Livin' Large: Commercial Accounts

"It was like the stock market crashed," he compared. "We had a big, commercial developer during the last recession who pulled all the funding on an industrial park, and we had to lay off 10 guys that afternoon."

The contract shrunk, leaving Heaviland Enterprises, San Diego, Calif., with only a few lot owners in the housing development, and they couldn’t support the costs. Though the company reconstructed the maintenance agreement to cover the bear minimum, it suffered losses in both profit and morale. "At that time, we weren’t as large as we are today, so that was a huge blow," Heaviland described.

Now, his business employs 85 people and his account mix is more diverse, stirring up his 100-percent commercial maintenance company with both large and small clients. Heaviland knows firsthand that contractors put more on the line for large, commercial clients than a mow-and-go job. This includes investments in labor, time and materials, plus an extra flurry of paperwork, added Lance Schelhammer, president, Grass Roots, Lenexa, Kan.

"It’s kind of like moving from the $5 blackjack table to the $100 blackjack table," he compared. This is not to say that commercial work is a game of chance. Contractors who book their schedules with a collection of large, commercial accounts and organize their businesses to cater to their different needs will find quite the contrary.

RISKY BUSINESS. When a majority of a company’s income stems from a handful of commercial clients, contractors cater to the accounts’ needs, noted Cullen Walker, president, W.L.M. Work-A-Holics Landscape Management, Naples, Fla.

"You do have all of your eggs in one basket, but you will be dedicated to keeping that account," he said, noting that he treats his "hit list" of key clients to courtesy calls and constant communication.

"It’s good to have a nice mix of small, medium and large accounts," Heaviland advised. "It’s like your stock portfolio – you want a balance so if one is not going well, the others will carry you."

Heaviland isolates what he considers his "gold accounts" – the 20 percent of his clients that comprise 80 percent of his revenue. He personally takes care of these preferred customers to reduce any risk of losing a valuable chunk of his business, he explained.

Key commercial customers should receive quick response to service requests, fair prices, quality work and professional crewmembers, Heaviland said. These considerations are insurance for "high-risk" accounts.

Less visible commercial accounts – properties that aren’t in high-traffic areas, for example – can pad larger projects and present a lower risk than jobs that require meticulous care or are located in densely populated areas, added Ed Watters, president, Watters & Chatham Landscape, Rome, Ga. Obtaining small-scale commercial accounts is also a safe way to begin building the commercial portion of a company.

"Do your slipping where people can’t see it," Watters suggested. "You might find your niche belongs down below rather than on top, and they are both equally important."

Variegated clientele also buffers a business during a tight economy, Walker added. "It is good to have diversity, because if you lose one account and it’s all of the jobs for one or two crews, you lost all of their work," he said. "It could be hinged on one person not liking something."

DIFFERENT, BUT GOOD. "Commercial properties involve matching your equipment with the property and matching your people with the property manager," Schelhammer explained. "You are dealing with a business that is using landscape to draw people into their building, and the jobs are more objective than subjective. Your landscape is going to help them achieve that objective."

The objective might be an image – a visual mission statement. And most often, there is one contact that is steering the project to reach this goal. Many contractors favor this cut-and-dry communication, Heaviland pointed out.

Also, one of these large projects might earn the profit equivalent to several residential accounts, Walker added. His company’s mix consists of 75 percent commercial work, but his residential clients bring in less profit for the time investment, he said. "One account is almost the same as far as office, communication and time, and we find that the behind-the-scenes stuff, such as filing, takes just as long."

However, commercial properties don’t mean more profit – just fewer jobs to build up the bottom line. But these few jobs often cause less of a headache when dealing with contacts. "With the building boom, there is probably more money in residential, but you have to be geared to deal with the client on a regular basis, and they might be picky and choosy," Schelhammer warned.

"Commercial clients are still picky, just over a broader scale."

Commercial clients look for quality, speed and price, whereas residential customers want to build relationships that reflect their investments, Watters noted.

Despite fewer small-scale requests and infrequent contact between the crew and the property owner, commercial clients are not necessarily easier to please, Heaviland pointed out. This is where residential and commercial arenas collide – organizing crews, targeting sales, checking for quality and maintaining solid client relationships are overlapping success keys.

SEALING A SALE. Commercial selling requires a little punch. Competition can be stifling for glamorous contracts, so companies that want to strengthen commercial sales can’t wait by the phone.

"You have to be aggressive," Heaviland stressed. "You have the job of differentiating yourself from other contractors."

Painting a positive image helps set Heaviland’s company apart from competitors. He does this with a sales presentation at his office where the field supervisor, customer relations manager and office manager discuss the company, the project and expectations with the potential client. He couples this face-to-face sales pitch with a reference list.

Commercial clients sense whether a contractor’s image is poor or polished, Schelhammer added. "From the name to the logo to the way you conduct business, you have to make the client comfortable that they are dealing with a professional entity, not a schlocky operation," he emphasized.

His company builds business appeal with articulate account managers, clean trucks and neat uniforms topped with a detailed brochure that identifies the company’s mission and the people who make it happen, he said. These extras are important, because most commercial clients don’t hire landscape companies just to beautify their properties, but to serve as a vehicle through which to drive their image, he added.

"If the company they hire to do their landscaping has an image, they will feel that they can certainly give them one," Schelhammer noted.

The little things – like reputation, reference lists, appearance and quality – aren’t so little when they make the difference between winning and losing a bid, Walker reminded. "Commercial clients are more intelligent, educated and experienced bidders that know their numbers," he said.

However, contractors need to make sure they are pitching their sale to the right person – the "decision maker" who calls the shots, writes the checks and often isn’t so easy to track down, Walker added. Architects and installation crews on construction sites often can point to property managers or project supervisors. After asking those working on the site questions about the manager’s credibility, how they treat their employees and whether they pay bills on time, contractors can decide whether or not to pursue a particular account, he said.

If the company decides to follow through with a contract and the service starts, contractors should expect to fill their promises, Schelhammer noted. "The commercial account manager will measure you on how you live up to that claim you make in your brochure, letter or verbal dealing," he assured.

FLEX TIME. Retaining an account can come down to the crew, the schedule and the communication that keeps these together. Timing is everything – especially when a landscape company’s duties coincide with other subcontractors’ site work, Watters said.

"We have to coordinate with other vendors and subcontractors, and usually there are deadlines," he described. "We might have to be done with our job by June 1 for move in or final occupancy [in a new house], and sometimes the site isn’t ready for us until May 15, so that time frame can be difficult."

Communication bridges these time gaps and keeps crews informed so the account manager can make necessary schedule adjustments, Watters noted.

"We try to go to the construction meetings with subcontractors and general contractors [when working with new construction] to make sure we know who is going to be in what area when, what needs to get done, and who needs to be ahead of who," he said.

This is helpful to avoid dead time on a property, Watters noted. "It’s all a speed game," he said. "We try to tell our customers that we would rather go in there late, after everyone is out, so we can move faster. I’d rather them be screaming for us to be there vs. screaming for us to get out of the way."

Commercial properties require flexibility in scheduling, but also can extend hiring options, Schelhammer noted. Since the account manager is the primary client contact, there is less communication between the crew and the customer, he said. People skills are less crucial. "It’s hard to find people capable of dealing with the public who can do the maintenance," he said.

Since commercial projects require less client contact than residential accounts, non-English speaking employees can adapt to the work environment without the stress of communicating with customers, added Heaviland, whose commercial crews are primarily Hispanic.

"Commercial can be more flexible with crews – especially the really big accounts," Schelhammer said. "If one crew chief is sick or it is a rainy week and we have make-ups to do, a lot of times they will go to a different account to help out."

Shuffling schedules doesn’t mean shifting quality, however. Most contractors agree they can’t afford to sacrifice quality.

"There are no second chances with commercial accounts," Schelhammer reminded. "You need to be very organized, you need to plan correctly and you really need to do your homework. If you lose a hand of blackjack, you don’t get another free one."