Travels with Jim follows Jim Huston around the country as he visits with landscapers and helps them understand their numbers to make smarter decisions.
Chris and Gregory Maroun had a very successful landscape business, Stecks Nursery & Landscaping, in southern Connecticut. In the late 1990s, Chris and his wife, Dede, decided to move a bit off the grid to the lake region of New Hampshire and semi-retire. Semi-retirement for Chris and Dede was to create Miracle Farms Landscaping in Moultonborough, N.H, that today employs about 100 people.
How it works in the field.
Chris recommended to his fence subcontractors, Rob and Aileen, who owned Brentwood Fence, LLC (BFLLC) that they work with me. The first thing that the three of us did was to create a 2019 budget for BFLLC. This allowed us to (1) analyze and benchmark the company’s operation; (2) establish realistic sales and cost goals for the year; and (3) calculate the labor burden and general and administrative (G&A) overhead costs used to price the various fence products that BFLLC installed and serviced.
Second, we calculated the daily labor rates for the various field crews. These rates included the labor, labor burden, crew truck and equipment costs, G&A overhead costs, and an appropriate net profit margin. Since Rob had accurate fence installation production rates, it was fairly easy to calculate the number of days that a fence installation job would take. Add the materials cost and any other ancillary costs with an appropriate margin to the number of days multiplied by the crew day rate, and fence installation pricing was not just easy to calculate — it was very accurate.
Third, Rob and Aileen implemented a simple incentive system based on daily crew production. Productivity was rewarded by the number of fence sections that they installed per day and per week. Crews began to think in terms of efficiency and crew productivity increased. If a crew member wasn’t pulling his load, the other crew members would have him replaced.
BFLLC has incorporated lots of simple yet smart changes these last two years. As a result, sales have gone from $2 million in 2019 to $4 million today. More importantly, the bottom line has improved significantly from the low single digits to over 20%. Rob and Aileen purchased a new building and yard for the company and the future looks bright.
Back to the future.
Before 9/11, Rob was driving an 18-wheeler throughout New England. After the attacks, the trucking industry collapsed, and Rob was out of work. He didn’t want to be at the mercy of someone else, so he started BFLLC with his father in 2004. Shortly thereafter, Rob and Aileen started a family. It wasn’t easy, but with a lot of hard work, belief in themselves and belief in the American dream, they built a successful company. Just as important, they were willing to listen to Chris Maroun, a highly respected fellow entrepreneur, and get some outside help for their business.
Implementing an incentive system, in addition to managing your budget properly, helps make sure crews are thinking like you in terms of efficiency.
The accurate pricing that we implemented at BFLLC combined with the production incentives not only added significantly to the bottom line, but they also made the company easier to operate and manage. We didn’t pull a rabbit out of a hat. We simply implemented some smart methods of doing things. This is what good systems do. With these in place, Rob and Aileen believe that within five or so years, they should reach $8-$10 million in annual sales. They now have big plans to pursue big dreams for themselves, their two children and their employees.
To be a successful entrepreneur, you have to have good character. Good character is what it’s all about. You have to be creative, diligent, persevering, full of faith that you can succeed, customer (other) oriented, frugal and much more. You also have to love people and love challenges. It takes great people like Rob and Aileen to make great companies.
This is not only what makes companies great but it’s also what makes America great. Some fences keep people in. Others keep people out. The fences at Brentwood Fence do both for their customers.
However, for the team at Brentwood Fence, their fences don’t just provide boundaries; they provide unlimited potential for a very bright future.