By Mike Carden
From the December 2023 Issue
Providing quality service and a top-notch customer experience is only part of what it takes to thrive in the Green Industry. To truly excel and stay ahead of the competition, businesses like yours need to adopt a systematic approach that optimizes efficiency, maximizes profitability, and fosters sustainable business growth. You need an actionable blueprint for success, fueled by data derived from a robust operating system. Let’s take a look at the essential items your blueprint should include, and how they can transform your Green Industry business.
Don’t Leave Money On The Table
When services are skipped, missed, or canceled, you leave potential profits on the table. This is why it’s essential for your business to implement a system for measuring daily route completion. If you are seeing patterns where services are being skipped or missed, you’ll need visibility into why this keeps happening in order to rectify the situation. A good place to start is by focusing on how you can manage and prevent controllable reasons or service interruptions.
You should also evaluate service or customer cancellations by “reason” to shed light on ineffective sales processes or other underlying issues. Are customers who cancel not getting the services they were expecting? Do the same customers cancel repeatedly? Do you have numerous canceled service appointments that still need rescheduling? Look for trends among different divisions or sales departments that can lead to process or communication improvements.
Finally, track adherence to budgeted or estimated labor hours, both on a daily basis and throughout the season or contract. Was a job underestimated just so it could be closed? Are crews taking too long at job sites, cutting into profitability? Taking action based on those insights will directly impact your bottom line.
- Measure daily route completion percentages.
- Identify reasons for skipped or missed services.
- Build processes to address controllable issues.
- Analyze trends over time to improve efficiency.
- Analyze cancellation reasons by customers.
- Identify trends and patterns in cancellations.
- Implement improvements in sales processes.
- Accurately budget labor hours for each task.
- Monitor adherence to labor hour budgets.
- Evaluate projected vs. actual labor hours.
- Inform subsequent contracts or bids based on your evaluation.
Retaining The Right Customers
Not all customers are created equal. Regardless of their customer lifetime value (CLV) – the total revenue you can expect from a customer over the length of their business relationship with you — it’s essential to differentiate between customers that are more valuable and those that may not be as lucrative. Rather than spending time, money, and effort on customers with a lower ROI, focus on those high-value jobs that will foster business growth.
So which customers are the most valuable to you? There are three main types:
Rather than spending time, money, and effort on customers with a lower ROI, focus on those high-value jobs that will foster business growth.
- Customers in dense service areas, because you can schedule more stops efficiently, maximizing time and profits;
- Customers on autopay, because you can count on that revenue; and
- Customers with recurring service lines, because you know what you are providing, timing of those services, as well as when you will get paid.
“Right-sizing” your customer base by eliminating lower-value customers is an effective way to enhance your revenue stream and maximize profits. An extremely effective way of doing this is through strategic price increases.
Using the right data-driven tool, you can segment your customers according to service area, type of service, method of payment, etc. and then flag those accounts for strategic price increases. For example, you can target customers located far from your densest routes — those who are more isolated in far-flung locations. When faced with a price increase, some of those customers will leave; that’s right-sizing.
This will improve profitability on the customers that remain, free up valuable technician time for growth capacity and improved job completion, and pave the way for proper profitability over the long term.
- Segment customers based on various factors such as location, payment method, and service type.
- Implement targeted price increases.
- Contextualize price increases to retain high-value customers or lose those that are low-value.
- Develop different pricing strategies for different customer segments.
Everything Should Recur
When it comes to your business, boring is good. Stable things are boring, and stability is valuable. Stable clients, stable payments, stable revenue — all of this translates into growth for your company.
You can foster this stability by prioritizing recurring activities across your entire business. Incentivize your sales team to promote and sell recurring services, incentivize your techs to convert and upsell customers when they’re on site, and incentivize your customers to invest in recurring packages and extended service contracts. Providing excellent customer service across the board will encourage customers to stick around. Be sure to employ protective measures to get ahead of churn and win back lost customers.
Fortunately, the very nature of the lawn care industry is recurring, and you can take advantage of that. Develop service lines that maximize efficiency and revenue by offering paired services such as lawn care plus mosquito control. You’ll increase revenue per stop by providing multiple tasks in one visit.
Designing add-on services that can be seamlessly executed while on-site also enhances customer satisfaction. To encourage clients to buy into these add-ons, create pricing incentives that incorporate them into your core service offerings, effectively bundling these add-ons whenever and wherever possible. Auto-renewal options, with automatic price increases, help maintain a consistent revenue stream. An active and adept sales process can further capitalize on these opportunities by upselling or cross-selling customers, ensuring that a business is making the most of their inherently recurring services.
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- Focus your entire organization on recurring activities.
- Incentivize sales, techs, and customers to prioritize recurring services.
- Always put credit cards on file for ease of automatic billing.
- Actively work to convert one-time customers to recurring customers.
- Design add-on services that can be done on-site.
- Create pricing incentives that bring add-ons into your core service offerings.
- “Bundle” services whenever possible.
- Highly encourage auto-renewals with automatic price increases.
- Make sure your sales process actively upsells and cross-sells.
In the Green Industry, having an actionable blueprint driven by data is key to sustainable growth. By managing services to completion, evaluating cancellations, and retaining the right customers, you can increase efficiency, boost profitability, and foster growth — ensuring not just ongoing financial success, but also positioning you as a leader in today’s market.
Carden is senior product manager with WorkWave, provider of RealGreen software. He has been with RealGreen since 2010 and has served in a variety of roles; helping companies across all verticals in the Green Industry, with footprints varying from owner-operator to national franchise brands. Since 2020 Carden has been the product manager for Service Assistant, working to cement the vision and direction. Carden loves helping turn feedback into solutions and helping solve market problems.
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