The landscape industry 2021 is bound to have a new set of challenges, landscape business experts Mark Bradley and Stanley Genadek share an outlook on how the snow and landscape businesses pros can scale forward.
The reality is COVID-19 has negatively affected the landscaping industry in 2020. Looking at 2021, many experts are preparing a more pessimistic lens for a quieter year. Some are expecting an impending recession, and others are expecting a work change or company pivot. While some segments of the landscaping industry in 2021 are predicted to struggle, other segments are actually predicted to grow.
Snow Removal Challenges
Landscape business owner and podcast host Stanley Genadek believes that snow contracting businesses like his will suffer the most in 2021. Most people don't consider snow removal to be a large segment of the landscaping industry. But snow removal is actually one of the most profitable and consistent industry segments, especially in the winter. Landscaping companies like Genadek's that operate out of colder climates are going to miss out on a lot of snow removal jobs next year.
The largest clients for snow removal contracting are often big-box malls, movie theaters, parks, or any parking lots. Because COVID-19 has shut down many of these types of businesses, most snow contractors will likely not find work this upcoming winter. Losing big clients like malls and movie theaters means any snow contractors would have to rely on individual driveway contracts to survive.
Travel, Tourism Shrink, Commercial Contracts Decline
Another segment of the landscaping industry decimated by the pandemic is commercial contracts. Many commercial jobs involved the maintenance and upkeep of hotels, airports, and resorts. Unfortunately, almost all these jobs are being eliminated due to the complete shrinkage of the travel and tourism sectors. Experts predict that both tourism and travel will continue to plummet into next year. This means that landscaping companies will have to either shrink or find a different segment of the market.
Commercial Real Estate Gloom
On a recent episode of the Landscape Disruptors podcast, LMN CEO Mark Bradley noted that the commercial real estate industry might never be the same. Recognizing the migration from office work to remote work, Bradley believes office spaces may not repopulate to the same degree for at least another five to ten years. At this point, the building will be older and finally need the work of a landscape contractor again. Until then, Bradley posed a bleak outlook on commercial real estate as a sustainable segment for landscaping companies.
With the profit margin of almost every segment in the landscaping industry expected to squeeze, there is still a glimmer of hope and the opportunities scale forward. The one segment of the landscaping industry that did indeed stay strong in 2020, the residential market.
Because of people being home more and not being able to travel, the residential landscaping segment has been booming. Many contractors have been unable to fulfill some of their assignments due to the number of bookings they have requested.
Even though this segment has stayed steady in 2020, it has not grown dramatically. The largest contributing factor to this is that there is still a labor shortage for contractors, despite an increase in job seekers. For that exact reason, there could be a significant amount of untapped residential clients that other landscape contractors could take advantage of.
Mark Bradley's landscape business advice was simple: be flexible. He believes if landscaping companies use pessimistic projections for the landscaping industry in 2021, they will be more prepared. Some may even realize the potential need for a pivot. Snow contractors, for example, will have to pivot to other segments of the landscape market in order to see any form of profit margin.
Running a landscape business successfully means making hard decisions. Next year, a landscape business owner may make the tough decision to switch to residential contracts. A decision like that requires significant amounts of training and re-tooling. Considering there is more demand in the residential industry than there are existing contractors, this may be a lucrative decision.
If you are a contractor or landscape business owner, you may need to shift segments in 2021. If you do, you are going to need all the help you can get when it comes to managing your staff. Fortunately for you, LMN provides elite landscape business management software designed specifically for the landscape industry. Start your pivot process now with LMN Free and make 2021 your year to scale forward where opportunities are predicted and reset business plans where challenges are expected.
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