Articles Written by Charles Vander Kooi

Rifle shooters & shotgun blasters

Many times contractors are not making money because they've lost market focus.

By Charles Vander Kooi

Contractors are always calling me to help them figure out why they're not making any money. Sometimes I find the root of their problem is that they lack market focus.

To illustrate this problem, let me tell you a story of a contractor client I met years ago. He was very typical of people in this business.

After several years in business, he had built a very successful design/build landscape company. He was doing high-end jobs at good prices. He had reached the point where he was finally able to afford the facility he wanted on the outskirts of town.

It was on 10 acres on a main road with a large shop and a house he converted into a nice office. With all that room, he bought plant material for his jobs in bulk at very good prices, and he stored it out front.

Sick plants

He still had 8 acres behind the house and garage, so when they had plants on a job that looked nearly dead but with some signs of life to them, he planted them on those 8 acres, and nursed them back to health.

His nursery was really more of a hospital. Strangest nursery I've ever seen. He had shrubs and trees of all varieties planted next to each other in rows – all plants he had managed to nurse back to health. Then he went out and bought some small whips. He decided he was going to grow his own plant material. By the time I came in he had filled the 8 acres with nursery stock.

'I've got it! We'll put on a garden center!'

As the suburbs around him grew, people driving down that busy road would see all those nice plants out there. And they kept pulling in and asking him if they could buy some of those plants. He kept telling them "Oh, no, these are for jobs. We're a landscape contracting company."

Then one day a light bulb went off in his head (really it was a hand-grenade). He declared, "Everybody's stopping here wanting to buy plant material. Why not start a garden center."

So he built a gazebo and added a sales counter with a couple of cash registers. He put a garden center sign out front, and hired people to sell plant material out of what was once his holding area.

So now he was a landscape contractor, a nurseryman and a garden center retailer.

Conflicting priorities

It was mid-afternoon on the first day of my visit to his office, and I was about to leave to do some work on his numbers, his overhead and pricing system. He was trying to finish up a drawing for a $200,000 job because he had an appointment that evening to present the drawing and hopefully come away with a signed contract.

All of a sudden there was a rush of customers in the garden center, and several people were standing around waiting for a salesperson to help them. So he jumped up from his desk to go help in the garden center about the same time as I left.

When we met again the next morning I asked if he sold the job last night. He said, "No, I had to cancel that appointment and reschedule, and the clients weren't too happy. We had such a rush of people I spent the rest of the afternoon in the garden center."

Here he was teetering on losing a $200,000 job so he could spend the afternoon selling $400 or $500 worth of rose bushes.

Rifles & shotguns

I have often told contractors that there are shotgun blasters in this business, and there are rifle shooters. Rifle shooters are landscape/hardscape contractors who say, "Put up a target, just 1 target" whether it's selling high-end or medium range or even low-end jobs. "Give me a .30-06 Springfield with a scope. I'm going to put the cross-hairs right on the bull's-eye, and I'm going to hit that bull's-eye every time."

Then there are those who've lost market focus. They say, "Put up several targets.

"Put up one for retail. I want to be a big-box store like home depot and have a garden center and sell plant material.

"Put up another target. I've always loved farming. I want to grow my own plant material.

"Put up a couple more targets. I'm going to sell any sized job. I'll do anything for a buck. If Ms. Jones needs a little grass replaced in the backyard, I'll do it. And I'm going to go after those high-end $100,000+ jobs too.

"Now, give me a shotgun with about 6" cut off the end."

So, he pulls the trigger, and at the same time he tries to swing the gun around real fast so he can spray all the targets in 1 motion. Then he asks, "Did I hit any of the targets?"

No.

He's in a multitude of businesses and not doing any of them at the level he needs to in this highly competitive market. Many times contractors are not making any money because they've lost market focus. They have become shotgun blasters.

Since 1980, Vander Kooi & Associates has been helping business owners add more to the bottom line of their company’s financial performance. We would be proud to help you with budgeting, estimating, high-performance management, marketing, sales, productivity and field training. Visit vanderkooi.com or call (303) 697-6467.