On the move landscape trends to better prepare you and your landscape business for growth and profitability in the years ahead.
LMN recently conducted an industry-wide report, and what stood out most is an evolving landscape industry that is becoming more professionalized. However, there are some critical areas that business owners need to address to stay ahead of the curve. Between a global pandemic, the rising costs of landscape supply and material, a global skilled labor shortage, and technology that allows business owners to be better in nearly every way, here are just some of the top trends to watch out for in 2022.
1. Year Over Year Growth
The landscape industry continues to show growth in all divisions. The industry as a whole reported a 19% year-over-year growth for the period 2020-2022. A continued sign that staycation backyard-dream builds and property maintenance are at the top of people’s wish lists. However, the commercial sector showed some signals of slowing, primarily because of a pausing commercial economy due to businesses being forced to meet COVID guidelines and restrictions. However, malls and airports are as busy as before with the economy opening back up and the commercial contract opportunity. Still, the commercial sector remains unknown going into 2022, and contractors will need to be flexible and adaptable to an ever-evolving global pandemic. The owner of Troy Clogg and Associates, Troy Clogg, says,
“We weathered the pandemic storm fairly well considering the initial lockdowns. It forced us to rethink how we do business and better prepare and adapt if it happens again. For now, the commercial landscape business is strong, but we learned a lot, and the pandemic humbled us.”
2. Fastest Growing Division
Design and Build or construction showed the highest growth signals despite the increasing cost of labor and landscape supply and materials. People, more than ever, want a staycation property. If you’re a lucky contractor that offers property maintenance services, you can double up and ensure there is good up or cross-sell in the other services you offer once the project is complete. And as the economy continues to open back up, we think the backyard dream build trend is here to stay for a bit longer. Brock Kiely, the Owner of The Brooklin Group, says,
“We had our busiest and most profitable season ever. Using tools like LMN Pro has helped us manage the growth, but we still learned some hard lessons, not over-booking ourselves and not over-working our team. We were rewarded for the effort, but we’re looking to find an even better balance in 2022.”
3. Labor Challenge
However, despite the unprecedented growth, the ongoing issue of hiring, training, and retaining skilled labor plagues the industry. Across the board, owners are reporting the same problems, and the number one recurring issue seems to be hiring. Ryan Markewich, the Owner and Founder at Creative Roots, says,
“It has been a challenge to find enough of and the right people to meet the opportunities, and we are not a company that is willing to sacrifice quality by taking on people who are not qualified or don’t fit our culture.”
When LMN conducted its industry survey in the third quarter of 2021, it revealed that hiring, training, and retaining employees remains the top challenge for business owners as we move into 2022. The results found that 92.1% of companies wish to find better ways to hire experienced and reliable staff. Learn more about the published survey findings.
Better addressing the labor challenge to meet your company opportunities is an ongoing problem for every owner within the industry and will likely remain in the years to come. There is no secret to solving this problem, only well-thought-out strategies and tactics to attract, hire, and retain staff. Brent Giles, the VP of Product from Greenius Online Training, says,
“We have to provide our team members with a destination company and a great place to work. The next generation can earn a paycheque anywhere, so beyond a living wage, what else as a business owner are you doing to enhance their life, and how are you creating a personal and professional development pathway that serves your goals and theirs for years ahead”.
Brent Giles and Greenius VP, Brent Giles recently discussed some of these labor challenges in a recent episode of Landscape Disruptors.
4. Inflating Prices
An industry that is more professional with each year that passes, combined with the rising cost of materials and more work than there are companies, is driving contractors to become better with pricing. Gone are the days of taking on every single job that comes your way. The new trend is to book the work, charge accordingly and deliver outstanding results for your clients. Shawn Spencer from Spencers Lawn Care says,
“We’ve been so busy this year and short on human resources that our only option was to start charging more. In some instances, we raised prices 2-3x, and our new customers didn’t even blink an eye at it. All they cared about was when we could get the work done.”
With ever-inflating landscape supply prices and contractors struggling to keep up with raising their pricing, it furthermore surfaces the ongoing issue of cash flow, which has plagued every business owner in the industry at one point or another. Just simply taking the time to build out your annual cash flow statement projections and identifying where your company will be cash opposing is the first step to combatting this problem. The second step here could be utilizing industry lending options like LMN Lend to fill those negative cash gaps within your fiscal year.
5. Tech Adoption
As the workload increases, so too does the demand become more efficient and streamlined to improve revenue per person hour. One could even go as far as utilizing a waste calculator. Tech adoption is driving contractors to look at their business differently and get more work done, more efficiently and effectively. Using simple apps to create and manage ever-growing to-do lists, or a do it all software program like LMN Pro to systemize and report on every part of the business is becoming commonplace. We live with our smartphones and computer devices by our side 24/7, and contractors are utilizing those tools more than ever to elevate their company and become more profitable with fewer headaches. Mark Bradley, The CEO of LMN Business Management Software has also seen a rise in tech adoption within the landscape industry.
“Our company continues to show strong year over year growth. It’s a definite sign of the times as landscape business owners continue to focus on becoming more efficient while streamlining their operations team using tech.”
6. Reporting
Reporting is what’s driving the efficiency side of the business. And just like technology adoption, reporting is becoming the norm and providing insightful data to make more informed decisions. With powerful and robust data, the decision-making becomes clear and objective. Let’s use LMN Time. For example, the new staff revenue goals dashboard can motivate and empower your staff with yearly revenue goals. It shows you the information you need to track sales goals, progress, and revenue earned for crew leaders, salespeople, and account managers. Measuring productivity is becoming the new norm and it rewards key staff for all of their hard work, which will ultimately drive a company’s bottom line. If you can’t measure it, you can’t report on it, which means you can’t identify any continuous improvement projects or strategies to improve the business function. Time theft and rounding is often at the forefront of waste, but some simple tools and reporting can combat this problem with effectiveness. Mike Lysycki, the CTO for LMN, says,
“Reporting is the key foundation to any successful business. It acts as your guiding light when it comes to growth and success as an organization and the avg landscape business is as complex as any major organization. Reporting on time, productivity, division, budget, and the list goes on, will be the future for the modern day landscape business owner”.
Looking Ahead:
The landscape industry today is becoming more professional, profitable and clearly shows signs of revenue growth across all divisions. Yet challenges still exist. Shortage of skilled labor and the increased demand for contractors will continue to be an issue. Technology and innovation can help contractors create greater impact for both their bottom and top line.
The industry is evolving in a big way, and contractors must be at the cusp of the ongoing innovations to keep up and meet the demands for high-demand services while understanding what to charge and how to become more efficient and profitable all while solving the ever growing shortage of skilled labor.
A simple starting point for any contractor is implementing business management software to streamline business operations, create better transparency within your landscape business, and truly work towards systeming critical business functions to become more streamlined and profitable.
