Show me the money: A look at incentive programs

June 18, 2018 -  By
A hand holding cash. Image: iStock.com/Fotonen

Image: iStock.com/Fotonen

They say money talks. And it seems lawn care technicians are listening. Companies are offering commission, bonus and incentive programs to increase production rates and motivate their lawn care crews to go the extra mile.

“In today’s competitive workplace, it takes a whole lot more than just a flat hourly rate to attract someone to be part of your company,” says Benjamin Allen, COO of Lawn-America in Tulsa, Okla. “Giving them some say in their ability to earn a living for their family is a good way to attract a good group of guys and girls to your workplace. It’s a competitive advantage for us.”

An eye on quality

LawnAmerica has had a technician commission system in place since the company started in 1999, and Allen says it’s been a large part of the company’s success over the years. The $8.6-million company provides 90 percent lawn care and 10 percent add-on services to a 90 percent residential, 10 percent commercial clientele.

“From our perspective, it is a form of shared ownership in the company,” Allen says. “The challenge of paying on an hourly basis is guys tend to work a set number of hours and then they’re done—their productivity isn’t necessarily tied to anything, and they get paid the same whether they produce well or poorly. When you move into a commission-based system, there is an incentive to perform well.”

LawnAmerica has both commission and incentive systems in place. Technicians earn 5 percent commission on everything they produce each day. They also have the opportunity to earn 2.5 percent commission on any sales they make, whether it’s bringing on a new customer or selling an add-on service to an existing client.

“The program incentivizes them to produce and sell,” Allen says. “If they are good and sell the services they also perform, they can turn the 5 percent commission into 7.5 percent commission.”

The company also implements team-based incentives for each crew. Once a crew exceeds its yearly goal—this year it is $200,000 per regular walking route—the standard 5 percent production commission doubles to 10 percent for the remainder of the year. Allen says this is the incentive that drives the best performance because it helps employees finish the year strong and provides extra money for them going into the holiday season.

“If they are in what we call ‘10-percent money,’ they have excelled and exceeded their original projections,” Allen says. “Being able to pay out a bit more at the end of the year is good motivation.”

LawnAmerica’s commission programs are tied to quality goals, which Allen says is a critical component of the systems’ success. The company keeps track of things like call backs, cancellations and customer retention rates. It also tracks each technician’s net promoter score, which is a management tool that can be used to gauge the loyalty of a firm’s customer relationships. Allen says this strategy helps keep everything balanced and prevents employees from abusing the commission systems.

“If their production rate is in line and their net promoter score is good, we know we have a good performer,” he says. “All the incentives tie together to build a safety net to make sure one isn’t being touted over the other. You have to watch the checks and balances and make sure you have someone who is doing well in all the metrics, not just excelling in one and failing in others.”

A bulletproof plan

Arbor-Nomics Turf in Atlanta has had technician commission and incentive systems in place for the past 15 years. Richard Bare, the company’s CEO, says the systems are beneficial for everyone involved, as production rates increase and technicians are rewarded for their hard work. Arbor-Nomics is a $10-million company that provides 90 percent lawn care and 10 percent tree/shrub care to a 99 percent residential clientele.

“We think a lot of technicians are money motivated and want to work hard and make good dough,” Bare says. “The commission system makes our guys feel that they are in control of their own fate every day based on what they do and don’t do.”

The Arbor-Nomics system is structured so if technicians exceed their weekly goal, they receive 10 percent of the extra production. Arbor-Nomics’ techs are eligible for time and a half and also receive 5 percent off the top of any sales they make. Bare says technicians can earn between $50,000 and $80,000 per year if they “really hustle and work their route.”

“The idea is to maximize the dollars from every stop,” Bare says. “If they have 10 stops at $100 each, they might hit their daily goal by noon and may bring in another $1,000 by the end of the day.”

Bare says the commission system has to be thorough and precise in order to be successful, as any holes in the program or unclear guidelines leave room for technicians to take advantage of the system. Companies interested in developing a commission or incentive system should implement it slowly, Bare says, and be very specific about the rules.

“You have to have this stuff well-thought-out and strictly put in place so there are no questions about it,” Bare says. “Sometimes guys can figure out how to work the system to benefit them in the short term. You have to keep in mind that a commission system can be a win-win, but it can also be a source of trouble.”

Keeping it simple

Spring Touch Lawn & Pest Control in St. Peter, Minn., implemented a technician commission program about two years ago to provide tangible goals for newer employees to work toward. Nathan Newlands, vice president of franchising, says since implementing the system, each technician’s production rate has gone up an average of 30 percent. Spring Touch provides 70 percent lawn care, 20 percent pest control and 10 percent irrigation services to a 95 percent residential, 5 percent commercial clientele.

“Rather than just getting their hours in, they are getting serious amounts of work done,” Newlands says. “The numbers are realistic ones that they can hit, and everyone across the board is benefiting.”

Spring Touch identifies six different technician levels, each based on the employee’s duration with the company, daily square footage requirements and certifications and licenses they earn. If a technician produces more square footage in a month than his level requires, he can receive 50 percent of the difference between the level reached and his current level. For example, if a level-one technician, who earns $12 per hour, produces work equivalent to a level-four technician who earns $14 per hour, the level-one tech would get a $1 bonus (50 percent of the $2-per-hour difference) for every hour he worked during the previous month. Spring Touch technicians also receive flat-fee bonuses for selling add-on services, securing new clients and earning new licenses and certifications.

“We were giving them time to study for certification exams, but they still weren’t passing,” Newlands says. “Already this year since we told them they would get paid extra, many have passed on the first try.

“It used to be that you just paid them to do their jobs,” Newlands adds. “But that doesn’t really work anymore.”

Newlands says it’s a good idea to keep the incentive system as simple and straightforward as possible to keep technicians engaged. For example, the company recently switched from a seven-level commission system to a six-level system to help simplify things. Spring Touch used to offer technicians a percentage of add-on sales or new client acquisitions, but switched to flat fees after they found that percentages were too vague to be meaningful. Newlands says they used to go over each technician’s goals only at the beginning of each month, but he noticed they tended to lose track of their progress as the weeks went by. Now, an office manager meets with all technicians weekly to review their status.

“If you stay on top of it and keep reminding them where they stand, they respond well,” Newlands says. “If they are really close to earning that bonus, they try to work a bit harder to get there.”

Featured image: iStock.com/Fotonen

About the Author:

Emily Schappacher is a freelance writer based in Cleveland.

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