Profit Power: Stop waiting for immigration reform

May 20, 2019 - By Jeffrey Scott

Photo: iStock.com/Lana2011

Politicians and lobbyists put up obstacles to increasing migrant labor, or H-2B. They argue that cheaper labor (though it has become quite expensive) will take jobs away from our citizens.

But given the seasonal nature of landscaping, and higher paying manual labor jobs, a migrant workforce makes the most sense. It always has.

I predict if the government were to open the floodgates of H-2B, then our entire economy would surge due to the pent up demand for manual labor services. It would create a cascade effect that would expand demand for manufacturing and all other services. Our entire economy would grow more confident.

But that’s not going to happen. So you need a better business model now. Here are some ways to take control of the situation:

First off, realize you are in the people business, not the landscaping and lawn care business. Make a mental shift.

Become recruiting experts, develop your recruiting skills in house and also use out-of-house sources.
Treat recruiting with the same seriousness as marketing, sales and business development.
Develop a training culture, with a weekly approach to training and developing your workforce.
Make human resources part of your solution. It’s not just for the big boys anymore. Develop people systems that will retain your employees and show them a career.

Beyond being in the people business, take specific business actions to shore up your financial cushion, including:

Sell annual and multi-year contracts, instead of seasonal and time-and-materials contracts: guarantee the cash flow and lock in the contracts.
Become experts at cash flow management. Don’t rely on an outside accountant to tell you were you stand. Write your contracts to buffer net cash flow.
Keep overhead recovery seasonally accurate to ensure your profitability.
Price high risk and small jobs at double your profit targets; don’t leave it to luck to have a good year.

Lastly, embrace technology and equipment to replace the manual labor that our workforce is less interested in doing:

Find mechanized solutions that will allow you to get more work done per crew. There are increasingly more solutions that require less labor.
Embrace robotic technology, experiment and push forward the options being offered.
Tight management of your equipment will give you an edge going forward. “Equipment” is like owning a separate business with its own inventory and cost control. Put smart management on it, and it will shift from a headache to an advantage.

Without improving our guest-worker laws, many landscape professionals will feel forced to hire employees that are not legal, or grossly under trained, or under motivated. It’s a travesty. Reform is the only logical solution that will lift the tide of all boats.

Until that happens, you need to remain proactive on building your business model and your own business acumen.