Tree service companies in most regions of the country have some time of the year during which business is slow. The slowdown is inevitable, but there are ways to keep your company going until business booms again.
Determine what your total expenses are for the slow season and set aside funds during the busy season. That way, you can meet your obligations without risking assets or employees.
Maintaining that rainy day fund is one of the survival strategies that Noel Boyer uses. A certified arborist and owner of All About Trees, LLC in Springfield, Mo., Boyer says he has never had to dip into his savings. Instead, he minimizes off-season expenses by deferring optional repairs and purchases. Other companies suspend insurance coverage on vehicles that won’t be used during the off-season.
“Knowing that [my employees and I] have families to feed and sometimes the work isn’t there [motivates me to set funds aside],” he says. “It’s better to lose a little in the winter than to have to retrain new people in the spring.” Although many winters have been busy due to ice storms, Boyer has had his share of slow ones. “I haven’t had to lay anyone off in several years.”
One way he’s tackled the slow season is by offering winter specials. He sells off-season work by mentioning winter rates on his estimate sheets. Boyer discourages regular clients from having elms and oaks pruned during the growing season due to disease susceptibility, and instead presells those services and provides them during the winter. He offers a 10 percent discount to those who schedule nonemergency work during the slow season and seeks to divert certain jobs. For example, working in a poison ivy infested area is less hazardous during cold weather.
Earlier this year, Boyer’s business was slow and he considered offering new services, but instead invested in radio advertising. Designed to promote his business’ name change and the advantages of treating trees damaged in past ice storms during the winter, his $5,000 in ads brought in $50,000 worth of work.
Steve Chisholm of Aspen Tree Expert Company, Inc., in New Jersey and brother of two-time ISA tree climbing champion Mark Chisholm, also works with clients to postpone optional work into the winter months.
“We try to delay municipal and commercial services until the off-season,” he says. “Municipalities have learned to budget for work at that time and know they’ll get better rates. They also pass on complaints from home- owners that are more obvious in winter.”
The strategy keeps Aspen in a strong position; their winter backlog is generally two weeks, as compared to four to six weeks during the warm season.
“Be more proactive in talking with condominium associations and management companies in the fall to encourage them to schedule January work,” Chisholm adds. He stresses educating clients to recognize that winter service is better for trees and for surrounding landscape features.
He doesn’t offer coupon promotions, fearing that it leads consumers to seek the lowest price, regardless of service quality. In addition, he points out that off-season discounting can be detrimental to tree service companies as the costs remain about the same year-round.
Other tree service companies promote themselves by devoting extra attention to newsletters, Web site maintenance and speaking engagements during the slow season.
“I never miss a chamber of commerce meeting or any other opportunity to keep my name out there,” Boyer says.
With the explosive popularity of social networking, the next slow season may be the time to check out Twitter, Facebook and YouTube. The sites don’t charge for accounts and are easy to use. Tree care tips posted on Twitter and Facebook or videos on YouTube can be a great way to reach consumers and business owners.
Lighting the way to profits
When traditional services aren’t in demand, some tree care companies branch out with seasonal offerings. Services such as snow clearing and firewood sales are common choices.
James Tuttle of Tree Loving Care in Lubbock, Texas, took liberties with the concept of tree services and began marketing his company as a Christmas decorator 25 years ago. His company provides and installs lights, inspects them periodically during the season, and removes and stores them after the holidays.
Early on, the holiday services were a small part of his overall business, but one that he could perform with his existing equipment and crews. In fact, when Tuttle began, he didn’t own a bucket truck and primarily lit trees, rather than structures like homes and businesses.
“We tended to do a few large jobs that might take a week to complete,” he says. “I favored jobs like that because publicity is priceless.”
To light up a large business, such as a shopping center, crews worked during the day and evening. On one high-profile job, a single, large tree required a week’s effort. A shopping center contract calls for Tuttle’s entire staff of nine to work for a day and an additional two to three workers for four additional days.
Tuttle says no changes were needed in his insurance, as lighting work is less hazardous than standard tree services. His area does not require business licenses; in other areas, companies may be required to obtain and/or alter licenses.
After years of success with this service, Tuttle purchased a Christmas Décor franchise in 2007 to expand this aspect of the business. Blake Smith founded Christmas Décor more than two decades ago to augment his lawn care business. In this business model, the franchisee furnishes and maintains all supplies.
“We discourage clients from owning the lights because if we package and store the lights, the next year everything fits and is ready to go. You don’t have any tangled messes,” Tuttle says.
With the expansion, Loving Tree Care is completing many more small jobs, such as residences, and is finding equipment needs differ, especially with newer homes. With the trend of constructing larger homes, often topped with steep-pitched roofs, special techniques and equipment are necessary. Tuttle now uses bucket trucks and sometimes cranes, which serve as rigging points for climbers who are decorating steep roofs.
Tuttle says two to four hours are needed to decorate a typical home with two trees, and a crew of two to three generally completes three to four residences per day. He says that tree lighting is more detailed and time-consuming than structures, although windows are complicated to complete.
The pricing structure for residences averages $900 to $1,500 in Tuttle’s area. He adds that the gross income is divided approximately in thirds: one-third each to supplies, labor and profit.
He urges those considering a holiday lighting service, which could expand into special event lighting throughout the year, to learn the business and its techniques and processes thoroughly. “When I took over the franchise, I was surprised that I didn’t know much,” Tuttle says, although he had performed such installations for decades. Also, it isn’t a 9-to-5 operation. Shopping center work, for instance, must be done after retail hours. He expects to have a crew working 7 p.m. to 3 a.m. this season, which begins in October with the creation of a large animated display at Tuttle’s office site, and wraps up with the removal of decorations by mid-January.
Holiday lighting services can be marketed through company newsletters, advertising, publicity and community involvement. Tree Loving Care donates holiday lighting to families who have members deployed in military service.
Maintenance and training
Downtime during inclement weather can be used for other purposes. Boyer dislikes having his crew out of work, so he schedules occasional trips to tree climbing competitions and has the staff perform equipment maintenance work during those times. “Our equipment is in better shape during the winter than any other time,” he says.
Training and earning certifications are other ways to keep employees busy while ensuring that you have a sharp team to work with when the phone starts ringing again.
Boyer points out that when off-season work is available, it is vital to remember that winter is simply a less productive time. When humans, trees and machines are coping with reduced sunlight and cold weather, a day’s work doesn’t accomplish as much as it does in May. Chisholm finds that winter work, especially if heavy snow is involved, can translate into repeat visits for cleanup work revealed when it melts.