Finding the right services to boost your bottom line
You may be successful with the services you currently offer, but could you be more profitable with additional services? Successful companies have found ways to select add-on services that fit their company, customers and employees, as well as enhance their bottom line.
Need to diversify
Mike Sturgill, owner of Outdoor Turf Professionals in Carterville, Ill., started his business as a mowing contractor 20 years ago. He quickly grew to servicing over 100 accounts, covering over 250 acres per week. There were times when he wasn’t getting as much profit as he needed, and felt the need to consider other services to offer. He found there were a considerable number of ponds and lakes in his area, and that customers were interested in fountains and aerators. He researched the market and received a distributorship for Otterbine for southern Illinois. He has diversified further and now provides slit-seeding service, organic fertilizer applications and landscaping. Sturgill states, “With diversification, we can reach out to a different customer base at the same time as we provide add-ons to our current customers.”
Chuck Miller of MirrorScapes, LLC in Lancaster, Ohio, started his business in 2007 providing soil tests, fertilization, aeration, weed control and mowing. His first employee had experience installing pavers, so that service was added almost immediately. Since then, Miller has seen the need to find business for the off-season. He determined that holiday lighting would be a good fit, so he received the necessary training and has launched that part of the business. “We have found that new commercial customers for the lighting business also wanted lawn care, so the growth has been twofold.”
Finding services for the off-season generates cash flow and can keep key employees onboard and busy year-round. The more times you are on a client’s property, the more you can communicate with them. Sturgill states, “Communicating with customers and providing discounts during the off-season can help cash flow and the bottom line.”
Finding the right add-ons
In many cases, your current customers will provide the impetus of which services to add to your business. Larry Jouett, owner of Professional Lawn Service in Kenosha, Wis., says, “If we have a client asking for something, it may be time to test the waters. Once we decide to test something, we come up with a business plan and a marketing plan. Talk to your customers, and then look at what the return on investment might be.”
Jouett got into the perimeter control business last year when a friend called and asked how to get rid of spiders in her house. Jouett found that it was a service that was needed in his area. He says, “Perimeter control is similar to lawn care; it is repeat business and ongoing.”
In 2002, Jouett added lawn mowing to his growing list of services.
Launching the add-on
Once you have decided to add a new service, you must establish the best way to launch it. You need a business plan, which should include costs, markup, investment needs and market analysis. You should also put a marketing plan in place. Are you going out to new customers, existing customers or a combination of the two? What are the best ways to reach the potential customers for this service?
Training is another area that must be taken into consideration. It is going to take time to learn what needs to be done and how to do it. Miller says, “You need to assure that you can do quality work in whatever you do. I don’t want to go out and practice on somebody. We want to provide the same quality service on a new job as we have on every other one.” If certification is available, attaining that designation will not only help you provide quality service, but can be used to assure potential customers that you can provide quality service.
|Photo Courtesy of Mirrorscapes LLC.|
|MirrorScapes LLC added holiday lighting to their repertoire last year to increase their cashflow and customer base.|
Change with the market
Your market is going to change. In order to be successful, you must change with it. Besides adding services, you may discontinue a service that is no longer needed or profitable in your area.
As you consider dropping some aspect of your business, you must think about how your customers might be affected. Just because something is not profitable for you does not mean it should be dropped. If the service is important to even a small segment of your customers, you need to determine if it’s worth losing customers over. You may be able to charge more for it, find ways to increase efficiency or have someone else to take over that area. If you leave a customer wanting, they may take all of their business elsewhere.
Sturgill sees market change as a real positive. He says, “With baby boomers aging, there is almost unlimited growth potential.”
Steve Trusty is a partner in Trusty & Associates, a communications and market research firm in Council Bluffs, Iowa. He has been involved in the green industry for over 40 years.