Our Level Up series shares the strategies that help landscape and lawn care companies get to the next level.
Justin White, owner of K&D Landscaping, Inc., based in Watsonville, California, was born into the landscaping business as his parents started the company in the 80s.
“I never really planned on taking it over,” White says. “It was always the summer job I did. I enjoyed driving the tractors and doing that kind of stuff, but I never thought I’d actually go into the landscape business. I just kind of fell into it after high school and realized it was something that I really enjoyed. As I continued on my journey in my career, I just kept coming back to this idea of landscaping and taking over for my parents.”
By age 25, he had made up his mind he wanted to be the company’s next CEO, which is what he did at 26. He says his parents were going through a divorce when he approached them about running the business.
“It was more of a slow equity transition process as the business grew,” White says. “I did this with my siblings, too. My brother, my cousin and my sister, we are all in this together, running the company. I took the leadership role, the CEO seat, but we all really took that step into the business around the same time.”
White notes that if you’re looking to transition the business to the next generation, don’t wait until you’re ready to retire to move them into the CEO seat. He says this is something that he and his father did right accidentally.
“I think you need to give it five, if not 10 years, before your ideal exit period where you want to have your next generation taking on the CEO title and really running the company day to day,” White says.
He says as they grew from $1 to $5 million, he butted heads with his father a fair bit as White pushed the envelope, but after he made enough right calls, his father began to trust his judgment.
White says it was a challenge starting out to have the team believe in him as a relatively young owner, but he gained a lot of respect because he worked in the field for about seven years before moving into management.
“Working side by side with them, they knew I was a hard worker,” White says. “I also tried everything possible when I took over to make the employees’ lives better in my oversight. I just tried to make changes that improved the employees’ quality of life versus trying to make decisions and changes that made it harder for them.”
White’s goal for his company is to reach $30 million by 2030, a goal they set in 2015.
“We should be about $20 million this year,” White says. “We’re starting to actually recalibrate our vision and our structure in terms of shooting a little bit higher. We’re looking at starting to move into acquisitions and growing more rapidly as we approach the $30 million mark.”
Shifting Service Focus
Starting out, the company performed residential maintenance, but in 2009-2010, they started to move toward commercial work. Now, the company is 70% commercial and 30% residential. White says their bread and butter is commercial maintenance, but they also do lot of commercial installation and high-end residential design-build.
“I would say we’re best known for our commercial maintenance and a sector that’s probably growing the fastest is large community management, so large HOAs and large communities that we maintain,” White says.
White says they don’t plan to move away from the residential design-build service as it provides diversity for the company, and doesn’t take away from the other side of their business. K&D Landscaping has also started offering in-house design, while previously, they were a bid-build company on the residential side.
“Now that we also offer the design element, that’s been a nice revenue stream for us, adding that design element and then it helps to improve our pipeline of new work when we’re doing that design versus not doing the design,” White says.
Over the years, the company has become more specialized in their work. In 2022, they added water management services, which go above and beyond typical irrigation services.
He says this additional service did $2 million in revenue their first year offering it. White says one of their keys to success was hosting the Central Coast Water Summit, where they invited major brands, local developers and HOA representatives to discuss water conservation, putting them at the forefront of the topic.
“When people think irrigation in our area, I think they think K&D water management, so that’s been a really big positive for us,” White says.
White says they take a proactive approach and work with parks and government agencies to manage their irrigation even if they don’t manage their landscape maintenance. He acknowledges that it is a challenge not being able to control the horticulture side of water management and they’re still working through this. They’ve also had operators who manage the parks going in and adjusting the clocks manually.
“We take a scientific approach and now that we’re upgrading the controllers, we’re starting to go to controllers with different locking mechanisms that have remote programming options,” White says. “We’re starting to modernize our approach a little bit and create more of a partnership with the operators, but it’s a constant challenge with them. They feel like we’re there to take their job. It’s a bit of a battle right now.”
Keys to Success
White credits several factors to their success including having a clear vision of who they want to be and how they want to get there, investing in employee development and strategic marketing.
Since 2015, K&D Landscaping has experienced rapid growth each year, with the exception of 2020 and 2021.
“We hovered around $10 million for about three years,” White says. “Other than that, we’ve always grown between 25% and 50% a year.”
White says his team has been able to handle this speed of growth by setting the expectation from the start. He says they’ve never grown more than they planned for.
“We hired ahead of that, invested ahead of that,” White says. “It hurt us a little bit in profitability and cash flow sometimes. But ultimately, it led to us not having those deficiencies, where other companies maybe have had a little more of the quality issues.”
He says they were focused internally as they grew from $1 to $10 million, but ever since they hit $10 million in 2020, they’ve focused more on industry involvement, like joining NALP. White says he’s gotten the most out of networking with other contractors at events like ELEVATE.
“If you want to grow your business and you want to grow it in a good way, and you want to be a part of something bigger than just yourself, I think that’s where NALP has been a resource for us,” White says. “Really, that’s why we joined recently; we feel that it’s where all the companies go who want to make a difference in the industry and want to improve the industry for the next generation.”
White says they are also focused on giving back to their team through training to ensure the company and employees grow together. One of K&D Landscaping’s core values is hunger, which White defines as an “if you see it, do it” mentality.
“It’s waking up every day with a desire to get more out of the work, out of your life and out of the company,” he says. “It’s just having grit, determination, not stopping. Always having this desire to grow. I tell our team if you’re looking for a company where you can come in and you can clock in, clock out and just do your job, we’re not really the company for you. We want people to grow, and we want people to excel and advance in their careers. That’s really the embodiment of hunger at our company. It’s a desire to grow and develop yourself as the company grows.”
He says their strategic marketing has allowed them to be really strong in areas where historically landscapers are weak.
“I was kind of the brains behind our marketing, and we did a lot of different things that you don’t hear of,” White says. “We have a very strong community beautification campaign we do and that has led to us unintentionally winning a lot of awards. I was recognized as a 40 under 40 in the Silicon Valley. We won Business of the Year. We got about five or six different awards over the last five years and that’s really propelled us in our community. We’ve really stepped up big time in our volunteer efforts. We’ve marketed that really well in terms of press releases and coverage in local newspapers and TV news broadcasts.”
He says their strategic marketing efforts have also given them a strong online and social media presence.
“We focus on marketing to clients, but I would say we also spend more time marketing to future employees,” White says.
Maintaining Company Culture
K&D Landscaping crafted 30 fundamentals last year with a consultant, which is the definition of their team.
“They’re very descriptive,” White says. “They’re just in every way, shape or form how we want to operate and be as a company. We practice those religiously. Every week, we have a fundamental a week. Every meeting starts with a fundamental of the week and we talk about it openly. It really gives our team very clear expectations as to what we want the culture to be.”
White says you also need to put people in leadership positions who embody the culture you want to create because the top five most influential people in your company are really going to drive your culture whether you have 10 people or 500.
“If you have people in those leadership positions, who maybe cut corners, and they’re in it for themselves, and they just don’t really care about the quality, I think you’re just going to struggle,” White says. “You’re constantly going to be fighting this culture of what you have versus what you want to have.”
White says one of their biggest challenges has been when they have a manager who is not growing with the company and resistant to change and improvement.
“You have this is very key individual leader who’s holding the team back and we’ve had to make some exits of those team members throughout the years,” White says. “These people are loyal. They’ve helped get you to where you are. They’re good friends usually and very close. Sometimes you have to make the hard decision that the company is better off without them in that leadership role, and maybe they’re better off without being at the company.”
He says they’re able to handle these sorts of situations by setting clear expectations and discussing shortcomings in one-on-one meetings.
“We’ve given them a lot of opportunities to get to where we need them and it’s almost a mutual agreement,” White says. “We’re both like, ‘Alright, this just isn’t working anymore.’”
White says offering severance packages also helps employees leave with a good feeling. He’s given a severance package to someone who had been with them for six months before.
“Typically, we’ll do 30 days of pay and that gives them a good month to go out and find another job and luckily the job market has been pretty good and feel like they’ve been able to relocate pretty quickly without losing any time or losing any money,” White says. “For us, it’s just being fair. Whether or not they’ve worked for our team for six years or six months, I just want to see them land softly and not be in a tight spot where they can’t pay rent or something. We really take a lot of responsibility when a new hire doesn’t work. If it’s in the first year, I’d say it’s typically on us. We should have identified whatever issues during the hiring phase.”
Recruiting and Retention
K&D Landscaping currently employs 135 employees year-round.
White says they have a very strong recruitment process with their existing team. He has used a recruiter in the past and realized they were typically paying $10,000 to $20,000 for a management-level placement. Instead, he decided to offer that up to their existing team through hiring and recruitment bonuses.
White says that retention is very important to them, and it’s a challenge to have high retention when they have a high level of expectation for their team.
“We have a very strict policy on not letting poor performers stick around,” White says. “That’s definitely hurt us a little bit because we’ve let people go where, maybe in a normal company, they may have been able to be okay and just kind of squeak by.”
However, by having high standards, they’ve been able to keep their A players happy working in a high-performance environment. White says they also strive to ensure their employees are well-compensated well for what they do.
“We try to make sure that they can’t make a lateral movement into another company and be paid more, unless potentially it’s within a different industry,” White says.
K&D Landscaping also hosts a number of employee events throughout the year and provides lots of K&D swag like jackets and sweatshirts.
“We just try to create that connectivity between the brand and their family,” White says. “We want them to feel like family. We try to treat them like family and hopefully they feel like that, so they stick around a little bit longer.”
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