Adding On Adds Up Fast: Marketing Strategies That Work

These market influences have led a number of green industry firms to expand their business offerings with any number of seasonal add-on services. Here we take a look at how six companies have pursued additional profits through add-on services, half of which are of the seasonal nature.

‘TIS THE SEASON. When Brad John-son had a lawn care company, he offered landscape lighting services as an add-on service. Today, he has sold the lawn care company and does just lighting, but not just landscape lighting.

Johnson is preparing for his second season as owner of a Christmas Décor franchise in Tulsa, Okla., and he said the future is bright indeed. "Last year was our first year, and we did $55,000 in revenue despite getting a late start," he said. "We were turning down business once we got going."

Johnson said holiday lighting is a very similar business to lawn care. "The same factors drive sales - the customers don’t have time to do it themselves and they feel pressure to have a house that looks as good as the neighbor’s."

And while lawn care companies may generate leads because of a current residential job, the results from lawn care are rarely as dramatic as with holiday lighting. "Nearly every job we did in a new area would get us two or three more jobs immediately from the neighbors," Johnson related. "We hardly had to market at all beyond attending one local home and garden show, some brochures and putting up door hangers."

Johnson asserted that considerable profits exist in holiday lighting. "Lawn care or landscape companies already have most of the equipment they need and the corporate infrastructure in place," he explained. "All that’s left is buying the lights, which are resold almost immediately."

"The margins are also better with holiday lighting," he continued. "People really enjoy spending these dollars because it’s during the holidays, the whole family enjoys it, and they get instant gratification."

The benefits of developing regular customers are even more pronounced with holiday lighting, according to Johnson, who said he expects a retention rate of 90 to 95 percent this year. "You can make money on the product when you initially sell it to the customers, and then make money on your service for putting the lights up and taking them down," he noted. "Next year, they’ve already got the lights, so you provide the service again and you begin to upsell them to add to their design."

Hydroseeding. John A. Meinert Landscaping, Pittsburgh, Pa., got in on the ground floor when hydroseeding technology was just being developed in the early 1970s. At that time, large units aided in the reclamation of large mines.

Today, Meinert is still hydroseeding, but his company is applying the technology to the residential and commercial landscape market. Pat Meinert said the company believes in the process and it continues to make money for the company today.

As a full-service landscape company, Meinert Landscaping does all of its own projects in terms of hydroseeding, but also contracts about 20 percent of its hydro-seeding business through other contractors.

The company owns two hydroseeders - a 1,500-gallon unit and an 800-gallon unit. Meinert said the availability of smaller units in the 300- to 500-gallon range allows more companies to get into the hydroseeding business on the ground floor, especially for smaller residential applications.

LET IT SNOW. Making the decision to offer snow removal services wasn’t exactly rocket science for Eastern Land Management in Shelton, Conn. "It was a means to add revenue during the winter months and help us keep key employees on," explained Bruce Moore, president.

What Moore has found, however, is that snow removal isn’t nearly as easy a service to provide as it may appear at first, but it’s becoming more of a necessity for companies in New England than an optional add-on.

Moore has also learned that companies offering snow removal services in order to qualify for bids can actually cost themselves money because of the pitfalls associated with handling this seasonal service poorly.

"As the market has gotten more competitive, it has also changed the way we bill for snow removal," Moore related. "It used to be set up as an ongoing business that we would sell whenever it snowed, and clients would generally pay more because it’s really an emergency service."

"Now, a lot of contracts bill the service as a separate part of the annual contract," Moore continued. "Contractors have to be careful, though, because if the contract isn’t worded correctly and you agree on a flat fee for the entire winter, you can really get hurt if there’s more snowfall than normal."

For some contractors, subcontracting snow removal is an easy decision. Eastern Land Management has done the majority of its own plowing over time, but Moore said that may be changing in the future if the market continues to grow more competitive.

"It can be a difficult service to provide, because you always have to be ready with the sand, salt, calcium and snow blowers," Moore said. "And the communication network is incredibly important. We have pagers and call forwarding so no matter what time a call comes in, it gets to the right person."

"Contractors can’t afford to miss a big snowfall because of equipment problems - you don’t know when or if the next one will come," Moore continued. "Plus, you can do a great job on a property for nine months, but if you screw up one snowfall, you’ve lost the entire contract. Customers place a premium on handling snow because it affects them so much more."

SOIL TESTING. For One Step Lawncare, North Chili, N.Y., calling soil testing an add-on service is inaccurate. It isn’t treated as a separate profit center, but as part of the package of service provided for customers.

In his search for ways to differentiate the company from its competition, president Bob Ottley discovered soil testing three years ago. He checked the competition, and only a handful of companies were doing soil tests, mostly for pH level.

An informal survey of his customers, however, revealed that they thought soil testing should be part of the program, and that few would be willing to pay extra to have one performed. So, he decided to make it a standard service for every customer.

Working with a private soil testing lab, Ottley laid the groundwork for a testing program. He decided to test each customer every three years, and began by testing half the accounts that first year and the other half the following year. He changed the cost of the average service call based on the additional cost of the soil test spread out over a three-year period.

Employees received training in collecting and marking samples. Flyers were developed explaining the new program to customers, and the computer system was modified to print labels for the sample bags for shipping to the testing lab.

One Step provides a complete analysis, which includes pH, potassium and phosphorus. Each customer’s lawn program can be customized based on the results of the test. This includes pH, which provides additional revenue in lime treatments when the test results show a pH problem.

Ottley isn’t shy about his company’s rates, which are 25 percent to 40 percent higher than his competition in his market. His customers see it as a benefit, and they have stuck with One Step.

WATER IS THE WAY. The key to successful irri-gation is getting the right amount of water on a property and then controlling where it goes. For Bradley Biggs, division manager, Mission Gardens Landscape, Mesa, Ariz., a growing niche of his business is keeping water in one place - the ponds he builds.

Designing and installing residential water features represents about $120,000 worth of annual business for Mission Gardens, and Biggs expects that number to grow. "We’re just about to hire our first full-time salesperson who will just sell water features," he noted.

Biggs explained that the average pond installation covers about 200 square feet of surface area and requires two days to complete, although the company recently completed a 2,100-square-foot job which included 6-ton boulders. "All pond designs are customized to the property because you never know what type of rocks you’ll be able to get to put around the pond," he added. "But you have to have a real eye for the work because you’re trying to recreate nature in someone’s backyard."

The majority of Mission Gardens’ ponds either include fish or chlorinated water. "Fish ponds are easier to maintain, but it can be tricky establishing the ecological balance in the water and keeping it clear," Biggs said.

Dealing with flat ground is a big challenge Biggs faces because ponds really need some type of stream entering into them to keep clean water. "There needs to be at least a 5-foot-long stream, but it can be tough to get that much slope on very flat property."

Otherwise, Biggs said pond installation can be a relatively simple craft to execute, if it is learned properly. "The problem a lot of beginners have is cutting the liners too short and letting water flow out of the pond," he said. "The sides have to be at least 3 inches higher than the water level, but people don’t understand the necessary precision, at first."

Irrigation. Ten years ago, Lori Spielman got her landscape company involved in irrigation installation and maintenance. Today, through slow and steady growth, irrigation now accounts for about 20 percent of revenues for Lori Spielman Landscaping, Ellington, Conn.

Primarily, Spielman works with smaller residential clients. This time of year, she and the crew are out winterizing systems they maintain, and they spend a month in the late spring setting up systems as well. They have about 120 residential maintenance clients.

When the company started out, Spielman sent employees for training on irrigation installation and maintenance. Today, she has two irrigation specialists on staff and continues to send them for updated training.

Spielman noted that there’s also plenty of spot maintenance to be done. Damage done by aerification equipment and thatch rakes are a frequent source of service calls.