Market Trends: March 2000

CLEVELAND – The Lawn & Landscape Media Group announced plans to introduce Interior Business, a new publication that will target the growing interior landscape market.

The inaugural issue of Interior Business will appear in May with subsequent issues to follow in July, September and November. Current plans call for a bimonthly publication frequency throughout 2001.

"The debut of Interior Business magazine is the result of our identifying a growing need for quality business management information for this segment of the market, as well as numerous requests from current readers and suppliers," said Cindy Code, group publisher of the Lawn & Landscape Media Group. "Interior Business will address the business management concerns of the professional interior landscape contractor as well as the growing number of exterior contractors that we see entering the interior market."

The publication received a statement of support from the Associated Landscape Contractors of America at ALCA’s Interior Landscape Conference.

Contractors can sign up for a subscripton to Interior Business at www.interiorbusinessonline.com.

ROCKY RIVER, Ohio – Despite their customers widespread growth, some lawn and landscape suppliers have been challenged to increase profits in the last few years. Various distributors in the industry continue to sell or consolidate, and now LESCO announced it is realigning its business into three separate divisions: lawn care, golf and product supply.

"To take advantage of the size and scope that LESCO has attained in the past decade, we have decided to organize our business into a structure that focuses our organization even more closely on our customers and markets," said William Foley, chairman, president and chief executive officer. "Focusing separate management teams on each of our business units will assist LESCO in achieving its long-term growth and profit objectives, while increasing accountability for the performance of our business and improving our overall response time to customers."

The lawn care division will serve lawn care operators, turf maintenance companies and in-house maintenance crews. The golf division will serve LESCO’s golf course and international markets. And the product supply division will oversee purchasing, manufacturing and distribution activities.

According to Breck Denny, LESCO chief financial officer, the divisions were developed to better focus the company’s marketing efforts.

"Before the realignment, the company didn’t have divisions. It had a production orientation with a sales effort in golf, a sales effort in lawn and an operations group. Now we have more distinct areas of responsibility, so they’ll be measured as divisions in terms of responsibility. Hopefully we’ll be more responsive as a marketing group now," he explained.

Dana Wilson will head the lawn care division as president. Wilson previously served as Northeast regional manager, director of service centers and vice president of service centers and lawn care.

Alex Antonio was named president of the golf division. Antonio was previously CEO of Howard Johnson’s Enterprises, a privately owned producer of fertilizers and related products based in Milwaukee, Wisc.

Charles McGonigle will serve as president of the product supply division. McGonigle was vice president of operations for LESCO.

LESCO, which is a powerful force in green industry distribution with sales of more than $460 million through its 234 service centers and 71 stores-on-wheels, also announced the company has formed a new management committee comprised of Foley; the divisional presidents; vice president, chief financial officer; vice president, chief information officer; vice president, human resources; vice president, general counsel; and corporate secretary. The committee will focus on driving the company’s strategic objectives through the new business units, as well as seeking new opportunities to speed the company’s growth.

LESCO also announced record earnings of $11.6 million for its 1999 fiscal year. "We believe our unique business model has begun to demonstrate its underlying profitability potential," noted Foley.

LESCO’s stock was trading at nearly $17 a share at press time, down from a 52-week high of $19.50 a share in early July 1999.

About 84 percent of the company’s revenues came from the sale of fertilizers, turf seed and pesticide products, with the remaining 16 percent from equipment sales.
– Scott Hunsberger

LAGUNA NIGUEL, Calif. – While the good times roll for most of the landscape industry, business influences are carrying different impacts on companies of varying sizes.

Kevin Kehoe, a green industry consultant with Kehoe & Co., Laguna Niguel, Calif., said a survey his group conducted found that while landscape companies are growing, companies doing less than $750,000 in sales annually aren’t growing as often or as much as their larger counterparts.

"We believe that three things are happening," Kehoe noted. "Pricing is relatively less of an issue, so mid- and large-sized companies are getting more of the good work.

"Second, the smaller firms are maxed out," he continued. "They have grown so quickly that they traded profits for sales and are cutting back on taking any more new business.

"Finally, good people are gravitating to the large companies who are willing to invest more in people in terms of pay, benefits, career guidance, bonuses and training," he concluded.

This final claim was supported by the fact that 68 percent of his respondents offer performance bonuses to employees, and this practice is noticeably more common in larger companies.

BALTIMORE, Md. – Frank Stevens, a pioneer and visionary in the professional lawn and tree industries in Maryland, passed away Feb. 2. He was 78.

Stevens started in the industry in 1967 with Cornell Chemical Co., now known as York Distributors, selling pest control products. From there, he joined Scientific Plant Service. In the early 1970s, he started Operators Heat’s lawn care division, known as Maryland’s Lawnkeeper. In January 1978, he founded Pro-Lawn-Plus, where he remained president until his retirement in 1991.

Stevens was active in developing several industry associations, including the Maryland Turfgrass Council, the Maryland Arborists Association, the Maryland Association for the Responsible Regulation of Pesticides and the Professional Lawn Care Association of America.

DALLAS – The Portable Power Equipment Manufacturers Association’s (PPEMA) board of directors unanimously endorsed a resolution requesting all leaf blower manufacturers label blowers with sound levels as measured by the ANSI B 175.2 standard.

"PPEMA and its members support sound level labeling for blowers," remarked Fred Whyte, PPEMA chairman and president of Stihl, Virginia Beach, Va. "Sound level labels provide important information to potential purchasers and aid municipalities in the enforcement of local sound ordinances."

The PPEMA Blower Labeling Program is available to all manufacturers of gasoline- and electric-powered leaf blowers. The program stemmed from PPEMA’s recognition of concerns that have been expressed about leaf blower sound levels and the importance of providing prospective buyers accurate information about sound levels that may affect purchasing decisions.

PPEMA members also encouraged non-member companies to make a similar commitment to sound level labeling for leaf blowers.

"As manufacturers, we are committed to reducing blower sound levels, encouraging proper blower operation and facilitating blower labeling efforts," Whyte encouraged.

BATAVIA, Ill. – Aquascape Designs, a supplier of educational information and supplies for water feature installations and maintenance, was named one of the 500 fastest-growing, privately held companies in the country by Inc. magazine.

The company has grown by 1,831 percent in the last five years – good for 116th place on the list – doing a significant portion of its business with professional landscape contractors.

Aquascape Designs is headed by Greg Wittstock, who started the business while he was in college.

"This award is an exciting acknowledgement and one that recognizes a lot of blood, sweat and tears shed by our employees," noted Wittstock, company founder and president. "Our mission is to change people’s perception that having water features installed on their properties requires a lot of work."

Skinner Nurseries will expand its distribution network to serve the Orlando and Savannah/Hilton Head markets … Orbit Irrigation Products was awarded the 1999 Ernst & Young Entrepreneur of the Year award in its region for manufacturing … Calloway’s Nursery merged with Cornelius Nurseries … Gardners’ Guild was selected a 1999 Waste Board WRAP winner for reducing waste … Pennington Seed unveiled a new packaging and production warehouse … Gehl Co. expanded its Madison, S.D., skid loader facility … Florists’ Mutual Insurance introduced employment practices liability Insurance to protect employers from wrongful termination or sexual harassment allegations … Barenbrug USA purchased Lloyd Seekamp Seed of Gilcrest, Colo. … Boz-zuto Landscaping won 13 awards at the 1999 Prince George’s County Beautification Awards ceremony … Pavestone Co. acquired White’s Concrete & Pottery.