As we wrap up 2019 and set our sights on 2020, it’s a good time to examine how well your company did financially this past year and where you’re headed in the months ahead. Was your revenue up, or was it down? Were your profits up, or were they down? Where do you want your numbers to be at the close of 2020? And what is your plan for getting there?
We had a great year at Grunder Landscaping Co., thanks to the hard work and dedication of an amazing team and to the strength of the economy. But success one year is no guarantee for the next, and there have been more years than I’d like when we haven’t hit our numbers at GLC. To win consistently, you have to stay constantly vigilant and continuously improve.
Highly Effective Net-Worth Reduction Tactics
Over the years I’ve identified a list of what I call Highly Effective Net-Worth Reduction Tactics. These silent but deadly killers can slowly but surely siphon off your profits without your even realizing it. Here are three to be especially vigilant about in 2020:
Inefficient Contract, Deposit, and Collection Processes
These can seriously eat away your profits. Avoid verbal work orders and get everything in writing, with contracts for significant jobs and at least an e-mail confirmation for small ones. This protects you and your clients. As soon as you complete the job, send an invoice. And if you have an accounts-receivable problem, you might very well have a client-satisfaction problem. Don’t let it go unaddressed: Talk to your client, find a workable solution, and move on.
High Indirect Labor Costs
Indirect labor is the cost of all the time that your hourly team members are clocked in but are not producing billable work. Some of the biggest buckets of indirect labor for landscaping companies are:
Training
Loading and unloading
Drive time
Call-backs or warranty work
These costs can add up quickly and deliver a real blow to your bottom line. Vince Torchia, my Grow Group partner, shared some great ways to reduce your indirect labor costs on our blog this year.
Underperforming Employees
If you had jobs come in this year over-time and over-budget, or dissatisfied clients, or broken equipment, the culprit may be underperforming team members. The question is, who’s making them the culprit? Is it them, or is it you? Have you clearly communicated your expectations? Have you trained your team thoroughly? Do you check in with them regularly on their progress and listen to their concerns? If you have and problems persist, then it may be time for you to usher your under-performers out the door.
Take some time this week to identify areas you need to tighten up financially to reach your goals in 2020. This time next year, you’ll be glad you did.
Lastly, I want to sincerely thank all of you who have joined us this year at our events, on our social-media channels, and for this e-mail every week. Your drive to grow and your dedication to our industry inspires me every day. I wish you all tremendous success in 2020.
Marty Grunder
President & CEO
The Grow Group
P.S. Reward your team for a year of hard work with tickets to GROW! 2020. We have programming tracks designed for owners, department leads, and office managers, and the whole team at LOVING will be on hand to show you everything they know.
Sign up three or more team members and receive 15% off.
Better still, make your purchase before January 1 and reduce your taxable income for the year!