Should You Grow Your Lawn Care Business During THE SUMMER!

Hey, everyone, It's Mike Andes, landscapebusinesscourse.com today it's Sunday. I'm just sitting out next to the beach here. Beautiful Birch Bay, or Blaine, I guess, Washington. And I wanted to address a question that's come in several times on email and on the Facebook group just the past week or so, and that is addressing really, should you grow or should you not grow this time of year? And I was talking to Abraham, our franchisee down in Texas, down in El Paso this past week, and talking about the growth that he's had and whether or not he should get another truck, another employee, as now we're heading into July and, you know, starting the rest second half of the year. And I think a lot of times it's easy to think like, okay, well, maybe I shouldn't get another employee. Maybe I shouldn't get another truck, because, hey, like, we're headed. Sorry about that. Those are actually fake bird noises. Those are fake bird noises. That's a water treatment facility. So they have these sounds of dying birds so that real birds and seagulls don't land on them and destroy it. But anyways.

The question is, like, should you grow? Should you keep growing your business this time of year when you're already through the spring? Like, the spring is done for most of our climates. It's super hot, the mowing starts to slow down. People start going to bi weekly instead of weekly service. You don't know if you can fill someone's schedule with 40 hours, etc. And so this is the debate that a lot of landscapers have. Like, man, I'm really busy, but, like, should I really grow? Should I really keep scaling? And so at our local shop, we've decided to keep the pedal on the metal, really, and really continue to grow this year. But it's not necessarily the right thing to do all the time for every business. And here's why. If you're buying a new truck, for example, and you're gonna buy that truck with cash, I'm just gonna assume that you're spending cash on that truck. You might spend 10, $15,000 on that truck. Then you go buy it, you know, get an employee. And you got to remember that growth sucks. Cash. I talk about this a lot, whether it been a course, the podcast, when you're growing, it takes a lot of cash. And I know, for example, this month, June 2020, the local shop has gotten probably six new employees this month and one to two new vehicles. And I know that this month they're going to be Very unprofitable, that they will probably just break even, maybe make a little bit this month. Whereas usually June is one of our strongest months in terms of profitability. So it's very hard sometimes to think, okay, well, and that's based on a cash basis, right? So like, because you got two vehicles, because we hired 20 people. When you hire people and you have people training them, you've got to pay the trainer and their productivity goes down. Because now, sorry about the brain, now instead of producing work, they are training someone else on how to do the work. And then you got this whole idea of, what if those people don't stay? And I've wasted money on training them during the most profitable time of the year when I could be doing projects, I could be getting more work. And is it even worth spending that 10 or $15,000 on that new truck when that's coming out of my cash reserves and I only got half a year to go? And so really what it comes down to is you got to have confidence, number one, that you can keep the leads coming in. And this is what I say so often when it comes to people wanting to grow is like consistent leads, Consistent lead flow is what leads to confidence in your growth. And so a lot of people talk about unsustained growth. And I think unsustained growth is when you're spending a lot of money for leads. Inefficiently, you're spending 2, $300 per customer acquisition cost and you do not have a very good cash flow. And you are.

Growing at a PA where even if you stopped growth, you would be unprofitable. In other words, if we hadn't have bought two trucks this year, this month, and hadn't have hired new employees, we would have still been like really unprofitable. That's unsustainable growth because you're basically just growing and growing and growing and buying new stuff. You're just taking on debt. And I think right now, as we've gone through this whole virus thing and we're going through it even now, I think that's what has exposed in every industry, right? The people that had unsustainable growth kind of depended on the economy staying the same way as it has been for the past 10 years, they're the ones who were left exposed. Whereas I think for a lot of us, especially in the landscaping industry, this is an opportunity to grow and to take some risks because there's other landscapers in our industry that are going out of business because they were over leveraged. There's other landscapers in our industry that are struggling to find employees. And because they can't get their employees to come back off of unemployment because the benefits are so good right now. And so you got to really weigh out these things. I don't need to give an answer to the question, like, should you grow in the middle of summer? The bottom line is this. Remember, you have half a year left. Like, if you are in any climate right now, almost any climate in the US you're only halfway through the year. So don't think, like, oh, well, from now on, I'm just gonna kind of coast, take the customers I got next spring. Next spring is nine, ten months away. And a lot of people ask me, like, well, how did you get to grow Augusta so quickly? Or, what'd you do? Honestly, it was like, hey, I have confidence in my ability to bring in new leads, and I'm gonna go out and take risks when I know they're calculated and when I know that the profitability of the business is sustainable. And what's a sustainable profit? Well, a sustainable profit is that knowing when, If I don't grow next month, that if I don't go out and buy new trucks, if I don't go and get new employees, then I'm gonna have a very profitable month. That's very powerful. Because if you do go out and grow and then you maybe grow a little bit too much, you just, okay, let's rein it back in. Let's not buy any trucks. Let's cut back on marketing. Let's cut back on hiring new people, and then have a really profitable month. Get your cash levels back to where they need to be at. This is the plea that I want to give you today, is like, we're only halfway through 2020. Like, literally right now, end of June, we're only halfway done. Don't stop accelerating. Don't stop. Don't think it's time to coast. A lot of times I make this kind of a post in, like, September, October, saying, hey, like, don't you still got a few more months of the season left? Like, let's finish this year strong. All that. And that's good. But, like, I see that even happening now. We've got through this whole virus thing. People are kind of getting like, hey, we're done. We're half. We're done. The spring, we're done. The growth part of the year. Like, what can you do this time of year to grow? What New services? What. What. How. How can you become more efficient? How can you become More profitable this time of year during the June, July, during August, when everyone else is just trying to. And it's hot and short routes for mowing, and it's just a matter of getting projects like, what can you do now? When everyone else is just like, okay, we got through the spring rush, awesome. Let's just try to stay busy the rest of the year and just build up our cash flow. And for a lot of landscaping companies, June is actually when they flip from being. They become profitable because they lose money throughout the winter. They lose money during the spring because they're inefficient. They got new hires, they got new trucks, all the stuff. They're training people. June is actually when you start making money. And so a lot of people like, well, I'm starting to make money now. This is great. And then they start building their cash reserves in the fall, and they build their cash reserves for the summer or the winter when again, they don't get as much business and. Or if they have unproduct, unpredictable snow patterns or things like that in. In the Northeast. So I really think this is the big takeaway is we're only halfway through the year, and you're only halfway through the cutting season. You're only halfway through the. The growing season. And I really do believe that so many people this time of year is like, hey, we've grown and now we're just going to kind of coast the rest of the year. Like, let's grow during the. Now we're hitting like June, July, and was kind of till the end of the year, just flatline and that's fine. But I really think if you want to grow your business and you're confident you can bring in new leads, go out and like, go get another truck, go hire another employee, focus on efficiencies, Figure out a way to beat out your competitors right now. And I'm not. I'm not one to like, bash competitors. I'm not into that at all. But, like, I'm all about beating competitors by being better than them. That is being a better employer, being a better marketer, being a better customer service place for your customers. Like, if the customers are being treated better, if they're getting a better product, better service from you, I want to see you win. I want to see you beat out the competitor that is not hiring correctly, not treating their employees correctly, that's pricing incorrectly, that is, doesn't have systems and procedures, doesn't take care of the customer. I want you to beat them out. And this is the time to do it. When everyone's marketing and putting door hangers out and spending money on ads during the spring, you become lost in the noise of everyone else's ads and all their marketing. This is the time when everyone else is on cruise control, when everyone else is just. Just kind of coasting. That's the time. That's the time to really take. Take advantage and to spend more money on marketing or to go get those employees that are right now on unemployment and are going to be looking for a job in the next couple months because their stimulus money is running out. This is the time. Take advantage of this. And maybe, maybe you're in the position, like, you know what? I need to build up my cash reserves, and I'm going to do it next spring because I need those cash reserves to get to the winter. I understand that. And I don't think growth is right for everybody, but for a lot of you out there, you want to grow and you want to continue to grow the business, and this is the time to do it. Not in the spring, because in the spring you have natural demand, the demand of the customer base. Generally, it's there organically. This is the time for the person who wants to grow to really succeed. Because you got massive unemployment. You got a labor market. Now that is, we haven't seen a labor market like this in years and years. And even six months ago, most of us would have been complaining about how hard it was to find people. Well, guess what? We got millions and millions of people in unemployment. And that's the labor market you can tap into trying to find those people that used to be contractors or in construction or working at a restaurant or on a cruise line or at a airline, they are looking for a job. You know, if they could hurl bags for 12 hours a day doing luggage at Delta Airlines, guess what? They'd probably be a really good worker for you in the landscaping industry. And so I really do believe that this is the time to accelerate. This is the time to really push through. If you're wanting to grow, if you're wanting to build up your cash reserves, this is a great time to increase your prices, increase efficiencies, focus on systems and procedures, and make yourself profitable enough so that you get the cash you need. So next spring you can take advantage and you can grow when the organic growth is there. Keep in mind, if you're going to grow during this time of year, if you're going to grow during the summer, that organic growth and organic interest in our products and services, in life Landscaping industry is less, your customer acquisition cost is going to be higher. But again, that's not the only thing that leads to an increase in growth. Labor is one of the biggest things and that's why I'm encouraging so many of you this time of year to actually go on the attack. You've got half the year remaining. Do not throw in the towel. Do not go on coast or cruise control. This is the time if you want to grow your business. The people at the end of 2020 that look back on everything we've gone through in this economy, gone through with this whole virus thing, the people who actually took advantage and accelerant on their systems, put accelerant on their business during this time when everyone's afraid, when there's so many people unemployed, when you know it'd be easy to coast right now and just build a nice cash cushion. If you're wanting to grow, this is the time to do it. We've got six months left in 2020. If you wanted to grow, this is the time to do it. Hopefully that helps someone out there. Make sure you check out landscapebusinesscourse.com we're going to be adding some really good content there next month. Adding in version 1 of P4P the software as well as already on there is the recording from Landscape Summit 2020. So the price will be going up once we add the software access in there in July. But I just wanted to say thank you everyone that has joined there lawn careweb design.com allowing me to make more content. We're gonna have a full time video person starting with me, Josh in July, hopefully provide more content for the community. Hopefully you guys learned something. Take care and Remember, you got six months left in the rest of 2020. Keep your pedal to the metal.