When you aren’t seeing a profitable bottom line in your lawn and landscape business, your first thought might be time to raise prices again. However, as customers continue to deal with increasing costs on every side, it might be a good idea to look at other saving methods first.
This isn’t to say you should never raise prices, and for some properties, it may even be overdue.
However, there is more than one way you can improve your profit margins, and it’s important to explore various cost-saving methods.
Review Labor Inefficiencies
Labor is your single highest cost, so the last thing you need is unproductive work hours. Reviewing how your team goes about executing jobs could reveal certain processes or tasks that eat up time. In other cases, you may find your team is completing the jobs as quickly and efficiently as they can, but you are not bidding the jobs to the proper number of manhours.
Another possible labor inefficiency is overstaffing or understaffing. While being understaffed can sometimes feel like something out of your control, constantly recruiting and creating a work environment where people want to be long-term can help with this issue.
On the other hand, you may find yourself on the rare occasion of being overstaffed out of fear of being understaffed. While preferable out of the two options, you need to make sure you have enough work to justify each staff member on your team.
Overtime is an additional labor challenge that can eat into your bottom line if it is unplanned. You also want to be careful that your usage of overtime doesn’t incentivize employees to work more slowly.
Optimize Equipment Management
An overlooked area that can experience a number of efficiency boosts is your fleet and equipment. One common mistake is not prioritizing regular maintenance, leading to frequent breakdowns and downtime for your team.
It’s also a good idea to organize your crews’ tools clearly so they don’t have to hunt for their equipment during the morning rollout. One option is to keep each crew’s necessary tools on their assigned trailer at the end of the day.
Another unseen cost is underutilized equipment. Don’t fall for the trap of buying a machine with all of its bells and whistles if it’s something that only gets used one month out of the season. In these situations, it’s better to rent a specific machine until there is enough work to support its purchase.
If you have fleet tracking technology, make sure you’re monitoring the idling of trucks and equipment. Running these unnecessarily results in wasted fuel and those costs can quickly add up. This software can also help you develop better routing so your team isn’t constantly backtracking and burning more gas than needed.
Reduce Material Waste
When you’re looking for ways to save on costs, material waste may not be top of mind. However, over-ordering or improperly storing products just for them to spoil is a miscalculation you can’t afford to make on a regular basis. While early ordering can result in savings, if you have a large amount of churn with your customer base, you may end up with more material than you planned for.
Another way your materials can be wasted is if you are not training your team to calibrate and apply products at the proper rate. If they are applying it at an inefficient amount, you’ll be stuck with numerous callbacks and applying too much can burn a lawn and result in angry customer calls.
In the cases of a client changing their mind on plant material you’ve already ordered, rather than eating the cost, try to find a new purpose for them, like upselling to another client on some small enhancement work. Recycling green waste on your property can also reduce your dumping fees and provide your team with a source of compost for future jobs.
Streamline Administrative Processes
With so many moving parts in your landscape business, you may find yourself neglecting your administrative processes as long as they get the job done. Yet redundant or outdated processes could be costing you with tasks taking longer than they should or slowing down the rest of your team.
Dig into whether there is wasted time or tasks that can be digitized. Not only can this help you become more efficient, but it can also help you get a better picture of where your finances stand.
It’s also possible you have redundant technology solutions you are subscribed to, or even worse, technology you’re not taking advantage of at all. Avoid buying software solutions and then fail to implement them properly. If your team is not using a certain platform, determine if it’s a general resistance to change or if the product isn’t a good fit for your operations.
Technology can be greatly beneficial to your overall efficiency, but only if it’s being integrated. Take the time to regularly evaluate and consolidate your technology tools so you’re not paying for multiple services that do the same thing.
