It takes one to know one.
That’s the business philosophy Brian Lemmermann applies as owner of equipment distributorship Quality Power Equipment. Lemmermann is president of this new Chandler, Ariz.-based venture, with a territory spanning to California, New Mexico, Colorado and Nevada. And he’s the founder and president of Somerset Landscape Maintenance in Phoenix, a firm he started as a college student back in 2000 and has grown to a $10-million company.
“We wanted to start an equipment dealership and distribution business from the perspective of the landscaper, based on quality equipment and service,” Lemmermann says, relating how in the early days of his landscaping business, he’d wait a week or longer for repairs when his equipment was serviced by other dealers.
Quality Power is different, he says. It promises a 24-hour turnaround for service. And it sells a new line of commercial mowers from Excel Industries called BigDog Mowers, which Lemmermann describes as a “refined Hustler.”
Actually, Lemmermann’s suggestions helped shape some of the equipment features, he says. For example, Lemmermann wanted to see a radiator on the hydraulic line, a bigger pump, larger tires that would require less rotation and reach higher speeds. And he wanted simpler electronics. These suggestions were taken seriously, he says.
This is the first full year for BigDog Mowers, and Lemmermann was asked to be a distributor. “They believed in us and the other businesses we started up (Somerset Landscape Maintenance), so they said, ‘Here is your first order,’ and it was about $250,000 of equipment,” Lemmermann says. “We sold that out in the first month and a half.”
Lemmermann expected to take a loss in the new business, but the distributorship brought in about $400,000 in sales the first quarter.
“That puts us on track to shoot for $1.3 million the first year, because winter will be slower,” he says.
The fast growth is not by chance. Lemmermann has grown deep contacts in the landscaping arena over the years – and he knows that his competitors value the same qualities he does in a distributor/dealer: parts availability, efficient service, quality equipment and fair prices.
“In this business, we are more partners than competitors,” he says of the landscape firms that Quality Power serves. “We want to make sure their equipment is ready for the next day. We want them to save money on sprinkler parts or lawn mower blades so they can be more successful.”
Gearing up for success. Lemmermann is a bit of a serial entrepreneur. His business savvy was recognized by the Arizona Republic newspaper, which added the green industry professional to its list of the state’s “35 Entrepreneurs Under 35” list. He has dabbled in business outside the landscape sphere. In 2011, he purchased a resort property – “I was itching to do something different” – and realized that managing a venture four hours away was not a fit.
He sold that in October 2012, but still runs a heavy-truck repair shop in Phoenix, another business outlet.
“I’m intrigued by business and the way it works, and I like taking something and making it more profitable and successful, not just for me, but for others involved,” Lemmermann says. “It’s not about money for me. It’s about the challenge.”
When the opportunity to own and operate a power equipment distributorship/dealership cropped up through Excel/BigDog, Lemmermann saw great potential. “I get to work in the same industry – and the business is right next door (to the landscaping firm),” he says. “It’s a good fit.”
But starting up the distributorship wasn’t easy. “It was a real eye-opener,” Lemmermann admits. Power equipment retail is quite a bit different than landscape maintenance.
For one, there’s the inventory and upfront costs. If it’s not in the store, it won’t sell.
Then there are personnel requirements. At first, Lemmermann hired a mechanic and store manager, but these workers were too green in the areas of warranty work and equipment management. They lasted one month. The fleet manager of Somerset Landscape Maintenance, Mike Bennett, who had worked for an equipment manufacturer, understands the business.
He now serves as the vice president of operations at Quality Power, and Lemmermann has hired two more technicians and a salesperson.
Lemmermann is building a team – and growing momentum in terms of opening up dealerships, with plans to populate his territory with dealerships that carry the BigDog line. “I love the business,” he says. “I really like the challenge of figuring out where there is a need and filling that need, and having customers come back for more.”
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Managing muni work When Brian Lemmermann started Somerset Landscape Maintenance, his customer base was purely residential, though he had his eyes on commercial expansion. He saw opportunity in the municipal market. His father was a contract writer who procured services for the city of Phoenix during his career, “so he helped me understand that anyone can get the job if you have the right qualifications.” The caveat to that: “You have to do what you say you’re going to do,” Lemmermann says. “Because (municipal clients) will put you out of business if you don’t.” Lemmermann has watched a handful of large landscape firms in his region fold because “they did things the wrong way.” They are fined to death for not finishing a job, for not obtaining proper certifications, or for not following specifications. Or, they underbid the job then win it – and are committed to working for practically nothing. Lemmermann learned this the hard way on his first municipal contract. “I knew how to do the work, but I didn’t know how to bid the job or to account for the expenses that go with municipal contracts,” he says. There are bonds, and various workers’ compensation requirements. His first contract was for $150,000, and he estimates losing about $30,000 on the job that first year. “I knew after the first month,” he says. “But I said, ‘No matter what, I’ll do the job the way I promised I would.’ I stayed up late at night to spray pre-emergent myself, and I did a lot of the trimming myself. We worked really hard to lose as little money as possible.” The following year, Lemmermann learned and didn’t bid for that job. “You have to understand your costs,” he says. Looking to break into or grow your municipal contract business? Lemmermann offers these pointers: Offer something special. One contract might demand a certified arborist; another might call for a certified irrigation technician. If you employ specialists, you can gain an edge. Do the math. Know your costs. Understand the cost of every employee on the job. Tally up the expenses associated with taking on a municipal contract – what permits are necessary? What certifications are required? What about insurance? Follow through. You could face fines for not seeing through the contract. Be prepared to deliver exactly what is promised in the bid – or pay for it. |
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