North Carolina firm sees diversification as driving its success
Michael Dickey standardizes his equipment (including mowers) so that employees get adept at using it and the company mechanic becomes very familiar with maintaining and repairing it. It also helps build win-win relationships with vendors.
A disagreement with a former employer over whether he could take a day off to tend to family business led to Michael Dickey being fired – and to the decision to start a business of his own. Dickey is owner of Color Landscapes, a successful company that he founded in Burlington, N.C., in 1994.
Owner: Michael Dickey
Headquarters: Burlington, N.C.
Markets: Piedmont/Triangle area
Services: Commercial maintenance,commercial installation andresidential construction
“Something happened and they needed me to work that day,” Dickey recalls. “We already had plans with the kids. I put the family first and they didn’t. So we ended up parting company.” The next day, he put $500 down (Dickey’s house payment for the month) on a $1,000 pick-up truck.
“I went out and started doing jobs and that week ended up making enough money to make the house payment and the truck payment. And we’ve been rolling ever since,” he says.
What started off with that one truck and a part-time employee has grown to two dozen trucks and 50 employees that provide commercial clients with the entire package of property management services, maintenance and chemical. The company also offers landscape design/build, landscape renovations, water features and pool decks, outdoor living and entertainment areas, large tree installs, landscape lighting and snow management. Color Landscapes is a full-service company.
While its service area is primarily central North Carolina, it travels to Virginia and South Carolina for larger commercial installations.
“If we find a good customer and we know how they work and they know how we work, we’ll follow them wherever they go,” says Dickey. “We found out that we can work out of town on big commercial jobs. Out of town, we tend to think a little bit harder and make sure all of the materials are lined up. Everything flows properly because everybody wants to get back home for the weekend. When you’re working out of town you have to spend more time organizing,” he says, adding somewhat ruefully, he wishes his employees would take as much care to prepare for jobs closer to the shop.
Riding the trends
In 2007, the maintenance division came to the company’s rescue, in 2008 residential construction started to recover and this season Michael Dickey is counting on commercial construction to grow again.
PHOTOS COURTESY OF COLOR LANDSCAPES.
Dickey is convinced that diversification is a huge plus for his company.
“Over the last five years, each one of our divisions has helped carry the company,” says Dickey. “Construction is great, but if we hadn’t had a maintenance division in 2007, we would have been out of business. In 2008, residential construction carried the company and right now commercial construction is carrying the company.”
In other words, from year to year, different divisions within the company produce different financial results. “We’re committed to keeping all three of them (divisions) going because it gives us a better balance and more diversity,” says Dickey.
Color Landscapes services a number of retirement communities, which he sees as an ever-growing trend because of the aging of the Baby Boomer generation and also North Carolina’s popularity with retirees from the North.
“Residents just enjoy life and we take care of everything else in retirement communities, whether they’re apartments or single-family homes,” notes Dickey. “We try to help the property managers do their job. We look for problems that are going to occur on the property before the residents have time to report them back to the property managers so they can call us and tell us to do it.” Even so, the occasional complaint is inevitable, he recognizes.
“That’s the nature of the business. We tell our guys you have 100 people watching you all day long regardless of what you’re doing, so be professional and get the job done. If you don’t, we’ll hear about it within 24 hours,” he says.
Dickey points to the quality of his trained employees as the biggest part of his company’s success. “We’ve got guys who have been with us for 15 years, so they know what we’re doing and they know what we expect of them,” he says.
Dickey’s technicians practice integrated pest management on the company’s accounts.
“If there is something by the door where there is a noticeable problem, we try to spray it and take care of it,” he says. “But if it’s crepe myrtle or some other plant at the edge of the property and there’s a few bugs on it, we don’t get happy with the chemicals. I don’t let anything get overrun or devastated. But if there’s a few bugs and it’s not that detrimental to the plant, we won’t spray chemicals everywhere.”
The company’s maintenance work slows in the winter, so Dickey moves trained mowing personnel to the construction sector. “We’ve had some of our busiest months in January because the project had to close out before the spring. We use our experienced help in moving the company from one side to the other, depending on the workload,” he adds.
Color Landscapes is often called in to fix work done by other landscapers. Dickey depends on Production Manager Chris Breedlove to provide the best solutions for property owners.
“He loves doing difficult projects that other people think are impossible,” he says. “We’ve done quite a bit of work with Elon University. They’ll call us and ask if we can landscape an area because students and their parents are coming back in two weeks. When you first look at it, you say, ‘No way’. If we get enough crew and enough equipment, we can make things happen. That – and our dedication to our customers – sets us apart.”
Color Landscapes won’t shy away from any project, even ones that other people think are impossible. With enough crew and equipment, Micheal Dickey says the company can make things happen.
Other distinguishing points in his company’s favor include the educated and experienced employees, regular communication with property managers, English-speaking crew leaders, an extensive inventory of equipment, high employee retention, and what Dickey describes as “impeccable customer service.”
The employee roster includes two registered landscape contractors, three certified plant professionals, three North Carolina certified landscape technicians, three with North Carolina pesticide applicators licenses, nine with horticulture degrees, and two Belgard-certified installers. Honesty and a good work ethic are what he values most in employees. He says that horticulture skills can be taught. The company’s best employees have come via recommendations from employees or people he knows.
“We have had good success lately by putting ads in papers, but it’s a long search trying to find the right individual because you can’t ask them if they’re honest,” Dickey points out. “You have to find that out by working with them or knowing their background.”
He adds, “We set the bar high for employees. We’re slow to hire. In the past, if somebody said they needed a job, I would hire them and then we’d have to deal with a difficult employee for a year or two. Now, we take months to hire the right person. Because we’re slower to hire, we’ve had a whole lot better success with our employees.
“If I had the chance to do anything differently when I started the company it would be to be more selective in hiring. I would have spent more time making sure the employees we hired were the right people for the company,” he adds.
Color Landscapes uses mostly Stihl and Echo landscape equipment, prefering to standardize equipment and use as few vendors as possible.
Keeping it simple
Color Landscapes has an in-house mechanic. Dickey prefers standardizing equipment and uses as few vendors as possible. The company uses mostly Stihl, Echo and John Deere landscape maintenance equipment.
“We try to use the same brand of mowers year after year so the guys get used to it and the mechanic knows what to expect and we can develop relationships with our vendors,” he says.
Color Landscape has been on a steady growth incline since 2007, with projected revenues of $4 million this year. “There’s more commercial construction going on now,” he points out. “They’re building apartment complexes left and right and we’ve fallen into that niche. We’ve got great customers that have the potential to build three or four more complexes this year. We’re going to work on keeping them happy and doing that work.”
Dickey also plans on doubling the size of the company’s maintenance division and picking up maintenance jobs after installing some of the new apartment complex landscapes.
While the current trend is residential construction, Dickey is cognizant that it could be something different next year.
“If everything cycles the way it usually does, they’ll build more apartments for three or four years and they’ll build single-family housing again,” he says. “We’ve been around long enough and have seen a couple of business cycles. The biggest thing that a young landscape entrepreneur should understand is he can build the best business in the world, but if he doesn’t understand business cycles and the way things are going to roll, he could get himself in serious trouble.”
The Obamacare Dilemma
Color Landscapes has some big decisions to make in light of the approaching implementation of the Affordable Health Care Act, also referred to as Obamacare. Owner Michael Dickey says that CFO Pam Jordan is studying the Act and attending classes to try to get a handle on it.
“We’re right at 50 employees. We’ve got an opportunity to be a bigger company, but if you go over 50 employees, that kicks in health care,” says Dickey. “We’ve done the math and health care for our company is going to cost about $75,000. The penalty if we don’t provide health care is $40,000. Our struggle is to figure out what our government wants to do.”
Dickey says his company has tried to offer health care in the past to its predominantly Hispanic employee base, “but many of them don’t care to participate for whatever reason. You’ve got to have 75 percent participation to get the group health rate and not all of our guys want to jump in there.” Dickey says he’ll need to factor in the cost of health care or the penalty into job costs.
“If we don’t, we’re behind the eight ball,” he says. “If we do, it’s an expense that our competitors who don’t have 50 employees don’t have. The other unknown is that somebody could file a lawsuit at the end of December and put a hiatus on this.” There are similar challenges with the H-2B program.
“Everybody is all excited that this is going to change and that is going to change and then somebody files a lawsuit and nothing changes,” notes Dickey. “It’s very difficult to plan and prepare for the future the way our government keeps changing the rules and not clarifying them.”
Nonetheless, Dickey says he will proceed with plans for company growth notwithstanding what actions the federal government is taking.
“We know what the ramifications are, but instead of holding back and not being aggressive, we’re going to go ahead and grow our company and do what we’ve been doing,” he says. “Then we’ll deal with the health care if it all happens when it all happens to the best of our ability.”
With his company having made it successfully through the Great Recession, Dickey is using that experience as a filter for making future decisions. Dickey’s five-year plan focuses on doing $8 to $10 million a year in Virginia, South Carolina and North Carolina with three to five facilities established.
“We’re not going to get strung out and so far into debt that we can’t manage it if everything dries up overnight,” he says.
Carol Brzozowski, Coral Springs, Fla., is a member of the Society of Environmental Journalists and a frequent contributor to Turf magazine. Contact her at [email protected].