Business Growth Takes Time, Money And Effort

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One of the greatest advantages of being a business owner is self-promotion. You increase business and profits when you elect to. Sure, there are a few obstacles to overcome, but a boss isn't one of them. The obstacles to business growth are mainly time, effort and money.

It's clear that no matter who you are, or where you find yourself at this moment in time, you will never have enough time to exercise all your options in life. That's an understatement to say the least. We are all subject to prioritizing activities and allocating time to get them done. But when it comes to business growth, unless strategic time allocations are made, growth comes slowly.

Ask any business owner who is actively working and trying to increase business, and make money at the same time how he grows his business. He’ll tell you growth comes only when you take the time to work on it - getting out more job bids, making and keeping customer appointments, and developing advertising programs and executing marketing plans. Then when business does increase, you need to have the two other components in place: employees and equipment. It's a three-ring circus, but business growth doesn't happen by accident - or at least it shouldn't.

THE "TIME" PART
Growth needs a plan. And, the first step is to put aside some time each week to work on it. No matter what comes up, you need to stick to the time allocated because if you don't, you may be forever working "in the trenches."

When I was in the business, my "business growth day" was Friday. Sure, I'd go to the shop, get the people out the door and on their way, but the rest of the day was spent on promoting business. I'd refer to my ongoing business growth plan, review it and think about my options.

The plan consisted of two parts. Part one of the plan included customers and sales; part two involved scouting for employees. I ignored part three, which was equipment, because as soon as business increased, equipment was always available at the store. Financing equipment and carrying the payments were the only concerns with part three. Therefore, what the growth plan came down to was increased sales and employees to carry out the work.

On Friday, I'd grab a batch of business cards, stuff them into my pocket for sales calls and get out and meet people who could at some point be transformed into employees. Depending on a company’s current situation, the primary focus will reflect what is needed for the company’s immediate success. If there's plenty of work and it's easy to get, then the emphasis will obviously be on finding workers. If sales are slumping, the focus will be on prospecting new clients or up-selling existing clients. In my case, finding employees was far more difficult than finding work, so the primary emphasis was on people.

Everybody I came in contact with on Friday I considered to be a potential employee, so I'd pass out business cards. If I saw a landscape crew in my travels, I'd stop and ask, "Do you know of anybody who needs a job?" Did I try to steal employees from other landscape companies? Absolutely! They've got experience, and besides, they'll only "jump ship" if they are unhappy with their present employer. Names collected on Friday were posted to an ongoing list. My list contained an average of 100 names of people I met along the way. As soon as I had sales that would support just one more worker, I'd go back to my ongoing potential employee list. If I had not allocated one day a week to "hunting for employees," I doubt I could have grown as fast as I did. Friday was also interview day - 30 minutes; that was it. In the first five minutes, you can usually tell if you've got a winner. So half of every Friday was spent finding the work, and the other half was spent finding people. I looked for long term in both - long-term people and long-term contracts - so I concentrated on landscape maintenance requiring care for large commercial sites. Logistics are easier that way. Maintenance is also easier to manage than other services since training time is residual. Also, offering landscape installations requires having a good foreman to provide direct supervision to a crew, and that type of employee is not easy to find.

THE "MONEY" PART
They say it takes money to make money. They're right about that, but it doesn't have to be your money - it can be the bank's money or those who finance equipment. As long as your credit is sound and you can cash flow the payments, obtaining vehicles and equipment usually isn't the problem - it’s working capital. You must focus on covering payroll and overhead costs, and you never want that to be a problem. As a rough example of how to cover these two expenses, consider the following figures, plugging in the appropriate rates and percentages for your business.

For each "fully supported with work" employee you hire, figure the gross pay for that person for six weeks, then add about 125 percent to the figure, and you will have the approximate cash number you're looking for (NOTE: The 125 percent figure is added to the employee’s wages to estimate the various taxes, benefits, insurance premiums and other overhead expenses associated with employing that individual person.). Your figure here is the total amount needed to carry that person - and the increased sales associated with having one more employee - until you get paid for the work six weeks later. For example, if you hire one person at $10 an hour, you will need about $5,500 in available cash to pay that employee’s wages and associated overhead expenses (6 weeks times 40 hours/week times $10/hour = $2,400 plus 125% = $5,400; rounded to $5,500 for this example). Generally the new employee generates about three times his or her base pay - in this case about $16,500 - in new sales. Remember, these numbers are rough, so work it using specific examples from your company.

From this example, you can see that business growth may come down to just how much working capital you have. You can back into the numbers by dividing your total annual sales by the number of employees to find the annual production rate (sales) per employee. That will help you plan sales increases "matched" against the number of employees needed to reach a specific sales goal, which will help you calculate how much working capital you'll need. Using the figures from the above scenario, if you increase annual sales by $50,000, and hire one more person to have enough labor to meet the work that sales increase generates, you create the need for another $5,500 in cash availability over a six-week period. Now, consider the next step: equipment and vehicles. Look at your total investment in equipment and divide that number by the number of production people on your payroll. The outcome is the approximate equipment investment per employee. Each new hire is supported by X amount of financed equipment. That's easy to figure, but it's an important consideration.

THE "EFFORT" PART
The three-ring circus in running a business is sales, production and control - get the work, do the work and control the outcomes. That's what it comes down to, but it takes effort to make these items fall into place for continued success. In other words, if you have to choose between buying groceries and making your equipment payments, eat if you're hungry, but know that without financing in the absence of cash to invest, you can't grow your business. If you don't maintain your credit in top shape, growth will probably not be possible.

Let's sum it up. The equipment is "waiting for you at the store." The employees you'll need to grow are "out there" wandering around; you simply have to "hunt" for them. It's a matter of taking a risk by hiring them "just in time" or having the stomach to hire them in advance of having the work to pay for them. Also, don’t forget sales and increased business. To juggle all of those and grow your business, you must have a solid allocation of your time, money and effort. Define the sales goal. Set aside the time. Do the math. Find the people. Then go for it.

About Nilsson Associates
Nationally recognized "Best Selling Author", Business Consultant and Seminar Presenter with over 30 years experience in the Green Industry. Nilsson's articles are published by Grounds Maintenance Magazine, Lawn & Landscape, PRO, The Arborist, Landscaper Publications of New York, PGMS, PLCAA. Nilsson owned and operated a successful Landscape Design-Build-Maintain firm for 15 years, and for many years was retained as Business Coach and Management Advisor to the national membership of the Professional Lawn Care Association of America.

Nilsson's books are endorsed by National Trade Associations, The California Landscape Contractors Association, The Professional Grounds Management Society, The Horticultural Departments of Ohio State University, The University of Tennessee, and The University of Georgia. Nilsson's books are in use by over 25,000 Landscape Contractors, Lawn Care Companies, Property Managers, Government Facilities, Park Departments and Municipalities nationwide.

For:
Landscaping Contractors
Lawn Care Service Providers
Parks & Recreation Managers
Snow Removal & Plowing

Labor Time Data Handbook - Contains over 500 field tested, time-studied labor hours data for landscaping and grounds maintenance job estimating and calculating labor time man hours for facility managers, parks and recreation departments, campus grounds, schools and university grounds. Bid with confidence, save time preparing bids, easily determine best crew size, make money on every job you get, never under or overprice a bid again, set realistic labor goals for employees. Includes labor hours for just about every job performed in landscaping and grounds maintenance by contractors and facility managers, parks, campus grounds functions and sports complex maintenance. For Green Industry Job Bidding, Pricing, Profits, Estimating Irrigation and Hardscape Jobs and for use in non-profit situations where budgeting labor hours, scheduling the work and determining total employee production man hours is desired.

These methods of collecting information was the basis for creating my Labor Time Data Handbook of Standard Work Times of man hours needed to perform the work. Included in my time study was all sorts of grounds maintenance and landscaping installation tasks and work that is normally done by landscaping and lawn care service companies. I timed things like Mowing, edging, trimming, pruning, snow plowing, ice control, tree planting, mulch, aeration, slit seeding, shrub beds, hardscapes, blowing leaves, lawn chemical applications, spring and fall cleanups, seed, installing sod, water gardening, flowers, and over 500 common job tasks to numerous to mention. I timed the different work tasks using many different types and sizes of power equipment was used during the timing trials for edger, trimmers, riding mower, walkbehind, weed eater, tractor, ztr, chainsaws, loaders, trucks, trailers, sprayers, hydroseeders, spreaders and the usual equipment of running a green industry company.

Labor Time Data Table of Contents:
Introduction
How To Bid Contracts
Knowing The Scope of the Work
A Few Words About Profits
Units of Work
Service Frequency

Labor Times:
Aerification
Back Pack Spraying
Blowing
Cleanups
Dethatching
Edging
Grading
Granular Applications
Hydroseeding
Installing Flowers
Installing Pavers
Line Marking
Liquid Applications
Loading
Mowing
Mulching
Pavement Sweeping
Planting Shrubs & Trees
Pruning
Raking
Sanding & Salting
Seeding
Snow Blowing
Snow Plowing
Sodding
Staking & Guying
Stump Grinding
Trimming
Watering
Weeding
Reference Section:
Annual Sales Statistics
Calculating Equipment Costs
Employee Productivity
Fertilizer Recommendations
Mowing Height Recommendations
Grounds Maintenance Statistics
Labor Management
Landscape Construction Estimating
Non-Productive Time Cost Worksheet
Tables & Measures
MIscellaneous Formulas
Financial Formulas

How to order
Labor Time Data Handbook
Written by Nilsson Associates
Book # A-7, Price $69.50
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Other
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Labor Time Data Handbook

Nilsson's Job Estimating System has everything you need to evaluate job site specifications & work required, figure costs, how to price ~ lawns, grounds maintenance, landscape installs. You'll get step - by - step instructions, bid proposal outlines & customer contracts, labor hours job times. You'll get job price guides to compare your prices with the going rates, overhead costs, materials, profit ratios. You'll set realistic prices, and job labor hours goals based on field tested, proven, time studied labor hours for every job you bid. You'll know how to evaluate every job for total work hours required, the price to charge for the job, the profit you'll make, best crew size, job costs. You'll also get add-on service check lists to help you maximize sales by upselling customers on additional property improvements.

Nilsson's Job Pricing Guidelines are in use by lawn and landscape contractors nationwide. See what other landscapers are currently charging from price lists compiled and updated by Nilsson Associates. Avoid Pricing Too High - Avoid Pricing Too Low - Win More Bids. Compare Your Prices With Nilsson's Price Lists Before You Bid - Makes Pricing Lawn & Landscape Jobs Fast, Easy, Accurate, Competitive.

When it comes to pricing lawn and landscape jobs nobody has more industry pricing information than Nilsson Associates. Nilsson's Job Price Guides covers lawn care job bidding & estimating landscaping job bids for commercial & residential customers. Get more customers. Price estimates & bids, grounds services, landscaping pricing estimates , estimating & bid the price seasonal work, year around commercial estimate contracts, best price per square foot, best grounds maintenance & landscaping job to bid & pricing, price of lawn care, lawn mowing price, aeration pricing, lawns, commercial landscape job bid estimates, maintenance estimating & pricing, mulching prices, pricing chemicals, weeding & aerating pricing, fertilizer prices, prices for organic fertilizer, pricing weeds in beds, pricing pruning & trimming trees & shrubs, pricing commercial & residential snow plowing, hardscape pricing, pricing hydroseeding, irrigation service estimates for commercial & residential, pricing seeding lawns, pricing lawn sod, prices for slit seeding lawns, pricing edging lawn beds, spring cleanup prices, pricing fall cleanups, hourly price of pressure washing walks & patios, pricing trees, stump grinding prices, price for gutter cleaning, lawn dethatching price, price for shoveling snow, pricing salting, price sanding.

For more information about Pricing
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__________________
Phil Nilsson
Toll Free 866-280-2252
www.nilssonbooks.com

Nilsson is a Nationally recognized "Best Selling Landscape Industry Author," Business Consultant, Speaker with over 30 years experience in the Landscape Industry. His articles appear in Grounds Maintenance Magazine, Lawn & Landscape, PRO, The Arborist, Landscaper Publications, P.G.M.S. and P.L.C.A.A