Green Industry Pros March 2017 +Dealer Success Guide V36

IS IT TIME FOR A UNIONIZED WORKFORCE? PAGE 8 MARCH 2017

CONTRACTOR PROFILE

PRODUCT COVERAGE • Walk Mowers • Trimmers & Edgers • Track Loaders

DIAZ GROUP Creating opportunities in the center of Chicago ❯ Page 12

Quit Making the Labor Crunch Worse!

PART 1 ❯ Page 34

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© Kubota Tractor Corporation, 2017

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TABLE OF CONTENTS

Volume 29, No. 3 | March 2017

› Passion Outlasts the Pain

COVER STORY

The blood, sweat and tears the Diaz family has poured into its Chicagoland landscaping company is starting to turn into pure gold.

From left: Tony Diaz, Rafael Diaz, Delia Diaz, Ruben Diaz Sr., Ruben Diaz Jr., Robert Diaz

PRODUCTS

12 20

FEATURES 04 Editor’s Column 06 Best of the Web 08 8 Reasons Why Landscape Workers Should Unionize

Having a hard time finding trained workers? Maybe unionization is an answer both employees and employers could learn to live with – and maybe even love.

16 Where Are They Now? Phillips|Creasey doubled sales in 2016 by establishing a traveling crew, breaking into bioretention systems, and continuing to grow its core business.

20 The Ph.D. of Propane Mike Halloran saw the potential of propane more than five years ago.

Now it represents nearly a third of his commercial mower sales.

28 Walk Mowers

28 Trimmers & Edgers 28 Why Mid-Size Walk Mowers Make Sense

U.S. Lawns franchisee explains why the intermediate walk mower is still his go-to mowing machine – even on large industrial properties.

34 Business Tips

You cannot afford to attract the wrong job applicants any longer.

Here’s what you can do to fix it.

QUICK TIPS from GreenMark Consulting Group

32 Track Loaders

24 Three-Week Crash Course

NALP’s lawn care technician training program can help you get new hires up and running in just 15 days.

16 greenindustrypros.com

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Pros

EDITOR’S COLUMN

The Management Resource for Landscape Contractors and Equipment Dealers

Published by AC Business Media, Inc.

Civilized Unions W e’re touching on a rather touchy subject this issue: unionized labor. Like seemingly every other topic in this country, the concept of labor unions has nearly identical support and opposition. Look at the data presented in the sidebars to our feature story on page 8. For every four people who favor unions, five don’t.

Green Industry Pros contributor Gary Goldman thoughtfully guides us through the notion that a unionized workforce could actually produce a net positive result for the industry. Yes, there are both pros and cons to unionized labor.

It’s important to maintain an open mind when studying them, and a civilized tone when discussing them.

Also keep in mind that neither Gary nor I are pro-labor lobbyists. Gary is a consultant, business owner and radio host, as well as a former contractor. I’m a professional communicator whose sole goal is to help our readers prosper.

That said, our readers’ inability to secure an adequate number of competent employees is reaching a crisis level.

It’s only going to get worse, barring an unforeseen economic collapse or sudden reversal of attitudes with respect to the H-2B guest worker visa program.

I wouldn’t hold my breath on H-2B, as it runs counter to the current “America first” mindset that’s in play. As for a more unionized landscaping industry workforce, I personally wouldn’t hold my breath for too long either.

For one, union formation doesn’t happen overnight. Roughly one in three workers need to be in support of forming one, and then at least one in two need to vote in favor. Secondly, union membership as a whole is flat at best, and only represents about 6% of private sector

4 GREEN INDUSTRY PROS

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MARCH 2017

201 N. Main Street Fort Atkinson WI 53538 800-538-5544 Volume 29, Number 3

Gregg Wartgow (920) 542-1248 563-1614 gwartgow@acbusinessmedia.com

workers. The construction industry actually jumped a point last year to around 14%, but “agriculture and related occupations” (i.e. landscaping) rank among the lowest at just over 1%. Thirdly, Kentucky just became the 27th state to pass “right to work” legislation, which gives the individual employee the right to join or not join a union.

So why in the world are we talking about unions, you ask? Well, things could change. If comprehensive tax reform takes place and businesses are able to keep more of their profits, perhaps they would be more willing—and able—to pay higher wages. Also, as more industries continue to face labor shortages, competition for those dwindling labor supplies increases. That causes wages to rise. Unions typically play an influential role because, on average, union workers end up earning roughly 25% more than their non-union counterparts.

The big question is whether or not labor unions would even attract more people to the green industry. There are many other occupations that are also struggling for employees, so both out-ofwork adults and young folks coming out of vocational programs have many career choices. Some will simply have nothing to do with a physically demanding job like landscaping. Keep in mind that many of today’s snowflakes would melt in a heartbeat in the hot July sun!

To some workers, though, the security and stability of a union job could encourage them to take a look at our industry. It’s something to think about as you interview, train and fire one inept employee after another this season. I wish you all the best in your endeavors. ›

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Green Industry Pros (USPS 003-763 and ISSN 2168-121X (print), ISSN 2168-1228 (online) is published 7 times a year: January/ February, March, April, May/June, July/August, September/October, November/December by AC Business Media, Inc. Periodicals postage paid at Fort Atkinson, WI 53538 and additional mailing offices. POSTMASTER: Send address changes to Green Industry Pros, PO Box 3605, Northbrook, IL 60065-3605. Canada Post PM40612608. Return undeliverable Canadian addresses to: Green Industry Pros, PO Box 25542, London, ON N6C 6B2.

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BEST OF THE WEB

Survey Sheds Light on Propane Adoption Roughly a third of commercial landscapers are considering propane to power their equipment fleets, according to a recent survey commissioned by the Propane Education & Research Council (PERC) and conducted by Wiese Research Associates.

The survey results consisted of 150 landscape contractors’ answers to questions that sought to learn more about their existing perceptions and purchase habits with regards to commercial propane equipment.

Specifically, the survey found that 34% of landscape contractors answered that they were somewhat or very likely to purchase a propane mower within the next three years.

HOW TO INSTITUTE DRUG TESTING IN YOUR COMPANY

Many companies—small green industry businesses included—have strict drug testing policies. Many do not. If you’ve thought about instituting a policy in your company, the experts from Drug Test Today offer some advice.

1. Establish the policy. The first thing you need to do is establish a formal drug/ alcohol policy that all employees must sign onto. This helps to keep things legal.

To get started, ask yourself: • Why is the company establishing such a policy?

• What precisely is expected of employees?

• What are the consequences for policy violations?

2. Frequency. Decide on a schedule to test employees. Depending on the size and makeup of the company, some do any or multiple of the following: pre-employment, post-accident, and random.

3. Testing location. For small companies, it may be cheaper to send employees to a local testing center whereas a larger company could utilize testing done at its facility.

4. Testing type. Decide what testing panel and type to use. By far the most common test is a five-panel urine test that will screen for today’s most abused drugs (cocaine, marijuana, morphine, heroin and PCP). greenindustrypros.com/12301520

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“We’ve seen solid growth of propane equipment in the commercial landscape market over the past four years, and this survey only reinforces our belief that the growth will continue its trend upwards as more commercial landscapers understand the financial and environmental benefits of operating a propane mower fleet,” said Jeremy Wishart, deputy director of business development for PERC. The survey also found that some contractors remain misinformed about propane. “While we’re pleased to see so many contractors taking propane equipment into consideration, there were some responses in the survey that show we still have work to do,” Wishart said.

“Fortunately, PERC has already created

resources to help solve some of the existing barriers respondents said they have before transitioning a fleet to propane.”

For example, 38% of contractors who responded that they were less favorable to propane equipment said that was because they did not know where to find propane.

Fortunately, PERC is already providing a way to connect contractors to local propane retailers, who can act as a professional guide for contractors transitioning a fleet to propane. With the Find a Propane Retailer tool, available at propane.com/fpr, entering a zip code allows contractors to search for a local propane retailer in their area to contact.

CUB CADET ACQUIRES UK-BASED REEL MOWER MAKER

STIHL LAUNCHING 40 NEW MODELS THIS YEAR

Cub Cadet has expanded its presence in the sports turf market with the acquisition of Advanced Turf Technology (ATT).

The UK-based company produces cutting reel mowers and cassettes designed for the sports field and golf maintenance markets.

ATT has two flagship products.

The INFiNiCut combines a lithium power source with user-programmable frequency of clip rate and a dynamic return floating head, allowing the operator to optimize machine configuration to turf conditions present on any given day. As the only all-electric sports field mower in the world, in battery mode, it is so cost effective that it can largely pay for itself through annual fuel savings alone, the manufacturer assures. It can also easily convert to gas power if preferred.

The TMSystem has increased its cassette offering, keeping pace with triplex mower manufacturers’ upgrades to offer the best options for golf course maintenance as it quickly covers multiple greens for large-area applications. It is fully compatible with all mainstream makes of triplex greens mowers and lightweight fairway mowers, including Cub Cadet’s RG3 robotic mower, as well as the INFiNiCut. The multi-use cassette system with inserts provides flexibility to mow, aerate, brush, de-thatch, groom, level, and scarify. greenindustrypros.com/12295633

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Stihl is rolling out one of the largest product launches in its history. The 40 new models include everything from brand new pressure washers to nine new battery-powered products and nine gas-powered models.

The new battery products are part of Stihl’s ever growing Lightning Battery System lineup. The pro gas-powered units are engineered for easier use, less maintenance and longer run times. greenindustrypros.com/12297126

OTHER TOP NEWS › New E-Commerce Tool for

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› How To Surround Perfect Prospects

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› New Holland Reaches

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SHARE facebook.com/GreenIndustryPros DISCUSS search: Green Industry Pros FOLLOW twitter/YG_PRO FOLLOW google.com/+Greenindustrypros FOLLOW search: Green Industry Pros

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EMPLOYEES

By Gary Goldman

8 REASONS

Why Landscape Workers Should Unionize Having a difficult time finding trained workers? Maybe unionization is an answer both employees and employers could learn to live with – and maybe even love.

I

f you are in the contracting/service industry, you know how hard it is to attract, hire and keep employees.

For whatever reason, there is a shortage of both skilled and unskilled labor.

Business owners, on any given day, are faced with the realization that an employee may quit to earn 50 cents more from a competitor. The frustration, not to mention the economic and

financial costs that business owners are faced with, has reached epidemic levels in parts of the country.

If you are fortunate enough to find help, you also quickly realize that they often lack training, want outrageous wages based on their experience, dictate the hours they want to work, and also have a lot to say about working conditions. Many do not have a driver’s license, and many get offended if you tell them they are required to take a drug test.

For men and women who plan on entering the job market as non-professionals—who see themselves more as blue-collar “workers” than as whitecollar “careerists”—here are eight practical reasons why they should consider being represented by a labor union. I strongly suggest that business owners also review these—because you, too, might conclude that unionization may not be that bad of an idea.

YOUNG FOLKS GROW FONDER OF UNIONS According to Pew research first published in January 2016, labor unions are viewed more positively today than five or six years ago, up from 32% to 45%.

Furthermore, today’s younger workers—millennials—are much more likely than their elders to view unions positively (57% compared to 42% of Gen-Xers and 41% of Baby Boomers).

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1. Money

Unionization automatically stabilizes wages, which means there is no more

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holding company owners hostage for pay increases every few months.

From the employee’s standpoint, union jobs generally pay more than non-union jobs. You want to be part of the American middle-class? Join a union. From top to bottom, industry to industry, region to region, union wages are going to be roughly 10-20% higher than non-union wages. (Unionplus.org actually puts the number at around 30%, while current Bureau of Labor Statistics data puts it at 25%).

That’s a big reason why many companies are adverse to the concept of a unionized workforce: They don’t want to pay one dime more than they have to.

However, when a business owner calculates the costs associated with untrained workers, downtime, and unstable wages for a given contract period, they quickly realize that the increased payroll costs are quickly offset.

Anti-labor propaganda suggests that it’s a trade-off: The additional pay an employee receives will be eaten up by monthly union dues. That’s a lie. ❯❯ continued page 10

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EMPLOYEES

IS UNION MEMBERSHIP REALLY DECLINING? According to data from the U.S. Bureau of Labor Statistics (BLS), the total union membership rate dipped 0.4% last year to 10.7%. It had remained relatively unchanged from 2014-15. The first year union membership data was available, 1983, the rate stood at 20.1%.

In the private sector, the highest union membership rate belongs to the utilities industry (21.5%), followed by transportation and warehousing (18.4%), telecommunications (14.6%) and construction (13.9%). Construction actually climbed 0.9% last year.

Men have a slightly higher unionization rate than women: 11.2% compared to 10.2%.

Unionization is much more prevalent among public workers: 34.4% compared to 6.4% of private sector workers. Private sector union membership declined just a tad last year, dropping from 6.7%.

The lowest private sector unionization rate is in the finance industry (1.2%) followed by agriculture and related industries (1.3%) which have remained relatively flat.

Among full-time workers, union members’ median usual weekly earnings are 25% higher than non-union workers.

Depending on the industry, union dues average about $60 a month, which is $600-$720 a year. And $720 isn’t 15% of any union worker’s income, unless they happen to live in Guatemala and earn $4,800 a year, which is less than half the U.S. federal minimum wage.

The argument is absurd.

goodies don’t even exist without a union contract. It’s another reason why many companies resist being unionized. But should it?

As a business owner, you would not have to be shopping health and benefit programs for your workers, and you would know in advance what the costs are. Also, smaller companies without HR departments would not need to assign employees to handle these issues within your company. You could offer benefits that you previously could not offer. You are now able to attract better employees.

2. Benefits

Pensions, medical insurance, paid vacation, holidays, personal holidays, sick pay, overtime premiums, shift differential, etc. are generally better in a union shop. Plus, many of these

PROS AND CONS OF LABOR UNIONS It depends on whom you ask, naturally, but there are some generally accepted pros and cons to labor unions.

Pros • Better wages, health benefits and retirement pensions

Cons • Over-inflated wages can strain a company

• Enhanced job security

• Lack of disciplinary accountability

• Seniority is rewarded

• Employee friction (i.e. new hires vs. those with lots of seniority)

• Enhanced negotiation strength

• Focus on seniority as opposed to performance

• Attract better employees • Improved employee satisfaction • Reduced employee turnover

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Black workers are most likely to be in a union (14.5%) followed by white (11.7%), Asian (10.1%) and Hispanic (10%).

3. Safety

Union facilities are generally safer than non-union. A union contract gives employees the immediate right to address an unsafe condition.

Anti-labor folks can talk all they like about OSHA being the “great equalizer,” but it’s not true. Even before it was ravaged by eight years of Bush administration neglect, OSHA was remote, understaffed and over-extended.

No matter what size company you run, safety is a major concern. Most business owners do not have the time nor financial resources to provide an adequate safety program, even when many of their clients demand this.

Business owners know the costs associated with accidents and injuries.

Poor PR, costly workers’ comp bills, and employees who cannot come to work all impact the company’s bottom line.

4. Dignity

Union workers will typically encounter fewer moody and dictatorial middle managers. While employees can still (rightly) be fired for job performance, they don’t have to tiptoe around in fear of being harassed.

A l s o , i r o n i c a l l y, b e c a u s e administering a contract requires a higher level of competence, you’ll often

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find more efficient middle managers in a union shop. Instead of flitting about making questionable, off-the-cuff decisions, they’re forced to behave like “professionals.”

5. Security

Bosses can’t just walk up and fire an employee because they want to give the job to their wife’s nephew. Also, they cannot lay an employee off out of sequence, demote them arbitrarily, or prevent them from being promoted without sufficient cause. AfricanAmericans and women didn’t get their shot at big-time manufacturing jobs until labor unions gave it to them, a fact that doesn’t receive enough recognition.

6. Competence

Union workers tend to be better workers than their non-union counterparts.

Before you vehemently object, just take a moment to consider the dynamics.

Which job in a community is going to attract the higher-caliber worker: the one offering decent wages, good benefits and exemplary working conditions, or the one with low pay, lousy benefits and no air-conditioning?

7. Training

Let’s be honest: Finding a trained individual is very difficult. Even when you have done your due diligence and check out a prospective employee, training and job knowledge can be very suspect.

Now imagine calling the union hall and requesting an individual to perform a certain task that arrives job-ready. This could be achieved for all aspects of our industry as well as all levels of employment.

8. Activism

Employees have the opportunity to become a shop steward and represent their fellow workers. Being chosen steward is no glorified popularity contest, unlike being elected class president or homecoming queen. Indeed,

STARTING A UNION The National Labor Relations Board (NLRB), an independent federal agency that protects the rights of private sector employees, offers guidelines on how workers can go about forming a union.

Method 1 – If at least 30% of workers sign cards or a petition saying they want a union, the NLRB will conduct an election. If a majority of those who vote choose the union, the NLRB will certify the union as their representative for collective bargaining.

NLRB guidelines aside, some labor union advocates say that starting a union from scratch is a tough proposition. Some suggest contacting existing unions to see about getting representation in a certain employment field. Working America, the community affiliate of the AFL-CIO, for example, is designed to unite working people who don’t have a union on the job.

Method 2 – The employer may voluntarily recognize a union based on evidence—typically signed union-authorization cards—that a majority of

people on the floor are going to pick a person they deem best qualified to represent their interests. Furthermore, as a union official whose authority is recognized by federal labor law, a steward will forever be a footnote in the history of the American labor movement. How cool is that?

I know most of you reading this article feel that I may have lost my mind. Just hold on for a second. Think about how much money you have spent training employees. Think about the efficiency level of your crews. Think about the lost opportunities and the cost of downtime caused by employees who are not performing their jobs properly.

Most importantly, all contractors will be proposing work on a level playing field if the workforce is unionized. As contractors, we are basically selling labor. If all contractors are working with a very similar cost of labor, you would greenindustrypros.com

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employees want it to represent them.

Once a union has been certified or recognized, the employer is required to bargain over the terms and conditions of employment with the union representative. (Special rules apply in the construction industry.)

see tighter bids. You would then be forced to sell the job on quality, service, responsiveness, value and reputation.

Wouldn’t that be nice for a change? ❯ Gary S. Goldman has been a management consultant to the landscape and pavement industries since 1985. He travels throughout the United States consulting with landscape, tree service and irrigation contractors, pavement companies, related associations, manufacturers and vendors conducting one-on-one consultations, seminars and workshops.

Gary is also a radio talk show host with emphasis on business and politics.

He can be reached at 508-652-9771, gary@garysgoldman.com, or by visiting garysgoldman.com.

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CONTRACTOR PROFILE

By Gregg Wartgow

From left: Tony Diaz, Rafael Diaz, Delia Diaz, Ruben Diaz Sr., Ruben Diaz Jr., Robert Diaz

Passion Outlasts the Pain

The blood, sweat and tears the Diaz family has poured into its Chicagoland landscaping company is starting to turn into pure gold.

R

uben Diaz Sr. worked landscaping in the Chicago area with his brothers for the better part of two decades. He worked hard, as did his two oldest sons—Rafael and Ruben Jr.—who often helped out in the field since the young age of seven. To say they loved landscaping is putting it mildly.

It was always Ruben Sr.’s intention to start a company with his sons one

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day. That dream came to fruition 10 years ago. Rafael had just completed his collegiate studies in landscape design and landscape management. Ruben Jr. was coming down the home stretch of earning his degree in landscape management and business. The landscaping industry was going up and up and up.

The timing seemed perfect.

Ruben Sr. took his shares of Diaz

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Brothers Landscaping and started Diaz Group LLC with Rafael and Ruben Jr. in 2007. He’d left his brothers on good terms. “They hated to lose their brother as a business partner, but they knew he wanted to start a company with his sons—and they respected and supported that,” Rafael recalls. “In fact, my uncles were our biggest allies in our early years.”

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After a strong first year in business, the Great Recession began to take hold and things got tough from 2008-2010.

“My uncles wondered if we were going to make it with our new company,” Rafael says. “Honestly, we wondered that too.

There were a lot of tears and a lot of yelling those couple of years.”

“But we knew we had to make it … we didn’t have a choice,” Ruben Jr. adds.

The Diaz’s passion for landscaping— and love and respect for each other—has allowed them to make it. In the years following the recession, sales gradually rebounded and ultimately began growing at a steady annual clip. Last year the company topped the $5 million mark. The Diaz family is now working with consultant Domenic Chiarella to develop three- and five-year plans designed to propel the company to the $10 million mark. It’s not going to be easy, but in a market like Chicago, it is definitely possible.

“The biggest thing about these guys is that they are coachable,” Chiarella says.

“They have a mindset that allows for improvement. They are willing to take ideas from others and work to implement systems and process improvements. Plus, they are a rarity in that they are very employee-driven; they want to create opportunities for their employees and also their community. This is not just about money to them. Success in business means a lot more.”

Nurturing the leadership gene

At the age of 62, Ruben Sr. serves as the company’s figurehead, mentoring employees and acting as kind of a spiritual leader. “He’s the glue that holds everything together,” Rafael says with a nod from his brother.

That innate ability to lead is something dad has passed along to his sons, both in their early 30s. Rafael runs sales and the business side of the company while Ruben Jr. oversees operations.

Municipal work typically comes in the form of roadside restoration.

Together they work on strategic planning and systems development. In 2011 they were joined by another younger brother, Robert, who serves as landscape management director and is also a co-owner.

Hard work and paying one’s dues is an important hallmark of the Diaz Group culture.

“With the company my dad and uncles h a d —w h i c h we grew up in—you always started at the bottom and worked your way up,” Ruben Jr. says. “That’s something that always stuck with us. We want to provide a way for employees to move up.”

That’s why the Diaz brothers are laser-focused on growth. A pivotal moment came in 2010 when the company earned its Minority Business Enterprise (MBE) certification. This soon led to government contracts that helped propel growth. As welcomed as this new revenue stream was, it was not without its challenges. The Diaz

“My uncles wondered if we were going to make it with our new company… There were a lot of tears and a lot of yelling those couple of years.”

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brothers learned very quickly about the importance of cash flow and collections.

The core of the company has also been growing. Diaz Group now employs 60 year-round employees who help generate around $5.4 million in

annual revenue. The company expects sales to grow considerably more this year. Roughly 45% of revenue is from snow removal, 25% from installation, 20% from maintenance, and 10% from municipal installation, most of which is road restoration work comprising topsoil, seeding and tree planting.

As pointed out, the Diaz brothers have a lofty goal of doubling in size and growing to $10 million over the next

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few years. The Chicago market provides for plenty of opportunity in both landscaping and snow removal. Chicago also provides for plenty of stiff competition.

Some of the industry’s largest companies are in Chicago.

“To be honest, we love that,” Rafael exclaims. “We love to know these great companies. Yes, we’re competitors. But many have helped us over the years.

We’ve tried to do business the right way and build relationships with them.”

When it comes down to it, though, they are competitors. Rafael and Ruben Jr. concur that it took a while before they were comfortable in their own skin and capable of selling the company in a consistent, confident manner.

“We always felt like we were a little fish in a big bowl,” Rafael says. “Then we started to learn that being the ‘little guy’ is actually our strength. Being an Hispanic-owned business, knowing our work from our many combined years of experience, and having a culture of professionalism and friendliness ultimately opened a lot of doors for us—especially when we started to feel comfortable about who we were.”

As the Diaz brothers’ comfort level increased, so did their business discretion. Rafael says he’d chased any work he could get his hands on during those first few years in business. Not anymore.

“We’re actually refining the profile of what our ideal customer looks like in each service division,” he points out.

“As we develop our three- and five-year plans, we want to grow market share in those areas.” Right now the company is almost exclusively commercial and HOA in maintenance and snow removal, and about 70% residential in installation.

From big to really big, and good to great

Along with being more selective with respect to certain projects and clientele, the Diaz brothers have also evolved their approach to systems development.

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Consultant Domenic Chiarella is helping to facilitate it, drawing upon his decades of experience as a successful contractor himself. Some of the systems he’d utilized can be implemented at Diaz Group. Others need a bit of tweaking.

The point is that the Diaz brothers are putting in the necessary effort to develop systems that work for their company.

“You don’t just create systems out of the blue,” Chiarella reminds. “It takes some real work, time and patience.”

The focus now is on two primary things: 1) developing systems that connect one department to another, i.e. sales to production to accounting, and 2) developing systems that allow for more delegation as the company grows.

Once you get to the multi-million-dollar level, as Diaz Group has, this becomes paramount.

“A good example is how we’ve improved our work order process by division,” Rafael says, adding that doing so has created predictability and consistency. “We’re also working to better define our sales process. This will help us create consistency in how we qualify leads, generate estimates and contracts, and maintain our pricing and profit goals. New salespeople we hire can then follow this process and there will be no surprises.”

Last year the systems focus was in the snow removal division. “We’d doubled our snow operation in 2016,” Ruben Jr. tells. “When Domenic came in, he’d helped us to set up a better routing system, along with a better system for tracking invoices and making sure we got paid. Had we not done this, I don’t know how we would have gotten through last winter.”

Well, just as the Diaz family did back in 2008-9 on the heels of the Great Recession, they got through it. Now they are looking ahead to this year and beyond with a transformed sense of optimism.

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Diaz Group moved into its new 6.5-acre property in the Back of the Yards Neighborhood late last summer.

GRANDSTAND® STAND-ON MOWERS

CRIME DOESN’T PAY … OPPORTUNITY DOES The Diaz family moved into a new facility late last summer. Robert played an instrumental role in establishing the line of credit to make the purchase.

“It’s a 6.5-acre property in the Back of the Yards Neighborhood, a low-income area,” Rafael Diaz tells.

Speaking of optimism, they just signed a lease-to-buy contract with John Deere for 30—yes, 30—skid loaders.

“We mainly use them in snow removal,” Ruben Jr. explains. “We also use them on landscaping jobs to improve efficiency, and use them a lot around our yard to load trucks and move things around.

Once in a while we’ll even rent them to other contractors if we don’t need all of them.”

That deal between Diaz Group and John Deere was struck through their joint involvement in the National Hispanic Landscape Association (NHLA). Rafael says he plans to also become a member of the National Association of Landscape Professionals (NALP) this year. “It is great to meet other successful business owners,” Rafael shares. “It can really open your eyes.”

Diaz Group’s now 10-year track record has opened the eyes of its marketplace, particularly when it comes to employees.

The company has become something of an employee magnet. “My brother and greenindustrypros.com

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“Many people advised us not to do it because of the high crime rate. We decided to take a chance and it has paid off in dividends. We have created lots of jobs for people in the neighborhood. Also, we only employ local contractors when performing work in the community.”

I love to go and talk to people about working for us because we have a story to tell,” Rafael says. “Employees have the opportunity to be developed and grow with us.”

The intention is for that opportunity to continue well into the future.

Rafael, Ruben Jr. and Robert—along with their 18-year-old younger brother, Tony—represent the second generation.

Numerous nieces, nephews and cousins also work in the business who represent the third generation. For instance, 19-year-old nephew, Rene, joins Tony as the company’s top-performing managers. “Tony and Rene are attending the same college Ruben Jr. and I had attended,” Rafael points out. “Their goal is to one day take over for me and Ruben Jr.” It doesn’t stop there. Rafael’s 15-yearold son works summers with his grandfather in the field. Ruben Jr.’s son is only three years old, but it’s just a matter of time before he takes an interest in the business too. After all, his dad and uncle started their careers at age seven. ❯

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WHERE ARE THEY NOW?

By Gregg Wartgow

Patience & Proficiency

PAY OFF Phillips|Creasey doubled sales in 2016 by establishing a traveling crew, breaking into bioretention systems, and continuing to grow its core business with a focus on being the best, not the biggest.

I

n the fall of 2015, when Phillips|Creasey was originally featured in Green Industry Pros, the company was on the verge of landing a couple of lucrative commercial installation jobs for a wellknown national retailer. The jobs came through, were completed in splendid fashion, and have since led to numerous other projects throughout the South.

In fact, the company has now formed a “traveling crew” to tackle this steady stream of work.

Those two original jobs were near Phillips|Creasey’s home base of Chattanooga, TN. The developer then asked if the company could travel around the region to landscape some other projects they were doing. That led to work in Knoxville, TN (100 miles away); Athens (170 miles), Augusta (260 miles) and Valdosta (340 miles) GA; and most recently a large project even further south in Lake City, FL, roughly 400 miles from Chattanooga.

The Lake City project just took place in January. “Now we’re looking at more work in Tampa, FL, Savannah, GA, and also in South Carolina,” says Phillips, who is overseeing the traveling crew while partner, John Creasey, keeps an eye on things back in Chattanooga.

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MARCH 2017

Since Lake City is about an hour and a half from Valdosta, GA, Phillips says he was able to secure ma ny of the same materials vendors. Materials management has been among the most challenging aspects of this traveling work. Phillips relies as much as possible on SiteOne John Creasey (left) and Michael Phillips first appeared in the September/October 2015 edition of Green Industry Pros.

Landscape Supply, a huge distributor with outlets all over the country. itself, Phillips and Creasey presented it But sometimes he must source other as an opportunity to employees—an suppliers and growers. Furthermore, he opportunity to gain some valuable expehas to get a feel for pricing. “It seems rience and also make more money (i.e. like a lot of things are priced a bit lower per diems for time away from home). As down here (North Florida), and I don’t expected, a couple of employees weren’t want to be pricing and bidding too interested, choosing to simply continue high,” Phillips points out. working at the home base. But many Labor can be another challenging employees were eager to volunteer for aspect when expanding your geographic the traveling crew. Regardless, Phillips footprint. Fortunately for Phillips and and Creasey wanted it to be a choice.

Creasey, it hasn’t proved to be much of “The real key to all of this is having an obstacle. When the opportunity to enough good managers in your company establish a traveling crew first presented so you have people you can rely on as

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you expand,” says Creasey. “Fortunately for us, we do.”

When assembling a traveling crew, Phillips|Creasey typically grabs three

eight weeks, but some last as long as three months. Employees might be gone for two weeks, return home for a long weekend, and then drive back down to the jobsite.

“We’re still experimenting with how to handle travel cost s ,” Cre a se y says. “Sometimes we’ve negotiated long-term room rates with hotels, and other times we’ve rented houses off Airbnb.com.

That has worked out pret t y wel l from both a cost and comfortability standpoint, because we want what’s best for our employees.

It really depends on the situation and what options we have.”

Prior to the 2009 recession, Phillips and Creasey were running separate companies that were each cruising toward the million-dollar mark. That changed, obviously. It has been a steady climb back ever since, particularly since 2013 when the two merged. Sales doubled last year. Now the partners are looking to more than double them again over the next few years.

As pointed out in the original Sep/ Oct 2015 feature story, that growth will have to happen naturally—as it has been over the past few years. Phillips and Creasey are focused on being the best, not the biggest. That focus has allowed the company to also continue growing its core business back in Chattanooga.

“We have a good amount of residential design/build work around Chattanooga,” Creasey points out.

“We’ve also done a few large commercial bid/build jobs over the past year as the revitalization of Chattanooga continues.” Phillips adds that the typical residential design/build project is now of a size and scope similar to what was happening in the mid-2000s before the housing crash. That is helping to drive both top and bottom line growth.

A bit crazy, but not out of control

Customer retention and bioretention

This past summer, Phillips|Creasey was High-end residential maintenance has held steady, but actually running is poised to grow this year and beyond thanks to a new several traveling business model that is being rolled out. crews. It wa s TOP: A couple of large commercial installation jobs unchartered waters, completed in late 2015 has led to ongoing work throughout the Southeast. for sure, but Phillips says things never or four of its key employees and then felt like they were getting out of control. supplements with local labor. “We’ve That’s important, because “regaining put temporary help wanted ads on control” was the main reason Phillips and the internet, and often work with Creasey merged their companies in 2013. local staffing agencies to find workers “Aside from buying another (and in whatever city we’re in,” Creasey bigger) truck to handle these larger explains. Some of those temporary commercial jobs, we really haven’t had employees did a good job and ended to do anything else or change anything,” up staying on with the company after Phillips says. Payroll as a percentage the project was completed. of sales has held steady, and they are Most traveling projects last six to hitting their profit goals. greenindustrypros.com

GIP0317_16-19_PhillipsCreasey.indd 17

Speaking of bid/build, one area Phillips|Creasey has broken into is bioretention systems. With so many municipalities needing to meet stormwater requirements and adopting landscape ordinances, bioretention ponds and swales have become a growing opportunity—and an opportunity that presented itself suddenly to Phillips|Creasey.

“It was a general contractor we already had a good relationship with who helped pull us into this service,” Creasey says.

“They had a project underway where the existing landscape contractor was behind schedule. They called us to lend some additional manpower. That project had a lot to do with bioretention ponds. We had

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WHERE ARE THEY NOW?

A new revenue stream and huge driver of growth has been in the area of bioretention system construction.

to get up to speed on that very quickly.

Luckily we have good, competent people in our company who can learn a lot in a short amount of time. They did, and we demonstrated it on the job. Then another goodsize project came up that was entirely bioretention, including native plantings and a lot of excavation and grading. We got that job. Now we’re known for having proficiency in this area.”

These bioretention projects are heavily engineered. “We have to look at drawings and specs, so we’d reached out to some experts to gain a better understanding of this type of work,” Creasey says. “We also had to send one of our managers up to Nashville to get certified. You have to have a certified person on the jobsite because there is a lot of documentation and inspections that have to happen; you have to keep a lot of logs on rainfall, stormwater mitigation data, etc.”

As for equipment, Phillips|Creasey is a big believer in rentals. “Renting allows us to articulate a specific need to a specific project. Depending on the size of the project, we’ll typically need two or three track loaders, along with a mini-excavator or maybe even

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a mid-size excavator if the project warrants. You also need several dump trucks, which is something we sub-out.

The sheer volume of material that needs to be moved in and out is significant.”

Next big steps

Also in 2015, Phillips had received his general contracting license, allowing the company to oversee complete construction projects. The company’s focus is still on landscaping—such a bioretention ponds and large-scale retaining walls—but the license gives Phillips|Creasey the ability to tackle other projects if need be.

On that note, the company hired a full-time construction manager last year. Phillips’ wife’s uncle was a homebuilder before the recession. He was looking to get back into the trade and took the job with Phillips|Creasey. “He’s basically a project manager, but he has built multi-million-dollar homes in the past,” Phillips points out.

“We’ve modified our thinking a bit on this part of our business,” Creasey adds. “Yes, our focus is still on landscaping. But our new construction manager, together with our general

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contracting license, gives us the ability to offer construction and home remodeling services. We’re already starting to design and bid on this type of work. It makes sense.”

Another thing that has proved to make sense is landscape maintenance.

Phillips|Creasey hasn’t aggressively tried to grow this division, but has maintained a steady base of customers.

High-end residential maintenance now accounts for roughly 10% of total revenue; it was more like 20% a couple of years ago before design/build sales took off.

Phillips and Creasey are now in the process of spinning off their maintenance business into a separate company.

They’re also bringing on another partner in that new company—a local landscape maintenance provider who will assume a 50% ownership stake. “This guy has been in business for about 10 years and has a good reputation,” Phillips says. “We expect 2017 to be a very successful first year and we expect to grow fast.” ❯ Read the original 2015 profile on Phillips|Creasey Landscaping at greenindustrypros.com/12109127.

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SPOTLIGHT DEALER

By Gregg Wartgow

The Ph.D. of Propane

Dealer Mike Halloran talks propane cylinders with interested attendees at the August 2016 Chicago Area Clean Cities Coalition event.

Mike Halloran saw the potential of propane more than five years ago.

Now it represents nearly a third of his commercial mower sales.

D

ealer Mike Halloran was one of several experts who presented at a propane educational event coordinated by the Chicago Area Clean Cities Coalition last summer. He laid out the reasons why a park district or landscape company would want to make the switch to propane mowers.

Clay Johnson of Metro Lawn Propane Conversions took to the podium after Halloran. “My presentation is going to go quickly,” Johnson said, “because Mike just covered everything perfectly.”

Halloran doesn’t just sell propane mowers—he has been helping to create demand for them through his commitment to customer education. He’s the

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owner of Halloran Power Equipment in Palatine, IL. His wife, Jill, is the owner of Mowerworks in nearby Barrington.

Aside from being owned by a Halloran, the two stores share a lot in common. For one, they take the commercial market very seriously. Secondly, propanepowered mowers are big business.

“Roughly 30% of our commercial mower sales are now propane, and half of that is conversions,” Halloran points out. It took a while for the business to build. “Gravely offered a propane mower many years ago,” Halloran continues.

“But in those early days, the mower had a Generac engine. Parts and support were hard to come by, so it never took

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off.” That’s a different story today. Gas engine conversion kits have become common, and Kohler even offers engines specifically designed for propane fuel.

Gravely remains Halloran’s top commercial mower line—especially with respect to propane. The two stores also sell Bob-Cat and Scag commercial mowers, RedMax handheld equipment, and Ariens and Simplicity consumer mowers. The Palatine store also carries Husqvarna, while the Barrington store has Stihl and Toro (consumer).

Even though the two stores are a mere 10 miles apart, they only experience 15-20% customer overlap. Palatine is more commercially focused (80%)

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while Barrington sales are split evenly between commercial and homeowner.

The two stores employ 18-19, eight of whom are service technicians (four at each store). The Hallorans’ three sons— Mike Jr., Richard and Eric—also work in the business.

On the road again

Halloran says he is a bit of a road warrior. “On typical days, I stop at the Palatine store first thing in the morning to look around and greet staff,” he relates.

“Then I get in my truck and hit the road, visiting customers and offering equipment demonstrations. I put over 45,000 miles on my truck last year.”

Halloran says it’s important for dealers to see market trends as they are developing—and you can’t do that when sitting at the shop all day, every day. He points to the stand-on mower as a great example.

“Several years ago, I would see landscaping crews having to mow a huge commercial property in the morning, followed up by some apartment buildings and a church, and then a handful of residential lawns in the afternoon,” Halloran tells. “So I quickly became one of the first Chicago-area dealers to start pushing stand-on mowers.

“A more recent example has to do with the construction boom around Chicagoland,” Halloran continues. “I saw all of these buildings starting to go up, which I knew would eventually lead to a surge in landscape installation work. So I decided to start stocking up on products like tillers, sod cutters, concrete saws and chainsaws, along with all of the popular parts and accessories.

You must have what contractors need— when they need it.”

Sometimes it helps to also have products that contractors don’t yet understand they need. Case in point:

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The Doctor is in

the two-wheel tractor. Halloran began selling this product years ago when Gravely formed a partnership with the Switzerland-based manufacturer. He even gained national fame when he took some units down to the Gulf Coast to help clean up beaches after the BP oil spill. Nowadays, Gravely itself is manufacturing the product, and Halloran continues to sell it. “Contractors working in downtown Chicago love it,” Halloran points out. “It’s great for doing debris and snow cleanup around tall buildings.”

The pioneering of useful innovations can really help an equipment dealer shoot past the competition. Still, after-sale service is the linchpin. One thing Halloran has begun doing is providing on-site parts stocking to select commercial “fleet” customers.

He installs a “Halloran Power Cage”— which is basically a locker—right at the customer’s facility. He and the customer establish minimum and maximum inventory levels for fast-moving parts, and Halloran keeps those parts stocked.

“Communication with the customer (the fleet manager) is key to making this work,” Halloran says. “Regularly being on site also helps in other ways. You can observe the customer’s operation and identify other needs they might have.

For instance, if they are having trouble with their two-cycle equipment, maybe you can recommend a different kind of oil. And getting back to the parts locker, you have to work with the customer. If they have a bunch of something they ended up not needing, you have to take it back. You can’t just dump it on the customer and say, ‘Now it’s your problem’. If I’m not adding value as a dealer, I’m of no value.”

Being a resource when it comes to propane education is the biggest way Halloran has been of value. While visiting with customers at the Clean Cities event, some of them started calling him “The Doctor of Propane”.

The Doctor hops in his truck and hits the road every day. He visits customer facilities to show them the latest and greatest mowers—and to see if propane

Shayne Wlas (left) and Richard Halloran work the front counter in Palatine.

would be a good fit.

“You really need at least three mowers to make the transition worth it,” Halloran says. Then the cost savings of switching from gasoline to propane really start to add up. An average user could save as much as $400-$800 in fuel per mower, per year. Also, a propane supplier will typically set up a landscaper with transportable tanks and holding cages at no charge if their fuel consumption will be high enough.

When it does make sense for a customer to switch to propane, The Doctor offers his consultation. “We evaluate the existing mower fleet for any units worth upgrading to run LP fuels,” Halloran explains. “Then we’ll set up a demo and do a tutorial for all of the company’s employees. I provide some extra training for crew leaders and mechanics so they understand how to

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SPOTLIGHT DEALER

troubleshoot any issues they might have in the field. For example, if a unit is run out of fuel, I show them how to install a fresh tank and get it started. I teach

then it’s just a matter of venting off a little gas and getting back to work.

“Another thing is how the propane tanks are stored in the holding cage at the customer’s facility,” Halloran continues. “I teach the employees that empty tanks should go on the shelves ‘valves in’. Also, employees should always put a new, full tank on their mower every night.

A nd t he y s hou ld always wear leather gloves when handling tanks.” Halloran also trains users to check for overfilled tanks before mounting them to avoid issues in the field.

Halloran says everyone breathes a

Mike Halloran is a road warrior, and this is his chariot.

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little easier with propane, as the fuel produces 85% less toxic exhaust and drastically reduces carbon and nitrous oxide emissions. “This goes a long way towards the green movement,” he adds.

Financial incentives such as grants and rebates can also play an important role in getting a customer to make his or her first plunge into propane. “The State of Illinois has one of the best incentive programs in the country,” Halloran says. “Through the Illinois Propane Gas Association, people can get $1,500 per mower for up to three mowers—each year.” That’s $4,500 for three mowers, roughly half to two-thirds the price of a single mower, depending on make, model and size. In any event, that’s some serious cash savings on the part of the end-customer.

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The Halloran Power Equipment showroom in Palatine, IL

Council (PERC) has also brought back its propane mower incentive for this season. That’s music to Halloran’s ears. Landscape contractors, facilities managers, municipal f leet directors and even homeowners can apply for incentives of $1,000 for the purchase of a new propane mower, or $500 to convert an existing machine with a qualified conversion kit. The PERC rebates cap out at a maximum of 25 units, Halloran points out, which really gets the attention of the bigger fleet managers.

Rebates aside, switching to propane still makes a lot of financial sense. “With propane, you’re saving money on the fuel itself,” Halloran reminds. “But you also have reduced engine maintenance because propane burns so much cleaner than gasoline. Propane is safer because it ignites at a considerably higher

temperature than gas.

If by chance there is a propane leak, the fumes simply evaporate in a matter of minutes; there are no puddles to clean up and worry about. So there is significantly reduced fuel spillage and spoilage, which cuts costs. And because propane is contained and sealed in a canister, you don’t have to worry about fuel contamination or even employee theft since the tank won’t work on a backyard BBQ.” One of Halloran’s largest customers, The Forest Preserve District of Cook County, is also one of the first to have gotten on the propane train. When the Forest Preserve indicated it wanted to “clear the air” over the 69,000 acres it maintains, Halloran was quick to get

them a long-term demo and help with their research into alternative fuels.

Now they are running a fleet of over 40 propane mowers and have reduced fuel costs by thousands of dollars each year—all while saving the world and going green.

Yet another propane-related accolade was added to Halloran’s resume this past October. He was the first-ever recipient of a Propane Leadership Award from the Propane Education & Research Council (PERC) at GIE+EXPO 2016. Had that award been around five years ago, Halloran would have won it then too. ❯

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LAWN CARE

By Gregg Wartgow

Andrew Ziehler, owner and CEO of Ziehler Lawn and Tree Care in Centerville, OH

THREE- T WEEK CRASH COURSE

here are several economic indicators fueling some optimism in the lawn care market, from existing home values to consumer confidence to rising disposable incomes.

With great opportunity, though, comes a greater need for great employees.

If you’re like most contractors, finding and retaining good employees has become more difficult. You bring back a core group of solid performers year after year, but also find yourself having to deal with a revolving door.

Recruiting can become costly and burdensome, as can training.

T he Nat iona l Associat ion of Landscape Professionals (NALP) has created a tool that can help. Its Lawn Care Technician Training program is designed to get new technicians up and running in no more than 15 training days. The

NALP’s lawn care technician training program can help you get new hires up and running in 15 days.

program focuses on key learning objectives in the areas of customer service, turf a nd i nsec t identification, fertilizers and pesticides, proper application techniques, and safety.

Each day is a different lesson. There is a written piece the employee reads and goes over with his or her trainer. Then there is a written test. Additionally, each lesson is provided in a PowerPoint presentation, which helps trainers to train several employees at a single time in a group setting.

The program was developed a few ago

by NALP’s Lawn Care Specialty Group,

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which included a couple of suppliers and nearly a dozen lawn care contractors. Andrew Ziehler, owner and CEO of Ziehler Lawn and Tree Care in Centerville, OH, was one of those contractors.

“We as a group were working on ideas to help companies succeed—especially smaller companies and new companies just coming into the business,” Ziehler says. “We all agreed that there was a real need for training. A lot of contractors know what they need to do, but it’s all in their heads. They need a system. So we came up with this 15-day training program.”

Originally based on content provided

by Jim Wilkinson, Ph.D., president of SeaScape in Coventry, RI, the final product is the culmination of best practices from several of the brightest minds in lawn care. On that note, Ziehler has

even implemented the program in his own company.

“The 15-day training program really gives you a strong foundation for training,” Ziehler says. “It then serves as a great launching pad for continuing education within your company to help you develop the best technicians you can.”

Ziehler’s company has grown in recent years, more than 30% over the past year alone. He expects to employ around 25 people this season, many of them first-year hires. “We focus a lot on culture and employee retention, but we’re growing,” he says. “So we’re continually having to bring on new people. We also put our new salespeople through our 15-day new technician training.”

Two out of three new hires are coming from outside of the lawn care

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and landscaping industry, which makes thorough, efficient and consistent training all the more important. “We prefer to go after employees with attributes that fit our culture, and then train them on the technical aspects of their job,” Ziehler points out.

That approach makes a ton of sense. It takes a narrowing labor pool and opens it up a whole lot wider. Tools such as the 15-day lawn care technician training program make it much more practical to do so. ❯

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MAINTENANCE EQUIPMENT

By Matt Gersib

Why Mid-Size Walk Mowers Make Sense U.S. Lawns franchisee explains why the intermediate walk mower is still his go-to mowing machine – even on large industrial properties.

Photo Credit: Exmark Mfg.

T

he commercial walk-behind mower remains a mainstay on the trailers of landscape professionals across the country. And, while zero-turn and stand-on riders remain popular options for many crews, a number of companies have found that walk-behind mowers give them a

run for my employees,” Pursell says.

“The ability to get closer to landscaping and run up under bushes and shrubbery means there’s less finish work after the primary mowing is done.”

The majority of Pursell’s crews leave every day with two mowers on the trailer: a 60-inch Exmark Turf Tracer X-Series wide-area walk-behind, and a 48-inch Tur f Tracer S-Series hydro-drive interm e d i a t e w a l kbehind. A handful of zero-turn riding mowers are available for specific jobs or needs, but Pursell says the majority of his crews’ mowing work is done by the 48- or 60-inch walk-behind machines.

Given the majority of Pursell’s business is comprised of industrial and commercial clients, his extensive use of walk-behind machines may seem counterintuitive to some. But he says his crews

“Walk-behind mowers are lighter, easier to operate and more efficient to run for my employees.” number of competitive advantages.

According to David Pursell, owner of U.S. Lawns franchises in the Ridgeland and Vicksburg, MS, areas, the advantages of running walk-behind mowers are many.

“Walk-behind mowers are lighter, easier to operate and more efficient to

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lose little, if any, productivity compared to crews running zero-turn riders.

“Almost all of our 60- and 48-inch machines are equipped with a stand-on sulky, so it’s rare when our operators are actually walking behind the machines,” Pursell says. “And while it’s true a zeroturn rider may have a higher top speed than an equivalent walk-behind, it’s rare you’re actually able to mow at top speed, regardless of mower type.”

Pursell says that, in terms of productivity, he believes a properly equipped 60-inch walk-behind is every bit as productive in most conditions as a 60-inch zero-turn rider. “In a wide-open field, the increased speed of a zero-turn rider may save some time. That said, on most of the properties we maintain, I believe a sulky-equipped walk-behind mower is just as productive.”

Right mix of mowers

For Pursell’s mostly commercial client base, the choice of a 48-inch intermediate and 60-inch wide-area

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walk-behind mower for each crew makes sense.

“We use the 48-inch mowers in any high-profile areas, or around cars,

with a more residential focus, access through gates is often the deciding factor with respect to mower size.

“If you’re maintaining a property

fuel efficiency of his larger machines.

“I haven’t tracked the specific data, but I can say I’ve noticed the reduction in fuel consumption since we transitioned our larger mowers to EFI. The engines perform better too. That’s a win-win situation.”

Pursell believes some contractors may be intimidated by the electronics behind EFI, but says he has had great experience with his EFI-equipped machines. “They start and run with the same consistency we’ve come to expect from our trucks, and they do it reliably every day.”

Landscape professionals have a growing range of options when it comes to increasing fuel efficiency and decreasing day-to-day operating costs on commercial walk-behind mowers. “EFI gasoline engines are just one way contractors are saving money on fuel,” Briggs points out. “A growing number of landscape professionals are realizing significant cost savings using the latest generation of walk-behind mowers powered by EFI propane engines.”

As a longtime proponent of propanepowered commercial mowers, Exmark worked closely with Kohler to develop the industry’s first EFI propane commercial mower engine. Today, Kohler EFI propane engines are available on both of Exmark’s hydro walkbehind models. And industry-wide, the number of manufacturers offering EFI propane models continues to grow.

Stand-on sulky attachments are a popular accessory. The ability to ride on the sulky lets crews be more productive throughout the day.

Photo Credit: Exmark Mfg.

windows or other sensitive areas,” Pursell explains. “They are set up to mulch, which reduces projectile risk, and since we’re typically mowing properties once a week, we’re not generating a huge amount of clipping material.”

Pursell says the choice of walk-behind machines allows his crews to run up as close as possible to landscaping, reducing the need for string trimmers or a smaller trim mower. As a result, his crews only carry a 21-inch mower on the trailer for specific client needs or finish cut requirements. “We really only use the 21-inch machine for high-profile clients, or on areas where a specific quality of cut has been requested,” Pursell adds.

At the other end of the spectrum, Pursell’s 60-inch mowers are set up for maximum productivity. “The 60-inch mowers are set up to side-discharge, and we use them primarily to cut large areas,” Pursell says. “With sulkies and powerful EFI-equipped engines, the bigger mowers get jobs done quickly.”

For landscape maintenance crews

with access through a 36-inch gate, you’re looking at a whole different set of rules,” says Jamie Briggs, Exmark product manager. “The width of the gate limits cutting deck width to roughly 30-inches once you factor in the width of the deck and discharge chute hardware.”

Briggs says Exmark developed its popular Commercial 30 walk-behind with the needs of these landscape professionals in mind. The 30-inch twin-blade cutting deck delivers 43% more cut area per pass than a 21-inch mower, with similar balance and maneuverability.

“The Commercial 30 has been very well received by our customers for its productivity, maneuverability, durability and small footprint on a truck or trailer,” Briggs adds.

Pursell says an often-overlooked factor when making equipment-related decisions is the quality of the dealer.

“As a landscape professional, your relationship with your dealer is a critical part of your ownership experience with a machine. How they respond to your needs can be the difference between being stuck with unproductive equipment and having machines, and crews, that are out there making money.” ❯

Technology increases efficiency

Almost all of Pursell’s 60-inch mowers are powered by Electronic Fuel Injection (EFI)-equipped engines, which have significantly increased the greenindustrypros.com

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MAINTENANCE EQUIPMENT The Finer Details – Walk Mowers, Trimmers & Edgers Toro Updates TimeMaster Mower with New Engine Toro says users of its TimeMaster 30-inch walk mower will be able to tackle bigger mowing jobs in 2017 thanks to the new Briggs & Stratton Professional Series 1000 engine, which provides increased torque and displacement compared to previous models.

With 10.00 ft-lb of gross torque, the engine delivers more power to rotate the blade, so the TimeMaster mower can handle thicker, heavier grass with ease. In addition, the overhead valve (OHV) engine design runs cooler and cleaner for better fuel economy and longer engine life.

Other key features include: • Super Lo-Tone engine muffler for quiet operation • Dual-sealing commercial-grade air management system helps reduce harmful yard debris from entering the engine

Ferris FW35 Walk Mower Featuring Oil Guard Ferris says its FW35 dual hydrostatic walkbehind mower was built from the ground up to meet the demands of professional mowing crews. The design provides for smoother and more user-friendly operation with easy-to-use controls.

New for 2017, the FW35 features a Vanguard EFI engine with Oil Guard. Oil Guard allows the user to operate their mower for 500 hours between oil changes. Increasing the oil change interval by 5x means less time spent changing the oil and more time cutting.

Other key features of the FW35 mower include: • Cruise control bar • Independent steering with speed indicator • Longer belt life • 1/4-inch-thick engine deck • Easy access to serviceable parts greenindustrypros.com/12300443

• ReadyStart system eliminates need to prime or choke the engine • 30-inch cut width and travel speed capability can reduce mowing times up to 40% greenindustrypros.com/10446753 or see ad page 14

Exmark Turf Tracer X-Series Exmark says its premier Turf Tracer X-Series walkbehind mower raises the bar for commercial productivity, durability and ease-of-service. Available in 52- or 60-inch cutting widths, Turf Tracer X-Series models feature Exmark’s patented Enhanced Control System (ECS). ECS significantly increases operator comfort with a design that places all vital controls at the operator’s fingertips, Exmark assures.

Other features include: • Heavy-duty electromagnetic PTO clutch and single-belt deck drive system offers increased durability and ease-of-maintenance • UltraCut Series 4 cutting decks feature welded 7-gauge deck reinforcements and large-flange, maintenance-free, Lazer Z-style sealed bearing cutter housings with splined blade drivers • Twin-cylinder Kawasaki and Kohler engine options, in carbureted gasoline, EFI gasoline and EFI propane configurations • Lazer Z-style belt shields provide tools-free deck drive access greenindustrypros.com/12150582 or see ad page 7

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Kubota Walk-Behind Mowers Kubota’s walk-behind mower line includes three commercial models: the WG14-36, WH15-48 and WHF19-52. The mowers are available in three deck widths (36, 48 and 52 inches) and each model is powered by a Kawasaki V-twin gasoline engine with outputs ranging from 14 to 19 horsepower.

The WG14-36 features a five-speed gear-drive transmission with reverse assist, and the WH15-48 and WHF19-52 use proven HydroGear variable displacement pumps with Parker wheel motors.

All three mowers feature fabricated welded steel decks and are equipped with a powerful 125 ft.-lb. electric clutch, maintenancefree spindles, and easy-to-use controls. The WG14-36 utilizes a traditional pistol-grip control, while the larger WH15-48 and WHF19-52 models utilize a twin lever hydro control similar to those found on zero-turn mowers, enhancing ease of use and improving maneuverability in tight spaces. greenindustrypros.com/12113941 or see ad page 2

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Rotary’s Premium-Quality Filters Rotary carries a complete line of premiumquality filters to fit small engines, trimmers, chainsaws, ATVs and golf carts. The company says its filters are professionally designed to ensure maximum efficiency and peak performance.

A 58-page special section in Rotary’s 2017 catalog features a wide selection of filters, including: • Air filters

Husqvarna 525ES Commercial Edger The 525 ES Edger continues the tradition of Husqvarna’s 500 Series by combining professional-grade performance with the company’s latest innovations. Featuring heavy-duty construction for durability, wellbalanced and ergonomic designs to limit fatigue during long-term use, and a powerful X-Torq engine that reduces fuel consumption and emissions, Husqvarna says the 525ES edger helps professionals get the job done.

Additional features include: • Steel drive shaft • Heavy-duty, 90° edger head designed for commercial use • Efficient air filter reduces engine wear

• Fuel filters

• Intuitive controls and an auto-return stop switch for easier starting

• Oil filters

• MSRP: $399.95

• Transmission filters

greenindustrypros.com/12173883 or see ad page 9

• Pre-filters Rotary says its filters are guaranteed quality that meets or exceeds all OEM standards for operation. Additionally, 100% of Rotary’s foam air filters are made in the USA. greenindustrypros.com/10157949 or see ad page 22

Billy Goat Outback BC26HHEU Brushcutter Billy Goat says its Outback BC26HHEU Brushcutter is designed to make quick work of under-brush, berries, bramble, vines, tall grass and small trees up to 2 inches in diameter and 6 feet tall — all at a rate of just under an acre of brush per hour.

Key features include: • 26-inch-wide deck with higher tip speed for improved speed and cut quality

Stihl FB 131 Bed Redefiner

• Tuff Torq hydrostatic transmission with fully automatic Enhanced Traction Control (ETC) offers superior traction on uneven terrain and handles slopes up to 20°

Previously only available as a Stihl KombiSystem attachment, Stihl’s 710cc gas-powered FB 131 Bed Redefiner is now available as a dedicated unit. Key features include:

• Front wheel casters help hold on hillsides when locked and makes for easier turning in tall grass • Pivoting brush deck hugs the ground for a better cut, minimizing scalping • Cut height adjustable from 1.77 to 3.74 inches • Ergonomically angled, plow-style handles with padded grips • Direct from-the-handle forward and reverse lever for easier machine handling greenindustrypros.com/12301894 or see ad page 23

• Vertical pleated paper air filter for enhanced filtration • Stihl-exclusive IntelliCarb technology maintains desired RPM if the air filter begins to clog • Semi-automatic choke lever enables simple three-step start procedure: purge primer bulb, set hoke and pull starter handle • One-touch stop switch allows user to turn off engine with the simple press of a button; switch automatically returns to start position which saves time and reduces the chance of engine flooding when restarting • Professional-design “open” deflector to minimize clogging • Easily adjustable cutting depth wheel • Easily replaceable heavy-duty skid plate prevents costly repairs to gearbox • New one-screw service cover provides quick access to spark plug and valve train for easy adjustment and service greenindustrypros.com/12274857 or see ad page 5

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MAINTENANCE EQUIPMENT

Honda HRC216K3HDA Commercial Walk Mower Honda Power Equipment is expanding its lineup of commercial mowers with an all-new model, the HRC216K3HDA. Key features include: • Operating weight of just 121 pounds

Grasshopper Edge-Eze Attachment Grasshopper says its Edge-Eze attachment saves labor by eliminating time-consuming hand edging and two-cycle edgers. The EdgeEze maintains a clean, sharp edge from the sidewalk, street or curb at a reported pace of up to 500 feet per minute. An optional electric actuator increases downward pressure in tough conditions. It is compatible with Grasshopper MidMount and FrontMount DuraMax decks (48-inch and larger). greenindustrypros.com/10156491

• Easy start/stop • Low-noise, fuel-efficient Honda GXV160 commercial engine maintains consistent speed across all mowing conditions • Hydrostatic transmission with heavy-duty automotive-style drive • Exclusive Honda MicroCut Twin Blade System offers four cutting surfaces to produce finer clippings • Eight cut heights • 21-inch steel deck with front axle and bumper protection • Heavy-duty steel piped reinforced handles greenindustrypros.com/12271270

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BLOWER BUGGY

SPRAYER

DETHATCHER

SPREADER

TRANSPORTER

(866) 537-6168 | JRCOINC.COM/GIP Circle 15 on card or visit greenindustrypros.com/

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Stihl Upgrades Pro Edger Lineup With large 710cc fuel tanks and low-emission engines, Stihl’s line of professional edgers provides 30% longer run times than their respective predecessors. The improved lineup includes three models: the FC 91, FC 96 and FC 111.

Other key features of these new edgers include: • Vertical pleated paper air filter for better filtration, extended replacement intervals and longer service life • One-touch stop and simplified starting procedure enabled by semi-automatic choke lever

Husqvarna W436 Commercial Walk-Behind Mower

• IntelliCarb compensating carburetor automatically compensates for reduced air flow when air filter begins to clog to maintain desired RPM while cutting

Husqvarna’s W436 Commercial Walk-Behind Mower features a fivespeed Peerless transmission, heavy-duty drive belts, rugged cutting decks, and premium commercial engines combined with a simple pistol-style control system to offer the utmost in productivity and durability. Additional features include:

• Solid steel drive shaft on FC 96 and FC 111 and flex shaft on FC 91 come with limited lifetime warranty

• 36-inch cutting width

• Mud flap-style debris deflector is split, giving users the ability to follow various contours of lawn and paved surfaces greenindustrypros.com/12296214 or see ad page 5

• Clean, open control panel • Belt shields that are easy to remove for maintenance access • MSRP: $3,799.95 greenindustrypros.com/12300408 or see ad page 9

Make Your Competitors Green with Envy.

A versatile machine for all types of jobs: • Over 150 attachments • Articulated, compact sized • Minimal turf impact • Excellent lift to weight ratio • Low operating and maintenance costs To learn how an Avant loader can help you work more efficiently, call us at

847-380-9822, or visit our website.

All in One Solution

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CONSTRUCTION EQUIPMENT Track Loaders & Mini Loaders Mini Skid Steers from LHD Machinery LHD Machinery says its mini skid steers have all the power to get the job done, but also have a much faster ROI because of a lower MSRP compared to other similar machines.

The machines include rubber tracks, double hydraulic arm rams, a 42.7inch width for stability and maneuverability, and triple hydraulic pump.

The machines are lightweight enough for a single-axle trailer, have durable steel construction and require minimal maintenance.

Tipping and operating capacities meet or exceed other comparable machines, LHD Machinery assures.

Each mini skid steer also includes joystick control for arm and attachment movements. The 2000X series upgrades the independent drive controls to a joystick as well.

The 2000 series has a 20-hp Honda engine while the 2000D and 2000X have a 25-hp Perkins diesel engine.

The 2000X series also adds a lockable auxiliary, variable single speed, and a higher gpm rate. greenindustrypros.com/12264617

Toro Dingo TX 1000 Toro’s Dingo TX 1000, with a rated operating capacity exceeding 1,000 pounds, is the most powerful in the Dingo lineup.

Additionally, when the loader arms are fully extended, the hinge pin measures 81 inches from the ground to easily reach over the side of dumpsters and one-ton trucks.

The Dingo TX 1000’s vertical-lift loader arm design keeps the load closer to the machine to allow operators to lift more weight with greater confidence. Additionally, the vertical path of the lift arms makes this loader ideal for vertical applications such as an auger or concrete breaker. greenindustrypros.com/12054497 or see ad page 14

Brand New Kubota SVL75-2 Bobcat T595 Compact Track Loader The 74-hp Bobcat T595 compact track loader features increased horsepower and performance for pushing or digging applications, without the need for operators to move up to a bigger machine.

With a 2,200-pound rated operating capacity and improved lift force, the T595 can help increase jobsite productivity, plus it can move or carry more material with an attachment to increase jobsite efficiency.

At 68 inches wide with a standard construction/industrial bucket, the loader’s compact size allows it to work in confined spaces, move confidently within a congested worksite or travel between homes. Its rubber tracks cause minimal ground disturbance for fewer repairs to established lawns when a project is complete. greenindustrypros.com/12234829

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At the 2017 World of Concrete show in midJanuary, Kubota unveiled its new SVL75-2 with High Flow compact track loader, offering increased hydraulic horsepower for a wide variety of attachments and expanded multitasking capabilities. Other key features: • Auxiliary hydraulic flow increases from 17.4 to 29.3 gpm • 2,300-pound operating capacity • Bucket breakout force of 6,204 pounds • Lift arm breakout at 4,766 pounds • Multi-function levers provide fingertip control of all major functions so both hands are on the levers at all times • 74.3-gross-hp, four-cylinder, directinjection, turbo-charged Kubota diesel engine equipped with Common Rail Fuel Injection and Diesel Particulate Filter (DPF) to meet Tier 4 emissions standards • 24.6-gallon fuel tank to allow for full workday without need to refuel greenindustrypros.com/10241149 or see ad page 2

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Ditch Witch SK1050 Ditch Witch has introduced the construction-grade SK1050 mini skid steer, ideally suited for a variety of demanding landscape, hardscape and irrigation jobs.

Equipped with a 37-hp Tier 4 Yanmar diesel engine, the SK1050 directs 30-hp to the attachment, giving operators the power to tackle an assortment of challenging tasks with more efficient and productive use of hydraulic attachments, including trenchers and augers. The attachment horsepower, combined with 15 gpm auxiliary flow and 3625 psi, the SK1050 leads to quicker jobsite cycle times, making your crews more efficient and decreasing overall labor costs.

ASV’s RT-75 Compact Track Loader

Other key features include: • Hinge-pin height of 83 inches enables efficient and flexible loading and unloading at a wide range of dump sites

ASV says its new large-frame, radial-lift Posi-Track RT-75 compact track loader features highly efficient hydraulics and an innovative, high-capacity cooling system while delivering superior serviceability.

Additionally, ASV says its patented Posi-Track undercarriage provides the industry’s highest ground clearance, lowest ground pressure, best traction and longest track life. Other key features include:

• 1,057-pound rated operating capacity provides operators with enhanced stability in a variety of soils for effective maneuverability while carrying heavy loads • Spring-supported, 74-square-inch operator platform

• Traction enhanced by suspended wheels and fully flexible track, multiple wheel contact points and triple-guide lugs (as opposed to just one or two)

• 15 inches of ground clearance

• 75-hp Cummins 2.8-liter turbocharged diesel engine produces 221 foot-pounds of torque

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ADVERTISERS INDEX Avant Tecno USA.....................................31 Billy Goat Industries, Inc.........................23 Brave........................................................24 Dosko.......................................................30 Exmark Mfg. Co. Inc...................................7 Ford Motor Co..........................................19 Husqvarna Turf Care.................................9 Iron & Oak................................................22 JRCO........................................................30 Kohler Company......................................36 Kubota Tractor..........................................2 Progressive Insurance.............................25 Rotary Corp................................. 22, 24, 35 Stihl Inc......................................................5 Sunbelt Outdoor Products Inc................33 The Toro Company............................14, 15

Blades • Filters • Belts • Tires • Snow Parts • Equipment • Forestry and much more for all Your Outdoor Power Equipment Needs Circle 17 on card or visit greenindustrypros.com/10857096

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BUSINESS TIPS

Listen to the spirited podcast for much more on this important topic: greenindustrypros.com/12304551

Quit Making the Labor Crunch Worse!

You cannot afford to attract the wrong job applicants any longer.

Here’s what you can do to fix it.

T

here are two emerging trends you must get a handle on very quickly.

First, the economy is likely to pick up steam and begin to resemble the mid2000s. The good news there is that selling will not be a problem for most. The bad news has to do with completing the work, which leads to trend number two: an ever tightening labor market that’s creating a severe shortage of talent across many industries, not just landscaping.

Nobody is going to fix this problem for you. If your reputation is for poor pay, bad treatment and high turnover, whom do you think will show interest in joining your company?

On the other hand, what if you became t he “employer of choice” representing a profession that makes a difference and provides an opportunit y to grow? That requires an understanding of what good talent is in search of. By the way, today’s generation wants what we wanted and what our parents wanted: • An employer that makes a positive impact in the community and positions itself as a market leader

• An employer that solicits and values each employee’s contribution • An employer that inspires excellence throughout the organization, rewarding good people and refusing to tolerate slackers, or “turkeys”.

Research continues to show that most employees at most companies feel like they only need to give a 30-40% effort to secure their job. With many, that’s all they give. Researchers have also discovered that some employees say they give an 80-90% effort. Why? They work for a company that makes money—but also makes a positive impact. The company demands excellence and treats employees accordingly.

We recently used this approach in turning around a $6.5 million company that was losing money. It had many problems, half of which were peoplerelated. Its reputation as an employer stunk. There were no processes for attracting, hiring or on-boarding new people. Because of that, we had to tolerate poor performance.

Step one was dealing with the turkeys nobody wanted to work with. We

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34 GREEN INDUSTRY PROS

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❙

MARCH 2017

❙

redefined our standards. Then I gave the turkeys a chance to prove everybody wrong. About half did. The half that didn’t had their positions designated for replacement.

Next, I stopped using our traditional hiring sources and went direct on craigslist. Our ad copy reflected our new values and focused on more than starting salary. It didn’t take long before there was a line outside my door that didn’t resemble a police lineup.

How you can get started

ACTION #1 – Add to your company’s identity the good it does in the community. Then make it true by sponsoring something that makes a difference and receives publicity.

ACTION #2 – Raise your operating standards and hold everybody accountable, including family members. Raise the level of play so people feel pride of accomplishment. Remember, eagles want to kill and eat turkeys.

ACTION #3 – Improve quality and decrease costs by having people fix their processes. With training on how to identify the causes of problems, make fixing them part of their role. Push them to rise to your level of expectation.

Typically, an author closes an article with something pithy. Here’s something different. Stop treating people as if they are stupid no matter how hard they try to prove you right. Demand professionalism and a level of toughness required to be successful in life. Send those who can’t handle it to your competitors. This has been a formula for success—and given the upcoming job market, it may be your only choice. ❯

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Volume 36

Dealer Success Guide

HELLO 2017

The year dealers got their mojo back

New laws strengthen dealer protections A SUPPLEMENT TO

Association bringing real-time realism to flat rate pricing Consumer market getting larger, smarter and more quality-conscious

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Volume 36 - March 2017

Cc o n t e n t s

MESSAGE FROM THE EDITOR The Year of the Dealer – For Real If you attended the GIE+EXPO in Louisville this past October, you may have noticed banners and other signage highlighting the fact that it was “the year of the dealer”. An expanded educational curriculum, including classes Gregg Wartgow on utility vehicles, editor@greenindustrypros.com indeed made the 920-542-1248 2016 GIE+EXPO one for the record books.

As I walked the show myself, gawking at all of the “year of the dealer” signage, I had flashbacks to 2003 when I was just taking over as editor of Yard & Garden magazine (which has since been rolled up into Green Industry Pros). That was the first year the show switched from hot and steamy July to mild and crisp October. The expectation was that since the mowing season typically winds down for most in October, more dealers would find the time to come to the show. They did. We also launched our Dealers in Excellence Award at that show. We called 2003 the “year of the dealer” too, because of the increased commitment by manufacturers to make the show a valuable one for dealers to attend.

Enough strolling down memory lane, though. I am here to boldly proclaim that this year, 2017, is going to be the year of the dealer to end all years of the dealer. Here are five reasons why: 1. Several economic indicators point to increased demand for landscaping services and products 2. Many dealers and financial service providers point to a growing consumer market for high-quality products sold by service-oriented specialty retailers 3. Big advancements are being made with flat rates 4. More state governments are implementing more robust dealer protection laws 5. If you’re a good, honest dealer who provides reliable service, you can still thrive in today’s market – it just takes the right approach and the right partners.

We have articles touching on all five of those points in this issue. I hope you enjoy them. And if you’re doing something special this year, this historic Year of the Dealer, please let me know so we can help share your story with the industry.

4 IN THIS ISSUE

4 Laying Down the Law

Two new state laws in the Northeast are designed to level the playing field between manufacturers and dealers. But are they providing one with an unfair advantage?

That largely depends on whom you ask.

10 Realistic, Real-Time Flat Rate Pricing

United Equipment Dealers Association readies its new online, interactive flat rate pricing guide for commercialization after months of development.

12 A Dealer and

His Daughter

Dave Groen and daughter Kristy Vander Ziel are all it takes to keep the small engines hummin’ at their popular repair shop in rural southwestern Minnesota.

12

16 How To Capture a 360° View of Customers

Three ways OEMs and dealers can work together to gain a better understanding of their target market.

18 Growing Opportunity, Narrowing Window

Many consumers are gravitating toward higher-quality products and better service, but they’re shopping differently and making decisions much faster.

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Regulations

by Gregg Wartgow

Laying Down the Law

Two new state laws in the Northeast are designed to level the playing field between manufacturers and dealers.

But are they providing one with an unfair advantage?

That largely depends on whom you ask.

I

t was a grueling, contentious, better than three-year process.

After all of the dust had settled and legal arguments had been heard, New Hampshire’s “Auto Dealer Bill of Rights” hurdled its final roadblock back in October when the U.S. Supreme Court declined to hear a legal challenge to the law. As a result, New Hampshire automobile dealers are better protected from suppliers—and so are equipment dealers.

New Hampshire Senate Bill 126 amended an older version of the law, RSA 357-C. The new law changes the definition of “motor vehicle” to include farm and utility tractors, forestry equipment, industrial equipment, construction equipment, farm implements, farm machinery, yard and garden equipment, attachments, accessories and repair parts. Offhighway recreational vehicles and snowmobiles were already included.

“It’s very important to have laws that level the playing field between dealers and manufacturers,” says one New England dealer. “That is exactly what this law in the state of New Hampshire does for equipment dealers. Dealers worked hard as a team to make this law happen. It’s something to be proud of.”

The Northeast Equipment Dealers Association (NEDA) worked closely with the New Hampshire Automobile Dealers Association to lobby for the law’s passage.

“It was a long, arduous process,” says Tim Wentz, field director for 4

Dealers often sell competing lines of product, which is now a protected practice in New Hampshire and Vermont.

NEDA. “The hearings started in the first part of January (2013) and went clear through to May. Virtually every week we were in Concord, NH, on that second floor. To the dealers’ credit, they packed those committee rooms. That is what really made the difference. The legislators could see that people really cared.”

In New Hampshire, there already was separate legislation that governed equipment dealers. Wentz says lawmakers took that definition of “equipment dealers” and had it woven into the separate auto dealer law.

“When I’d first started with NEDA back in 1999, everybody was telling me that what had happened with the auto industry was going to happen to the power equipment industry,” says Wentz. He’s referring

to mass consolidation and a reduction in the total number of servicing dealers.

“When you look at the dealer agreements in auto and compare them to our industry, they include much of the same text,” Wentz continues. “Additionally, the manufacturer behaviors are the same.

The dealer behaviors are the same.

The end-consumers are also often the same. A landscaper is buying a truck and a mower or skid steer, etc.

A consumer is buying a car and a mower for his or her lawn.”

In other words, the automobile and equipment industries are very similar when it comes to the manufacturerdealer dynamic. Thus, collaboration between auto dealers and equipment dealers was natural—and each

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Regulations

deserve the same protections, the courts have concluded.

Many on the manufacturer side do not agree. They see big differences between the auto industry and the outdoor power equipment industry. For one, power equipment makers often sell through more than just dealers. Many sell through box stores, for instance, while some sell online. Many use a combination of two or all three.

“Generally speaking, we don’t support putting outdoor power equipment dealer protections in an auto dealer statute,” says Kris Kiser, president and CEO of the Outdoor Power Equipment Institute (OPEI), a manufacturer association.

Nonetheless, the State of New Hampshire thinks auto dealers and equipment dealers should be viewed similarly. There is one exception, though. Stihl won its appeal to be excluded from the law. Stihl’s “handheld” equipment, the courts found, doesn’t have wheels or a transmission. Thus, that equipment shouldn’t be considered a “motor vehicle”. A handful of other manufacturers— AGCO, CNH (i.e. Case, New Holland), Husqvarna, John Deere and Kubota—also appealed, but to no avail.

Why dealers like the New Hampshire law

The New Hampshire law does several important things from the dealer’s perspective. Cutting through the labyrinth of legal mumbo jumbo, here is a summary of the law’s most important elements.

Succession. The law makes it easier for dealers to facilitate familial business succession by including adopted, step and lineal descendents, in addition to spouses, children, grandchildren, siblings and parents.

Competition. The law generally prohibits a “manufacturer or distributor” (*supplier) from

competing with a dealer in that dealer’s contracted market area.

Some exceptions naturally occur.

Suppliers also cannot change the market area set forth in the dealer agreement without good cause. Good cause could include changes in the dealer’s registration pattern, demographics, customer convenience and geographic barriers. If a change is about to take place, though, the supplier must give the dealer at least 60 days’ notice—along with the information, data and methodology used to conclude that a change is necessary.

Measuring dealer performance.

Equipment sold outside of the dealer’s territory cannot be considered when measuring that dealer’s sales performance. All that should be measured is how a dealer performs within his or her specified market area. That performance can then be used to evaluate whether or not a dealer is performing up to expectation, and to administer any incentive programs. Additionally, performance standards must be applied uniformly across similarly situated dealers.

Vigorous communication with the dealer is also mandated. Once a year, dealers can request reports that include: ✔✔All written correspondence with the dealer over past 12 months ✔✔Reports created by the supplier memorializing any contact with the dealership or its employees ✔✔The supplier has 30 days to satisfy the dealer’s request ✔✔The supplier can charge a reasonable per-page fee ✔✔Documents discussing any possible insolvency, or criminal or fraudulent activity by the dealer can be excluded.

Other items dealers need to buy.

The law gives dealers some control over the various goods or services they must purchase in order to operate the business, such as signage,

tools and materials. In other words, the supplier cannot require a dealer to purchase from a specific vendor— unless the supplier substantially reimburses the dealer for those purchases. “Substantial” means at least 65% of the cost, which can’t be greater than the total cost of the goods from another vendor the dealer would rather buy from.

With respect to signage and branding materials specifically, the supplier does have the right to approve the work of an alternate vendor in order to preserve its intellectual property rights. In other words, hypothetically speaking, a dealer doesn’t have the right to hire an alternate vendor to create a sign that looks terrible and damages the supplier’s brand image.

Finally, dealers are granted some local decision-making ability to choose their floorplan sources.

Facility. Suppliers cannot require a dealer to enter into a site-control agreement or exclusive-use agreement. This gives dealers control over what they use their facilities for and which products they sell.

“When you’re carrying multiple lines of equipment, being forced to operate separate facilities and staffing for each line is just not economically viable—especially in New England,” one dealer says.

Additionally, suppliers generally can’t force dealers to change location, substantially update their facilities or add/replace signage.

If a supplier feels that a change is reasonable and necessary due to economic conditions or financial expectations, the supplier has the burden of proving it.

Furthermore, suppliers cannot require dealers to upgrade their facilities more frequently than every 15 years. After a 15-year period has elapsed, the supplier has the burden of proving that a facility upgrade is

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necessary. Exceptions could be when health, safety and technology requirements are called into question.

Another caveat is if the supplier offers “substantial” (at least 65%) reimbursement for the improvements, which can’t be greater than the total cost from a vendor the dealer would prefer to buy from.

Service and parts. Warranty repair is the big area of contention. Suppliers must now reimburse dealers at full retail for parts used in warranty repairs (this requirement is already present in several other states).

Also, suppliers must pay a given dealer’s posted shop labor rate.

Also as part of the new law, a supplier cannot require a dealer to sell an extended service contract or maintenance plan. And service-only dealers are given full protection under this law.

Inferior dealers get a lifeline?

It is important to note that “singleline dealers” are not protected under this law. A single-line dealer is defined as one that has purchased at least 75% of its inventory from a single supplier, and has total average annual sales volume in excess of $100 million in its defined market area. Suffice to say, there aren’t too many equipment dealers that fall into this category.

What does that mean? Well, a massive dealer largely tied to a single brand is likely to be in a pretty good position with that brand. The dealers who need more protection are those selling numerous brands of equipment, and those selling given brands of equipment where additional dealers are in close proximity.

Manufacturers are concerned that the New Hampshire law, through its heightened dealer protections, will entrench poor-performing dealers in the marketplace. Legal filings by 6

Since Stihl’s products do not have wheels, Stihl was granted an exemption from the New Hampshire “motor vehicle” law.

a lawyer representing the OPEI last May stated: “The law makes it virtually impossible for a yard and garden equipment manufacturer to terminate a poor-performing dealer or add a new dealer in the state of New Hampshire, unless that manufacturer first obtains state approval through a cumbersome, protracted, and unduly expensive process stacked against the manufacturers.”

Kiser added, “Ultimately, the New Hampshire law needlessly meddles in the manufacturer-dealer relationship, hinders the free marketplace, and hurts consumers (by limiting strong competition among dealers).”

Some think a little bit of meddling was sorely needed. One dealer says, “If you are a good dealer who wants to succeed, you understand it’s a two-way street. A good dealer will want to make the proper investments and commitments on behalf of the manufacturer so he is providing excellent service and taking care of the customer. For the dealers who are performing poorly and not putting the appropriate effort in, it might be a little bit tougher for a manufacturer to get rid of them, but they still can. But you know what, it was the manufacturer who set that dealer up in the first place. There are still plenty of ways for the manufacturer to ensure that the dealers who represent them are good dealers.”

“Dealers saw what was happening when they wanted to put up a new store, or perhaps sell the business to a family member or one of their employees,” Wentz adds. “Some manufacturers would say, ‘You can’t do that unless you get rid of one of these competing lines.

“Similarly, we also started to see more instances where some manufacturers would see competing lines of equipment at one of their dealers,” Wentz continues. “All of a sudden that dealer is having discounts taken away. NEDA’s position is about preserving the free marketplace and taking care of the consumer.

If the dealer isn’t able to provide the customer with the best equipment for that particular application, the dealer loses credibility pretty quickly. Competition ensures that the end-users get the most costeffective product for their money.”

In the interest of competition and fair market principles, wouldn’t it also make sense to allow more than one dealer of the same brand in the same market area?

On that note, it is interesting that this first domino to fall has fallen in New Hampshire, a state known for its libertarian tendencies. After all, the state motto is, “Live Free or Die.” Government interference in free market activity is generally frowned upon. That said, the

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Regulations

protection of personal liberty is of critical importance. Perhaps that is why a law protecting “the little guys’” ability to operate his or her business captured the state government’s attention.

Proliferation of dealer protection laws

Dealers around the country are probably wondering if something like this could happen in their state.

Those in Vermont already have an answer.

The State of Vermont passed a new law back in July, Senate Bill 224 (Act 142). Legislators say the new law is necessary to protect the state’s economy. There is a strong need for a reliable servicing dealer network to help support the vitally important farm and forestry industries of the state, not to mention the snowmobile and ATV industries.

Lawmakers also say the law is necessary to help protect consumers.

A more even playing field between suppliers and dealers will help dealers prosper, creating a stronger competitive environment that benefits the consumer through improved service and retail prices.

Unlike in neighboring New Hampshire, the Vermont law is not tied to the automotive industry. The law defines “equipment dealer” as anyone primarily dealing in the retail sales of farm, utility, forestry, yard and garden, or industrial equipment.

The “motor vehicle” loophole doesn’t appear to exist.

The law also dictates some requirements for when a supplier wants to terminate a dealer agreement: ✔✔Supplier must have just cause to terminate and also provide specific reference to at least one violation of the dealer agreement ✔✔Notice must be delivered in writing at least 120 days prior to date of termination 8

DEVELOPING: Connecticut Mulls Warranty Reimbursement Law Second-generation dealer Tony Gargano, manager of Gano’s Power Equipment in Colchester, CT, testified on January 31 to the Connecticut General Assembly as to why outdoor power equipment servicing dealers should be better reimbursed for the warranty work they do on behalf of the manufacturers they represent.

Gargano, who was joined by Tim Wentz of the Northeast Equipment Dealers Association (NEDA), was asked to testify as the Assembly took up proposed House Bill 5633, “An act concerning post-sale warranty work reimbursements for power equipment dealers.”

HB 5633 requests that the general statues be amended to require suppliers of power equipment containing wheels and transmissions, including, but not limited to, lawnmowers, to reimburse retail dealers of such equipment the full retail cost for parts and such dealer’s posted shop labor rate for post-sale warranty. Text of the proposed bill also states that these stipulations are already granted to automobile dealers.

✔✔Dealer has 60 days to meet the requirements cited in the notice ✔✔If it’s a sales performance issue, the supplier must work in good faith with the dealer for two years Check greenindustrypros.com/12300587 for updates. in an effort to improve performance. ✔✔Can’t prohibit dealers from selling The Vermont law also stipulates a competing line of product some buy-back terms for when ✔✔Can’t require a dealer to operate a a dealer agreement is severed. separate facility and/or staff for For instance, the supplier must other brands repurchase inventory, along with ✔✔Can’t change a dealer’s territory any supporting materials such as without good cause. manuals or signage, within 90 days.

It’s a two-way street Dealers are to be paid “net cost” for wholegoods inventory—dealer Manufacturers tend to think that cost minus incentives plus freight what has happened in New Hampand assembly—on everything shire and Vermont will spread to purchased over the past 30 months, other states throughout 2017. “I less a reasonable allowance for think we’ll see a lot of action this weather-caused deterioration. With year,” Kiser says. “We look forward respect to parts, dealers are to be to working with our dealers on these paid 100% of net cost for all new issues going forward. We have good and undamaged parts, and 95% for relationships with our dealers in the superseded and/or noncurrent parts. outdoor power industry. We meet With respect to warranty repair, with dealers regularly. It’s a symbidealers are to be paid their posted otic relationship. We look forward to shop labor rates. Warranty-related continued dialogue—and a consenparts are to be reimbursed at dealer sus strategy going forward.” cost plus 20%, plus any shipping At the end of the day, the supplierfees. Suppliers must pay all apdealer relationship should be—and proved warranty claims within 30 often is—a real partnership. When days. If a claim is denied but not in a strong equipment brand works in writing within 30 days, it is to be close, honest collaboration with a assumed that the claim has been apstrong dealer brand, both the manuproved, and thus, should be paid. facturer and dealer benefit. And The Vermont law also identifies you know what? So does the end some prohibited acts on the part of customer. ■ a supplier, including: *For the sake of brevity, we’ve ✔✔Can’t force dealers to accept referred to “manufacturers or inventory they haven’t ordered distributors” simply as suppliers.

GREEN INDUSTRY PROS DEALER SUCCESS GUIDE ■ VOLUME 36

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Working forward to payment solutions that don’t cut corners.

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Service Department

by Gregg Wartgow

Realistic, Real-Time Flat Rate Pricing

United Equipment Dealers Association readies its new online, interactive flat rate pricing guide for commercialization after months of development.

T

he United Equipment Dealers Association (UEDA) announced the development of its new interactive OPE Flat Rate Guide at GIE+EXPO back in October. Since then UEDA has been working with dealers to test the software and ready it for an official launch sometime this spring if all goes according to plan.

The online OPE Flat Rate Guide is designed to provide dealers with a secure web portal to find and report OPE flat rate repair times with more current and accurate information than what is typically provided by OEMs. With this information, dealers can increase their productivity and profits while improving customer relations.

“This is the only industry resource that factors actual dealer times into a flat rate calculation used to determine job pricing,” says Kim Rominger, executive vice president and CEO of UEDA. “This project is not just important to members of UEDA, but to all dealers selling and servicing the machines found in the OPE Flat Rate Guide.”

Dealer Dale Magie agrees. He’s the president of Moe’s Outdoor Equipment & Supplies with two stores in Liberty Township and Springboro, OH. Magie has also been serving as president of UEDA’s board of directors. He played an instrumental role in helping to advance this concept 10

of an interactive flat rate guide.

“Flat rates in general are increasingly important to a servicing dealer,” Magie says. “OEMs like to reimburse dealers per hour at their shop labor rate, but consumers want to know that ‘a new belt put on this mower will cost me this much.’”

Magie says his service department has been utilizing UEDA’s original flat rate guide—originally available in printed form or CD-ROM—for many years. Staff used that guide as a framework to develop its own dealership-specific flat rates. The concept of the guide now being online and interactive is intriguing to Magie.

“Our dealership can continue to provide its own input on what the flat rate times should be, but other dealers can too,” Magie points out.

“This is great because we can compare ourselves to other dealers. Plus, since other dealers are helping to provide the data, we don’t have to do all of the work ourselves to keep our flat rate pricing current. Finally, when more dealers are providing the times, it is much more credible information to present to the customer or manufacturer.”

Another dealer who played an instrumental role is Scott Muehlhauser of Scott’s Power Equipment with three Missouri locations and a fourth in Illinois. Muehlhauser is an example of a dealer who is not within

UEDA’s four-state territory of Ohio, Michigan, Indiana and Kentucky— but still wants to utilize the flat rate guide in his business.

“We’ve also been using that old printed flat rate guide for many years,” Muehlhauser says. “I really like this idea of it going digital. Rates can be updated more quickly and easily. Plus, 80-90% of what dealers are doing today is happening online, so it just makes a lot of sense.”

Another benefit is that the service departments across Muehlhauser’s four stores each have easy access to the exact same information. The information is up to date, which allows for consistency and increased efficiency across stores.

Dealers giving it a test drive

Dealer interest during the initial unveiling at GIE+EXPO was tremendous, Rominger points out. UEDA quickly began signing up dealers to participate in the pilot testing. “By the end of 2016, we had all of our existing flat rate data uploaded into the new system,” Rominger says.

“Then we started getting dealers going with testing it in early February.

Training is very important with something as new as this. UEDA laid out a plan to remotely train 10 dealers at a time on how to use the system. Once the first group was trained,

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Service Department

Screen shot of the OPE Flat Rate Guide

it was turned loose. UEDA then took the dealers’ feedback and reports of any technical bugs to improve the software. Then a second group of 10 dealers was trained and deployed.

The goal was that, by the third wave of dealers, things would be running smoothly and more dealers could be deployed at a given time. It’s expected that a total of nearly 100 dealers will help test the system.

“We want to make sure we have this thing right before we put it out in the marketplace,” Rominger says.

“We don’t want anything to surprise us. That’s why we wanted to take our time with the testing and rollout. The goal is to have everything fine-tuned and ready for launch by the spring selling season.”

Dealers set the times The interactive OPE Flat Rate Guide is the latest iteration of the original flat rate guide developed in the late 1990s. A guy named Bill Bohmer had actually helped UEDA (OMEDA at the time) to develop its first Ag & OPE Flat Rate Guide in printed form in 1998, later being made available on CD-ROM. The Ag & OPE Flat Rate Guide was in the process of undergoing its third update a few years ago when Rominger and his staff determined it

was time to take it online and make it more interactive. “The discussion with our partner on this, Charter Software, actually happened over a dinner meeting,” Rominger shares.

“That’s all it took and we were moving forward.” Dealers Dale Magie and Scott Muehlhauser were also part of that dinner meeting.

The basis for the flat rate times comes from that original Ag & OPE Flat Rate Guide, which is entirely based on actual data provided by dealers, as opposed to OEM recommendations. Realistic flat rate times factor in conditions resulting from wear and tear like mud, grass, rusty bolts and other issues faced by dealers every day. The difference now is that, because the OPE Flat Rate Guide is online and interactive, dealers can upload their own time information into the system, and also add new product models as manufacturers introduce them.

“There are always new product models coming out,” Rominger says.

“We can get those model names and specs from the manufacturers, but we can’t get the repair times. That’s the nice thing about the interactive nature of this system. Dealers can help us compile new data in a very timely fashion.” When a dealer uploads a new product model and its

repair times, UEDA staff will review that upload, verify product details with the manufacturer, and add it to the system.

Charter Software has been the technological driving force behind the development of this OPE Flat Rate Guide. So naturally, the Guide works seamlessly with Charter’s Aspen business management system.

It’s important to note, though, that Charter Software has put the OPE Flat Rate Guide on a universal platform so it can also work seamlessly with other business management systems.

“This project is very exciting because it is a technology tool that is managed by a dealer association for dealers,” says Anne Salemo, president and CEO of Charter Software. “Our goal is to get as many dealers as possible to subscribe to the OPE Flat Rate Guide. As a result, our API, available through UEDA, allows any business system to integrate with the OPE Flat Rate Guide without any charge from UEDA or Charter Software.”

“We have had a couple of additional BMS providers express strong interest,” Rominger adds. “There are obviously others and we’ll be working on that too. We’re giving this information to a BMS provider free of charge because we want it out in the marketplace for dealers to use.”

On that note, Rominger says it is very likely that dealers outside of UEDA’s territory of Indiana, Kentucky, Michigan and Ohio will be utilizing the OPE Flat Rate Guide. “We have had agreements with most of the regional dealer associations with our old flat rate guide from the late 90s, and that is going to continue,” Rominger points out. “The national Equipment Dealers Association (EDA) would also like to be a part of it because EDA has an outdoor power equipment council within its broader membership.” ■

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Spotlight Dealer

by Gregg Wartgow

A Dealer and His Daughter Dave Groen and daughter Kristy Vander Ziel are all it takes to keep the small engines hummin’ at their popular repair shop in rural southwestern Minnesota.

Dave Groen and daughter Kristy Vander Ziel

“E

verybody thinks that owning your own business is ‘living the dream,’” says Minnesota dealer Dave Groen. “Well I’ll tell you what, it’s a lot of work. But if you don’t do it, you don’t get anywhere.”

Groen has been doing it full-time on his own for 12 years now. “I’ve been working on lawn and garden equipment for what seems like forever,” Groen says with a hint of both pride and pain in his voice. He took his first job as a small engine technician at a dealership in 1985.

In 2001 he was working full-time for another dealership when he bought a building and started a repair shop of his own on a parttime basis. He did that for the next several years.

“Finally I realized I needed one job, because I couldn’t keep doing 24/7 for much longer,” Groen says.

In 2005 he quit the dealership and made Groen Small Engine Repair his 12

full-time endeavor. He solely focused on repairs that first year. Then he connected with a big distributor in Minnesota, Central Power Distributors (CPD). That relationship led to Groen earning his Kohler certification (he’d been Briggs-certified for many years), and also getting into the wholegoods business with the Troy-Bilt line.

Today Groen Small Engine Repair also sells Columbia mowers (another MTD brand), Briggs & Stratton pressure washers and generators, and Ohio Steel and Agri-Fab accessories and attachments. In addition to Briggs & Stratton and Kohler engines, Groen is also certified in LCT engines and Hydro-Gear drive systems.

Even though he is down to one job, Groen’s typical daily schedule is still quite grueling. “I am in the shop between 5 and 6 a.m.,” Groen says.

“I make some deliveries if scheduled, usually by 7 or so. I then work at the

shop until 5 p.m. Then I head home and have supper and work on bigger repairs, like repowers, in my home shop. I also make deliveries at night if need be. Sometimes I’m still on the road at 10 p.m.”

Thankfully Groen has a very understanding and supportive wife, along with an understanding and tremendously reliable daughter.

“When my dad started here fulltime in 2005, he’d asked me if I wanted to help here and there,” says daughter Kristy Vander Ziel. “So it started out as a part-time thing, but by the next year I was full-time.”

Kristy has backed off her hours over the past year, but still plays a very important role in helping her dad keep his head above water. “I do all of the bookwork, run errands, pick up parts and stock parts, and help with customers,” Kristy points out.

She used to help out with repairs, too, working alongside her dad.

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Spotlight Dealer

Lawnmower Fun Ride

That’s not the case anymore since she’s not working as many hours.

Nitwits, nitpickers and customer loyalty

Given the dealership’s sales level, sales mix and overhead structure, Groen definitely could afford to hire another employee. “I just don’t know,” he says. “It’s so hard to find good people that will do things the way I want them to be done, especially in the shop. Kristy says I’m too picky, but that’s just the way I am.”

What some may interpret as being a bit picky could also be interpreted as being precise. To small-town dealers like Groen, you have to be precise—darn near perfect—because your reputation can become stained in a blink.

Most of Groen’s customers live on farms or simply have acreage. He also gets quite a bit of business from municipalities in the way of parts and repairs. “I don’t sell too much equipment to them, though, because I don’t carry any big commercial-grade machinery,” Groen points out.

Revenue is split pretty evenly between equipment and parts/service.

“For a town of 60 people, that’s pretty good,” Groen jokes. Truth be told, he’s pulling customers from all over the area—sometimes as far as 100 miles away. That said, a good chunk of his customer base is in the 30- to 35-mile range.

So that explains it: Groen Small

Engine Repair is the only place to go for miles and miles. No wonder they’ve been able to do things “their way” and still be successful after all these years. Nope. Groen has plenty of competition. In fact, three dealerships are in a single town about 15 miles away. The fact is, the fatherdaughter tandem has been successful because they indeed do things “their way”, and “their way” is based on total customer satisfaction.

“We have good service; that’s why they come to us,” Groen says. “I’ve always looked at it this way: When I fix a piece of equipment, it’s like I’m fixing it for my mother so she can get it started and use it with no problems. You can’t disappoint a single person in a town this small; word travels too fast. We are fair to everybody, and we don’t believe in the concept of selling used equipment as-is. If you bought it from us, you have the right to expect it to work.”

When it comes to new equipment sales, Groen offers to do that first five-hour oil change for free. “We tell them to bring the machine back to us or I’ll even go pick it up,” he tells. “I also spend a lot of time talking about bad gasoline, i.e. ethanol-blended gas, especially when it has been sitting around for a long time. My new favorite saying is, ‘Bad gas, spend some cash.’ And that’s the truth. More than half of our repairs are gasoline-related. The customer is going to spend money at some point. They might as well

spend it up front on a good fuel stabilizer because it can help prevent some headaches and more costly repairs later on.”

Groen sends a packet of Briggs & Stratton fuel stabilizer with each new equipment sale, enough for 2.5 gallons of gas. “We tell the customer how important it is to use it and then come back to get more down the road,” Groen adds.

Some of Groen’s customers are farmers with 3,000-gallon fuel tanks on site. He advises them to run to town and get 5 gallons of fresh gas for their mower, but they don’t always listen. After all, they already paid for all of this fuel that is just sitting there. As a dealer, Groen says you can try to advise the customer on what they should do, but must also be prepared to help them when they do otherwise. A good fuel stabilizer like Briggs & Stratton offers can help. So can having a robust parts inventory.

A noggin full of part numbers

“My biggest pet peeve is having to wait for parts after I get something torn apart,” Groen relates. Plus, since it’s just him and his daughter, he doesn’t want to spend a minute longer than absolutely necessary placing parts orders. He’d rather keep an ample supply of what he’s confident he’ll eventually need in stock at all times.

“I think I have every belt that MTD

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Spotlight Dealer

makes,” Groen exclaims. “I keep 25 spindles in inventory at one time, along with lots and lots of blades.”

Generally speaking, Groen orders parts from his main distributor, CPD, once a week. They offer a program where dealers get free freight one day a week if they get their orders in by noon. Groen has picked Tuesday as his free freight day. He does a visual check of his inventory first thing in the morning to determine what he needs to replenish. His shop isn’t computerized. “It’s all in my head, and that’s OK because there’s nobody else here who needs to know,” Groen reminds.

Kenneth, MN, is a big farming community. Hence, there is plenty of John Deere equipment in the market. Groen repairs a lot of it.

He’ll typically get parts from the big dealer in the area. The same goes for Stihl. Finally, he relies on two aftermarket brands—Stens and Oregon—to help supplement his parts inventory and ensure he has what he needs, when he needs it.

He has less of a need for twocycle engine parts than in the past.

“When I was still taking in two-cycle repairs, I used to have 20 pieces lined up at one time,” Groen says.

“It just wasn’t worth the hassle of running around for parts for all of the different brands people were bringing me. So I’ve stopped doing it.” Now Groen only services what he sells, which is a limited amount of Troy-Bilt trimmers and blowers.

Groen also sells Troy-Bilt mowers— but not in a limited amount. Mowers are a big part of his sales operation.

“We’re selling more and more zeroturns,” he says. “We used to sell a lot more lawn tractors and rear-engine riders. But now we’re selling about 10 zero-turns to every tractor or rider.

And the zero-turns are getting bigger.

So we’ve had to get bigger trailers in order to keep up with how the market 14

Groen Small Engine Repair shopfront

is changing.” Groen says he also sells 10-15 push mowers a year.

But speaking of zero-turns, a growing market is females who have taken on the chore of mowing their lawn. Groen says most are initially intimidated by the zero-turn. He directs them to the tennis court.

Huh? That’s right, the tennis court.

Groen has one on his expansive property surrounding his dealership.

“I let them drive the mower around on the tennis court where it is nice and level,” he explains. “I tell them we won’t run the engine wide open or engage the blades; they can just get a feel for the controls. Most end up feeling comfortable after a short time and want to buy one—and a year later you couldn’t take that mower away from them.”

It has been a fun ride As is the case with most small-town repair shops, Groen Small Engine Repair relies on word of mouth.

Still, Groen has regularly run ads in a local farming publication which reaches a lot of people. “I’ve heard that dealers should spend about 2% of their inventory on advertising,” Groen says. “Well, we spend more than that.” It’s necessary in a market as desolate as this because expansive reach is so important.

At the end of the day, though, it’s Groen’s reputation that pulls customers in—and keeps them coming back. Great, reliable service is key.

So is community involvement.

Groen and his daughter have been

helping to spearhead a unique fundraising event for the past six years called the Lawnmower Fun Ride. It is held in conjunction with the City of Kenneth’s annual celebration each August. Groen encourages customers to bring their riding mowers and four-wheelers to join in the 5-mile ride and make a modest donation.

Roughly 90% of the money raised goes to the City of Kenneth for snow removal. The rest helps pay for food and entertainment. “We typically have 60 to 80 people riding in the event—and they come from all over the area,” Groen says.

They must come from all over the area, because the turnout for the Lawnmower Fun Ride nearly exceeds the entire population of Kenneth.

That’s part of living and operating a business in a rural area. Your neighbor, and oftentimes customer, might be 20 or 30 miles away.

Perhaps that is why Groen and daughter Kristy go to such lengths to stand behind what they do and always do right by the customer— even when it requires 16-hour days.

“It took a while, but now we seem to have a good system and rhythm to how we do things,” Kristy says. Still, it’s easy to get frazzled when things get really backed up. “But all you can do is focus on one machine at a time. We’re pretty proud of the fact that, unless it’s a major rebuild or something, we usually get machines back to customers within a week.

They are happy with that so we don’t often run into any issues.” ■

GREEN INDUSTRY PROS DEALER SUCCESS GUIDE ■ VOLUME 36

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Marketing Tips

How To Capture a 360° View of Customers 3 ways OEMs and dealers can work together to gain a better understanding of their target market.

O

riginal Equipment Manufacturers (OEMs) that rely on independent dealers as their sole point of trade are often challenged to have a true understanding of the ultimate end-user universe. This is mostly caused by a lack of data collection at the point of sale at the dealer, who then would provide access for the manufacturer. Absent of this, manufacturers are flying blind on having a deeper understanding of who and where their top customer and prospect segments are.

This data gap can have wide and varied implications to improving efficiency and effectiveness across sales, marketing, product and finance teams. Contemporary OEMs strive to have a much broader view of their entire ecosystem, which is to say from manufacturing plant, to distributor, to territory managers, to dealers, to the local marketplace.

The business benefits of getting this full spectrum include: ✔✔Reducing market waste and redirecting media dollars wisely across national, regional and local buys ✔✔Improve customer loyalty and profit by understanding purchase trends ✔✔Decrease inventory lag time and increase product replenishment with smarter inventory management by dealer and customer need ✔✔Predict greater growth opportunities by customer segments (i.e. high-value customers vs. lowvalue customers) 16

✔✔Accelerate product sales with the right product portfolio for each local dealer ✔✔Make poor-performing dealers act like high-performing dealers.

Here are few suggestions to help you on your journey.

Idea 1 – Properly analyze registration data OEMs can incent their distributors and dealers to collect product registration and warranty data. Additionally, while most OEMs do have product registration data, few take advantage of turning it into actionable insight.

To properly know exactly what your

customer base is compared to the marketplace opportunity, a manufacturer must hygiene and normalize product-centric counts into customer counts. For example, if one person registers four different products, this single customer is often counted as four unique customers. When that happens, you are overstating your market penetration but understating the lifetime value of your current customer base.

When these counts are analyzed correctly, dealers can be convinced that a given OEM’s brand drives foot traffic to their stores, resulting in repeat business.

Additionally, equipment manufacturers that also build engines— such as Briggs & Stratton, Honda,

Bundled customer segments should go beyond the obvious “buyer by profession or type” (e.g. farmers, landscapers, homeowners). Customers within each type could represent very different segments with unique brand loyalties and purchasing habits.

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Marketing Tips

Kawasaki and Kubota—can leverage their OEM partners’ data to help understand what products are best to build based on customer types in a particular region.

Idea 2 – Create customer segments

After hygiening the data, a manufacturer’s next natural step is to bundle like-minded end-users into segments.

These segments should go beyond the typical “buyer by profession or type” (e.g. farmers, landscapers, homeowners). By adding more context to the analysis, the OEM can know and understand a customer’s value to itself and its dealers.

While those commonly used buyer types often make customers look the same on the surface, customers within each type could represent very different segments. For example, while it may seem like all landscapers are landscapers, small or large, what you may discover is that one group may have the proclivity to buy certain types of product from certain dealers at different times of year. You may also find that emerging landscapers may be brand loyal to your competition for certain product lines and accessories, or that companies or even homeowners with certain key attributes such as equity levels are ideal targets.

Idea 3 – Action to realize the growth opportunity With precision comes increased profits. Having the customer purchase data, or even the ship-to-dealer data, will make it easier for an OEM to predict the next end-user purchase. Some organizations call this propensity modeling.

It is a complex process for an OEM to get answers to these fundamental outdoor power equipment sales and

marketing questions, such as: ✔✔What should be my best product portfolio mix by territory, dealer and customer target? ✔✔Can I upsell more products or aftermarket parts/service at the right time? ✔✔When should I be communicating my next marketing message in order to become more relevant in the buyer’s journey? ✔✔Can I increase my product replenishment? ✔✔Do I have nuances in seasonal booking seasons?

At Black Ink Technologies, we help manufacturers gain more visibility into the entire supply chain—from manufacturing plant, to distributor, to territory managers, to dealers, to the local marketplace. Even if you have decent tools internally such as business intelligence, CRM systems or statistical modeling, we at Black Ink take it to the next level because our models and data are specific to the manufacturing and power equipment marketplace.

This helps improve customer acquisition and customer relationship management— and that helps both the OEM, their distributors and the dealer. ■

ABOUT THE AUTHOR Jeff Winsper offers more than 20 years of leadership experience in sales and marketing. He is the president and founder of Black Ink Technologies. Black Ink is an advanced, analytics SaaS platform made especially for the power equipment industry, independent dealers and their OEM/distributor supply chain. Stihl USA is a customer of Black Ink and an example of a 10-year relationship in which Black Ink helps them sell more product through the existing dealer network, identify new dealers to cultivate and develop, improve co-op marketing, and enrich dealers’ local ability to service their customer base. Email Jeff at jwinsper@blackinkroi.com and connect with him on LinkedIn.

To inquire, visit greenindustrypros.com/10155781

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Market Insights

Growing Opportunity, Narrowing Window

Many consumers are gravitating toward higher-quality products and better service, but they are shopping differently and making decisions much faster.

R

esearch from Synchrony Financial illuminates the importance of outdoor power equipment dealers having a strong online presence. Consumers are spending less time shopping, largely because of the vast amount of research they’re conducting online—especially when it comes to lawn and garden products.

Last summer Synchrony Financial conducted its fifth annual third-party Major Purchase Consumer Study. More than 2,700 consumers were surveyed about their shopping preferences for items costing at least $500 from 13 different product categories—including lawn and garden.

The survey results show that consumers spent an average of 80 days shopping/researching in 2014.

That dropped to 68 days in 2015 and even further to 63 days in 2016. Lawn and garden shoppers, specifically, spend even less time researching purchases with an average of 36 days.

“As major purchase shoppers become more decisive, influenced by the amount of information they find online, it is important for retailers to have a strong online presence,” says Ronda Slaven, vice president 18

of research and insights, Synchrony Financial. “Making it easy for shoppers to find the information they are looking for during their search can help ensure that a retailer is part of the major purchase shopper’s consideration set and stays top-of-mind throughout their journey.”

Survey results show that 68% of lawn and garden shoppers report visiting a retailer’s website when conducting research. At the same time, only a little more than half (54%) visited a manufacturer’s website or used a search engine, and just 38% visited a review site.

Mobile matters, as does financing

Having a website today is not enough. The website must also be mobile-friendly. Roughly 82% of lawn and garden shoppers started their research online. Furthermore, nearly two-thirds conducted in-store research and more than one-third used a mobile device at some point during their journey.

Synchrony Financial offers some tips for dealers hoping to leverage the consumer’s mobile experience: ✔✔Make payment and financing info easy to find ✔✔Make it easy to apply for credit

✔✔Consider creating a retail app where shoppers can pre-load credit card info like a digital wallet ✔✔Enable your POS or terminal to accept mobile wallets.

Promotional financing plays an important role in the shopping experience. While 77% of lawn and garden respondents made their major purchase in-store, 23% made it online. Then, 63% said they “always” seek promotional financing while 78% said they feel that special promotional financing makes larger purchases more affordable.

Additional Synchrony research done in 2016 shows that retailers who integrate credit messaging on their home page, product pages, shopping cart and checkout pages see a higher rate of customer engagement.

Retailers can also designate a credit landing page where the card benefits such as promotional financing can be clearly explained with links to apply online.

Promotional financing can help retailers drive website traffic when mentioned in search results, build incremental ticket size (cardholders spent about 30% more than non-cardholders), and close the sale (47% of Synchrony Bank cardholders said they would not have made the purchase or would have gone to another retailer if financing wasn’t available). ■

GREEN INDUSTRY PROS DEALER SUCCESS GUIDE ■ VOLUME 36

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