4 Secrets to Extreme Profit

and Minimal Management

Secret # 1 – Finding the Perfect Customer

Marketing

Secrets to Success

Marketing - $20.00 Special

Piecework – Pay by the job

Revenue Tracking – Who pays me the most?

Knowledge System– Become useless

CLC

Top Line

Bottom Line

A company

• An organization that stands between customers and employees.

CustomersBusinessEmployees

A company

• We use Job Costing to raise the value of our customers

Customers

Business

Employees

$ per hour

What constitutes a “Good” Customer?

• In the right area– Travel time is a killer to productivity and efficiency.– This is such a big deal that it's worth around $40,000

dollars a year for a company with 10 crews that have 3 men on each crew to move it's starting location (the shop) 15 minutes closer to their customers.

– .5 hours X 10 crews X 3 guys X 36 Weeks X $45/hour =• $24,300 in lost sales per year. $40,000 to move, you would

recover in less than two years.

What constitutes a “Good” Customer? (Location)

• In the right area

What constitutes a “Good” Customer?

• Able to pay the bill– Have a policy in place– Use CLIPxe to prevent

losses– Some companies run a credit score– CLC – 2011 = $6,565 – 2% Bad Debt 300K sales

2012 = $1,713 – 0.3% 530K sales

2013 = $1,910 – 0.2% 700K sales

Credit Card “ding”, automatic

What constitutes a “Good” Customer?

• Their expectation meets our service– Who are you?– What level is your service?

– CLC – Mow, Blow and Go!• No bagging• No landscape construction• No special requests

– Small Residential

What constitutes a “Good” Customer?

• Minimal interaction with the company• Low maintenance customer• Ease of communication

– “I want to be called before you come and do the visit.”– “I want to talk to your guys when they are here.”– Call ahead to put the dog away– Skip three different applications– The customer that calls after every service– The customer that wants you to cut at a different height– Wants to meet for a standard service

What constitutes a “Good” Customer?

• Consistency in contracts– No exceptions to the rule– Ongoing contracts from year to year– Normal pricing, no special prices

What constitutes a “Good” Customer?

• Property meets our equipment– No large trees– Small yards– Newer developments– Wide enough gates– No pools– Easy driving in and out– No aeration on irrigation systems– “Dog Run” – government contracts

What constitutes a “Good” Customer?

• Referral to others– Don’t give away the profit to get a customer

• $800/year give away $40 you have given away 5% profit

Cutting Edge Lawn Care – Austin, TX

• I want to share something we did 7-8 years ago regarding this subject.•  • Up until then, we took all clients that called for any lawn maintenance.  80% of our clients did not have

sprinkler systems, and we mowed them biweekly -- until the drought that begin 8 years ago.  That summer, we went 6 to 8 weeks between mowings in June through September because it did not rain.  In January the following year, the weatherman predicted another hot and dry year. 

•  • That is when Todd and I looked at each other and said, “No way!”  So, we thought about it and made a

major policy change.  We decided from that point on to only accept new clients who had sprinkler systems, and who wanted weekly lawn mowing during the growing season, and who would sign one of our two annual service plans (one is 38 services per year, and the other is 52). 

•  • That year, we turned down 80% of the people who called us for quotes. And, we grew 20% in sales. 

The new policy saved us.  The drought has continued in Austin since then, and we have grown every year.  Last year, we grew almost $200,000 in sales. I have attached an Excel chart of our sales history.  On the far right, we made a note of the year we changed policy. Look what a difference in sales growth it made over the year before, and ever since.

•  • We are so thankful that we raised our bar.  We have been really blessed. 

Cutting Edge Lawn Care – Austin, TX

• Sprinkler SystemsCutting Edge Lawn Care, Inc.

Sales HistoryMonthly Totals Ann %

YEAR JAN FEB MAR. APR. MAY JUNE JULY AUG SEP OCT NOV DEC ANNUAL YEAR Y-T-D % Growth2014 160,312 2014

2013 145,276 99,558 138,091 173,419 189,147 141,497 201,416 188,871 153,533 168,533 125,797 154,630 1,879,768 2013 191,329 11.3%2012 104,470 113,678 133,616 141,515 174,535 143,378 161,190 161,799 134,323 144,288 138,663 136,984 1,688,439 2012 111,819 7.1%2011 97,907 97,383 137,425 122,798 170,778 171,238 141,799 146,860 120,751 130,657 112,878 126,146 1,576,620 2011 103,474 7.0%2010 82,918 81,824 116,122 105,661 127,229 171,286 137,618 134,914 122,989 119,589 133,298 139,698 1,473,146 2010 124,214 9.2%2009 83,838 69,358 100,242 98,955 120,077 143,808 142,262 121,614 109,694 103,744 106,788 148,552 1,348,932 2009 106,092 8.5%2008 66,511 65,988 87,436 128,088 121,591 139,816 110,560 119,903 115,160 108,459 80,834 98,494 1,242,840 2008 180,130 17.0%2007 67,362 36,454 68,875 70,984 109,464 113,301 100,751 128,156 77,294 113,746 81,902 94,421 1,062,710 2007 188,942 21.6% Changed Policy2006 45,418 54,911 56,357 60,607 99,027 91,317 78,233 98,903 61,966 93,711 76,765 56,553 873,768 2006 51,274 6.2% First year of Drought2005 48,043 40,133 59,226 75,746 92,643 79,290 79,347 79,566 74,266 74,035 68,368 51,831 822,494 2005 78,422 10.5%2004 39,105 32,971 46,468 61,450 62,126 81,772 63,260 82,247 65,939 65,683 72,079 70,972 744,072 2004 58,378 8.5%2003 46,779 36,386 43,909 59,481 59,672 67,807 82,483 57,258 73,999 59,203 45,476 53,241 685,694 2003 45,563 7.1%2002 32,387 28,110 40,081 48,113 57,387 55,323 61,599 76,035 65,464 62,642 52,811 60,179 640,132 2002 187,195 41.3% Bought L&L2001 20,946 19,162 26,336 40,501 47,033 50,327 42,587 41,710 33,577 43,499 54,643 32,616 452,937 2001 119,421 35.8%2000 13,822 11,324 21,184 26,873 30,070 38,350 39,089 34,579 31,358 30,000 29,867 27,001 333,516 2000

JAN FEB MAR APR. MAY JUNE JULY AUG SEP OCT NOV DEC

Cutting Edge Lawn Care – Austin, TX

• One other thing I forgot to mention was something it took about 3 years into the policy change for us to learn.  Our new clients (with the sprinkler systems, weekly service, and on an annual service plan) were worth three times the value of our old clients base (no sprinkler system, biweekly mowing and no service plan).  Originally, we thought they would be worth twice (biweekly to weekly mowing).  But the fact that they had invested in a sprinkler system and they were willing to pay for twice the mowings meant that they wanted a much nicer lawn and landscape.  So, they also bought fertilization, color plants, new shrubs and shrub trimming. 

Finding the “Good” Customer

– $20.00 Special – What are you selling?– Advantages:

• Target Neighborhood• Target Customer• Take some of the risk• Eliminate the Estimator• Employee Buy-In

Finding the “Good” Customer

• Marketing– ValPak

• Angie’s List– Ask for a seasonal rate– Watch it closely

Keeping your best customers

• Use Job Costing Report (Key # 3)• Send them chocolates• Find more like them• Sign up multi-year contracts

“We are sharing a Valentine message and a small box of Whitman’s chocolates with all 900 of our clients. We bought 1,000 plastic bags with a hole to hang on our clients doorknobs.  Each of our crews inserts the Valentine and the box of chocolates in the bag as they drive to next home   Russell Stover, who owns Whitman’s, sold us the $1.77 boxes of chocolates for 75 cents each, freight prepaid from Kansas City.  Our total cost is $1.09 each.  But our return is many times that.  We are receiving some wonderful emails from our customers who have already got their Valentine and candy.”

Keeping your best customers

• Use your Website to help you manage them.

www.cliplawncare.com

Go get the Gold!