To seize opportunities when they present themselves, you must understand the ebb and flow of the typical business cycle. In the beginning stages, there is a limited marketplace, little competition and much higher profitability. Many successful landscape professionals started out with just a truck and some basic landscape equipment, and soon discovered a growing market for lawn and landscape maintenance. They also found that as their local markets matured, competition heated up and profit margins shrunk.
To grow and stay successful, many landscape companies had to offer additional services and products to their core business. Landscape contractors started to install brick pavers; lawn maintenance contractors added irrigation services; and the irrigation contractor began to offer landscape lighting. They found that they were leaving a lot of money on the table by not providing these add-on services. Providing these services helped distinguished them from the competition, while allowing them to prosper from new areas of profitability.
Contractors who offer a wider range of products and services to their established customer base can anticipate new business throughout the year, and lower the day-to-day cost of doing business. Deciding on what new products or services to offer your customers requires the consideration of several factors.
When defining areas for new growth, you need to look at the potential size, as well as the current state, of the market. If the market is large and saturated, you will find the classic business cycle qualities of heavy competition, high labor costs, and slim profits. Most contractors we spoke with say they would rather be on the upswing of a rapidly growing and still-profitable niche, than the downside of a large business that has high costs and low margins.
That’s why adding a growth business like hydroseeding to your core landscape business can help add profits to your bottom line. Hydroseeding has been described as the best kept secret of the landscape industry. First developed in the 1950s, hydroseeding has exploded into a profitable operation for the landscape contractor, as homeowners and builders slowly become aware of its value.
Hydroseeding, or hydromulching, is a grass planting process that is fast, efficient, and very economical. Hydroseeding is usually more effective than traditional seeding, and much more economical than conventional sod.
The process begins by mixing mulch, seed, fertilizer, and water into the tank of a hydroseeding machine. The slurry is then sprayed onto the ground, providing the proper environment to promote seed germination.
With the production of newer and smaller machines, contractors have a much easier time breaking into the hydroseeding business without investing a lot of money into the venture. This makes hydroseeding more accessible as a side job or an added service to a landscape business. (See related article).
As the green industry grows and matures, more and more contractors will be expanding their service offerings. And those who are successful will continue to build strong relationships with their customer base. To stay ahead of the competition, they will find new niches with specialty products like hydroseeding.
Whatever area of the green industry you serve today, take a look at your next job and evaluate what other services you could be offering your customers. Examine the need for the service, along with its start-up costs and profitability; then ask yourself, is there a future in hydroseeding for me?