Are you ready to expand your lawn care company?

March 10, 2017 -  By
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Q&A At the 2016 Lawn Care Forum, LM Editor Marisa Palmieri led a panel about branches and satellites.

The questions you need to ask yourself before opening a new satellite or branch.

As a company grows, it can reach a point where it outgrows its facilities and is ripe for expansion. If your shop is full and your crews are spending more time getting to their routes than actually working on them, it might be time to consider expanding with a satellite or branch office.

On Nov. 17, day two of the Landscape Management Lawn Care Forum, a panel of lawn care professionals discussed the ins and outs of opening new branches or satellite operations.

The panel included William Hoke, president/CEO of NexGreen in Columbus, Ohio; Bob Mann, corporate agronomist for Lawn Dawg in Nashua, N.H.; and John Prusa, owner of Highpoint Lawn Service in Stow, Ohio. Each firm is built upon satellite and branch operations.

The definitions vary across the industry, but typically, a branch refers to a full-scale office—crews, administration and management—that works in partnership with but independently of the headquarters. It brandishes the company’s name and ideally functions the same way, but it should be able to run alone, led by a branch manager.

A satellite, meanwhile, takes many forms. Sometimes, it’s a brick-and-mortar location. Other times, it can just be a place to park some trucks and extra equipment that’s closer to the area customers live or perhaps where employees live. Usually, it’s also a baby step toward a full-fledged branch.

No matter what form this new extension of your brand might take, the decision to expand is not one to make in haste.

“The first thing I would suggest is that you do some deep soul searching and ask yourself the question, ‘Why you want to do this?’” says Prusa. “Why do you want to complicate things?”

If you’re considering making a move, here are the “soul-searching” questions you should answer first.

How do you know you’re ready?

Hoke’s NexGreen does tree, lawn and shrub care and has branches in Columbus, Maryland and Michigan. He says his location is at the point of considering a new satellite operation on the opposite side of Columbus. While it’s still in the same city and might not warrant a completely new branch, the satellite option allows his team to have a better response time to clients and opens up a new pool of employees the company can tap into. Plus, if it goes well and there is enough work, a satellite can easily turn into a branch.

Hoke, who opened many new locations in his former role as a TruGreen vice president, says there are a few signs that make him consider expanding to another site. The first, and probably most obvious, is when he starts to feel like he’s growing out of his current location. The second major factor is proximity.

Proximity to your customers is extremely important, he says. The quicker response time and reduced windshield time, which helps cut down fuel and overtime costs, creates operational efficiencies. Also important, he says, is being near where your employees (or potential employees) live, which improves their quality of life and overall job satisfaction.

“We want to reduce fuel costs, overtime and the amount of time guys are sitting in traffic,” Hoke says. “A key, to me, is understanding where you’re employees live and where they’re coming from. People don’t want to drive 45 minutes away to go to work.”

Who will lead your branch or satellite?

Leadership selection is one of the biggest factors to a successful branch, says Prusa. His company, which is based in Stow, Ohio, has seven branches in Ohio and New York and performs lawn and pest control.

“That’s the very first decision we make,” he says. “It’s the toughest decision because you might think you have a great person who’s worked with you for years, but they’re not necessarily the right fit.”

Of course, it’s important for that person to have sales skills, which will be the driving force behind building a new location. The branch manager is also going to establish the culture at the new branch through top-down leadership. Ideally, the culture carries over from the headquarters, but that doesn’t happen automatically. To ensure consistency, Prusa says, find someone with tenure who has a grasp on the culture you’re trying to maintain.

Just because a person knows the company ropes, however, doesn’t mean he or she is ready to take on extra responsibility. Satellite or branch managers must carry intangible leadership skills that allow them to set internal goals, go after those goals and understand how to accomplish them.

“You need someone who’s willing to be there at seven o’clock at night, after everyone else leaves,” he says.

Most importantly, the person has to have your values, Prusa says. As an owner, you’re essentially going into business with this person. It’s a huge undertaking with huge risks, and the person who will lead this new endeavor must be trustworthy.

“They can’t be blowing smoke all the time,” he says. “They have to have an honest character to them.”

How do you choose a market?

Opening a new branch is a costly commitment. Prusa says it costs about $350,000 to $500,000 in cash to get a new operation to the point where it’s sustaining itself. With that price tag, it’s important to choose a market that’s going to give you a quick return on your investment.

“Think about that for a second,” he says. “Do you have that cash flow for the next three to five years?”

Prusa says he “does a lot of homework” on an area before moving into it. His ideal area to open a branch is a growing, vibrant community where people have disposable incomes. But he doesn’t just pick a ZIP code and bombard it with marketing. He drives street by street and makes a list of neighborhoods that fit his company’s ideal profile.

“I’m looking for new developments with wide-open lawns,” he says. “These are simple-to-service customers with disposable incomes.”

What should you think about from an operations standpoint?

The goal of every branch or satellite should be consistency. That means clients shouldn’t notice a difference between the service of a branch/satellite or the main office.

“Think about McDonald’s,” says Mann, whose company has 10 branches in Massachusetts, New Hampshire, New York, Connecticut and Maine. “If I go to Anchorage, Alaska, and buy a Big Mac or if I go to Florida and buy a Big Mac, it’s exactly the same sandwich. When you’re a customer of Lawn Dawg, I want you to have the same level of expertise, the same customer service, the same experience whether you’re in Portland, Maine, or Rochester, N.Y.”

Consistency in service comes from consistency in culture. It’s a seemingly simple answer to a large problem, but when you put some distance between the headquarters and the branch, it’s often the most difficult to make sure everyone is “singing off the same sheet of music,” Mann says.

A lot of that goes back to having the right person in charge, the panelists agree, but it’s also about implementing systems that can be replicated. Lawn Dawg uses a 12-item service commitment checklist to help technicians at all branches uphold the company’s values.

“Then we put that into place with something called Production 101, where every lawn specialist is taught exactly how to do a job exactly the same way,” Mann says. “If you’re training to that level, every job will have consistent results or you’ll know exactly what went wrong immediately.”

About the Author:

Dillon Stewart graduated from Ohio University’s E.W. Scripps School of Journalism, earning a Bachelor of Science in Online Journalism with specializations in business and political science. Stewart is a former associate editor of LM.

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