Should I Add Fertilizations to My Business? (Lawn Care Business Q&A)

Hey, everyone, it's Mike Andes and you're listening to landscape business course. Today we are going to be answering your questions from landscapers just like yourself. And if you'd like to join the texting platform where you can submit your own questions, just text the word landscaping to.

Hey, everybody, this is Josh here. Just editing the podcast. There was a little mix up. The number given in the podcast for the texting line was incorrect. The number that that is correct is 360-227-6362. Once again, the correct number is 360-227-6362 for the texting line. Thank you.

Text the word landscaping to that number. You'll be put in the group and then when there's question Q&As, I will ask you for questions and you can submit them. So we're gonna jump right into today's questions and answers session here, people texting in with questions. But before we do, make sure you've come and you have registered for Landscape Summit 2021. It is January 14th, 15th and 16th. It's in Bellingham, Washington. So it's about an hour and a half drive from Seattle. Unless you fly directly into Bellingham, it's like a five minute drive from there. We have moved the venue to a much, much larger facility. It's literally about five times the size. So that way we can have a lot. We can have enough people because of COVID restrictions. So in our state, there is like, I think they're like 15 or 20% of capacity, which we have a building that can contain over 1300 people and we're only allowed 200. And so please sign up because we're gonna fill up and I have this feeling we're gonna get shrunk down to 150 with restrictions. So please sign up. It could literally turn off registration. I just will not be able to sell more. So please sign up for that. We're gonna be learning a lot about profit sharing, implementing P4P and just creating an amazing culture for your team. I'm gonna have a lot more activities between owners. We're gonna be sharing numbers with each other. So make sure you bring your profit and loss statements from 2020 because we' actually like, we're gonna practice sharing our numbers with our team, with each other, and we're gonna watch how it should be done. We're gonna do a lot of different interactive stuff and having my team involved, sharing with your employees, if you bring them so your manager, your spouse, like, this is a great event to bring them to and we're feeding you really, really good this year. Cause we can cater this new venue. We're gonna bring in great catering and we're gonna have a Saturday evening dinner. So please, like this is not a money thing. It's $299 to come. I promise you. We spend every single dollar of that and a lot more on the shirts and the hats and I think five or six meals we're doing this year. So please, I'd love to see you there. It's definitely an event you don't want to miss and I'd love to see you there. So anyways, make sure you check out landscapebusinesscourse.com conference sign up today. Sign up your wife, sign up your husband, sign up your manager. I'd love to see everyone there. Alright, so let's go ahead and jump right into these questions. This is kind of part two of a video I started on the last episode. Let's go ahead and jump right into these. I have another 60 or 70 questions here to get through. We'll try to knock out some of these. Here we go. This question is from Ethan. How do you charge for leaf cleanups combined with mowing? Great question. All right, so you gotta determine. This is the tell tall sign. And that is if someone asks for leaf cleanup and it's early in the fall, you, you know, almost just based upon the fact of them asking that they're going to want their leaves removed on a consistent basis. Therefore you're gonna try to upsell them on a weekly or bi weekly time when you come and you gather the leaves. And that can usually be done when you're mowing. So if you already are mowing throughout October and November and you can say, hey, look, I'm only gonna charge an extra $20 per week for leaf cleanup and you know, you're just gonna be mowing over the leaves and maybe blowing some of what's on the, the pathways onto the lawn, for example. Now if someone asks at the end of the season, obviously you're doing a big cleanup. It's going to take like a whole day, a whole bunch of debris, et cetera. But in terms of charging for leaf cleanups combined with the mowing, if you've never done them before, this is how I think about it. Ask yourself, if I have to clean up all the leaves on the property, how long would it take me to blow off the hard surfaces and blow the leaves out of the bed onto the lawn and then mow the grass at a slower pace? Because you're gonna be, you know, picking up a lot of leaves. Usually when you're. When you've done that, you've blown all the leaves from the beds and the lawn or the driveway into the lawn, and now you're mowing. As long as you're consistently mowing like every week, there's not gonna be like piles of leaves. Usually there's gonna be occasionally after a windstorm, a lot more. But it's not gonna be like, you're not gonna be like hauling off a couple truckloads of leaves if you're mowing every week. So if you're mowing very consistently, you usually, you can marginally increase the price and include it as the season goes on because you've gotta mow anyways. And so you're like, hey, I'll just suck up the leaves while I'm at it. And you already getting the price, the cost of the money from the mowing in addition to the leaf part. So long story short, there is like, try to upsell people onto recurring services for leaf cleanup. And to determine that price, ask yourself, if I had to blow everything off the hard surfaces and out of the beds, how long would that take? In addition to mowing it at a slower pace than normal? So maybe if it usually takes me 30 minutes to mow the lawn, I'm gonna say it's gonna take me an hour, but it's gonna take me another 30 minutes to like, blow off the hard surfaces and the beds. So I'm gonna charge for an hour and a half, for example, which comes out to be three times what I would usually be charging for the mowing. All right, let's go to the next question. See here. Oh, there's more coming in. Okay, next question.

From Troy. When should I invest in a leaf debris loader for my business? What I have quoted is around $4,000. And a dump trailer around 8,000. Let me know your thoughts. I have some cleanup accounts, just haven't taken the pluns in this section of the business. Thanks, Troy. Alright, so good question. For $4,000 plus $8,000 for your dump trailer, that's $12,000 investment. If you're only doing this for a month out of the year, I would have big question marks. That being said, that $8,000 dump trailer could probably use 12 months out of the year for landscape jobs and other other jobs. So the $8,000 is not. I'm not so worried about because that dump trailer will be used a lot. The $4,000, that's the part where I Was like, okay, look, if you're gonna use it for once a week for four weeks, like four times, I don't want to do it because there's a good chance it's gonna need maintenance after I haven't ran it for 11 months. And I just don't use it enough for it to keep storage space. Literally, I'd rather rent it now. If you are doing three or four months of solid leaf cleanup every day being used, yeah, you should go buy one today. You should have bought one yesterday. Right. Because $4,000, they're not super expensive for the amount of money and time they save you. And so just keep in mind that if you're. It really depends on how often you're using them. And from what I've heard, because we do not have them locally. If you're gonna get one, spend an extra little bit and get the bigger ones. Get the bigger motor and really go for it. Don't get the ones that get clogged up. And you spend more time just hassling with the big tube than you do getting work done at a more efficient rate. The last thing you wanna do is spend $4,000 and spend your time unclogging the hose. So I've heard, go big or go home. And I feel like you wanna make sure you're using at least once a week for at least two months out of the year. That would be my takeaway. You gotta use at least 10 times in the year. Because otherwise I'd rather just rent the thing. You could probably rent it for $1000 or 1500 bucks for a couple months. So anyways, that's my two cents on that. Next question. How does one do pay for performance when they don't mow lawns? I have a landscape design business, and we do gardens, brush clearing, patios, walls, fences, and more abstract projects where we don't know exactly how long something will take. Okay, so first of all, we do do landscaping projects with P4P. In the course, we walk you directly how to do that. That being said, the last part's the part that gets me a little bit concerned, as you don't know exactly how long something will take because P4P is based upon budgeted hours. And you need to be accurate on that. You can't just go after the fact and make it up, because now you don't have any incentive for the crew to work faster. So if I was you in this case, I would try to standardize or reduce the complexity of your projects to the point where you can do budgeted hours and give that to your crew and give it as a target for them to be able to hit. That'd be my two cents. Next question. All of these are great questions. I could dig down and do an entire episode on them, but we just got a lot of them coming in. Is it a good idea to hire subcontractors for work we don't do, like seal coating or gutter cleaning? And tack on a fee. I'm not a huge fan of this. Honestly, like, when you start to grow and scale, handling subcontractors on one off jobs that you don't consistently work with them on is just more trouble than it's worth. Like, even if you up, let's say for sealcoating, it's a $5,000 job and you're getting a $500 cut. Like, the headache and the time. I usually don't feel like it's worth it unless it's jeopardizing a $50,000 landscape job where the client's like, no, I want you to do the seal coding and sub it out to someone else and take that off my plate. Then we might do it. But in general, I would stay away from it. And in order to do that, I'd be really open and honest about how much you're gonna be charging the customer if they do make you do the subcontracting? Like, if someone said to us, hey, we want you to do the 50,000 doll, but we also want to do the seal coding and just go get a subcontractor and take it off our hands. Be like, okay, no worries, Mr. Jones. But keep in mind, we're going to mark it up by one third if we do the subcontracting. And if they're like, okay, no worries, then great, we'll go do it. But if they're like, oh, that's quite a bit. Thanks for letting me know. I'll go do it myself, then we're off the hook for it. But in general, we do not like doing subcontractors because there's liability risk, there is professional risk in terms of if they don't do a great job. Now our reputation is on the line. We just. We don't like it. We don't like babysitting. We like to have our team that knows our standards and how we operate and on our schedule. And, yeah, I don't like subcontractors. I'm not a huge fan. Not a huge fan, but I know some people. That's their business model, and that's great. Great for them. Their business model is subcontracting a lot of stuff out and they make a business out of it. Good for them. What is the best way to start? Get started with no startup capital, do you suggest saving up money or borrowing money from the bank? I would suggest going out and getting jobs because booking yourself very bus will get you momentum and get you cash flow and that literally means getting a blower and a rake. Right now this is the perfect time of year fall. Go start doing some cleanups, generating that cash flow. Start stacking money away and you know, get momentum there. Hello, Mike. I'm 20 years old. This is my second season, my first second season on the landscape industry. I want to know if I should charge customers by the hour or by the job. You charge them by the job in terms of what they see on the estimate, in my opinion. But your back end pricing should be based upon how many hours it's going to take. So this gets confusing to some people. The customer sees a dollar amount for the job, that's all they see. They see this with the job. They do not see this is what you're gonna get. And then we're gonna charge you X amount per hour plus materials. They don't see that. They see here's what you're gonna get, here's the price for the job. But, but for you on the back end to calculate that number, you are using a dollar per hour figure, a man hour rate that you're trying to achieve. That's my two cents. Just my opinion. Hey, thoughts on a retail yard? We are leasing a space already set up and was an old landscape retail yard. I know you guys did this. I don't foresee a lot of profit from it, especially with buying a loader, but mainly a way to afford employing a full time office manager. That can propel me to the next level in my business. Any thoughts? Thoughts on this would be great. Thanks Bryce. All right, great question. This is exactly why I did a retail yard in the beginning days of Augusta is to be able to afford a full time office person. This is the exact reason why we started command center for the franchisees because most people cannot afford until they're doing well over half a million in revenue. A full time good trained office person. And they don't, they gotta provide and make sure they can afford them throughout the winter when they're a little bit slower usually. And so this is why we did command center because people do this in order to afford the office person when it's a bad strategic move. Long term, because it helps you in the next few years and it still might be a good thing for you to do. Bryce, if you're already there and it's already set up for you and it's not going to be a lot of capital expenditure. But yeah, you got a loader, you got more insurance cost. You've got to find someone that's not only good at the office, but now good at using a box, a loader into vehicles. It's a lot of liability. And for example, you might find a really good office girl that can do QuickBooks and run your software and do great on the phone and email, but they will not want to touch that loader. Well, that's difficult. And then you might find someone who's really good with the loader, but really not that great at answering people on the phone. So it's very hard to find someone that can do both of those things that are kind of extreme polar opposite. And I usually see if people are continuing to grow, that they will eventually take away the retail yard because it is low margin, it is super fluctuations. And the customer does not come at an even keel. They come in globs. They come at 15 people wanting the same product at the same time, delivered in the same window on the same day, all at the same time. And then you don't have anything for like a couple days. And it's very much touch and go. And yet you need to have service, you need to have employees there all the time. Very, very difficult. Don't like the model. It's low margin. And I hate when I have staff. They're just sitting there waiting for a customer to walk in. It's very much up and down, like I said. Whereas with landscaping and mowing, you can schedule out, you can get recurring work that you know is always coming in, and you can charge a much more premium price in comparison to just trying to charge a dollar more per yard or things like that. Very low margin. And like you said, buying a loader. If you spend $50,000 on a loader, I promise you that $50,000 could go a lot longer, a lot further if you spend that on marketing, hiring a couple other trucks for your landscape crew, stuff like that. Just my opinion. A good move in the next two to three years, Bryce. But if you continue to grow, you will eventually cut that part of the business out. It's a completely different business. Like landscape supply is very different than landscape service. The same way that hardscaping is very different than mowing lawns. It's different business models. So trying to do all of it just adds too much complexity to the business. We had dump trucks and delivery times and delivery windows. And then you have to be open on the weekends and evenings like it's. Trust me, it's no fun. Next question. What system do you have in place whenever damage is caused to a customer's property, such as a broken window? So we have what we call the yellow slip system. We've talked about this a lot where the, the employee has to go back, they have to fix the issue, talk to the customer, but in terms of if a broken window happens, they're getting a yellow slip. We're going to make sure it gets fixed. And with P4P damage cases, that money can be taken off of their performance dollars at the end of the pay period.

All right, next question. Hi, Mike, I've been in business a couple years and have a selling question. The past couple years I've been doing weekly mowing and then upselling existing customers with upsells as needed, Bush trimming, mulch, et cetera. I found it takes a lot of time to sell those things when I could be working on something else. I wanted to hear your thoughts on how to create value and close on residential contracts that include full service so I don't have to during the season. How to do it, Discounts for bulk residential contracts, how to close. All right, so yeah, this is a good question. There is definitely value in trying to sell someone on a full service package at the beginning of the year. The problem with that is you need a contract because if you just give them a monthly amount and they cancel the end of summer, you have not realized most of the profits of that contract, which are gonna happen during the slower months of the winter when you don't have to show up as much. Don't like that. I don't like inconsistent profit margins, hate it with a passion. And then secondarily there adds more friction to the process of the sale. When I have to explain the contract, explain when I'm showing up which services are included, take some services away that they do or do not want and that add friction to the sale. So usually it's easier to sell the mowing or the entry level services, the gateway services, and then upsell them in the future. And then what I would do if you're really wanting to do contracts is see who bites, see who gets the leaf cleanup, see who gets the mulch, see who gets the bush trimming, and then offer them individually a package once they've already done Services with you and say, hey, look, I've seen you've gotten all these services from us. Why don't we just put it together as a contract year round and your property will take good care. We want to do estimates anymore. You already know the price. You can work it into your budget and that might be the model. You go, all right, next question. I want to grow. We do 75% residential, 25% commercial mowing and landscape maintenance, cleanups, mulching, et cetera. With approximately 125 customers. Do you recommend getting into fertilization? This is my opinion based upon what I have seen, I would not get into fertilization. If you're wanting to focus on landscape maintenance, fertilization is great if you want to stay at 125 customers. All right, so this is the thing. If you say, I want to grow really really fast, don't add services, focus on making the business better, alright? And some people will disagree with me because they're like, oh, fertilization is where you want to be at. That's where all the money's at. That's fine. But then make a conscious effort to switch to fertilization. Don't just keep adding services. Because if I say, yeah, go get into fertilization so that you can grow, what's gonna happen is the next year you're like, man, I see this drainage in my area just so big. I think we should add that too. Then the next year it's gonna be like, oh, patios and hardscaping. That's where the money's at. You're gonna keep adding services and you're gonna keep growing in top line revenue, but not in terms of profitability. So I really encourage people to go deep on their services. In other words, select a few services you do really well at, go really deep on those and don't just keep adding more services, get really good at what you do instead of just adding more and more services.

Next question. And I'm not against fertilization, Everyone thinks that. But like, I just don't like the fact that people have to get certified. In most states, especially if you have a big tank, you gotta buy another truck. Usually you either as the owner, get certified and then you do all the work, which I don't like either. Cause you're in the field and it kinda locks you into that mindset or it just adds complexity to the business model if you have to train every single person on how to use the sprayer. And how do you get certified in the all different types of chemicals and all the rest of it. So anyways, I'm gonna cut it off there. I'm gonna start another video for the rest of the question that came in. But make sure you sign up for Landscape Summit coming up here in just like 70 days, I think it is in January. Three days. You'll completely change your business. And I really look forward to seeing so many of you go to landscapebusinesscourse.com conference and sign up today. For you, your spouse, your manager, all of your employees. It's just great time for your team to get together, get focused on what you're gonna do in 2021 and make you've ever had. You've been listening to Mike Andes on the Landscape Business course podcast. I'll see you next time.