At this moment, the office at Anewalt’s Landscape and Contracting is in turmoil. Not because anything is wrong, mind you; the company is simply transitioning to a much bigger space on its complex in Bernville, Pennsylsvania—a move made necessary because of the company’s growth. As co-owner and general manager Lori Anewalt puts it, “We’re simply bursting at the seams.”
It’s a good analogy for what this story is about. While you’re out there growing your green industry business, you may not be spending much time worrying about how your office operates. After all, the important stuff is what happens out in the field. As long as work is flowing through the pipeline, and the bills are getting paid, the office is fine. Right?
Maybe not. It may very well be that efficiency gaps exist within the walls of your brick-and-mortar headquarters—gaps that are costing you money and holding your business back.
What sort of gaps are we talking about? Well, think about all of the processes and procedures that go on in your office. Calls are coming in, projects are being managed, schedules are being made and changed, people are being hired and fired, books are being kept, supplies are being ordered, and on and on and on.
That’s a lot of balls being juggled. And as your company continues to grow, more will be tossed to you. An efficient office can make the difference between your enterprise breaking out in a big way, or merely breaking even.
You may not want to analyze this all alone. After all, you’re not an “office-y” type; that’s why you gravitated to this profession. You like being outdoors, talking with clients, running crews, selecting plants and installing sprinkler systems, not squinting at numbers on spreadsheets. Some guidance might be needed to help make your office run as smoothly as the rest of your operation.
“Gutting it” into the danger zone?
“Most landscape contractors are pretty good at landscape work,” said landscape industry consultant Marcus vandeVliet, “but many of them aren’t very good at managing their businesses. I’ve found that the better someone is at being creative, the worse he is at managing data.”
As a result, he says, a lot of contractors operate their businesses on “gut feel” rather than solid data.
That’s dangerous, and not a strategy for growth. You can get into a situation where your business seems to be growing, but your jobs aren’t profitable.
The companies he works with are primarily small to medium in size, with a ‘small’ company being one that realizes between $500,000 and $800,000 in gross annual revenue, and a ‘medium’ company, one that turns over $800,000 to $2 million a year.
A company starts to enter the ‘danger zone’ once it hits that half-million-a-year mark. “Somewhere between $500,000 and $800,000 is the point where an owner can start losing control of his business,” said vandeVliet.
Where previously he’d been involved in every transaction, he’s now starting to rely on a key salesman, an office manager, or a field supervisor to keep projects on track and in the black.
“Typically, the overhead structure isn’t adequately set up,” said vandeVliet. “The end result is that the owner doesn’t have the data he needs to make better decisions based on facts instead of gut instincts. And often, his most ‘successful’ employee is the one who’s been there the longest, not necessarily the one who’s the most efficient.”
This may be the time to hire a green industry business consultant, or take some classes or webinars. You might also invest in one of the business management software programs designed just for our industry.
Willow River Landscaping & Tree Farm in Hudson, Wisconsin, is coowned and managed by founder Ron Shimon and his three sons, Dan, Jim and Eric. They’ve never felt the need to solicit outside advice. However, they did recently implement a landscape management software program which they use for all of their estimating and job costing.
“You input what you’re planning to do, and it’ll tell you exactly what you’ll need to charge in order to get back the cost of your skid steers, trucks, trailers, power tools, labor, and all of your other overhead,” said Shimon. “It does a pretty good job of recovering those costs.”
Willow River started using it a couple of years ago. At first, Dan Shimon became concerned that the program was causing the company to charge too much for jobs. “After he got deeper into it, though, he saw where, in the past, we actually hadn’t been charging enough.”
The program has helped this family business continue to grow at the healthy rate of 20 percent per year since 2010. Going into the fourth quarter of 2016, the company is doing substantially better than it did last year at this same time, and expects to turn over about $1.5 million by year’s end.
You may already be using a piece of software to help run your business. But is it adequate for your current needs? Aaron Williams, owner and CEO of Williams Landscape & Design, Inc., in Williamsburg, Virginia, had been using a program that was great for design/build projects, but had no provision for the maintenance side.
A new program helps in bidding for both maintenance and construction contracts. It’s used for routing, work orders, and time and materials tracking. All of the company’s client information is organized there, including all of the proposals.
“We do scheduling, time sheets, estimating, and job costing out of it. Job costing information gets spit back out to us daily, so we can tell where to make adjustments on big commercial or residential projects.”
Many companies have sought the help of green industry consultants with good results. Anewalt and her husband, company president Edward Anewalt IV, have worked with one for 12 years. He’s helped them greatly in streamlining every aspect of their operation. A second consultant deals strictly with the financial side of their business.
“Five years ago, we started to take a look at all the processes that go on in our office,” said Anewalt. “The first was paper flow. We discovered that we had many hands touching pieces of paper, and started asking, ‘Is this really the way we should be doing things?’” “We also looked at job costing, at how work orders flow through the office, from the person who writes up the work order, to how it gets to the scheduling room, to what happens once the crew leader has it in his hand. We looked at every aspect of that paper trail.”
Neil Bales, vice president of sales and marketing at Lawns of Dallas, feels that the consultant they’ve worked with for the past five years has benefited the company immensely.
“He improved how we think through our monthly budgets, everything from our estimated labor hours to materials costs, and in countless other ways as well,” said Bales. “He’s definitely helped our bottom line.”
One thing he did was completely revamp the way the company conducted employee evaluations.
Through the use of ‘grow cards,’ workers can see where they currently stand, and in what areas their performance could improve. During the evaluation meeting, goals are set for the coming year, and are recorded on the cards.
This has proved particularly useful for the sales staff. “I come from sales,” said Bales, “and I know that salespeople need achievable goals.” And, a road map to get them there. “As a for-instance, let’s say some one’s got a goal of half a million dollars in new maintenance contract sales for 2017.
So I’ll say to him, ‘Great goal; how do you plan to achieve it?’ The salesman says, ‘Well, I’m going to make calls and go out and meet with people.’” “That’s a very broad brushstroke. So what we’ll do next is pin down the specific pathway he’s going to travel, something more like, ‘Every week, I’m going to make ten cold calls and five followup calls to my existing clients, and set up four client coffees or lunches per month.’ That’s concrete and trackable.”
“I think the saying goes, ‘what gets measured gets managed, and what gets managed is measured,’” Bales said. “We can track these things, go back to our sales staff and business developers, and ask, ‘How many cold calls did you make this month?’” “Maybe he says, ‘I made 20,’ but another salesperson made 40. He can see a direct correlation as to why his sales pipeline only had five new leads in it, while the other guy had ten proposed contracts in his.”
Increasing efficiency in your office also means looking at everyone who works within those walls, at what they do and how they do it. Anewalt discovered many duplicated efforts. For instance, two different administrative people were tracking sales using Excel spreadsheets, using different methods.
Neither one knew what the other one was doing.
The reverse could also be true; there may be too much work for the number of people you have doing it.
“As we’ve grown, we’ve had to add people in the office,” said Williams. “We started out with one admin person. Once we reached the $2 million-in-gross-revenue mark, we realized that she needed help. Now that we’re at about $3.5 million, we have three people in the office, two full-time and one part time.”
One employee specializes in QuickBooks, and handles payables and receivables. Another focuses on the construction side, scheduling and calling clients and utilities. The third focuses on job costing. “You kind of resist bringing on that extra office person,” Williams said, “until the day comes when you ask, ‘How’d we ever get along without him?’”
Going paperless, or at least, using less of it
Williams started thinking about the way his office ran twelve years ago when he attended a job costing seminar taught by vandeVliet. “He said, ‘you’ve got to have a system for recording all of your numbers as they come in from the field, and then, turn them into something you can manage your business by.’” Hired on later as a consultant, vandeVliet advised increasing efficiency by jettisoning paper wherever possible. Williams bought tablet computers for his crew leaders, which they use to keep track of workers’ start and stop times. At the end of the day, all they have to do is come into the office, hit “upload,” and the data goes into the main computer system.
“The old paper-based system was very slow. Someone in the office had to manually enter each one of those times into our computer. But with the tablets, that part’s already done. It makes things much faster, saves a lot of paper, and the times are much more accurate.”
While moving offices and turning off computers, Anewalt’s company has had to revert temporarily to the old paper-intensive way of doing things. It’s been a great reminder of how things had to change.
“We realize that we’re at a turning point,” said Anewalt. “With the level of business we now have, as a medium-sized company, we can no longer keep up with so much paper and keep getting it right. I need to be able to bring things up on my iPad, along with someone else, so both of us can look at it simultaneously, from wherever we are.”
Not all of vandeVliet’s suggestions are high-tech. One simple idea made a profound change in efficiency at Williams’ office: a magnetic scheduling board. Each crew has a vertical line of magnets and correlating dates. Williams can see each crew, the names of the jobs they’re going to be on, and how many days are scheduled for each one.
“We can look at that board and know at a glance what materials we need to order and everything else we need to do for those jobs, such as calling utilities. It helps immensely in our weekly production meetings.”
The company has used the boards religiously for 12 years, and not solely for project management. They’re also used in sales meetings to track incoming leads and bids-in-progress, where they’ve been very helpful in revealing sales patterns.
Get your people involved
The task of making your office run better is one that’s never done.
“As efficient as you may be, you can always find things to tweak,” said Bales. “You should never sit back and say, ‘Now, it’s perfect.’ If you start feeling that way, I encourage you to get an outside opinion.”
Sometimes, the process can hurt. “There’ve been a few times when our consultant has ‘punched me in the nose,’ as he likes to say. It may take me a day or two to stop protesting and come around to his point of view, or we’ll at least have an open dialogue about it.”
Whatever is done, stresses Bales, your team needs to be part of those conversations. Changes never work well when they’re dictated from the top down. Let your workers have a voice, and allow them to offer solutions.
“I can tell somebody how I want something done, and it may indeed be the best way. But if they don’t have buy-in, it’s still not going to be done efficiently. Besides, they might have an even better way.”
Anewalt agrees. “We always try to explain to our staff why we’re doing what we’re doing. We don’t just proclaim, ‘Do it this way, because we’re the bosses, and we said so.’ We say, ‘if you have a better idea, or think there’s something we need to consider, please tell us.’”
Williams takes his foremen and top management on an annual twoday winter retreat. A consultant is invited to mediate. “We examine everything that happens from the time the client calls, to the moment we’re handed the check; what happens, and who’s responsible, at every step along the way.” A lot of good ideas have come out of these retreats.
Examining the way your office operates may not be as straightforward a process as gluing two pieces of pipe together. But it may be the key to keeping profits flowing, and your company growing. Isn’t it worth a look?