hull tree final presentation
TRANSCRIPT
Strategy TeamWeston Thayne - Daniel Godoy - Mike Peterson - Rebecca Thorpe - Stuart
Davis
Chad Hull Logging in Montana Moved to Idaho and Started Hull Tree
Care Had high demand and couldn’t keep up
with work Mont bought the Utah Side and later Idaho side of Hull Tree Care
History
Tree Removal Tree Trimming Wood Chipping
Aiming to move into Stump Grinding Tree Spraying
Services
Company OrganizationMont
Poulsen
Idaho
Kody Alden
Utah
Foreman
Main Cutter
Main Cutter
Ground Crew
Ground Crew
Chad & Raven
TrendsINDUSTRY STRUCTURE
• Almost 140,000 establishments in 2015
• 69% Nonemployees / Sole• Narrow geographical
markets• Stable market -
establishments grew at an average annual rate of 1.6% from 2010 to 2015
• Employees have risen at an average annual rate of 2.4% from 2010 to 2015
MARKET TRENDS
• Revenues US $16.2 Billion in 2015
• Annual growth in revenue was an average of 3% from 2010 to 2015
• 3.3% of growth in 2015
TrendsMAIN DRIVERSIn the five years to 2015, demand for tree cutting and other arboriculture services has grown as a result of rising disposable income and a rebound in construction activity. Crippled real estate markets halted construction activity and lowered demand for industry services prior to the period. Since then, favorable macroeconomic trends have revived residential and commercial construction and investment; although local government spending remains tepid, positive employment trends have relaxed budgetary constraints in recent years.
Source: IBISWorldhttp://clients1.ibisworld.com/reports/us/industry/currentperformance.aspx?entid=6064
Trends
Source: IBISWorldhttp://clients1.ibisworld.com/reports/us/industry/currentperformance.aspx?entid=6064
IMPORTANT TAKEWAYS
• This industry is HIGHLY sensitive to construction/real state market
• Public investment also have high influence over this industry
Asplundh
Tree's Inc
Bud to Branch
Total Tree Care
Self Trimming Homeowner
Competitors
Mission and Vision Ethical Company others can trust Work that brings happy customers High quality employees Vision “Our Mission is to provide
Dependable High Quality Customer Service.”
Purpose
Recommendations
Current Company Struggles: Not profitable – Projected loss of about $21,000 in 2015 Human Resource issues
Recommendations: Understand Business Financials Create Price Structure and Process Know the Industry Employees (Core Team Form Organizational Structure
Business Financials
Jobs per Day Average TicketUtah 2 363Idaho 2 287Consol 4 325
Metrics 2015 Actual
US$ ‘000 US$ ‘000
Jobs per Day Average Ticket Jobs per Day Average Ticket Jobs Var AVG TicketUtah 2 363 4 436 100% 20%Idaho 2 287 2 316 0% 10%Consol 4 325 6 376 50% 16%
2015 Actual 2016 Budget VariancesMetrics
US$ ‘000 US$ ‘000
Business Financials
Projections• 82% growth in revenue
in 2016• 29.5% growth in
expenses• 2016 Net Income = $
139k
US$ ‘000
Business Financials
Create Price Structure and Standard Process
Service Item Price Basis Cutter Labor $45 Hour Ground Labor $35 Hour Vehicle Fees $3 Mile (outside 10 mile
radius)Boom Truck Use $50 Hour
Minimum Fee $150 Hour
Pricing based on assumption that all employees are trained and efficient
Origin of Daily Revenues Average Hourly Pay $39
Hours worked per day 8Men working per day 5
Total labor Revenue Pot./day $1,560Truck and Travel revenues $300
Daily Revenues $1,860Discounts/other (10%) $(186)Total Daily Revenues $1,674
Company Procedures/ProcessesCompany Processes Quickbooks – Easily View AR, Profits, comparisons;
database for customers; bidding and invoicing Bid sheets Time Cards (Reconcile employee hours with bidding
sheets) Social EntrepreneurshipScheduled meetings with management Meet with estimator/foreman 1 day each week to review bids and schedule
Bidding Sheet
“Only a small percent of the successful entrepreneurs I have interviewed over the past 20 years have started businesses in markets they knew absolutely nothing about. And these people generally become serious students of the industry” – Mike Glauser (Building Your Dream on Main Street) Why?
Knowing the industry allows you to ask the right questions about your business
Gain a basic knowledge of financials within the business Know your numbers
How? Talking to Chad the previous owner isn’t enough GEMBA- Go and Do Prioritize
Be the Owner of Hull Tree Care Drive what you want from this company
Know the Industry
You need a TEAM. - Honest and transparent- Has strong work ethic- Willing to do all jobs- Works well in groups- Able to keep ego in check- Respects people’s experience - Comfortable with different opinions Compensation to motivate- Utah manager to move hourly
Quarterly profits Favoritism of employees hired by leaders- Hourly wage promised Provide Utah manager a cut in the grinding- Join forces Look into network of potential hires
Employees
“Entrepreneurs we interview choose team members primarily based on character. Since many of them run smaller companies, they can’t afford to have noxious people in their organization. They tend to look for decent people first, and skills second. When you only have five or six people in your company, you can’t bury a difficult person deep in a corporate structure. So quality of character is a major emphasis in finding team members.” – Mike Glauser (Building Your Dream on Main Street)
Employees
Hire at USU
Craig D. AstonSenior Lecturer, Ornamental Horticulture
[email protected] Beorchia
Academic Advisor College of Natural [email protected]
Hiring
Hire on CareerAggie https://www.usu.edu/career/htm/career-aggie Click “Off-Campus Employer Guide”
LDS employment Monster Indeed KSL/Craigslist
Hiring
Create training videos instructed by Chad & Kody
New hire required to travel up to Idaho and shadow Kody
Train new hire trimmers on how to price trees
Create a culture of employees to talk to neighbors when they visit sites
Training
Questions?
APPENDIX