In my February article for Landscape Management (“The haves and the have-nots”), I analyzed the results of the 11th-annual Herring Group Benchmark Report. I broke down the differences between high performers (those with an operating profit greater than 10 percent) and everyone else.
I also discussed the three attributes that are essential to high performers. They all have:
1. Courageous pricing.
2. A motivating vision (the culture piece).
3. Diligent execution (operating systems, reports, daily habits, etc.).
To illustrate how these three traits work together, I interviewed three high-performing landscape company leaders on a webinar in January:
- Judd Bryarly, CEO, and Josh Pool, COO, of Timberline Landscaping in Colorado Springs, Colo. Timberline is a large, full-service residential and commercial landscape company.
- Andrew Craft, CFO, of Site Landscape Development in Lewisville, Texas. Site is a large commercial design/build, maintenance and irrigation company.
Here’s what they had to say about the three key attributes of high-performing landscape companies.
Courageous pricing
Both companies have experienced a pricing concept we espouse at The Herring Group — if you are not nervous, you are not pricing high enough.
Site has doubled revenue over the last five years and hit its stride this year, according to Craft. He attributes part of the success to overcoming a reluctance to raise prices on maintenance renewals. The team used data and steeled themselves for internal resistance to the increases. Out of 300 customers who received an increase, Site lost only one account. Many said they had been expecting an increase; others said Site was the last vendor to raise prices.
Customers who went out for bid learned prices had gone up overall.
Timberline also struggled with pricing in the past. Its pricing model did not capture all its overhead costs, such as equipment usage. After a pricing analysis, the team learned that some accounts were priced accurately, but many were off track. Like at Site, Timberline’s leaders were nervous about increases, but ultimately did not get much pushback from clients.
Internal resistance is often the hardest part. “It’s been a challenge, and our teams questioned it, but they also trust this is the right direction because they also realize, ‘If I want to keep getting raises, the company has to raise prices,’” Pool says.
Motivating vision
Every successful landscape company has a motivating vision for the team to rally around. Motivating vision serves as the expression of company culture.
At Timberline, the team values grit, which Bryarly defines as “doing what it takes to get the job done.” Company leaders hold monthly training sessions around grit and hire for it over credentials on a résumé.
The go-getting culture starts at the top, according to Pool. “(Owner Tim Emick) has always instilled in us, ‘Let’s go after the biggest, hairiest projects we can find because, first, nobody is bidding on those and, second, there is a lot of reward at the end, typically.’”
Diligent execution
Executing well is one of the toughest things to do in any business. It is never complete. You must remain diligent.
At Site, the team self-implemented the Entrepreneurial Operating System (EOS) to streamline operations and focus on results. “It’s a framework to help businesses get everybody on the same page, stay focused on the goals, work smarter, grow and succeed,” Craft explains. “And that’s where you get momentum — all these things working together.”
Your turn
Are you courageous in your pricing for new work and contract renewals? There is a lot of psychology at work with pricing, so we help our clients understand the psychology and provide comparable data to help them be courageous.
Does your company have a motivating vision? You may want to compare your vision to other landscape companies (or even other service companies).
Diligent execution: Could the CEO of your company leave for a month and, upon returning, find the company operating just like it was when he or she left?
