State of the Lawn Care Industry: Ask Me Anything!

What's up, everyone? It's Mike Andes. Business boot camp, podcast, landscape, business course, a whole bunch of other things. But today we are doing Q and A while everyone is coming in live. Feel free to post your comments and questions in the comment section. Until then, let me go show you a couple things while everyone's hopping on. It is fall season. Lots of property cleanups this time of year. Leaf cleanups, if you haven't already. Go to lawn caremedia.com you got door hangers for leaf season. We got flyers, my personal favorite for leaf season. We also have postcards which are every door direct mail ready with the postcard stamp and everything. So check that out. Also the instant quote door hanger again right here where you can actually, if you're doing door hangers while you're walking up the house, you can put exactly what it includes, like leaf cleanup and put the price, put the notes on there. All they have to do is take a picture of this and send it to you and you got yourself a job. You don't have to ever go back for an estimate. So check that out. Lawn caremedia.com also we are going into the snow season, so we got door hangers, we got Postcards again, all EDDM ready flyers. Lawn CareMedia.com check it out. You get access to the to the Photoshop files as well as the jpegs. So if you're more savvy and want to change little tiny things, you got the Photoshop files. Also, light installation. This is just one of them, but there's a whole bunch of them as well. So if you do light installation, rental installations, teardowns, check it out. Lawn caremedia.com and it is extremely helpful. All right, let's go ahead and jump into some Q and A. We got a whole bunch of people popping in here. Let me just go ahead and throw this up just for fun. There we go. All right, comments. Welcome, Vincent. Whoa. Jeff James. Aiden. First string lawn care Benjamin John Garretson. Let's go, Brandon. Okay. Hey, Mike from Alberta, Canada. What's your best lawnmower that you have? The best lawnmower I've ever had. Honestly. I really like Gravely 148s and 152s because their price and in our market, our dealer is really good for Gravely. So we just, we just actually got Gravely as a preferred vendor for Augusta lawn Care. So really happy about that. We get 22% off MSRP being a part of Augusta. All right, what's some good ideas for recurring fall winter services in Texas? Want to profit in fall rather than feel like I'm chasing leads. Yeah. So the bottom line is going to come down to the fact that if you're getting a lot of leads coming in, you're going to keep your prices high. Now if you're just trying to fill work, you know, put work on the schedule that's in, typically you're going to reduce your margins just to be able to close more jobs and fill up your calendar. So the goal here is, if you want to create recurring work, is how do you get your existing mowing customers to convert into recurring cleanups, that is winter services. So what we do is we say, hey, look, we're finishing up mowing, we're going to go directly into winter services, and here are the things we're going to be doing on your property instead of mowing. And so that's what I'd be trying to do. And I'd be trying to make sure that you're very clear about the fact that you're not going to do leaf cleanup every time you come. You, you're going to spend the same amount of time as you would mowing. You're going to now spend on picking up branches, picking up leaves, pulling weeds out of the beds. And you get all those things done each time that you come in. And hopefully you can keep that on a recurring basis with the customer. So that way it is not a one off jobs. What are some good tips to prepare for rapid growth? I think the biggest thing would be obviously investing in your people. I was talking to someone yesterday and they this past year have been struggling. It's been their first year. They have a few employees, some part timers, some that are good, some that are bad. And I was honest with them. I'm like, look, the number one thing I'm concerned about is going into next spring with one solid, full time dependable employee that you know you can build the business on. That will be the difference between doubling next year and 5xing your business. And so I truly believe that right now, as we're heading into the fall winter season, if you don't have one solid, really good person and you're wanting to grow next year, you go ahead and do that now. So even like the local shop, we're hiring. Literally, we put out an ad yesterday to hire people because we know that this labor market is so bad and it's hard. Everyone's talking about that. Well, we've got to get creative. We got to come up with different ways of thinking about this. The problem and so our, our what we're trying out right now is like, we're going to try hiring everyone that's getting laid off. Everyone's getting laid off this time of year because we're slowing, everyone else is slowing down. We're going to go ahead and hire them. And I don't know what we're going to do for winter. We'll figure it out. We're gonna sell winter services. We're booked out four or five weeks right now. We have like 30 or 40 estimates. They said next week that we haven't got to. So the work is still coming in. We're gonna keep hiring and we're gonna figure out winter services and we're gonna keep the guys busy somehow and we're gonna hire people and say, hey, look, maybe we don't have 40 hours, but if we can give you 25 or 30, we'll make sure you have a full time position come spring. And for a lot of people, they, they don't mind. So, yeah, I'd say we gotta get creative with the labor problem and we can't keep moaning and groaning. Guess what? In 12 months, that's gonna be the excuse for a lot of people. So let's just tackle the problem now knowing that it's going to be the issue. Don't wait till next spring rush. Like, oh my word, I can't find people. Let me give you a news alert now. It's gonna be really, really hard to find people next spring. Okay. It's not, you know, it's like, well, there's not any more of the unemployment benefits. Guess what? That's not going to change anything next spring it's still going to be very difficult to find people that want to work hard. So you should be doing the hard work now of finding people and if not, implementing systems like pay for performance and profit sharing and open book management so that you hire good people and attract great people come spring rush. You've got to do that hard work now.

Thoughts on the weight? I'm guessing you mean right? Autonomous mower. Very, very cool. It's still very much in beta. We talked with Ed Wright at GIE about it. It's still one of those things where it's not like I can consistently depend 100% of the time it's gonna do its job. It's still in beta. It still needs a lot of kinks ironed out of it. And until that time, I just can't throw an entry level employee out with a $50,000 mower and say, Good luck. You know it. So it's, it's coming there, right? Like autonomy, battery operation, all that stuff is coming down the road. I think people are jumping on a little bit too soon in terms of the new shiny thing. When I don't want to make a business decision until it makes money. When it's a good business decision, that's when I'll be on board. Until that time, I'm going to keep testing, I'm going to keep playing with it. But I think we're three to five years out between before battery powered mowers are going to be a real not threat. I think it's going to be a good thing for our businesses. But until it's a good thing for our businesses from a number standpoint, I'm not interested in. I'll keep testing it, I'll stay, stay informed. But I'm not going to be all over. And autonomy I think is a good five to ten years out before. It's actually from a monetary standpoint makes perfect sense without stretching numbers and things like that. How many locations are in Tennessee? I'm guessing you're talking about Augusta. I think there's about 2, 3. 3 or 4.

What winter services do you do in your businesses? In your business? So we focus on the recurring side of winter services, which is we try to upsell our mowing customers into recurring winter services. In other. Other winter services that we do in our area, we get a lot of rain during the winter so we can't really do anything in terms of grading excavation, paver patios, retaining walls. It's extremely difficult. So our biggest thing is bush trimming really trying to push and advertise getting the debris or the leaves and the branches off of their house. We do have windstorms in our area, so that helps with, you know, picking up debri, just smaller type services. Right. That we can do. It's very difficult in our area. If you were a construction company like doing only grading excavation or big projects because there's so much rain that it would be like very stop and go during the winter.

Now, you know, YouTube channel has a great video about switching equipment to electric and there's number you can save a lot money on maintenance. Yes, I agree with that 100%. I think it makes a lot of sense for a solo operator too that is getting one set of equipment, especially the hand trimmers, hand trimmers, blowers, perhaps the mowers. Though from a monetary symbol, I just cannot make sense of buying 10 of those for my crew right now. From A money standpoint, I'd have to like. It would take two to three years to recoup the cost. And in two to three years that equipment's going to be basically like the stone Age. In three years, battery technology will be so far ahead of where it is now. Autonomy will be so far ahead of where it's not now. So I don't want to jump on the, on the bandwagon too soon. Pay a premium and literally by the time that that equipment is paid for itself, it's antiquated.

Yeah, Jeff, so this is a good point. You could charge a premium for it being quieter. I think there is definitely something to be said about the fact that for some people, they talk about being quieter when they've never driven a zero turn electric mower. It is quieter, but it's not a way quieter. Right. So we're not talking about like this thing being Purring Kitten. It is purring Kitten. And until you turn the blades on, the blades have noise. And so I think there is a misconception that it's dead quiet. An electric mower. It is when you're driving it, but when you turn the blades on, it's probably 70 to 80% the same sound as a gas powered mower. What age do you hire at? We typically wait till someone's 18. We've. It's just usually inconsistent before that. What do you think of the large companies that hire labor from other countries? I think it's a massive, what's the word? It's a dependency that they have. It's a vulnerability. There you go, a vulnerability. And over the past five to six years, a lot of these big companies have had to pivot away from the HDB program and hiring outside of the United States is because it's so inconsistent. And then with, with the pandemic last year, like even more so. It's just the number of visas can change on a dime and you do not want to have that vulnerability. And so a lot of them had to turn to subcontracting because their visas were cut short last minute the past few years.

How do you recommend a small lawn care maintenance company to hire a CPA in December to go over financials on year one under $40,000 revenue? I don't think you need a CPA. I think you need a bookkeeper. Alexander Alexandro, by the way, you met with us at gie. Liz is trying to get a hold of you, so email me. She's been trying to get a hold of you, she said, and she can't get through. She can't find an email that's working. So email melandscape businesscourse gmail.com please. But in terms of the CPA, you do not need a CPA to put together your financials. If you're especially at 40k in revenue, you really need a CPA to look over the financials at the end of the year and put together your taxes. And what you need throughout the year, though, is a bookkeeper. They're a lot cheaper than a cpa. We're going to be having a really cool announcement next week, so stay tuned for that. Something that's going to be launching next week here that will help with that. Landon Smith what percentage of profit should I put towards a Future Mowing Setup vs Marketing when to grow fast? So I need to market to get jobs but don't want to get stuck with no money for my second setup. I'm going to take this away just because it's taking so much of my space away. So good question. I think the debate is, okay, so should I put money into getting a mowing setup versus marketing? The bottom line is what I would recommend doing is extending your existing setups in. Pulling them as much as possible means putting two or three people potentially on that crew. And then it's a natural cadence to hop into another truck so it's being used to its max. Like it's not being used one or two days a week for the first few months. It should be used a lot from day one. And to do that, you're going to staff up in each crew. So you might have two people in the two or three people in a truck mowing all day long. They're not a full day. Well then now when you buy the next truck, you can pull one or two people into that truck and immediately it has a full day's worth of work. What I would say though, in terms of marketing versus that is just know that if you have leads pouring in, you needed equipment, you could potentially go get a loan on equipment. It's very easy. Zero percent, three years on. You know, Sheffield Financial or most dealers have a pretty good program for financing. Now the truck side of things is a little more difficult because it's going to be a 10, $15,000 purchase and you might not be able to get financing. So it just, it's everyone's case is a little bit different. But what I would say is $5,000 spent on marketing. I would rather do this. I would rather spend that $5,000 in marketing and buy a $15,000 truck than spend $20,000 on a truck. All right. I just believe that's the better move for the business. And especially if you're trying to grow fast, because the growth, your business doesn't grow more in terms of new leads and sales. Demand doesn't change. There's a better word. Demand doesn't change by getting another truck. It only increases your supply. And if you look at the supply and demand curve, you want demand. Demand is the objective. Like right now, for example, when I'm looking at companies on the stock exchange and like companies like Apple, they just reported and they had a down quarter because of supply chain constraints. And when people look at that, you know, people come out of the stock or it's like, oh, it's not as good. They do their hit, their sales numbers. But if you look at a little bit deeper, it's not that demand has changed. It's not that people don't want their products. It's the fact that they can't the products, they can't get the supply to them. I would much rather have a demand, way too much demand and not enough supply like Apple has right now. Then they have a ton of iPhones that they can't sell them. That's a problem. So I would much rather focus on creating demand, I. E. Marketing, than trying to focus on, I have all these trucks and equipment ready to go. Who cares? That's easy. Figuring out supply is easier than figuring out demand. In the next 12 to 24 months, we will figure out supply and all these supply chain issues. You cannot create an Apple in one or two years. Right. That demand, that brand awareness comes through a lot of marketing, a lot of advertising and building a brand. That's what you want to focus on if you want to build a really successful company. Can P4P work for a solo operator with one helper? Yes, it can. It's not going to be as much of an impact, obviously. And the big thing that you want to be measuring is does it take me, does the 10, 5, 10 minutes it takes me every day to run P4P going to outweigh the benefits that I get with having an employee? Because if I have one helper with me all day long as an owner, they're going to be working hard all day long. I don't really need to manage, have a system to manage their efficiencies. It's as soon as they're working without me or there's a second employee or there's another truck, that's when people really going to move the needle for your business. So if I had one helper, I probably wouldn't worry about ppp. Now, if you know you're going to grow, definitely implement P4P. So it's an easy transition as you do get a second, third, fourth employee usually during their busiest time of year when you're not going to have time to implement P4P. Everyone right now, everyone listening to this, all 55 people listening to this, this is the time to make changes on your business the next four months, next three, four months. This is the time to make changes in your business. That's why we have Landscape Summit in January. Because we don't have mowing, we don't have spring rush, you don't have craziness happening and where there's labor shortages and all the rest of it. Like the next three to four months is when you make the change to P4P. You might have heard me talk about for the past three, four years. You might have been like, oh, it's a good concept. This is the time to dig in and get it done. All right. This is the time to open up your books. This is the time to get your financials correct. This is the time to do everything you've been thinking that you should be doing and hearing me talk about all year long and your excuse has been I'm too busy. I'm okay with that. I get that, I understand that. But now, next three to four months, perhaps maybe it's January, February for you. If you have a slower season coming up, this is the time to get stuff done. And if P4P for you is what you need to get done this, this winter, I encourage you to do the hard working and make that change. Farmstead gardening. How can I grow my lawn care business when I have a full time day job? When should I hire someone? I would hire someone when you've either raised your prices significantly and you can easily cover their wages or I would hire someone when you have so much work coming in that you can't get to it on a part time basis. Right? So. And then obviously then the next step would be the next catalyst to growth is you going full time. Tesla outdoor power equipment. Let's go. How much should I spend on ad before spring to get a full schedule for mowing? So typically your best, your best mo, your best dollars spent on marketing. The best bang for your buck is going to typically be two to eight weeks after the grass has started to grow. Now I am going to start marketing two weeks before the Grass starts to to grow because I want to get an edge on that, right. So I know that usually don't. For example us, we start mowing March 1st. But we're going to, if we were advertising, we would start advertising mid February. Knowing those first two weeks of February we're not going to get a great customer acquisition cost because the grass is not growing. There is no pain for the customer. When there's pain for the customer, it's easier to get them past the buying decision and it's easier to get a premium price. So when we are marketing, we're going to usually start marketing a couple weeks before knowing that our customer acquisition cost is not ideal. But during the winter months it's almost impossible to sell people. On mowing you're going to get some, we always get some people, you know, setting up mowing services because they, they move to a new house and they're hey, we got it set up for spring. But it's your customer acquisition cost can be higher and it's going to be a lot harder to get people to think about grass growing when there's either snow or ice out on the lawn. Like it's difficult for customers to think that far ahead. Our farm used gravely two wheel tractors and I love them. Let's go. In your chart of accounts, do you have subcontracts under income for maintenance and landscape installs? What percent of your business is maintenance versus landscape installs? Yes. So in your chart of accounts for income you should have subcontracted income because you're also gonna have an expense for subcontractors and that way what is direct cost? Etc. But anyways, what percent of the business is maintenance versus landscaping installs? Usually we're around 50, 50, maybe 60% maintenance, 40% installs. And that's why everyone's like you only do maintenance, you only do long cut. No, we actually do a lot of our stuff is project based work from a revenue standpoint. And then there's some of our locations with Augusta that do only mowing. Literally 99.9% of their inc from mowing. And then we have others that do tree work and hardscaping and drainage and tractor work. So yeah, best online marketing, Google, Facebook for growing long mowing. You know what is really interesting? I have seen a massive shift in the past six months from Facebook to Google. We've been tracking it a bunch. I'm going to talk a lot about it at Landscape Summit and kind of what I see on the horizon. But man, Google Ads are coming back in terms of customer acquisition cost, I have to say we have, I was just looking at some of our metrics this morning across our system. We're like there, there's some locations at 20, 30 cents a click but like the average around like 60, 70 cents. I haven't seen that in years.

So it's been really cool. I'm gonna talk a lot about Landscape Summit, some of the things that we're doing, but I. Facebook has been definitely underperforming since they made the changes on iOS 14. The targeting is just not there. The customer acquisition cost has gone through the roof. The lead lead cost per lead's gone up. So just not, not as great. But hey, Facebook will figure it out because they're entering the metaverse. So best commercial walk behind for a new business. Honestly not the right person to ask that question. We don't use walk behinds. We either do stand on their sit downs. Cybertruck, let's go. I'm going full time in the spring with my lawn care business. Do you suggest staying solo the first year, then hire the second year really depends on your goals. If you're wanting to grow really quickly and you have money, then you can get a second truck, a couple employees, multiple setups, right from day one. If you are cash strapped, you don't have a lot of money to spend on the business, then I would focus on going solo. Build out your schedule, fill it up and then the second year, always your second spring rush is the time to leap. Okay. If you're, it's going to be the least cash intensive because your first year, typically you're just trying to get started, you're figuring things out. Your close, close ratio isn't as good. You'll figure that stuff out. And then spring rush, the second year is when we see consistently people take off. Like when franchisees join, usually they'll get somewhere between 10 and 40,000amonth in their first year. Just somewhere in between that range, it's the second spring rush where they'll just take off and they'll do between 30 and 80. So we just see that consistently as a new business. How do you go about gaining clients? I would start with these door hangers, right? Honestly, like this time of year we got the instant quote door hanger. We actually put the price when you're doing door hanging. We got the whoops, we got the flyers again, we got the postcards, more door hangers. So I'd be starting with this stuff. Go to lawn caremedia.com and get all these templates and if you want to rip off the templates, that's fine. Just look at the picture and rip it off. Make it up on Photoshop. I promise you the time to rip them off will take a lot longer than the cost it is to buy them. So. But feel free if you want to just, just, just copy them. One thing I'm doing is we get guys that work for us just for snow and we get them for spring because they like work year round. When it doesn't snow, we find something for people to do. Yes. And they'll stay with you year round. Correct. The challenging part for a lot of people is if you don't have snow. But in our area where it does freeze but it doesn't snow, and that's challenging because you. It's hard to find things for people to do. And so I would recommend is being honest with employees and be like, hey, we don't have work year round. Maybe during the winter we have 20 to 30 hours, but we will make sure you have 40 hours guaranteed from, you know, let's say March to November, right? Whatever your months are. And a lot of people, as long as you're honest with them, they'll be okay with it as long as they can know and expect and they can budget. And if they're like, hey, I need 40 hours, they say, okay, look, you can go work for two or three months, find something else. Maybe something inside since it's kind of miserable outside. Find something else to do. Work for a couple of months and you have a guaranteed position when you come back in the spring.

Does your little. Does your employees pay for their own grass when they run out or come back from a job to get more gas in the shop, to do more yards? We always pay for it. We give everyone credit cards. Blades of grass. Blades of glory. Glass. Blades of glory. Lawn care. What happens to my website if I start with Lawn Care web design but later decide I want to end the service? Is there any way for me ever to own the website your team created for my business? No. So the design part is. Is ours. That's what part of the subscription services. You would own the domain though? Yes, so any of the domain. That's why we recommend you buy the domain from like GoDaddy or HostGator or something like that and then come to Lawn care web design. We'll build the design, but the subscription model only works if we control the design. So if you ever leave the service, then you keep the website, you keep the domain, but the actual design is ours. And so that's how the subscription system works. That's why we don't have to pay. You don't have to charge the five or ten grand that cost us to build your site. We don't have to charge it up front because we expect to be able to keep someone for a long term. And that's why you should always be updating your website and utilizing the service. Send them pictures and video, things like that. Which by the way, good point. If right now you're doing leaf cleanup or you're getting the fall cleanup and all the rest of it, try to make sure that's on your website. Add a banner. We're about to add a banner for all of our franchisees that do snow service. Adding a banner at the very top that's like light blue that says now accepting snow service, con snow service clients, whatever it says. But you should be doing that. And that's why with Lawn Care web design we have the unlimited design changes. Just literally send us an email and within a few days we can get that up for you. Justin, what's your thoughts on how to raise prices? We are running about 850,000 business that is 75% maintenance running our numbers. It's going to be a shock to some due to inflation. Then you should absolutely raise your prices. Everyone.