Lawn care operator recovers from loss of major client
After decades in the lawn care business, Vince Pfaff has plenty of experience growing and maintaining grass. He knows all about mowers and equipment, employee relations and serving customers’ needs. He used these skills to build K and V Lawncare, Inc. (www.kandvlawncare.com) in Fernandina Beach, Fla., into a highly respected and successful business.
Over the past year, Pfaff learned the hard way that doing a great job isn’t always enough. A down economy and the loss of a major maintenance account left him scrambling to learn new skills, sales and marketing chief among them, that would help him rebuild his company.
Last spring, after a 14-year relationship, K and V Lawncare’s largest customer, a commercial business with five locations in the area, switched to another lawn care contractor in a cost-saving move. “Like everywhere else these days, push came to shove and a new manager came in and had to cut the budget,” Pfaff explains. Pfaff learned last January that the commercial client was asking him to lower his costs, so everyone at K and V Lawncare took a 20 percent pay cut to help make that happen, but even that wasn’t enough.
Another lawn maintenance company put in a bid for 60 percent less; the client asked Pfaff to counter, which he did by taking 35 percent off his rate and agreeing to break the multiyear contract that had been in place. “I thought that was a nice thing to do, but we were replaced. The manager did his job, and now he’s no longer with that company, which is normal,” says Pfaff, who lost three of that company’s five sites in the process.
He was also left wondering how another company could do the job for so little. “In Florida, we have a number of subcategories for licensing, including to put down various control products. I honestly don’t know how they are doing it legally at that price, I honestly don’t,” says Pfaff. After losing the bid, he explained his position in a series of letters, drafted with the assistance of a lawyer, to high-level management at the commercial company he had worked for. There was no reaction. “I wasn’t angry and I didn’t want to cross any inappropriate lines. I just wanted them to understand the situation. It was discouraging,” he explains.
Large lawn care companies might be accustomed to seeing accounts come and go with some regularity, but for K and V Lawncare, a small company that had devoted so much of itself to that one client for 14 years, the loss of the account was devastating. “We had basically been an employee of that organization,” Pfaff explains. “Every year, we had added responsibilities as they added properties. We did all sorts of extra things, if they had an inspection or a big function we would come in and get everything cleaned up for them on short notice. If someone there dropped the ball on something, I would get a call on a Friday and I’d be out there on the weekend to meet with them, and by Monday I would show up with four of five guys to do whatever they needed us to do.”
The loss of that account was not only demoralizing because of the effort that had been made to go above and beyond in terms of performance, it also was a huge blow in business and financial terms. Pfaff had structured K and V Lawncare primarily to serving that client, at the expense of a diversified customer base. Prior to the loss of its largest client, their customer base was about 85 percent commercial and 15 percent residential.
With the loss of most of the company’s business, Pfaff unfortunately had to let his employees go and is now maintaining the remaining accounts by himself. He’s sought Small Business Administration assistance to rebuild his business, and may need to take a part-time job outside of lawn care and take out a bridge loan to help him through until he can sign on new customers. “I could see it taking a year or a year and a half to rebuild,” he says.
Pfaff is telling his story to help others in the green industry learn from his experience, and from the steps he’s taken to begin rebuilding. One lesson he says he’s taken away from this episode is the need to have “a huge safety cushion” in the event you lose a large account. “You really have to have a disaster plan in place, either a partner or wife who works outside the business. You have to have five or six months’ savings for the house and the business.”
Another lesson was the importance, especially with commercial clients, of having more than one “sponsor” or “proponent” within that organization. “I lost my sponsor, and when a new manager came in, he didn’t know all of the good things we had done in the past, or even all of the things that we were doing every month,” says Pfaff. “Even though we had monthly checklists, property reports, horticulture reports and took pictures of the things we did, sometimes location managers are so busy they don’t necessarily want all of those things, all that paperwork. So, I think now that part of the responsibility would be to schedule meetings at least once a quarter to explain all of the things you’re doing, and to give them a list of other things on the property that need to be done, regardless of whether they want to do them, because it’s important to blow your own horn and justify your existence there.”
While Pfaff says he may have made a mistake in not touting his own work enough, he remains convinced that pricing was at the core of the commercial client’s decision to drop K and V Lawncare: “It’s sad to say, but for many customers now, it’s not about quality. It’s about quantity and price. Safety, security, licensing, insurance, all the things that are the cornerstone of our company don’t seem to help anymore. The motto for our company is ‘Working hard for honesty and integrity,’ but how can I compete against a company that comes in for 60 percent less than we can do the work for?”
Pfaff also learned that contracts have to be incredibly detailed to offer any real protection. “We had a good contract, not an incredibly great contract, but if an organization wants to break a contract, they can do it,” he says. In this case, he says, the company also chose not to fully honor the 90-day notice that was required.
Pfaff says that even before he realized he was losing his largest client, he did have a network in place to help him with his business. “At the University of North Florida in Jacksonville, they have a small business center. I have a councilor who I bounce ideas off all the time, he’s been helping me for 10 years,” he explains. “I also have an accountant who has helped make sure that we’re licensed, insured and incorporated. I have also relied on local equipment dealers to help me out, and a horticulturist to explain to clients what needs to be done with their property so that it’s not just me telling them.”
Since losing that large commercial account, even with his business devastated, Pfaff has made it a point to further expand his network of advisers and business resources. “I’m a member of PLANET and I’ve been very happy with all of the help that Tom Delaney has given me,” says Pfaff. “I also now have a green industry lawyer to help me with writing new contracts, they obviously have to be crystal clear. If someone doesn’t want to sign a contract, then you have to go somewhere else.”
Pfaff, who has a college degree, has always taken pride in running a professional business, through memberships in PLANET and other industry groups, meeting all licensing requirements, etc. He now feels that approach is more important than ever. “I learned long ago that you have to separate yourself from the pack, no matter what,” says Pfaff. “We do a lot of community volunteer work, we do college scholarships for our crew, we do the Project Evergreen’s Greencare for Troops program.” While some of those efforts are on hold until he can rebuild K and V Lawncare, Pfaff says he’s committed to the importance of doing charitable work.
In his location in north Florida, grass growth is slow during the winter months. So with mowing required only every three weeks or so, it’s not a great time to try to drum up new business. “We’re going to go door-to-door if we have to. We’re going to put up some flyers and we’re going to do some volunteer work in the area to help get our name out there and say that we’re a good company. I’ve got a long list of things I need to do,” says Pfaff.
He has also been on projects for school, government and roadside contracts. “To get the work, companies are bidding half of what they would need to in order to make any profit,” says Pfaff. “Either they don’t know what they’re doing in this business, or they have cash coming in from somewhere else.”
One of the most important lessons he learned is the need to diversify the client base, says Pfaff, to avoid overreliance on a single customer. Though that’s easier said than done, as it could mean turning down extra work from a given customer. “Ideally, I think I would have an even mix between commercial and residential. But, again, the money in commercial maintenance is so much better. You might make as much in two really long, hard days at a big property as you can in 40 trips to a residential property. It’s hard to turn that down.”
To help him in his sales and marketing efforts, Pfaff has attended a number of workshops on these subjects, including one presented by popular green industry consultant Tony Bass that he says was particularly helpful. “Tony is very current on sales and marketing, which are things I never really had to do in the past, because I was always so busy in the summer months,” says Pfaff. “Hindsight is nice, and it’s hard to go knock on doors at 7 p.m. after a long day of work in the summer, but maybe I should have hired another person, or not slept at all, so I could have done more sales work!”
Those workshops have helped him learn how to write proposal letters, and to find the right person within larger organizations to approach about submitting a bid. “It’s a totally different skill set than maintaining the properties,” says Pfaff, who also has developed a Web site to help him in these efforts.
For others who might be worried about a similar event, Pfaff says his most important advice is to have a disaster plan in place. “Because things aren’t always going to click,” he explains. “Things are going to happen and you need to be able to react.”
Patrick White is a freelance writer and editor who has covered every aspect of the green industry in the past 13 years. He is based in Middlesex, Vt., and is always on the lookout for unusual stories.