View Full Version : Hello to all from Wichita KS.
10-13-2008, 05:45 PM
I am the President of Legend Lawn and Landscape Inc. in Andover, KS. For those of you that don't know Anover is just outside of Wichita. I am 21years old and this is my first year in business for myself. However, this is my fourth season in the industry. I am 21 years old and have 2 years of a college education complete in working torwards a business management degree. My education has been temporarily suspended while I get this business up off the ground. I have always been told that I am very business and entrepreneur oriented, and consider myself to have some business sense for my age. When I'm not working, which is never, I like to play golf. I used to play every day, and went to college on scholarship for it. Now I am lucky if I get out once a month.
Previously to starting this company I was the manager of Southwind Lawn and Landcape Inc. in Wichita. This company is now defunct. This past February the owner came and told me he was going to liquidate his company. This was a bombshell to me, because he had led me to believe I had a future with his company and maybe even an ownership oppurtunity. He did offer me his residential accounts free of charge. I felt this was the least he could do. He agreed to send all of the customers letters explaining the transition, and agreed to help me get started. However, I haven't heard from him since, and he never sent the letters. I pressed forward and talked to as many customers as I could, and was still able to pick up some. I picked up some others on my own by flyering, and bought some accounts from a competitor mid-season. All in all I would consider my first year in business to be a success. I have learned alot.
I have been in search of a good lawn and landscape website, and I seem to have found it here. I look forward to becoming a regular on the forum and utilizing the sites sources. Thanks Alot, and we will talk to you later
10-13-2008, 05:53 PM
Previously to starting this company I was the manager of Southwind Lawn and Landcape Inc. in Wichita. This company is now defunct. This past February the owner came and told me he was going to liquidate his company. This was a bombshell to me, because he had led me to believe I had a future with his company and maybe even an ownership oppurtunity. He did offer me his residential accounts free of charge. I felt this was the least he could do. He agreed to send all of the customers letters explaining the transition, and agreed to help me get started. However, I haven't heard from him since, and he never sent the letters.
Welcome to our forum!
What do you think attributed to the liquidation of that company? What do you feel you learned from the experience?
10-13-2008, 11:54 PM
First of all I said that it was a bombshell that he was going to liquidate in my previous post. This is partly untrue. I should have seen the writing on the wall, as it was all over the place, but I was 100% committed to turning this company around and making it work. Also, as recently as December (He liquidated in February) we had meetings discussing the future of the company and my role with it. Never was liquidation mentioned. Three major contributing factors led to him having to liquidate his business:
Money Management (Debt) This guy had more debt than you could shake a stick at. I never have seen anything like it. He financed his entire business on credit cards and, used credit cards to run his business. He also never made smart purchases. We had 7 trucks 5 of which were tagged. We never used more than two in a day. 3 of these trucks were nice or decent and the other two were junk. He wouldnt get rid of them? Why? I'm still asking myself. Also we had a shop full of equipment that never got used. We were primarily a mowing company with some landscaping, and a snow removal operation in the winter. For instance. This guy had probably over $3000 in tree trimming equipment. Everything that you could imaginge. You could scale a California Redwood with this crap. In the three seasons I was there we maybe did two tree jobs. Neither of them required more than chainsaws and trucks. Ridiculous. Also with all this debt and credit cards eager to spend money on he never purchased a Skid steer or compact utility loader which we were in dire need of. In the time I was there we spent so much money renting Bobcats we could of bought a damn good used one if not a new one. He wouldn't break down and make that purchase, or at least purchase a dingo or something.
Equipment Maintenance: He did no equipment maintenance whatsoever. I did the best I could to maintain his equipment when I came on, but most of it was already trashed. He had two Walker Mowers with less than 3000 hours on them that were just ruined. He never greased them or did the required maintenance. They burned oil etc. His philosophy was all Kohler engines burn oil. BULL HOCKEY. I purchased a new Walker mower and have put alot of hours on it and it has yet to burn a ounce of oil. I have done all routine maintenance religiously. That is the only difference. Also, in this business things happen. Things break. Things will need fixed from time to time. Whenever something needed fixed 9 times out of 10 it was fixed inproperly, not fixed at all, fixed halfway, or jerrigged in some time of way. Duct tape was his best friend. For this upcoming season he was going to need to drop alot of money on equipment when all of it was prematurely destroyed, he had extended all of his credit, and had spent all of the cash paying creditors. SCREWED.
Communication: This is one of the major keys to business success, and he ignored it. He failed to communicate with his customers, and he failed to communicate with his employees. He had to go back to work full time at a local aircraft plant to pay creditors. That is the primary reason I was running his business. There would be weeks when I wouldnt even talk to him or him call me. I had a company credit card in my pocket. I went out did the work, sold a job, or two, managed the employees, bought what we needed to operate and went home. Often times when I would call him to give him a report on the events of the day he would act as if I was bothering him, so I eventually just left it up to him to get ahold of me. Often times when we would communicate it would be over a case of beer at the shop. Nothing was ever serious. When I started calling his customers to let them know that A. he wasn't showing up this season and B. I was if they would give me a chance. I was flabbergasted by what one customer told me. This customer lived in a neighborhood where we typically did not do leaf removal, but his yard had more leaves than others. He said, " I probably called______seven times last fall requesting a leaf cleanup, and not one of my calls was returned." I apoligized and informed him that I had not been notified either. He was not at all suprised. He said that he had already found somebody else for the season and wished me luck. What could I say? The story was similar with many of his customers.
Needless to say this business was doomed, so it is probably a good thing that he liquidated. I did learn alot from this guy. Mostly how not to run a business. I could talk your head off about this guy,but thats pretty much the jist of it.
10-14-2008, 01:35 AM
We had 7 trucks 5 of which were tagged.
What do you mean by tagged?
Also, what was his policy on buying mowers and trimmers and stuff you used everyday. Did he buy new, or used or what?
What do you think got him into most of that debt?
Do you know any history on how he got started in the lawn care business or why? Did he have any background?
What do you think you will do differently from him?
10-14-2008, 11:21 AM
By Tagged I mean that he had valid registration and license plates on 5 of the 7 vehicles. As I said, 3 of these trucks were decent and 2 were junk. We never really used more than 2 in any given day, but we did run 4 snow plows in the winter. 1 of these junk trucks was 2 wheel drive. We used it as our salt-sand truck, but it was useless with a plow on it. I was trying to get him to sell these two junk trucks and buy 1 nicer one that was 4 wheel drive and more functional.
His equipment replacement policy was simple. He didn't have one. He finally broke down and bought 2 new trimmers and a new push mower towards the end of last mowing season. The only reason he did this, was if he didn't we wern't going to be in operation. Consequently the trimmers were not broke in properly, because they had to be immediately thrown into service.
What got him into most of that debt? Im not 100% certain. There were several mitigating factors, I'm sure. Like I said before, he made many unwise purchases. Most of these were financed by debt. Then he would realize that it was stupid and then go make another purchase to fix it financed by debt. It was just a compounding snow-ball effect. That is the way debt works. If you let it get ahold of you, it is going to snowball out of control. What is so ironic, is this guy isn't dumb. He graduated magna cum laude with a degree in economics from a ivy league school. He's a genius in alot of aspects. Alot of times I thought he was almost too smart for his own good. It's amazing that he amassed such a large amount of debt with an education like that.
Yes, he did have a background in the industry. Him and a partner started out push mowing 40 mowing accounts about 8 years ago. Whats sad, is that 8 years later when he liquidated he only had about 75 mowing accounts. He just didn't grow enough to sustain his business structure. He had his business structured to be a full service, growing, lawn and landcape business, and he just couldn't sustain it without growth.
What am I doing/going to do different from him? Alot to say the least. I did start my business with a loan, but I made sure that it was one that the business could easily pay off. I have one company credit card, as opposed to his 10. I have only used this card when I have absolutely have needed to. I use my cash in the bank, when at all possible, and avoid using my credit unless it is urgent or an emergency. Also, I know a thing or two about money, but not near as much about my Dad. I have sort of brought him on as a C.F.O. type of figure to help manage the company finances. This was an excellent decision, and has definitely saved us some headaches.
Secondly, I perform all maintenance religiously. All the maintenance charts were taken out of the equipment owners manuals, put on to spreadsheets, and posted in the shop. All of my trimmers, and blowers are serviced every 100 hours. Also, I plan to replace all the equipment every three seasons. Including vehicles. Another good rule to follow is try to replace at least one piece of equipment each season. For instance, I plan on replaceing my hand held blower with a 2nd. back pack blower before next season. This is a good way to grow your equipment fleet, as you grow your business, and also keep things in good shape. Also, don't purchase equipment until you need it. For example, I did not purchase a chain saw this year until I sold my first tree job.
Thirdly, I communicate with all my customers and employees reguarly. Talk to your employees daily, even if you get rained out. Always check your phone, and return phone calls. Check your voicemail. This guy never checked his voicemail. If your on a customers property and, you see them outside, take a minute, stop what you are doing, and reach out to the customer. If nothing else, just give a friendly hello, or how are you doing.
Fourth, I market my business which he didn't do. We have signs on our truck. He didn't until his last year in biz. We flyer like crazy, and we have a plan for growth. Those who fail to plan, plan to fail.
10-14-2008, 04:26 PM
Fourth, I market my business which he didn't do. We have signs on our truck. He didn't until his last year in biz.
That is fascinating! Why do you think he never did any marketing?
I did start my business with a loan, but I made sure that it was one that the business could easily pay off.
Do you have any advice to others about the process of taking out a loan for your lawn care business. When you should and shouldn't? Also what you would say is one that can be easily paid off. Where to get it from? What should you spend that money on?
10-14-2008, 09:00 PM
Why didn't he do any marketing? Wow, thats a tough one to answer. I think that he seriously thought it wasn't necessary. Prior to last mowing season I communicated to him that I had a couple expectations going forward. These were that he at least put our number in the phone book and get signs on at least two of the trucks. He did this. Never did we hand out fliers when I was there, but I heard stories of him flyering previously. He had some results from these , but a major problem was he was letting employees flyer unsupervised. I'm pretty sure they were playing x box and trashing the flyers. If you flyer, always make sure that you are present to supervise or help flyer yourself. You are the only one that ensures that the flyer gets on that door.
Then again, why have a marketing plan if you are never going to answer your phone, return phone calls or check your voicemail? When I gave a bid or gave out a business card I always told the customer to call me and wrote my phone number on the back.
I think he thought that he had a solid customer base to rely on, which is somewhat true. The problem is these peoples prices had not been raised in years and they were severly undercharged. Unfortunately for me, these are alot of the customers I gained.
Loans...First for the process of taking out a loan. If you plan on going to the bank for starting your business make sure you have a solid, well thought out, business plan. I personally went to my local Best Buy and purchased a software program called Business Plan Pro. It was $100, and well worth it. This program walks you through the business plan process step by step. Also, it is not a bad idea to have a professional consultant review your business plan before you go to the bank. This can get pricey, but it can be the difference in you getting a loan or not. When I say make sure your business can easily pay that loan off, you should make sure that your loan payment is no more than 10% of your projected revenue. You can spend this money on anything you need, but spend it wisely. I used mine on the truck, trailer, tools, and equipment. I didn't really have any tools before, so I needed those. I had an oppurtunity to buy the liquidated businesses equipment, but as I said it was trashed. Therefore I got my own, new equipment. If you already have resources such as your own tools use them and spend your loan on other things. I already had a laptop, laser jet printer and office supplies from being in college so I have been able to utilize those resources.
10-14-2008, 10:11 PM
How did that previous lawn care business owner handle paying the employees? Did he offer incentives to help sell more? Did you learn anything from that experience and how you will do it differently in the future?
10-14-2008, 10:59 PM
I was just paid an hourly wage. There were no icentives for sales. I was just trying to sale sale sale to create some job security for myself. As far as paying my employees differently, that is something I haven't really thought about, but incentives are an excellent idea. Right now I have two part time employees, who are both in college. When I first started earlier this year, I brought on one of my guys from the other company. This guy was a landscaping genius, and I tried to bring him on as sort of a partner in the company. I bought him his own business cards, and tried to show him that he had a future with my company. Unfortunately that situation didn't work out. I have often wondered what would of happend if I would have offered more incentives for him.
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