Stronger together
Merging businesses with different service focuses and founding a common culture is helping drive growth for Columbia LandCare.
The conversation started simple. Jed Taylor, who started his company Missouri Mowing out of college, visited the office of a competitor one day and asked the question: “Would you ever be interested in selling out?”
Bill McWilliams, then owner of Columbia Turf, had never really thought about selling the commercial maintenance business he bought in 2006. But the two met for lunch during the summer of 2008, and they continued meeting every Wednesday that year.
“We would sit down and rekindle our conversation, and it went where it went,” Taylor says, relating how the two owners of Columbia, Mo.-based businesses began sharing experiences, discussing ideas and forming a relationship that eventually formalized into a new company in 2009. Today, it is known as Columbia LandCare.
Since the merger, the company has nearly doubled in size, building the combined staff of 45 employees into a team that will top 80 people this year. And Columbia LandCare boosted its revenues from $2.5 million in 2009 at the time of the merger to $4 million last year.
“Our momentum to move forward and our vision is greater together than it was separately,” says Taylor, 32. “That created great energy and motivation for everyone to carry their weight and keep on moving forward.”
Coming Together. Competition, burn-out and succession swirled in the pool of reasons for merging the two companies. Taylor admits that his company was running into McWilliams’ firm quite often while bidding commercial maintenance accounts. “We were competing on a lot of jobs,” he says.
And Taylor’s business, mainly focused on design/build, was beginning to bleed him dry. “I was personally getting burnt out,” he says. “You know, you run a business and you wear all the hats.”
Taylor now heads the design/build and snow and ice removal divisions of Columbia LandCare so he can focus on his passion. “The merger was a way to break up the responsibility (of running the business), so that was an original motivator for me.”
Meanwhile, McWilliams’ production-driven company was focused entirely on maintenance.
Taylor saw the merger as the way for both leaders to grow a business that would be strong across all sectors while allowing owners to manage to their strengths.
Aside from combining talent, there were sheer numbers reasons for joining forces. Taylor was running into the growth speed bump that so many business owners experience when their companies hit $1-2 million mark. You’re almost a “big guy” – but not quite. “It’s hard to get over that hump and up to the $3-4 million level,” he says. “By merging the businesses, we gained critical mass.”
Read how Columbia LandCare merged cultures after being born from two different companies. Find the story and sign up for the A Cut Above e-newsletter at www.lawnandlandscape.com/newsletter
Kristen Hampshire
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Adding irrigation Whenever Columbia LandCare’s accounts called for irrigation maintenance or installation, the company relied on its go-to, Mike Hentges of Hentges Irrigation. After all, the independent contractor had shared a shop with Columbia LandCare’s Jed Taylor for eight years at his old facility. Columbia LandCare purchased Hentges Irrigation this year, and Taylor expects irrigation to bring in a chunk of business this year. By acquiring the irrigation outfit, Columbia LandCare will inherit about 700 residential irrigation maintenance customers. And that could mean opportunities to cross-sell services. “The way that business goes, you install a system and you gain a customer for life by doing the maintenance,” Taylor says, noting that Columbia LandCare’s irrigation business will grow to 14-15 percent of the total business mix now that Hentges is on board. And now, rather than subbing out irrigation jobs, Columbia LandCare can sell the service as a part of its complete brand. Hentges gains some ownership in a larger firm, and the benefits of being on board with a larger company. “I think Mike is excited because he gets a little bit of equity in being in a bigger company,” Taylor says. |
Service guaranteed
Listening to clients prompted this contractor to start an irrigation warranty company.
Back in the late 1990s, CBS Services, a Houston-based landscape and irrigation company, was experiencing a high volume of residential installations. “We were doing upwards of 600 each year,” says Wade Martinez, president. “What we realized was that our success was based on our guarantee of fixing any problems. When you put that many systems in, you’re bound to get a number of people calling with complaints – even just because the dog chewed it up. So we decided to let customers know that if anything happens to the system within the first year, we’ll take care of it – no questions asked.”
The huge success of that first-year, anything-goes guarantee got Martinez thinking. If it was the guarantee that people really wanted, then how could he start bringing that to the masses? He began to ponder a warranty service program. Out of that idea came Smarter Warranty America (SWA). “SWA works like a virtual business assistant for contractors around the country,” Martinez says. “How it works is if a contractor is our partner, we handle his warranty.”
Martinez says it’s a win-win situation. Customers get the peace of mind throughout the ownership of their sprinkler system and contractors wind up with happy customers. Since SWA is basically a third-party back-up, Martinez says that even if the contractor who installed the irrigation systems goes out of business, the homeowner knows they still have someone to call. Are most customers willing to pay for the warranty? “Yes,” Martinez says. “Customers are certainly more than willing to pay a premium for the ease of mind that an extended warranty offers.”
Of course, the model of having an outside company administer warranties isn’t specific to SWA. Martinez says they studied the way Best Buy operates and built the idea from that model. “Their extended warranty program is very profitable,” he says. “About half of Best Buy’s profit is merchandise sales and the other half is just selling the warranties. So, we know that people like buying warranties. And it’s definitely true of sprinklers as well. About half of homeowners end up buying a warranty for their sprinkler system.”
Read more about how Martinez offers warranties and internship programs and sign up for our Water Works e-newsletters at www.lawnandlandscape.com/newsletters.
Lindsey Getz
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Five tips for growth Martinez started his career in 1988 as a high school kid with a lawn mower and a dream. More than two decades later, he’s grown the Houston-based business into a multi-million dollar landscape and irrigation firm that’s expanded into all areas of professional outdoor landscaping and sprinkler construction. But Martinez says he’s never forgotten where he started out. He offers the following five tips for achieving growth. Get out the pen and paper. “Write down your specific goals and objectives – weekly, monthly, semi-annual and yearly,” Martinez says. “Many overlook this simple task, but it is paramount in keeping your business on track for success. Wandering aimlessly in your pursuit of a successful business will lead you out of business.” Aim for organic growth. Martinez says the best kind of growth is organic – through your existing client base. The best way to do this is to work hard at maintaining customer relationships. “Stay in front of your customers at least six times per year with thank you letters, requests for referrals, coupon mailers, greeting cards and more,” Martinez says. “Provide excellent customer service. Customers who have had a pleasant buying experience with you will buy from you again – and tell their friends.” Maximize your web presence. There are many more online opportunities beyond a website. “Register with all of the search engines, get online reviews, post blogs, create YouTube videos and market with Google AdWords,” he says. “Increasing the information posted on the web about your company enhances your Search Engine Optimization (SEO) and makes it more likely for potential customers to find you.” Remember: cash-flow is king. “Under-capitalization is one of the biggest reasons businesses fail,” Martinez says. “As you grow, monitor your receivables daily or weekly and endlessly try to find ways to save on your expenses.” Go for great. When things are going well, it’s easy to stop pushing as hard as you were when you started. But you should never stop improving and trying to learn more. Martinez says, “According to Jim Collins, the best-selling author, ‘Good is the enemy of great.’” |
Marketing the extras
How to sell your less popular services.
When your best dish is steak, how do you sell the vegetarian special?
In the case of Pike Nurseries in Duluth, Ga. the core business is its retail garden centers and the bounty of perennials, annuals and gardenware that fill each large store. But the company also offers design/build and pick-a-plant services for customers who want a turn-key landscape solution.
Design/build isn’t the bread and butter at Pike Nurseries, but it’s a seven-crew operation that has grown in recent years as the company has cross-marketed the service and introduced itself as a one-stop-shop to clients who want to focus on sipping wine on the patio rather than actually building it themselves.
Mike Kunce, CEO of Pike Nurseries, says the secret to selling the “sides” is to train associates to ask questions and offer suggestions. Here are some ways Pike Nurseries sells its landscape design/build services.
Mixing messages. Pike Nursery spends 3 percent of its overall budget on advertising, and this includes marketing in newspapers and magazines, on television and radio and during home and garden shows.
These are opportunities for the nursery to tout its design/build services, as well.
“Most (landscape) companies can’t afford to advertise like we can,” says Kunce, noting that even though landscaping isn’t the largest service the company offers, this division can ride off the rich coattails of the core retail garden center business.
Sell yourself. Associates at Pike Nurseries are trained to solve problems. It’s all part of the company’s “gardening without guesswork” theme, and associates are rewarded when they sell one of Pike’s extras, such as the pick-a-plant service. “We train associates to recognize the need (for landscape services), and when they capture the lead and refer the customer to our landscape construction department, they get a small reward for the service,” Kunce says.
These rewards are paid out monthly and can average $50-75. Kunce says the reward is a per-referral fee and a percentage of the sale.
Teaching the trade. The focus on associate education kicks off in early spring at Pike Nurseries with its annual product knowledge fair for employees. More than 100 vendors set up booths and seminars take place during the two-day event. (Employees are split into two groups and attend on their assigned day.)
“Every associate goes to every booth and finds out what is new this year,” Kunce says. “That way, they will have the product knowledge to make the customer’s experience successful.”
Read more about how Pike Nurseries markets its services by bringing clients to its show room at www.lawnandlandscape.com/newsletters. You can sign up for the Business Builder e-newsletter at the same Web address.
Kristen Hampshire
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Targeting the campaign Events are just one piece of the marketing pie at Pike Nurseries, but Kunce knows that it’s worth the time and effort to plan socials for customers because of the rave response. He also knows which customers want to receive email promotions for orchids, perennials or landscape design/build services. That’s because Pike Nurseries relies on point-of-sale technology to tailor every marketing touch to customers’ buying preferences. Every time customers make a purchase, they give their phone number or name so the Pike associate can look up their Play In the Dirt rewards profile. If the customer isn’t part of the rewards program, the associates asks for their email address and contact information and enters it into the computer system before ringing up the sale. “We capture the data for every purchase customers make,” Kunce says. So if a customer purchases an orchid, the system knows this and an email is automatically sent to that person three months later featuring a coupon for a new orchid, since, by then, the orchid will be out of bloom. “This is all done automatically,” says Kunce, noting that the company sets up templates for such buying scenarios. From bulbs to roses to mulch – no matter what a customer buys, there is an email offer that will be sent to them down the road. |
Shared ownership
As Roger Jacobi planned for retirement, he set up an ESOP to ensure his company would be left in good hands.
Roger Jacobi founded AgriLawn, a lawn and pest management company in Oklahoma City, after being squeezed out of his first lawn care job in the mid 1980s.
“I worked at Green Keeper in Dallas, Texas for four years, which was a family-oriented company run by wonderful folks,” Jacobi says.
“I’d just graduated from college, and within four years they promoted me to a management level position.”
When the owners of Green Keeper sold the regional company to a national chain, however, Jacobi soon found himself without a job. “The national company that bought Green Keeper had their own managers in place to run things,” he says. It was a turning point in the life of the young entrepreneur. “I became determined to start something on my own, and it forced my hand in that direction.”
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So Jacobi moved back to Oklahoma City, and at the age of 28 he founded AgriLawn. From his humble, one-man-and-his-truck beginnings, he grew AgriLawn into a successful company with 32 employees, $3.5 million in revenue, a fleet of 25 vehicles and a new state-of-the-art facility.
“Getting laid off was the best thing that ever happened to me,” he says with a chuckle.
Yet Jacobi’s early experiences in the industry also taught him nothing good lasts forever.
When he and his wife began planning their retirement five years ago, they didn’t want to sell to a national chain. They’d worked hard – too hard, in fact, not to be able to cash in on the company’s continually escalating value. Moreover, they’d created an “ownership culture” among employees and wanted to see them treated well.
“My wife and I were rocking and rolling, putting in 70 hours week in and week out, and then we got to thinking, ‘What are we going to do long-term?’” Jacobi recalls. “That’s when we started exploring alternatives to selling the company.”
Today, AgriLawn is an employee-owned company with an Employee Stock Ownership Plan or ESOP.
“Creating the ESOP was a way for us to take gradual steps towards retirement while staying committed to our customers,” Jacobi says.
Read how Jacobi’s stepped away from the business and his employees have profited from the ESOP. Find the story and sign up for the Growing Green e-newsletter at www.lawnandlandscape.com/newsletter.
Lee Chilcote
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Generating business Today’s consumers demand information at their fingertips, and in the age of Google, Facebook and Twitter, companies withhold it at their own peril. After all, it’s available somewhere on the Web – so why not on your website? That’s why Jacobi provides lawn care tips on his company’s website. He recognizes the risk that some customers will simply take the advice and do the work themselves – or worse, hire another company to do it – yet he says the risk is well worth taking. “Our website is a resource for current and future customers, and it lends credibility,” says Jacobi, whose Oklahoma City-based lawn and landscape company is celebrating its 20th anniversary this year. “Once they visit one page on the site, they’ll visit other pages, too.” Providing lawn care tips is also a way of generating new business, he says. Prospective customers that visit the website often later call the office to obtain quotes on work. “They access the information on lawn care tips to become better informed about which services to choose,” Jacobi says. Consumers armed with information don’t necessarily want to do to the work themselves, he adds. Jacobi also views the lawn care tips as an educational tool for existing customers. “If they’re already using our services and want to educate themselves, we can refer them to the website.” Despite his belief that having an effective, informative Web presence is essential to his company, Jacobi stresses that having one-on-one conversations and developing personal relationships with customers is still important. “Nothing beats having a conversation with a customer.” |
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