“It’s cutthroat out there and we’re all beating each other up.” This is a comment we recently heard from a gentleman that works exclusively in the pine straw installation business. This gentleman isn’t alone is his sentiments either. More and more we hear about the struggles landscaping firms are having as often as twice a year with their customers about bidding, costing and installing pine straw. There simply isn’t much margin in this landscaping task that requires an enormous amount of time, capital and human resources to manage. I don’t believe there is a single one of us who would dare to enter the pine straw business today knowing how thin the take home is and how difficult it is to identify, solicit and maintain a loyal customer base. At the end of the day, pine straw is a bottom line item that the lowest bidder will likely win.
With this in mind, how is it that one particular company who operates in the Southeast can consistently hit high double digit margins? The answer is: spray-on colorant. Now, we’re not talking about the old-fashioned paint that hit the market a decade ago. We’re talking about a new breed of environmentally friendly colorants that look natural and physically make the needles last longer allowing you to use 20% fewer bales per install. This particular company has identified which customers in their growing book of business can benefit from colorant on their pine straw installs, and then they proceed to tell them why. It’s a quick explanation of how these colorants increase the longevity of the needles, how it allows for 20% fewer bales to be installed and how it keeps the color up to 9 months. When customers learn of how negligible the cost of it is, there is rarely any objection to spraying their recently installed straw and continuing to spray it going forward.
Finding a way to differentiate your businesses services from your competition isn’t always easy. It’s this principle that has given way to a new way of doing business insofar as pine straw is concerned. You can bet your bottom dollar that your clients are contacted by your competition every month to get their pine straw business. Companies unwilling to accept and adapt to this fact are losing this fight to companies that incorporate coloring. So, how does Big Landscape adapt? It’s really simpler than you might imagine.
Let’s use this example to really hit it home:
Let’s say Property X does two installs of 1,000 bales of long needle annually. That equates to approximately 50,000 sq. ft. of total area. At about $5.50 per bale installed, you’ve got $5,500 billed to the customer per install – or approximately $11,000 annually for pine straw. Let’s say on a good day we’ve managed to snag 11% profit margin off Property X – we’ve taken home a measly $600. After both installs, we’ve profited $1,200. To add insult to injury, that long needle you just laid looks tired and colorless in 4 months leaving your customer with subpar curb appeal for part of the year.
Now, let’s look at Property Y who does one install with colorant every 9 months opposed to two installs annually. We’re still covering 50,000 sq. ft. of area but our Property Y is leveraging the power of the colorant to use 20% fewer bales at each install, meaning they bill $4,400 for straw and an additional $3,500 for colorant equaling $7,900 total per install. By installing and coloring every 9 months over 3 years, you’ll do 4 installs instead of 6 the traditional way. Monetarily, that means you’ll bill $31,800 instead of $33,000 (whoa, you saved the client money?!) and your profit is $13,920 instead of $3,600; that’s 75% more! How did the profit get so big? That colorant you added sells to your customer for 7¢ per sq. ft., while your cost is 1¢ per sq. ft. including labor - see the math?
Knowing what is in it for you; we now turn our attention to the client. The client is always looking for the most bang for the buck and we know how tough it is to get them to part with a dollar if there is a cheaper alternative out there. When pitching the added colorant, we find ourselves up-selling a product that is inherently more expensive initially – so how do we get that client to justify the initial added expense? You have to focus on the year-round color, continuous curb appeal, and that when used over the years, leveraging the power that color adds to natural needles, they will save money. Look back at the example of Property Y.
Pine straw simply doesn’t hold its color. We know that. Those needles we install today will look shabby 4 months down the road. At $5.50 a bale installed, that’s a high price to pay for a product that simply doesn’t hold up. For properties where first impressions are made every day such as apartment complexes, commercial buildings, shopping centers and golf courses, long lasting and consistent color is crucial. Pine straw with colorant has the unique ability to hold on to that natural color consistently over an extended period of time, never leaving a property void of color. It’s a simple sell to these properties. You are offering a product that will reduce their overall capital requirement while providing the natural color year-round allowing them to make great first impressions to their customers every day.
With the knowledge that the pine straw market is becoming tougher and tougher with razor-thin margins, is it time to rethink the way you provide this service? We think so. The battle is raging on as we speak and the companies who have already adapted to the new way of providing higher quality pine straw installations are realizing greater margins and increased customer satisfaction. Those that are slow to adapt are sacrificing time, money and image fighting for little margins and always watching their backs for a competitor. Where does your company fit in to this equation?
A Note about the Author
Chris Watkins leads the Sales and Marketing of EnviroColor in Cumming, GA. He’s spent a considerable amount of time speaking with business leaders who are realizing the added benefits of using colorants and similar products to differentiate their installations from the competition. EnviroColor is the nation’s largest supplier of all natural pine straw, mulch and turf colorant to the professional landscaping industry. You can reach him via telephone at 678-648-5620 or via email at CWatkins@EnviroColor.com.