You shouldn?t need a couple of inches of snow and 30 degree temperatures to remind you that landscaping, in most parts of the country, is a seasonal business. Regardless of the weather, bills still have to be paid and good employees, in a time of very low unemployment, are ever more important to hold on to. Even though it may seem like you?ve got more business than you can handle at the moment, you know the winter slowdown will inevitably arrive.
Rather than allowing the late fall and early winter to be the red ink months, you could view them as a profitable window of opportunity. The ideal scenario would involve offering a service that your current clientele is predisposed to buy. It should also offer a relatively high margin of profit while keeping your investment costs low by allowing you to use your existing vehicles and employees. In addition to providing winter income, this new venture should help pay for itself by generating new clients for your summer business.
For years, Kevin Lipscomb, Lipscomb Services, searched for some kind of additional activity that could keep his landscaping crews busy during the winter season. "Even in south Texas, where the weather is pretty mild all winter long, we were still faced with laying off good workers,? said Lipscomb. ?And, in spite of our reduced workload, our fixed expenses still had to be paid.?
Lipscomb?s creative mind came up with a bright idea -- to offer his landscaping customers the opportunity to rent Christmas lights and decorations from him. In addition, they would pay him to install and then remove them after the holiday season.
"Our landscaping customers ate up the idea. Not only do they avoid the work of putting up and taking down the lights, but they don?t have the hassle of storing and maintaining them, either,? explains Lipscomb. ?And next Christmas, they can choose to have us decorate in a totally different way since they don?t have a bunch of lights and decorations left over from the past year."
The holiday decorating season typically begins in late October with take down occurring in early January. Additional business can come all year long from event decorating for special occasions like weddings and parties, but it?s the holiday season that really jingles.
Lipscomb found that lighting and decorating is contagious. Nearly everyone who likes a cheery, well-lit home for the holidays dreads the idea of installing and, especially, removing the lights. So it?s not surprising that when his company shows up for an installation, they can immediately expect a dozen or more inquiries and job leads from neighbors and friends.
Outdoor Decor, Inc., the name Lipscomb has given that segment of his business, was begun specifically to take advantage of the landscaper?s slow-season window of opportunity. What began as a way to supplement a thriving landscaping business has now grown to take on a life of its own. Almost exclusively through word-of-mouth referrals, Outdoor Decor has generated business from customers who had never used or even heard of Lipscomb?s landscaping business. Many of these new accounts have now become Lipscomb Services landscaping customers.
"Christmas lighting has really helped us in two big ways," says Lipscomb. "First, it significantly turned the winter season from a cash poor to a cash rich period. Second, it?s brought a lot of new customers to our landscaping service. These are new customers for which it cost us next to nothing to acquire. They found us because they drove by a friend?s or neighbor?s house after we had decorated it. Some called us just because they saw our logo on the side of one of our trucks."
"Lighting seems like a simple business -- and it is, once you figure it out,? claims Lipscomb. But we had to work really hard for several years before we fine-tuned the right combination of suppliers, fixtures, tools, and pricing. There?s an efficient way to install lighting, and lots of inefficient ways. Do it yourself, and you?ll throw away lots of money that should be going toward your bottom line.
Lipscomb decided to franchise Outdoor D?r. He has several good reasons why purchasing a franchise is the most profitable way to enter and stay in the holiday lighting business.
?With Outdoor Decor, our goal is to get you over those first couple of years of start-up hurdles immediately. Once you know how to do it right, it?s a simple business. We?ll teach it to you and offer plenty of advice along the way."
Through trial and error, Outdoor Decor developed quick and easy methods of estimating and billing. They also know which suppliers offer the most reasonable prices, and they learned the hard way which ones offer the most reliable supplies. That?s very important if you want to minimize service calls during the holidays. Franchisees get the benefit of this experience plus access to information on specialized tools, insurance, and advertising materials.
One of the big advantages of an Outdoor Decor franchise is the low start-up cost. The initial franchise fee is currently $10,000, and payment options are available. The franchise fee includes enough UL-approved lights to decorate three to five homes, fasteners, extension cords, basic repair and tool kits, hats and aprons, vehicle decals, and training for up to three employees.
What makes this franchise really profitable is the low yearly franchise fees. "Twelve payments of $100 each are all we require of our on-going franchisees, no matter how large they become," Lipscomb says. "This allows us to provide year-round support and advertising while letting our franchisees maximize the profits they?ll see from their investment."
In addition to the cost of the franchise, Lipscomb estimates that each working crew will require $1,000 or less in tools and ladders. For most residential jobs, there?s no need for any unusual equipment or special vehicles. On rare occasions, the proper equipment can be rented with the costs being billed to the customer.
Although it involves lighting, Outdoor Decor?s installation power management methods do not require an electrician. "I can?t say you?ll never need an electrician, but we?ll teach you how to wire 99 percent of your jobs without having to call one in," says Lipscomb.
Last season Lipscomb estimates that his local business turned away more than 300 customers because he simply didn?t have the manpower to meet the demand.
As a small business owner himself, Lipscomb knows what it?s like to wear many hats. When you?re busy trying to keep up with the day-to-day demands of your business, it?s hard to plan very far into the future.
However, it?s important to take the time now to get set to make money this winter. Don?t wait until November to try and get into this business. You?ll miss out on a lot of opportunities, emphasizes Lipscomb. In other words, plant the seeds now and watch your business grow.