How dominant is TruGreen in the U.S. lawn application market? A recent article in the Memphis Commercial Appeal touting the company’s importance to the city lays it out in black and white.
The article is based on an interview with TruGreen president and CEO David Alexander, who was hired as president in late 2012 to turn TruGreen around. The company had been bleeding customers and had lost $5 million in the year previous to his hiring. In 2014, TruGreen was spun out of ServiceMaster to become an independent company.
TruGreen is a giant in the chemical lawn care business. For 2016, it reported sales of $1.4 billion, amounting to 34 percent of the U.S. lawn market. To put TruGreen’s size in perspective, the next largest U.S. lawn care companies reporting sales for 2016 are Weed Man at $148 and Lawn Doctor at $108 million respectively, according to published reports. Using TruGreen’s numbers, the total lawn care market is about $4.1 billion.
Alexander credited TruGreen’s turnaround from 2012 sales of $979 to $1.4 billion in 2016 to several factors, including the adoption of an operating system that took into account the vagaries of weather and other complications unique to a route-based outdoor services company.
Other factors cited for the turnaround of TruGreen’s fortunes include the purchase of a 70 percent stake in Scotts Lawn Care in 2016 (with recorded record sales of $289 million for 2015) and a reinvigorated and reengaged base of 14,000 employees.
From its founding in central Michigan in the mid 1970s, TruGreen has always been regarded as a powerful marketing machine. For decades TruGreen relied on telemarketing to drive sales. In June 2003, with the passage of the federal do-not-call registry, it had to shift its marketing efforts. In recent years it has relied on a huge spring dose of television advertising and millions of pieces of direct mail.
This past season, TruGreen devoted about 6 percent of its revenue – more than $80 million – to marketing, according to the Memphis Commercial Appeal article.
Organized in 21 regions spread over 48 states, TruGreen services 2.4 million homes and businesses from 250 branches and 50 franchise locations. The company’s operating income grew from $85 million in 2015 to $152 million in 2016, according to the article.