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If you can’t beat ’em: Third-party management services

February 17, 2015 -  By and
Offering third-party management services on a regional level provides clients a more personalized experience, Tim Boyle says. Photo: Giant Landscaping

Offering third-party management services on a regional level provides clients a more personalized experience, Tim Boyle says. Photo: Giant Landscaping

On a regional level, Giant Landscaping joins the third-party management game.

Tim Boyle still gets a sour taste in his mouth when swallowing the concept of third-party management in the landscape maintenance industry.

It stems from his personal experience as the co-owner of Giant Landscaping in Manchester, N.H. At times he’s had to walk away from a commercial account because it was too underpriced due to the management company’s agreement with the client.

Because Boyle doesn’t foresee large, national clients losing their interest in using third-party managers anytime soon, he’s rebutted with an “if you can’t beat ’em, join ’em” mentality. Giant Landscaping began offering its own third-party management service on a regional level about a year ago to engage and book more commercial accounts directly and do the same for other landscaping companies in its region.

“There’s a better way to do things,” Boyle says. It’s based on an awareness of the contractors’ P&L. “It comes down to not being greedy. If you’re the guy out there paying for fuel, materials and labor, you need to be making money for that part of the job,” he says.

Being the broker

Boyle describes third-party management much like brokering, whereby a service seeker, such as a national retail chain, hires an outside party to vet and contract with service providers, like a landscaping company. The contractor, in turn, works for the management company, not the client itself.

On a national level, third-party management firms include Brickman Facility Solutions and Affiliated Grounds Maintenance Group.

For clients, third-party managers cut out the extra legwork that comes with securing and communicating with the provider. For a landscape company, a management company takes a cut for acting as the middleman.

Though still gaining its footing as a third-party manager, Giant Landscaping plans to expand this facet of the business by leveraging its field experience to match a contractor with a commercial client and by operating at a regional level, in theory managing accounts more closely than national companies do.

The company itself, which does about $2 million in annual revenue, employs 15 people year-round and 30 in the winter when it offers snow removal, a service comprising 30 percent of the business. From there, it has a split focus on maintenance and design/build, securing about 50 percent of its work through commercial accounts.

“We’re a smaller, more dedicated group of people,” Boyle says. “I think the money the client is paying for the service is better managed. We don’t have an $8 per hour employee sitting in a cubicle who doesn’t know what he’s talking about.”

In fact, the third-party management division at Giant Landscaping is manned by its office staff, all of whom have field experience, which Boyle says qualifies them to be the liaison between the contractors and the clients.

He reinforces that the point of third-party management is to give the client only one person to call. Having a person to call who “knows their stuff” in the field makes a third-party manager top notch, he says.

A balancing act

Giant Landscaping sees value in securing commercial accounts, such as with Tesla Motors. Photo: Giant Landscaping

Giant Landscaping sees value in securing
commercial accounts, such as with Tesla
Motors. Photo: Giant Landscaping

Giant Landscaping’s starting point for the service has been with BJ’s Wholesale Club, an account the firm held years ago through a national third-party management company.

For this client, Giant Landscaping handles the landscape maintenance at one local store and subcontracts out the job for another BJ’s Wholesale Club location outside of its immediate service area—something that’s become a loose rule of thumb for Boyle to determine when it’s ideal to subcontract a job versus just having his company take it on.

“Honestly, I service southern New Hampshire primarily, and I’ve found, across the industry, it’s best if you operate in a certain area,” he says. “It’s way better for the client because they’re getting a better service.”

Boyle uses the same reasoning for why he’s instituting a regional third-party management approach. It allows him to manage accounts personally and not fall into what he refers to as the bad business of some companies overseeing accounts from across the country.

“I’m not trying to take any business that I can’t drive to,” he says. “You want to stay within your means.”

Still, there can be a balancing act that comes with operating as a third-party manager and a service provider in terms of how to keep things fair and not scoop up all the accounts.

All it takes is a focus on simple logic and a customer-centric, noncompetitive mentality, Boyle says.

Which is why he has made building relationships with other contractors equally as important as building relationships with potential clients. And it’s something he’s put into play even before pursuing third-party management as an additional service. For instance, it’s never been out of the usual for a competitor in another service area to offer up a job to Giant Landscaping if it seems to be a better fit for the client and vice versa.

In terms of vetting those landscape companies as a third-party manager, Boyle will go visit their sites and interview them personally to assure their performance will reflect well on his company.

That process starts with a phone call.

“The first thing I want to do is make sure that someone is actually going to answer their phone when I call,” he says. “If they don’t, I pretty much rule them out immediately.”

 

Katz is a freelance writer based in Cleveland.

About the Author:

Former Associate Editor Sarah Pfledderer is a West Coast-based contributing editor for Landscape Management.

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