The Offseason Book: Chapter 5: Adjacent Services (Cure 3)

Chapter 5 adjacent services the crisp morning sun beat down on the white snow as I pulled up to Cathy's lawn and landscape in Ohio. Josh. Cathy stood out front, pacing with a weary expression, his eyes tired yet welcoming. He was fresh off a 17 hour shift, plowing snow and salting driveways. At first glance, his operation looked like it should be thriving. Over $700,000 in revenue last year. Four trucks, a solid client base of big contracts. But within minutes, the real picture began to surface. And it wasn't pretty. An unexpected situation had blindsided Josh last year. His brother helped manage the business, but he stole work and equipment from the company while keeping it hidden from Josh. Josh hadn't seen the signs until it was too late. The books were a mess. There was no way to track expenses. Employees who got too close to the truth were mysteriously fired by his brother. There was betrayal, confusion, and loss. Unused and broken mowers littered the dimly lit shop space. By the time I got there, the fallout was staggering. His financial statements said he made $150,000 in profit the year before. But Josh had three bank accounts, all negative. Overdraft fees piled up daily. He was behind on his personal mortgage, behind on his car payments. He buried himself somewhere between $400,000 to $500,000 in debt and didn't know the exact number. His website didn't work. It had a security error that blocked people from accessing it. Someone misspelled the business name on his Google listing. He had zero Google reviews. Third party lead agencies outranked his website online. His brand had no digital presence. When I tried to look him up, I couldn't find him. But the financial mess wasn't the only issue. Only two of his employees had driver's licenses. Most were unprofessional short term hires. Some didn't speak English. Some were working without legal authorization. Josh's ex wife was getting paid cash to work for the business. In the past, Josh had fired her. She was dragging the culture of the team down. The only reason Josh kept her was that she had a driver's license and could transport the crews around. Each morning he picked up employees from their homes. He drove them to job sites and balanced his schedule to keep things running smoothly. Those same employees complained about low pay and were inconsistent with attendance. Josh was being pulled under by the weight of low margin work. Massive commercial mowing contracts looked good on paper but were paying about 30 to $40 an hour. They needed a lot of crew coordination. This caused frequent callbacks and made Josh depend on cheap, unreliable workers. He was Also trying to grow the business, he was thinking about adding services like tree removal, chipper work and hydro seeding. But he was already swamped with mowing and landscaping jobs during the spring rush. The problem wasn't that Josh wasn't working hard. It's that he was working hard on the wrong things. He had no margin to breathe, no way to get ahead, and no clarity on where the business was bleeding out. We fixed the basics first. Lawn care, web design, rebuilt his website from the ground up. In six weeks, Josh went from zero Google reviews to over 40. Customers could finally find him and they liked what they saw. The real breakthrough came when we separated the profitable from the painful. Mowing wasn't working. It was low margin and had the same seasonal demand curve as landscaping. So we offloaded it. Josh began subcontracting all his commercial mowing contracts to cheaper local providers. Instead of making $35 an hour doing the work himself, he could make 15 to 20% margins without touching a blade of grass. This let him focus on his strengths. Project work like landscaping, hardscaping and design installs. Jobs that paid 70 to $90 an hour with fewer callbacks, with real profit with crews, he could pay more. The labor pool he could hire from changed. He didn't need to keep hiring under the table workers to survive. He could attract legal laborers and pay them well. Then we doubled down on snow service jobs. Josh already had snow contracts. They were profitable, but he never capitalized on them. None of his crew could drive the trucks. We flipped that script. He held onto the snow removal parts of the commercial jobs and subcontracted out the mowing. This changed his year. Now winter was a huge profit driver, not a setback. He could go out and sell more snow contracts. Josh finally fired his ex wife from the business. He didn't do it out of anger. He didn't need to rely on her being a driver anymore. He started hiring employees who were legal, professional and had driver's licenses. He paid them more, they stayed longer. His customers were happier. His stress levels dropped. In six weeks, Kathy's lawn and landscape had turned a corner. Not because we had added more services, not because we got more leads. We realigned the business to focus on high margin services, snow and landscape jobs. These services complement each other well and have opposite demand curves. This helped reduce seasonal chaos. This wasn't about working harder. It was about working smarter. It was about selling services that offset the demand curve of his core business. Landscaping and hardscaping in the summer, snow removal in the winter. That's how you fight seasonality. After four weeks with the new website, Josh began receiving four to five landscaping estimates daily. Josh booked himself out for 26 weeks into the future with profitable project work. That's how Josh started to win again. He avoided low profit margin mowing jobs. He sold snow as an adjacent service to his core landscape offerings. Tier 3 for Seasonitis is selling adjacent services. We looked into lockdown mode, which means shutting down in the off season. We also focused on finding more and better jobs by advertising and upselling.

Now let's discuss how to sell services adjacent to your core business. This method is effective if your market faces severe weather changes in the off season. These shifts can stop you from selling your main service. This was the case for Josh at Cathy's Lawn and Landscape. He couldn't do landscaping jobs when there was snow on the ground. Cure 3 is also ideal if you do not want to change your business name or brand identity. With the Ford F150 example we used last chapter, upselling means upgrading from an XL to a Lariat model. Cross selling means selling a trailer, bumper or kayak rack with that truck. This approach appears everywhere in consumer experiences. When you book flights on Expedia, you'll see car rentals and hotel options at checkout. These have nothing to do with flying but complement the trip. The fundamental idea of cross selling is saying, you know that thing you bought? You might like to buy this too. Amazon excels at this strategy on their product pages. More on that soon in your workbook. On page 14. We'll examine the cross sell tree. But first let's consider the upsell service funnel. Mowing is at the top of the lawn care funnel. It's affordable and most customers need it. From there, upsell them to a property cleanup, then to recurring bed maintenance. Then I sell them chemical applications. The highest value lawn care customer receives full service maintenance. I sell them year round service for all their outdoor needs. That's the upsell service funnel. As discussed in Cure 2, I am selling a better version of the original service. Now let's examine the cross sell tree. I provide waste removal, snow removal and top dressing with overseeding for my mowing customers. They perform these services on the same property with similar equipment. Property cleanup customers might need pressure washing, storm debris removal or gutter cleanouts. Bed maintenance clients that enjoy drip irrigation, mulch installation or weed barriers. Chemical application customers might want mosquito control, soil testing or organic options. Adjacent services don't need large investments in new equipment, trucks or branding. You use what you already have. There is no extra liability insurance or major new expenses. For the sake of an example, here are some pricing assumptions for a landscaping business. Let's say the mowing service is $50 a cut weeding service is $30 per service, bush trimming is $300 per service, snow service is $80 per push and mulch installation is $900 per service. Let's calculate the financial impact of cross selling. If I charge $50 per mowing 30 times per year and cross sell eight snow removal visits, I could boost revenue by 42% from $1,500 to $2,140 each year. Cross selling bush trimming three times per year to mowing customers increases annual revenue by 60%. Cross selling, snow removal and mulch insulation boost revenue by 103%. This means my income doubles without any marketing cost. Question is do we have a leads problem or a cross sell problem? Do we lack enough offers to increase customer lifetime value? On page 14 of your workbook list 3 cross sell opportunities to each service in your upsell funnel. You can grow a business in three ways. I name it ORA O R A Onboard retain Ascend. You can onboard more customers through marketing. You can retain customers and raise prices over time. You can ascend customers by increasing their value through cross selling. Home service businesses prioritize onboarding getting new customers. We place some emphasis on retention, but we often neglect ascending customers into higher ticket higher margin services. This is where the real profit lies. Worried about seeming too salesy? Remember this. Ford's biggest fans don't buy the cheapest models. They drive vehicles with all the bells and whistles. They upgrade to the Lariat and King Ranch editions. These customers stay with Ford for life. Their churn rate is nearly zero. They never leave the brand. These loyal customers also cross sell themselves into light bars, custom suspensions, special tires and other modifications. They customize. They buy more adjacent products and services. Your most loyal customers give you more money once you realize this cross selling doesn't feel pushy. If you cross sell and get more money from customers, they're less likely to leave. They become your biggest fans. They leave great reviews because you solve more of their problems. Solving more of your customers problems will make it less likely that they will go to a competitor. There is more risk for them to leave if you perform more than one service. Make your service stickier, solve more problems and offer more services to your customers. Let me share a case study with a massive impact. This business had 200 recurring customers with an annual turn of 50% every year. They were losing half of their customers. Their annual customer value was $1,000. Multiply that by 200 recurring customers and you get $200,000 in annual value. Cross selling snow removal and organic lawn care boosted their annual customer value to $2,400. The company went from $200,000 to $480,000 in revenue the next year. They didn't run advertising campaigns. They kept the same number of customers. They more than doubled revenue by increasing annual customer value from $1,000 to $2,400. Here's what's remarkable. The average customer lifespan went from two years to three years. That means annual churn dropped from 50% to 30%. The company didn't change its service quality or training. They provided the exact same service. Customers who bought snow removal and organic lawn care were less likely to leave. It's harder to leave once you've purchased more services from a company. Same as Ford. It's harder to leave the brand once you've bought its best truck and modified it to your liking. We increased annual value from $1,000 to $2,400. We reduced churn from 50% to 33%. Lifetime value for this business went from $2,000 to $7,200. More than tripling. The combination created a massive impact. How? We added one more service. We solved another problem for the customer. What if you don't have a retention problem? What if you have an ascension problem? We often think customers leave because of poor service. In reality, we're not selling them enough adjacent services. We don't solve enough of their problems, making it easy for them to switch to someone who will. When you triple lifetime value, you can afford to spend much more on customer acquisition. Customers become much more valuable. After meeting with Dr. Cashe and Alex Hormozi in Vegas, I created a cross sell tree. I found that snow services increased demand during our mowing off season. That became Augusta Lawn Care's adjacent service. It was perfect in some markets. Why? When the grass is growing, there is no snow. When there is snow on the ground, we can't mow. We sell snow services using instant pricing on our website. Do you have a small, medium or large driveway? Here's your price checkout. Let's go. There are four different types of cross selling. Write these down on page 15 of your workbook. First is bundling, offering a discounted package that includes multiple related services. For home services, you can offer priority scheduling instead of price discounts. For example, customers who buy both mowing and snow removal get first priority when it snows. Second, recommended products or add ons. Relate to what the customer has already bought. If work is slow, look at declined estimates from this time last year. Recommend the exact same services they considered before. Many will accept with minimal effort. Consider when to propose extra services before the job, during lead collection, in meetings, or after providing estimates. You can recommend them on site or after the job. Customer satisfaction is highest then you completed the job. They're thrilled. You solved their problem. You have built trust. Offer them a solution to another problem they have. During the walkthrough, they're giving rave reviews. This is the perfect time to cross sell another service. The final invoice is another opportunity to mention your next seasonal service in all September and October invoices. I promote snow removal as a recommended add on schedule. Post job inspections for projects when you arrive. They're still happy with your work. Make minor adjustments if needed, then cross sell additional services. Third, another approach is using partners recommended products sold by partner companies for commission. For example, if you don't want to offer snow removal yourself, partner with a snow only company. Sell their services to your customers to earn affiliate commissions. The fourth type of cross sell is seasonal cross selling. It works great for seasonal businesses. Send mass emails or texts to customers right before leaf season or as snow is about to fall. Click here to get on our snow route. Our goal is to avoid the business contracting seasonitis. We want to avoid off seasons and fluctuations in revenue, but I would be crazy to think that demand is not seasonal. To address this, we must have season specific offers for season specific services. Create a seasonal offer for every season of the year on page 14 of the workbook. Match a service from your cross sell tree with every month of the year. Some services might get promoted across multiple months. For mowing, I target March through May, but for the other nine months I need different cross sell opportunities. Leaf cleanups in October and November, snow removal in December and February, and Christmas lights in November and December. What if Augusta Lawn Care was actually called Augusta Snow Services? We'd mow for seven to eight months. Then as snow season arrived, we'd get busy. This wouldn't be a time to relax or lay off employees. We'd run ads, hire more staff, get more trucks and prepare for the snow season. Do we have a leads problem or an offer problem? Often we lack enough services to stay busy year round. Create more offers for each season, every quarter, every month. Give your team resources to execute cross sells. Provide sales training to your phone answering team. Turn customer service calls into cross sell opportunities. When someone complains about grass clippings in flower beds Offer bed maintenance services. If someone complains about a patchy lawn, offer top dressing and overseeding. Give your team product knowledge and sales materials. We give all frontline team members business cards. It costs $8 to get 100 of them printed off. Train your crew to identify specific customer needs. Teach them to notice overflowing gutters, weedy beds and other cross sell opportunities. Finally, share customer data and pricing information with your team. Some owners worry employees might steal this information. They might, but without it they can never effectively upsell or cross sell for you. We provide our crews with instant pricing door hangers. We give the technicians business cards. When they see opportunities to cross sell. They write down the prices and share them with customers. Hiding information from your team might seem like protecting your business, but it actually stops cross sell opportunities. You're blocking your crew from improving customer lifetime value on your behalf. Use software to encourage your team to recommend products based on what customers have bought before. If a customer buys fall cleanups each year, offer them spring cleanups or regular weeding services. Sell them on a recurring maintenance plan. In a test with Copilot CRM, we found that turning on the cross sell feature boosted average revenue by 29%. This feature allows employees to send text messages or emails to customers about extra services while they are on site. Make it seamless for your crew to sell more services, incentivize them and watch your business grow. Let's examine some cross selling techniques from online retail stores. They excel at this first is the price drop alert, a time bound discount this weekend only. Buy one T shirt. Get one free for home services, send a mass text. We're accepting new snow customers for the next 24 hours. Get your first visit 50% off. Post purchase recommendations work well in retail. After you buy a suit, the store sends you recommended ties that match the outfit for home services. After customers accept an estimate, the thank you page can suggest extra services. They have said yes to your proposal. Their payment information is already entered. They're in buying mode. Suggest the next logical service. Identify common combinations. If someone buys shoes, they likely need socks. Our home services add optional line items to every quote if they request weeding, include bark mulch installation. We know their flower beds need help. Weeding and mulching complement each other. Follow up on abandoned carts Online retails do a great job of this. You get messages if you put items into your cart but never purchase them. For home service businesses declined line items and pending quotes are the equivalent of abandoned carts. In retail, it is possible that you misinterpreted what the customer wanted. It is possible they wanted to spend more. This happened to me once. I quoted 2000 to $3000 to extend a flower bed. Weeks later I drove by and saw my competitor installing a massive retaining wall. I asked about his bid. $24,000 including a paver patio. The customer didn't want extended edging. She wanted a new design. I undersold her. I was thinking small. I never cross sold her from the $2,000 edging into a $24,000 project. In Copilot CRM, we ask every declined estimate why they did not accept. This gives us a second chance at closing the deal. At the very least we get information about why estimates are declined. I need to know if price was the only concern. I need to know if I didn't give them the options they wanted. I need to know if there was a scheduling problem. I never wanted to lose out on a 24,000 job because I thought the customer was price sensitive. People believe they can achieve complete automation of upselling and cross selling. You can and should use automated texts and emails. We send out thousands every day from Copilot CRM. But personalized recommendations are worth the extra effort. Think about the experience of being with a well trained apparel salesperson. They tailor the products they offer to your needs. An amazing waiter or waitress can also suggest menu items that match your tastes. We are willing to spend more money with these types of salespeople. It's ironic. In home services we'll knock on strangers doors for new business. But we hold back when it comes to offering more services to customers who already trust us. We spend thousands on billboards seen by strangers. We paint our trucks to attract new customers. Yet we hesitate to make follow up calls to customers with pending estimates. We're reluctant to contact existing customers about promotions or money saving service combinations. We don't text customers who declined estimates to learn why. When the economy tightens, and it will, there will be fewer leads. Customers will become more price sensitive and get many quotes. Business owners unwilling to follow up will lose out to those who do. Here's a tip. Don't send text, only send imessages. The blue bubble tells customers you're sending a personal message, not an automated one. This is what Gary Vaynerchuk calls scaling the unscalable. A personalized recommendation is far more effective than a mass hey, this is on sale versus Mr. Jones. I think the service would be perfect for your property. I noticed that it was needed last week when I was on site. Think about this. Sending personalized messages takes five minutes each, so you can send 12 in one hour. If one person responds and becomes a customer with a $5,000 lifetime value, isn't that hour well spent? Is five minutes worth $5,000 in lifetime profit? Absolutely. Here's a radical idea. What if you spent $0 on marketing next year? Focus on cross selling to all your customers. Existing, new, old and even unhappy ones. Amazon excels at this. They fill most of their product pages with upsells and cross sells. When I shop, they offer instant checkout for convenience. They upsell me to Business Prime. They cross sell faster delivery. They recommend subscription plans. Further down I see frequently bought together bundles and similar items to consider. One page contains dozens of cross selling opportunities. Cure three of adding adjacent services comes with a big warning. Be careful. Adding services and expanding your service area may seem like easy ways to boost revenue, but they are often the least profitable. Growth strategies Only add an adjacent service if it has an opposite demand curve from your primary service. At Augusta, we offer snow removal because when snow covers the ground, demand for lawn care disappears. The demand curves work in opposite ways. Lawn care is busiest in spring and fall, but slows down in winter. In contrast, snow removal is most needed when lawn care is at its lowest demand. Review your cross sell tree on page 14 of the workbook. Mark an X next to services with the same demand curve as your primary service. Identify adjacent services that will fill your off season gap with opposite demand patterns. Only add services to your business to fix seasonitis and drops in revenue. Do not add more services to inflate revenue during your busy season. On page 16 of the workbook, list two adjacent services you can offer to current customers. You should not need new trucks or equipment. Draw their demand curves and compare them to your current revenue pattern. The main goal isn't to boost revenue, it's to fix the Q4 collapse with services that thrive when your core service lead flow slows down. Finally, determine where in the customer life cycle you'll promote these adjacent services. Will you cross sell after completing your core service? During the buying process via text, email, or in person, develop a plan to promote these adjacent services to your existing database. How will you promote your adjacent service without spending on advertising? Consider sending targeted texts and emails through your CRM system. Send this notice to all your business contacts. These people have demonstrated a need for your service in the past. Share a post about the adjacent service on your social media accounts, but don't stop there. For the highest conversion rates, consider making personal calls to your customer base. If you close 10 to 20% on this new service. The time you invest will pay off big. Practice your script now. How will you talk to an existing customer about this adjacent service? What would you say to emphasize the value and connection to the work you have already done for them? Remember, these customers already trust you. They've experienced your quality work firsthand. They're more likely to try your new adjacent service than strangers. Plus, it costs nothing to reach them.