Jud Griggs
Design/build consultant
To fight the seasonality factor, most companies I talk with immediately start looking at reducing costs wherever possible. This usually means cutting people. While reducing costs is important, layoffs can have a negative impact on your workforce.
A better solution is to look for alternate sources of revenue. These revenue sources may not be as profitable as the landscape work you perform in season, but the ultimate goal is finding ways to reduce, or better yet, eliminate the red ink on your P&L during the winter months. Your goal should be to at least break even. Generating some positive cash flow would be an added benefit. These are six ways to reduce seasonality:
1. Snow removal
On the positive side, it can be extremely profitable — especially salting operations. You can keep a majority of your key employees working over the winter. It’s also another service that you can offer to your clients to keep them as long-term, loyal clients. On the negative side, snow removal beats up your employees and your equipment. Invariably, snow and ice events happen on Christmas Eve or Christmas Day which disrupts your employees’ families. If you have an extremely busy winter with lots of snow, your team may go into spring burned out.
On the equipment side, be prepared to replace a couple of transmissions on your vehicles and repair some cosmetic damage to your trucks. A final word of warning — do not budget for a lot of snow each year. You could have a windfall of cash one winter, where you might have little or no snow revenue the next year.
2. Holiday lighting
Many contractors are doing their research and jumping into holiday decorating on their own. Others are choosing to work with some of the holiday lighting franchises, which cost more but they offer training and pricing assistance. The challenge with holiday lighting is that most clients want their lights ready to turn on Thanksgiving weekend. In some years, your production team is still fully engaged at Thanksgiving because the weather has not been too cold to stop production.
Some years, it conflicts with completing your fall clean-ups. A point to remember is if you are doing holiday lighting and have to climb ladders to reach heights over 12 feet tall, you had better check your workers comp insurance. This can be a big cost that cuts into that added revenue.
3. Winter decorating
Winter decorating includes elements like holly branches, red twig dogwood or pussy willow branches to existing containers. The containers can be at the entrance to the house or commercial office to add some life during the grey doldrums of winter. This is high margin work that many of your crew members can do with minimal training. You may want to offer the option of freshening up the displays at least once or twice during the winter.
4. Winter pruning and cutbacks
Winter is the perfect time to do major structural pruning on shrubs and smaller ornamental trees. It’s also a great time to do major cutbacks on some shrubs. By doing this pruning in the winter, you get a head start on your maintenance operations in spring. As noted above, if you are not insured to do pruning work over 12 feet, leave that to the tree companies. You may want to consider teaming up with a tree company to subcontract out your major tree work.
5. Perform construction work in winter
It’s possible to construct patios, walks and retaining walls in the winter with proper planning. Performing these functions in the winter means you have to protect the area you will be working on from freezing (typically with frost blankets and marsh hay). While this construction work may not be as efficient as it is in season, the ultimate goal is to at least cover your overhead costs and break even. Some contractors even offer a small discount (5%) to clients to allow you to push some of their projects into the winter months.
6. Plant large trees in winter
We are talking four-inch caliper trees and larger. The advantage of planting large trees in the winter is that you can drive up to the planting location with minimal damage to the established landscape because you are driving on frozen ground. This again requires advance planning to protect not only the tree but also the planting location from freezing.
To ensure these seasonality reducers will be successful, set some team goals and celebrate your successes. Remember when you set your goals, the key is to reduce losses over the winter months. I recommend designating one of your supervisors or future managers to lead this initiative. Then, track your progress toward meeting those goals. Post weekly progress to keep everyone engaged. Pizza parties or having a party at the local bowling center make great team-building opportunities.
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