Who is your perfect customer?
It’s the offseason, and that can be the perfect time to take a step back and reevaluate your business.
Dave Tucker has been in the Green Industry for decades and seen lawn companies of all shapes and sizes thrive and fail. In his research of the industry, he discovered that there are just four keys to extreme profit. Your success is our passion so we will lay these four secrets to extreme profit out for you, one secret at a time in the next few weeks. Stay tuned and make your company grow to extremes this upcoming year!
1st Secret To Extreme Profit – Finding the Perfect Customers
The Perfect Customer Is In The Perfect Location
Travel time can be the number one killer of productivity and efficiency. Location is such a big deal that it’s worth around $40,000 a year for a company with ten crews that have three men on each crew to move it’s starting location 15 minutes closer to their customers.
How is that possible you ask?
.5 hours (of traveling 15 minutes to and from your daily route) X 10 crews X 3 guys (on a crew) X 36 Weeks (a season) X $45/hour (each man costs you per man hour) =
$24,300 in LOST SALES per year. So even if you paid $40,000 to move your location 15 minutes closer to your routes, you would recover it in less than two years.
The Perfect Customer Is Able To Pay
Hopefully, you look at this point and just say, of course! But have you looked at your numbers in CLIPitc or CLIPxe and made sure that all your customers pay their bills on time? Even if your late customers eventually settle after a few phone calls that means you paid someone (or spend your own time) for 10-20 minutes just to make late payment calls. Our policy is that when the customers don’t pay, we don’t cut! We try to have most of our customers’ credit cards on file and just bill them monthly for the service.
The Perfect Customer Only Wants YOUR Service
Get the perfect customers so you can do your best work and make the most money.
The Perfect Customer Won’t Force You To Give Away Your Profits
As Cutting Edge Lawn Care shared with us, it is never worth it to give away your profits just to get a customer. Cutting Edge used to take any customers that called them as long as they owned grass and wanted it cut. However, 80% of their customers didn’t have sprinkler systems, and they all lived Texas! One summer they went from weekly and bimonthly mowings to stretches of 6-8 weeks between mowings because of a horrible drought. Then in January, they found out that the next season was predicted to be the same – long, dry, and hot.
“That is when Todd and I looked at each other and said, “No way!” So, we thought about it and made a significant 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 increased almost $200,000 in sales… One other thing I forgot to mention was something it took about three 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, bi-weekly mowing, and no service plan). Initially, 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 more beautiful lawn and landscape. So, they also bought fertilization, color plants, new shrubs and shrub trimming.
Don’t give away your lawn service — find your perfect customers and stick to that type and your company will grow.