What Is My Business Worth?


By Grant Harrison

Being a landscape business owner is hard. There are a million things vying for your attention, and it’s usually the most urgent that gets it. Meanwhile, your business keeps going -- but is it growing? Has it increased in value over the last year? The truth is that most landscape business owners have no idea what their business is worth or how it’s actually doing. They’re usually fantastic technicians, happy to be working IN the business, but rarely ON the business. But knowing the value of your business -- and understanding the steps needed to increase its value -- is critical for the growth and health of the business. It will increase profitability now and also make your business more attractive to potential buyers, whether you’re looking at selling now or in the future.

Let’s take a look at six pillars of business and identify some best practices and tools you can implement fairly easily to increase efficiency, productivity, and profit.

The health and safety of your staff is your greatest priority. A Health and Safety Committee should be actively engaged in your business, and their recommendations should be taken seriously. Ensuring your staff is trained in the areas of health and safety is an easy way to eliminate potential hazards.

Tools: For safety training, we recommend Greenius. Greenius provides online training courses, covering every aspect of your landscaping business, including equipment and safety training. It provides consistent training and messaging to your employees, ensuring that everyone is learning the same thing in the same way.

Hiring well is critical to business success. It’s important to hire based on your company’s core values, not based solely on a need for a spot to be filled. Providing employee orientation and having an onboarding plan is extremely helpful to the employee and to the organization. It ensures that everyone is aware of the job duties, expectations, company culture, training schedule, and organizational structure. It sets an employee up for success right from the start. Additionally, providing regular communication to your employees keeps everyone on the same page, creates confidence in your employees, and gives you control over your company’s messaging. Consider a monthly town hall meeting, a quarterly newsletter, a one-day kickoff each spring and fall to help build company culture and to show your appreciation to your staff. A happy staff is integral to company success.

Tools: We see great value in personality profiles for your staff, especially senior management. There are a number of testing programs that can be taken online: CliftonStrengths (formerly StrengthsFinder), EVERYTHING DiSC, Winslow, and TTI Success Insights. In addition,  GrowTheBench.com provides online education programs to help your staff grow and develop in their roles.

Just as you use an onboarding program for employees, consider using an onboarding program for clients. In the same way that it provides clarity for your employees, it will do the same for your clients. You can communicate how the job process works, the payment schedule, how delays are handled, who to contact if there’s an issue, etc. It puts clients at ease because they know what to expect and this builds their confidence in your company.

Communication with clients is key. If there’s one complaint we hear regularly about contractors, it’s that we’re notorious for not communicating with our customers. Set your business apart by providing proactive communication to your clients. For example, if you’re operating a snow business, send an email to your clients to let them know when snow or ice is expected in the forecast and when you expect to start clearing snow. Send them a weekly report that indicates when you were on site and what service(s) you performed. For landscape design/build customers, contact them if you’re going to be late to the site; if you’re not able to be at the site due to the weather; and during the job, send them a daily update to let them know what you’ve been doing. There really is no such thing as over-communication when it comes to customers.

Tools: Email is probably the most effective tool in communicating with your customers, but programs like Constant Contact can be very useful, as can text messaging.

A lot of landscapers will stop reading here, simply because they saw the word “financials.” This is generally because they feel they have neither a strong understanding of their financials, nor the time to put into understanding them. But learning how to create a budget, review budget to actuals, and read financial reports is imperative to understanding your business and deciding where changes can be made to increase profit and efficiency.

Tools: There are many options available to help with the bookkeeping and financial tracking aspects of your business. We recommend Landscape Management Network (LMN). These will help you with budget creation, cash flow projections, and profit and loss reports, among many other functions.

Determining some best practices for operations is one of the quickest ways to affect the efficiency and profitability of your business. Consider standardizing processes and equipment throughout the company and creating an operational manual. There are plenty of programs and apps that can assist with this area of business. In order to track your progress, it’s important to have key performance indicators identified for each division. Measurements like hours vs. budget, fleet costs, quality of work being completed, and gross margin on each job are key.

Tools: Harnessing technology for your business is an easy and effective way to increase productivity. We recommend programs like Landscape Management Network (LMN), Microsoft Office Planner, Tom’s Planner, and Fleetio, but depending on your needs there are many other programs available.

Creating a regular meeting rhythm is one of the quickest and easiest ways to start building cohesion in your leadership team. Scheduling regular SWOT meetings and strategic plans will keep everyone informed, as well as create consensus and accountability. Sharing your leadership’s vision and core values with your staff will help to create “ownership thinking” from the staff.

Tools: Hiring a consultant with experience in a program like Traction is invaluable. A consultant will help you with establishing a regular meeting rhythm, keeping your meetings focused and running smoothly, and helping you identify priorities.

This has been a very brief overview of ways to increase the profitability, efficiency, and value of your business. Feel free to contact me to learn more.

Tags: Leadership , Value , Safety , Financials , Staff , Customers , Operations , Profitability ,