportunity to work on acquisitions as a consultant and see many different organizations of many different sizes. I saw a huge disparity in the profitability of these companies. What I didn’t see were companies that existed in a market without national competitors making more money. More competition meant more profitability.
Judy Guido: Where do you see the greatest growth opportunities in our industry?
Jon Georgio: I have a specific outlook because I’m based in the Southwest. In the Southwest right now, water is in a devastating place. Water costs more than gas by ounce out West. Our focus and what we see as our greatest opportunity is transforming thirsty landscapes into places that can use a lot less water.
Mike Bogan: Water is a huge challenge. What effects us will ultimately effect everyone else as well, but it will just take a little longer to roll across the country. Regulations with pesticides will also be impactful, as well as challenges with the labor force.
Jen Lemcke: We’ve been an outbound marketing company and have excelled at that. But there’s an opportunity for us to master inbound marketing, whether that’s driving leads through our websites or through other things people are doing online. We’re looking at different strategies in print and driving calls. We’ve had people answering phones who have been administrative, but there’s an opportunity for us to change our mindset and have salespeople answer the phones and close sales. We can deliver tools to employees that allow them to close sales quicker and more effectively.
Craig Ruppert: I don’t know the answer. Our focus is to watch, pay close attention and be ready to react and take advantage of opportunities when they come. We try and narrow down opportunities to a few things so we’re ready to take advantage of them.
Judy Guido: There’s been a lot of mergers and acquisition activity lately in our industry and across every sector from distribution to manufacturing to contractors. How do you see those activities and entities being formed impacting the industry today and in the future?
Mike Bogan: Someone recently asked me if mergers and acquisitions are good or bad for our business, and I think I’ve seen it both ways. The rollup of LandCare and the merger with TruGreen were tremendously effective. It was a different way to pull companies together. If you look at how acquisitions aided in the growth of Brickman or ValleyCrest, they were extremely effective. The difference was there was a really strong culture and strong business and they were able to absorb another company into their system and it was extremely effective. All of the stake holders won. The difference is making sure it works for all of the team members involved—not the parent company doing the acquisition or the seller walking away but for the team members in the acquisition—or it won’t work for anybody. If they walk, the customers walk, too. That’s what buying is: buying a customer list and a renewable customer base. If you fail to keep the team members who work for the organization and keep their hearts engaged in what they’re doing, you’ve failed.
Jon Georgio: I think it makes our industry more professional. It makes us raise our game and develop ourselves and become more profitable organizations. I used to know more than clients about landscaping but now they know significantly more; they are more educated. They are driving us to be more professional, and that’s a good thing.
Jen Lemcke: It’s made the industry better. When we need money for lobbying, these are the companies that come to the table. It’s making our business more professional and viable. It also creates the opportunity for small guys to come in and establish themselves as local providers.
Craig Ruppert: It spurs new competition because there are startups happening all of the time. It also creates value. A business 20 years ago is worth less than it is today because there’s a market for them, and that’s good for all of us.
Judy Guido: Who has made the biggest impact on your career?
Jen Lemcke: I learned a lot from a lot of people. When I joined the board of NALP, my dad said, “These are smart people; sit back and listen.” I’m a doer and I like to get things done, but one of the things I’ve learned is to slow down and listen. I met another franchise business—The Grounds Guys—through NALP. In 2008 business was flat and we focused on our internal processes and how we can help grow our franchises. I talked to The Grounds Guys and they were going to sell more than 50 franchises that year alone. I asked if I could come to their offices and check things out so I could learn how they were going to do that. I spent eight hours in their offices and took 40 pages of notes on how they run their business. Then I followed up via phone and asked more questions to make sure I understood how they operate. Those conversations really helped me and helped us grow to where we are today.
Mike Bogan: Working with Dick Brickman was the biggest thing for me. He taught me some key lessons:
- Don’t worry about being the biggest; worry about being the best.
- Do unto others as you want them to do to you. I never heard him speak to a group without referencing that.
- Focus on being in business forever; not just this year.
Then, outside of the industry, companies like Zappos and how they deliver an incredible customer experience, as well as the Whole Foods story, are great; we can learn a lot from them in building our organizations.
Jon Georgio: I admire my parents for their courage, and the heart and soul of the company was my brother Mike, who we lost two years ago. He created the culture we have that makes people want to stay and work there. Burt Sperber was also a big influence for me. I was always amazed at what he did and his model of business on the West Coast. He made me realize that as I was $1 million and he was $100 million, that you didn’t have to be rich or from a certain pedigree. You can be normal person and do it. He was very free with his advice.
Craig Ruppert: We’ve been in business twice and the one thing we learned is there isn’t a company out there who we can’t learn something from. Dick Brickman and Burt Sperber stood out for us early on. Both of them did something no one else was doing at the time. They set examples and gave us all a vision on how we can successfully grow.
Judy Guido: What is the biggest mistake you made in business and what lesson did you learn from it?
Jen Lemcke: For me, it was moving too fast. I moved at a rate where I wasn’t as good of a listener as I am now. My dad has been instrumental in helping me slow down and listen to what people are saying and use that to help influence my decisions.
Mike Bogan: I got in the habit of moving too quickly and focusing on bigger business challenges and not people. When you are too focused, you stop thinking about anybody else and you might walk by without smiling or speaking to them, and that’s not the normal you. I have to remember I’m always a leader and I’m creating a culture every day in how I treat people and interact with them.
Jon Georgio: Sometimes our greatest asset can be our biggest flaw. If I make a mistake, it usually means I’ve waited too long to make a decision or stuck my head in the sand.
Craig Ruppert: I’ve made a lot of mistakes but one jumps out at me that had a lasting impression. It was many years ago. We had a key person who ran our maintenance operation. One day, he just didn’t show up for work and left his keys in the truck. He left no note. We thought we’d hear from him the next day or the next week but we didn’t. I thought, “Wow—he must have been unhappy.” It caused my brother and I to get involved with the customers he handled for us and in the process of doing that we realized they weren’t our customers anymore. They were his customers now. We’d lost half of them because we lost one key employee. That really shocked me and got my attention. It reshaped our view of the business and how we treat people and keep them.
Judy Guido: Any parting thoughts?
Jen Lemcke: We often get so involved in the business that we think we’re alone. That’s the beauty of this industry is that we’re not alone. Don’t be afraid to reach out to each other and network and share business tips.