At this time of year the enterprise value specialists at Ceibass are busy helping ambitious lawn and landscape business owners with their 2021 business planning.
“Planning is a deliberate look into the future. The first step is to come up with situations that your company would like to produce,” said Tom Fochtman, Ceibass CEO. “It could be situations like a 15% increase in revenues, an 2% increase in profit margins, a 10% gain in market share or customer satisfaction, a reduction in admin expenses, or a more efficient use of manpower and routing. Attack your direct expenses. Then create action plans to produce those situations.”
Tom went on to say that lawn and landscape is a very competitive industry and that those companies that are best at planning – anticipating future situations they want to produce and creating effective action plans to realize them increase their competitive advantages over time. Companies that don’t plan well produce their own breakdowns, higher costs, increased risks and decreased likelihoods for success relative to those who do plan.
So with that in mind, the Ceibass team got together and offered up some more thoughts on how to effective, strategically and competitively plan for 2021:
Take the time to plan well. Don’t find time to do it. Declare time.
Engage as many members of your team as possible to come up with your action plan. Planning is a great team building endeavor.
The purpose of planning is to increase your effectiveness at fulfilling your intentions. Take planning seriously. Know your intentions – the situations you want to produce and why you want to produce them.
Plan in 3-year and 1-year time horizons. Update each as some situations you are trying to produce take longer than one year. Your plans get ratified and become your annual goal. Discuss actual results to goals on a monthly basis.
Update and keep fresh your sales and marketing tactics and update your technology and equipment
Don’t dust off last years plan, start anew, start fresh.
Raise your fees – you can get a 5% increase in fees almost without having your customers notice. This 5% falls to profit.
Review the profitability of your various services and seek to make higher margins
If capacity is a problem, consider dumping customers that are not profitable
The COVID lull is over. M&A activity is up. Look for strategic acquisitions as a way to grow.
Know your competitors, know their offers, strengths and weaknesses and how you are going to compete against them.
Call your top customers and explore new offers with them.
Is it time for “smart debt?” Don’t be afraid of smart strategic debt. With interest rates at historic lows, look to grow.
If you lease your facilities maybe it is time to buy. You are the tenant. You don’t need to worry about the space being empty.
Look for deals and financing from equipment manufacturers.
Many banks are offering interest only deals. Negotiate great terms, lenders are more open to working with you in this environment.