Landscape contractors have been put through the wringer this past year. The obstacles just kept rolling in, one after the other — and few companies have been spared. If you’ve been operating as normal, consider yourself lucky, because many contractors have been struggling with financials, pandemic-related lockdowns and securing reliable employees.
Hiring the right people has always been challenging in the landscape industry due to the seasonal nature of the work, but the global pandemic has amplified that struggle. Over a year into the initial U.S. outbreak, we still don’t know when it’s going to end. There’s one thing we know for sure, though. No matter how long these challenges last, there is light at the end of the tunnel.
The bright side
Work is trending upward again, allowing large and small businesses alike to pay employees higher wages and making it easier to attract talent.
Toward the end of 2020, we started seeing a subset of homeowners investing more in their homes. Either they were still going into work as normal, or they had transitioned to working from home. Spending more time cooped up led fortunate homeowners to update their living spaces, both inside and out. As people started caring more about their outdoor living spaces, the demand for landscape contractors to maintain those spaces also started to increase.
This trend will likely continue into 2021, especially once the warmer weather hits. As spring is well underway, contractors should focus on selling larger projects like patios, decks and full landscaping plans. Unlike last year’s busy season, we are expecting a higher volume of work and more homeowners making investments in their homes and hiring landscape contractors for their landscaping needs.
Where we’ve been
Before this positive trend, we saw a drastic decline in landscaping projects due to much of the population pulling back on spending. In the spring of 2020, it was unknown how peoples’ lives would be affected, and unfortunately for the industry, that meant a decline in lawn and landscape services. Mowing and edging are activities homeowners can tackle themselves — even if it’s not their preference. Residential-focused businesses saw the brunt of the decline and are certainly hoping for a better year.
Where we started
Even before the pandemic became a reality, 2020 was difficult. An executive order was passed that limited the number of H-2B visas available. H-2B visas allow employers to hire foreign workers on a temporary basis. This legislation cut the number of allowed visas almost in half, to a cap of 66,000 H-2B visas allowed into the country per calendar year. Large contractors were greatly affected by labor shortages, as they rely on adding employees to their roster during the busy season.
Other companies, mainly small contractors, started losing qualified employees to other entry-level skilled labor jobs. They couldn’t compete with positions that offered year-round pay at a similar wage and were less physically demanding. On top of that, small contractors didn’t have the option of increasing the hourly wage to compete. This combination of issues left them scrambling to find qualified employees.
Ways to Forge Ahead
The only way to move is forward. Here are some actionable strategies to keep your business focused on the future:
Evaluate your equipment
Do so thoughtfully and strategically. Which piece of equipment is bogging crews down? Which pieces are providing the most value? Are there any units that need to be replaced? Answering these questions can set you up for improved speed and efficiency. Involve your employees in these conversations, too, since they know the equipment inside and out. It may not be necessary to replace dozens of units, but identifying even one weak spot can make a difference.
Lean on current customers
Your best business comes from repeat customers. Instead of tracking down new customers this quarter, focus on building relationships with current ones. If they haven’t pared back on services, make sure they are educated on your entire set of offerings. It could create a lightbulb moment and lead to more work. You can also initiate the conversation by proposing your vision for a client’s home. Who knows, they may just agree to a big project. Even if they don’t, your efforts will build loyalty, trust, and future business with that client.
Embrace new technology
Change can be hard, but it’s easier when that change helps drive profit. Today’s landscape management software can give you vital information about managing a business. From pinpointing inefficiencies to providing the tools to improve them, these technologies pay for themselves. Since they automatically provide this insight, business owners no longer have to spend time searching for answers or working on invoices. They are free to spend more time on valuable activities, like managing day-to-day work and building customer relationships.
Horizon360™ is Toro’s business management software and an example of what you can gain from new technology. It provides day-to-day business insight using GPS and machine telematics. You can track equipment whereabouts, run time, and productivity by installing tracking devices on any unit. They’re smaller than a wallet but can easily track and organize your crew’s time.
This powerful data can also help educate employees on what equipment to use and when, and even drive behavior change when needed. Additionally, Horizon360 is extremely user-friendly and can be implemented by anyone with just a few simple clicks. This easy-to-implement business intelligence software is built for contractors, by contractors.
On the financial side, business management software helps spell out the direct and indirect costs associated with each job. Seeing the numbers can be an eye-opener, but using data as a tool for growth can propel your business to the next level. Locating inefficiencies in your pricing structure can increase employee wages and attract labor from less efficient contractors since you can now offer more. Productive contractors get more work done in less time — and using less labor than nonproductive contractors. It’s a win-win.
The state of labor shortages will continue to fluctuate and, at times, cause businesses strife. The difference-maker is how you respond to these changes. Thinking proactively, being open to change, and focusing on the future is crucial. Right now, the goal is to bridge the gap by implementing one or more of these strategies.
Pinpoint at least one strategy you can put into place right now: focus on current clients, assess your equipment or implement new technology. These actions will help boost productivity and morale with current employees — and demonstrate how much you appreciate them.