A spring like no other

Frank Leloia and the crew at Custom Landscaping and Lawn Care are pulling themselves out of the trenches.

The coronavirus pandemic has hit the New Jersey-based business hard, with multiple employees contracting the virus.

“It’s been really challenging,” Leloia says. “We have had 19 cases of the virus. Of those 19 people, only five had symptoms.”

Leloia says that so many workers got sick despite the company adhering to the Centers for Disease Control and Prevention’s guidelines.

“We are making sure trucks, machines and equipment is sanitized on a daily basis. We staggered start times, we are wearing masks and gloves,” he says. “We started implementing taking temperatures; however, out of our 19 cases, nobody has had a fever.”

Leloia estimates that around 75% of the company has been tested for COVID-19.

Leloia says having so many employees out has made it difficult to keep up with the workload.

“It presented a lot of challenges, but we were able to work through them,” he says. “We’ve been working seven days a week, and 80 hours weeks.”

Even through it all, Leloia says Custom Landscaping and Lawn Care hasn’t had an increase in cancellations, but not a lot of new work either.

“Maintenance is still thriving,” he says. “We’re not seeing the bigger, more expensive jobs coming through the way that we’d expect them to, but we’ve been managing to keep up.”

Leloia and the Harvesters were also working to improve human resources.

“All of our focus HR-wise has been tracking the virus, what to do if somebody doesn’t feel good, how long to keep them out and those type of things,” he says.

Leloia says he hopes things will continue to improve.

“We’re trying to figure it out as we go, like everybody else,” he says. “We’ve got to make sure the work is done and it’s as safe as possible for employees as well as our customers. I’d like to think, optimistically, that the worst is over.”

Harvesters’ Take.

As you can imagine (the COVID-19 cases) threw his operation into a tailspin. Not only did he lose the 12 crew members but those that worked with them. At one point, 40% of his operations were shut down. The result: All in his company rallied. They worked 12-hour shifts and seven days a week to care for their customers. In early May, those infected employees are returning to work. None were hospitalized and they are all well.

Sales are up over last year. Larger enhancement sales are down, but all in all, financially they are having a good year.

Frank reported that they received their PPP money but is leery if he will in fact be able to keep it.

As for the future, the next 90 days look better and better every day. So far, there doesn’t seem to be any long-term effects going into the fall.

Looks like customer lawn care is doing well despite their setbacks. As a matter of fact, they are looking for a business developer that can help grow their commercial department going forward.

The team at Lawn & Pest Solutions in Mississippi has been busy. Owner Paul Welborn and company beat its production goal for April by 17% and new sales are about 5% ahead of 2019 levels. However, Welborn says they budgeted for a substantial increase in new sales but that hasn’t materialized yet.

If the COVID-19 restrictions on social distancing relax without increased health concerns, he expects to see at least a portion of the increased budget come through.

A company sales challenge to add termite services has been going great because technicians have embraced the upsell opportunities.

The company normally pays technicians $30 for each referral that leads to a sale, but have expanded it for the sales challenge. For the sales, Lawn & Pest Solutions is tracking referrals whether they lead to a sale or not and offering prizes for the technicians that get the most referrals each month and then a larger prize at the end for the overall leader.

“One of the pest techs told me the other day, ‘I'm not going to let the other guys beat me,’ which tells me he's having fun with the challenge we laid out for them,” he says. “Our techs are already good at talking with customers, so we educated the techs on the big talking points about termites so they could increase awareness. We increased termite sales 100% over last April.”

Two new hires have been able to get started on the newly implemented career ladder, but it has somewhat been impeded due to COVID-19.

“A major component of the career ladder for the more experienced employees involves tests within some software,” he says. “With the social distancing and our isolation policies, we have not implemented that portion as well. So, we are a little off track from where I had planned to be year-to-date.”

Welborn is also monitoring the numbers more closely while rolling out a new budgeting system and chart of accounts to better watch gross margins and cost of goods sold. Welborn meets with his operations manager and office manager each Wednesday to look at year to date and month to date numbers.

“(We’ve) discussed worst case scenarios if sales do not materialize as we had budgeted,” he says. “Bill (Arman) stressed importance of watching sales week to week and me stepping in as owner to assist closing big sales.”

Harvesters’ Take.

Paul’s company is fortunate because they have not experienced any COVID-19 cases. He did, however, close his office as recommended by the state of Mississippi and followed all of the CDC guidelines with their crews and equipment. His managers and office people have been for the most part working from their homes.

Regarding sales, so far inbound leads have sustained them but not at the growth rate they expected. They are 5% higher than last year at this same time but that is not enough to support their budgeted growth. They have gotten some new jobs, one of which was particularly good in renovating a sports field. One thing they also tried was having a sales contest among their technicians. This was very successful and they loved the competition.

In order to accomplish the higher budgeted sales, they brought on a business developer but he has been struggling. This particular sales professional is excellent at person-to-person sales, but we all know what happened there. Paul is still optimistic that during the late summer and fall he will again be able to meet people and make the sales they need.

All in all, their financials are okay with gross margins running between 50-60% as budgeted. They also got their PPP money and are tracking it carefully with the hopes of having the loan forgiven. Paul is watching the numbers very closely as we requested and hopes the economy bounces back.

David Hawkins Jr., says the annual frenzy of new jobs is slower this year, but his company, Hawkins Landscaping, is managing the COVID-19 crisis as best they can.

First, it’s certainly true that they don’t have as many lawns to maintain at this time, but Hawkins says that it’s easier to deal with the usual stressors that accompany every spring. They have more time to spend at each site and have a better work-life balance for the 26 employees at the company. Plus, Hawkins says he can use everyone staying at home to his advantage. He pitches his services as creating a “staycation” environment and tells them it’s something they’ll always have. Plus, for customers looking to buy into a design/build project, Hawkins reminds them that the interest paid on certain home improvements are a tax write-off.

“It’s made (our work) more in their face. They’re there every day now,” Hawkins says. “In a way, it’s just like anything else – one door closes, another one opens.”

Of course, Hawkins Landscaping is not immune to the pressures of COVID-19. Among other things, some of Hawkins’ primary goals once he was selected for the Turnaround Tour have taken a backseat to putting out daily fires he didn’t anticipate would happen this year. Hawkins and his son, David Hawkins III, have had preliminary conversations with their insurance company as they discuss a transition plan so Hawkins Jr. can retire, and Hawkins III can lead the company.

Hawkins’ employees are still doing physical appointments and keep their distance. Hawkins recalled one weekend where he went on a jobsite and explained their services to a potential client in person because nothing beats face-to-face communication, he says. He jokingly calls email electronic volleyball, and apparently, his client agreed. Despite having lower bids, the client liked that Hawkins came out to educate them and signed on for his business. He recommends other companies simply be smart about how to handle everyone’s perspectives on COVID-19.

“When we go there, if they have their mask on, I put my mask on. A lot of people are really appreciative of that,” he says. “Like everything else, you have to be an opportunist. You have to have a little nerve and take a chance on it.”

Hawkins is also reexamining his pricing with the Harvesters. For example, they offer clients a 10% discount if they offer their whole hardscaping job to Hawkins, but the Harvesters pointed out that there’s a good chunk of possible money being left on the table as a result. “But sometimes, you’ve got to keep the guys busy,” Hawkins says. “So, we’re working through that now.”

Harvesters’ Take

Overall, the Hawkins team is doing good. Sales are up over last year at this time and net profit is up $50,000. The only sales that were down were from a slow snow season. They are still close to meet their sales goals for 2020 at $2.2 million in sales.

They have had little effect from the virus issue and have received their PPP money. Their focus remains on the residential market with installs and maintenance.

Their install backlog is at four weeks and pricing seems to be pretty competitive. They have also been getting some new sales from posting completed jobs on Facebook.

Moving forward over the next several months, they are focusing on four areas:

• Get testimonials from existing satisfied customers: The Harvesters have coached them up on these and given them a step-by-step method to get great testimonials.
• Marketing and advertising: Harvester Ed is assisting here by using Facebook, testimonials and “safe distancing” six feet face-to-face meetings with customers.
• Cost tracking: Production manager Carol Hawkins will track labor and material costs and will be adding this to the mini budget program.
• Getting more efficient: We want to get really close to the installation process and see where we can get more efficient, especially if they are giving 10% discounts!