Educating clients

In the landscape design/build business, “we deliver sticker shock daily,” jokes Ted Bentz, president of Second Nature. Many people are surprised at how much a hardscape, pond or retaining wall cost. Bentz knows his expenses, and can make 10 to 15 percent profit .

The problem is, customers need a little Landscaping 101 to understand the numbers on an estimate, he says.
“When my crew knows I’m heading off to talk to a potential client, they’ll holler at me as I’m heading out, ‘Don’t deliver another heart attack,’” Bentz says. “We, as an industry, need to educate homeowners so they understand what is invested in their landscape.”

Second Nature focuses primarily on more plentiful, but slightly less profitable, commercial work. These projects are bid well in advance, so Bentz has been thinking about pricing for 2010 (and 2011) for some time. Estimating gas prices is impossible, but material prices have decreased since summer of 2009, Bentz says. His goal is to save money in materials, give his employees raises and keep prices even for 2010. For contracts that he’s bidding for years ahead, he’ll rely on strong supplier relationships to get the best pricing possible.

And while the profit may be less for commercial work, Bentz says that efficiency on the job site actually makes up the difference. “We can work with our suppliers, have their trucks deliver materials, work with bigger delivery items – whether rock or topsoil – and I don’t have to spend my time or my guys’ time chasing materials,” he says.

Also, once crews park their trucks on a commercial job site, that’s their home base until the project is complete. With residential jobs, the run-around can end up costing Second Nature more than they can figure in to the budget.
The X-factor is always gas prices. Bentz does not include a clause in contracts that would allow him to increase the fee if prices at the pump skyrocket, but tries to build in a cushion in case they do. “These are the things that keep you up at night,” he says.

Overall, Bentz is pleased with 2009. His revenue was down about 10 percent compared to 2008. “You don’t ever want to go backwards, but given the conditions nationwide, I feel like we did alright,” he says.

“Projects are still happening, it’s just a matter of focusing on our operations and what we can do to lower the overhead numbers to be competitive. There is work to be done.”