Article
Reprint from Lawn & Landscape Magazine
By: Bob West
January 1999
Article URL
Conventional wisdom among green industry contractors holds certain
business philosophies in high regard: focus on customer service, develop
long-term employees and excel at what you do best.
Bob Ottley, president, One Step Tree and Lawncare,
N. Chili, N.Y., has turned these philosophies into the foundation
for a successful and growing lawn care company. But the only reason
Ottley’s company
has ended up where it is at today is because he once ignored
these keys to success in favor of common pitfalls such as offering
too many services, competing in price wars and ignoring customers
service.
OWNER: Bob Ottley
HEADQUARTERS: N. Chili, N.Y.
FOUNDED: 1976
PRIMARY SERVICES: Lawn and tree care comprise almost
all of the company’s
revenues, with 88 percent from lawn care and 12 from tree
and shrub care. The customer mix is 75 percent residential customers
and 25 percent commercial customers.
1998 REVENUES: $1.85 million
1999 PROJECTION: $2 million
1998 SERVICE CALLS: 980 to residential customers, 37 to commercial
customers
AVERAGE SQUARE FOOTAGE TREATED: 9,500 square feet for residential
customers and 126,000 square feet for commercial customers.
Executive Summary:
MISSION STATEMENT: One Step Tree and Lawncare’s
mission is to enhance landscapes through professional services using
innovative people, products and equipment and to grow in the community
where we live and work.
FUTURE CHALLENGES: Finding good, qualified employees and finding ways
to keep them and motivate them and dealing with any new government
regulations as they arise.
BACKGROUND: Got his start in the green industry
with a neighborhood lawn mowing job. Moved into retail with a local
garden center and managing a retail chain store’s garden center.
Like so many others in
the industry today, Ottley’s green industry interests first
developed as a youth when he started a neighborhood business cutting
lawns. This led to a job with a a local garden center, which was
where he found his calling. “I really enjoyed dealing with the public in the garden center,” Ottley
recalled. “I liked explaining how to care for plants, troubleshooting
people’s problems and the selling process.”
Ottley was then hired as a garden shop manager for a local retail
chain. Come the holiday season, however, the garden center area became
the Christmas toy department and Ottley moved into a more general management
position until the chain went bankrupt.
Ottley had gotten enough of a taste of responsibility that he decided
that was the time to go out on his own, and One Step was founded in
1976 with one employee, a truck, a mower and a fertilizer spreader.
At the outset, Ottley wasn’t
too selective in terms of what work he pursued in order to keep dollars
coming in the door. “I did some landscape installation, some design, patios and
decks, mowing and lawn care,” he noted. “But lawn care,
the process of growing healthy turf, was my true interest.”
In the fall of 1976, ChemLawn had yet to reach Rochester, but Ottley
was fortunate that his relatives from Kentucky did.
“When my relatives came to visit that year they asked me if
I sprayed lawns, and I explained that I sprayed for weed control when
necessary but not for fertilizer,” he said. “I had never
heard of spraying fertilizer, but they said it was very popular
in Kentucky, so I researched it over the winter and bought a 200-gallon
skid-mount spray unit for the spring of 1977 and started spraying
lawns.
“A year later ChemLawn came into the market and if you weren’t
offering liquid lawn care you were in trouble,” Ottley added.
In 1979, Ottley began what has turned into a 20-year-long
involvement with the Professional Lawn Care Association of America
that will include him serving as PLCAA’s 1999 president.
“That was the year I attended my first PLCAA conference and
realized lawn care was a real business,” Ottley said. “So
I discontinued landscaping services that year and dropped
maintenance the next year.”
That move cost the company almost half of its $150,000
of sales at the time, but today, Ottley looks back on this decision
as one of the keys to the company’s success.
“I was young and inexperienced when it came to managing a company
at that time, and I was stretched too thin,” he observed. “I
couldn’t focus on delivering such a diversity of services, so
focusing just on lawn care was a positive move for me. Plus,
we made up the dollars we lost in the first year by focusing on lawn
care.”
As the market progressed
through the 1980s and competition intensified, Ottley
saw price becoming the determining factor for many customers, particularly
those new to professional lawn care, and decided that wasn’t the market
he was after. Instead, he chose to supplement his program with value-added
services such as soil testing and an Integrated Pest Management approach
in order to differentiate himself from the competition. Doing so meant One Step needed technicians with greater knowledge
and technical expertise and could not afford to lose such employees
once it found them. So Ottley needed to become a year-round employer
in a seasonal market that seldom lasted beyond Nov. 1 for lawn care.
“I also realized that if we were going to keep people and provide
a superior service with I.P.M. and soil testing, it would cost us more
to do so,” Ottley added. “The real key was that we were
able to put through a 20 percent price increase to our customers
in 1990 and they stuck with us.
At the time, One Step also expanded its service from
a four-visit to a five-visit program, adding a combination fertilization/post-emergence
crabgrass control and surface insect control scouting visit.
“Now, we’re definitely the most expensive company in the
market by 20 to 40 percent, but we’re still competitively priced
for the value the customer receives,” he commented, adding that
the ease with which One Step converts prospects who have used
competitive services before into new customers validates this approach
of greater value at a higher price.
Today, the challenges associated with an I.P.M.-based approach are far
from conquered.
“Customers still don’t fully understand I.P.M., even though
we talk about it in all of our newsletters, leave behinds and other
materials,” Ottley admitted.
For his part, Ottley defines I.P.M. as “a way of controlling turf
problems through growing healthy plants first of all to build up a
natural resistance and then knowing your thresholds as to what level
of damage you can have on a given plant or area that’s not detrimental
to the long-term health of that plant. Then, the last resort
is to select the proper control product that is targeted for the specific
pest and only treat the infected area.”
Ottley continues to emphasize this part of the
company’s service.
“It’s crucial to be able to differentiate yourself from
the competition, and this also lets us put the environmental issue
forward,” he noted.
Despite the problems over-diversifying meant for One Step Tree and
Lawncare, N. Chili, N.Y., the company has responded to growth by expanding
into tree and shrub services.
After some slow years of little growth in the division,
recent growth has forced the company to restrict tree and shrub services
to current lawn care customers only. Currently, tree and shrub services
comprise 12 percent of the company’s sales with a goal of 15
percent.
“I can’t say why the work has picked up other than that
our customers are more aware that we offer this service and we’re
establishing ourselves as experts,” noted Bob Ottley, president,
adding that the company treats trees up to 15 feet high.
Significant pest problems of late – aphids attacking maple trees
in 1997 and a viburnam leaf beetle attacking the viburnam family of
shrubs in 1998 – also helped boost the business.
But Ottley chose not to pursue new customers, largely due to the lack
of qualified technicians.
“In lawn care, our technicians are trained to offer Integrated
Pest Management, and that takes a lot of time,” Ottley related. “Even
more training is required for tree and shrub services because there
are so many plants, diseases and cultural problems to identify. You
can’t just move someone from lawn care to tree and shrub care.”
The one area Ottley would like to see the division improve upon is
its profitability.
“Tree and shrub is a funny business because the product cost
isn’t as high as for lawn care but the labor costs are higher,” he
commented. “Plus, since it’s new for us, our tree and shrub
routes aren’t as tight, so it doesn’t produce as many dollars
as lawn care.”– Bob West
In order to keep his technicians busy through the
winter, Ottley expanded the company’s services. “We sell Christmas trees through December, we’ve begun
offering winter pruning and we bought a holiday decorating franchise,” he
said. “So we’re keeping pretty busy even if we’re
not generating a great deal of income.”
Once the holidays pass, One Step technicians begin preparing for the
next season.
“We don’t run our business on a continuing service agreement,” pointed
out Ottley. “Our customers sign up for one year at a time and
have to be re-signed up each winter.”
While this approach makes the company more susceptible to cancellations,
Ottley said One Step maintains an annual customer retention rate of
84 to 85 percent and benefits from having to renew all of its customers
each year.
“This approach holds our feet to the fire in terms of doing
the job and gives us tremendous feedback when customers don’t
renew,” he explained.
In addition, Ottley makes his technicians responsible for renewing
their own residential customers instead of having a salesperson handle
this process.
“I believe the customer likes talking directly to the person
who will be on the lawn providing the service,” he related. “That
way, the technician knows the areas of concern for the customer.”
The cumulative results of these moves by Ottley
have resulted in the identification of the core One Step customer: “We look for more
mature customers – more than 45 years old with above average
income, and they’ve either used other lawn care services or they
are very particular about their property, the environment, the products
used on their property and the way their service is carried out,” related
Ottley.
And while that is clearly a profile cut for a residential customer,
One Step derives about 25 percent of its sales from commercial customers,
with only a fraction of that amount coming as a subcontractor.
This commercial side of the business has evolved for the company since
it hired a dedicated commercial salesperson eight years ago to establish
a commercial department.
“We knew the opportunity for this work existed, and we thought
truly servicing these accounts required a dedicated person who could
find out who to talk to at each company and build a relationship with
them,” Ottley commented. “It’s not like residential
lawn care where you can make a sale by hanging signs on a
door.
“We’re happy with the balance we’ve got right now,
and I can see benefits to shifting it either way,” added Ottley. “I
think we know enough about both markets to be profitable in either
one, so we’re not trying to steer ourselves in either direction.”
Ottley admitted that when environmental pressures
on the industry reached new intensities and contractors
had to deal with new posting and notification laws in the 1980s, he
became disenchanted with lawn care. “That was a nerve racking time because you never knew how the
customers would react to new laws, and I got discouraged to the point
that I was looking to sell the business,” he recalled. “But
no one was looking to buy a lawn care company in New York
in the late 1980s.”
So Ottley let the business run without him and, in doing so, had his
eyes opened to how poorly the company treated customers.
“We weren’t customer friendly at all,” he said. “Phone
calls were an interruption and service calls were a hassle.
“That’s when I decided we are in business to help people
take care of their lawns, and I got back involved in the business,
but on the operations side instead of handling the administrative functions
as I was before,” Ottley continued. “It became my job to
make sure we were looking at things from the customer’s perspective
and seeing service calls as opportunities.”
Ottley credited this internal shift, which earned
the company recognition from Inc. magazine’s Notable Performer
contest, with keeping the company in business today.
“Offering this level of service was a key for us to differentiate
ourselves from the competition,” he observed, returning to a
common theme. “We set out to become the very best lawn and tree
care service out there. If you don’t have something to differentiate
yourself from the rest of the market, it’s next to impossible
to win a price war, especially against some of the big competitors
out there.”
One Step Tree & Lawncare Inc.
4343 Buffalo Road
N. Chili, N.Y. 14514
585 594-1095
The author is Editor of Lawn & Landscape magazine.
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