I hate to be the one to bring this issue to the table, but reality has to, at some point in time, overtake optimism as the driving force in how we run our businesses. Most of you know me as a very optimistic person, especially when it comes to this industry. I’ve never believed that an independent irrigation contractor could survive over the long haul without two factors. One is creating alliances, the other is diversification. Working in the second consecutive wet year, following a drought year, more and more guys are asking me how to protect against long downturns in their irrigation business.
Alliances with builders, landscapers, landscape architects and just about any tradesman that can call you in on their projects as the “irrigation guy” are a necessity in this business. I’m not suggesting that they automatically give you the work, but “last look” on any project is about as good as it gets. Last look doesn’t guarantee you a job, or a job at the right price. It raises your closing percentages and lets you increase your odds. It’s like card counters. They can’t predict the exact next card the dealer has, they just know how many cards and of what suit have already gone by, thus increasing their odds of success when guessing the hole card.
… alliances can be worth anywhere from 10 percent to 50 percent of a contractor’s business for the year.
Depending on who you talk to, alliances can be worth anywhere from 10 percent to 50 percent of a contractor’s business for the year. If you’re saying to yourself that there’s no way that alliances could account for 50 percent of your year, then I believe you haven’t explored or worked the concept of alliances yet. Let me suggest how getting started with building alliances can help you when the bread-and-butter calls stop.
The first step toward creating an alliance is to target someone who you think can be a strong source of work. Set up a meeting, letting the contact know that you would like the opportunity to bid some upcoming work, as a way of showing how well you can perform for the company. If given a chance to bid, bid aggressively, let them know that you are serious about working with them.
If you get the job, you must step up your normal work habits and create a new mindset for the project, a level of customer service you have never reached before. Every aspect of the job must run smoothly and be coordinated perfectly on your part. Do anything requested of you, do it quickly and professionally, dropping other work if necessary. If you’re not going to go completely out of your way for the new contact, or believe “that’s not the way I do things,” then alliances may not be for you.
Remember, the good news is that they are always there, even in slow times, but you’ll need to be sharp and committed to the partnership. They need to know that you will always be there, that their customers will get superior service and that you are more responsive than anyone else, or there is no reason for them to be in an alliance with you!
The other way to weatherproof your business is to diversify into other segments of the green industry or into a totally unrelated field. There are two keys to success, no matter how small a step you take in getting away from the core of your current irrigation business. First, you need to find an idea, test market it, talk to others in that field, learn what’s involved and then feel the waters. Take a committed step only after you feel this is a solid, feasible direction for you. Even the easiest step, say moving from residential to some light commercial work, can be a huge jump. Anyone who has made that jump will gladly tell you the commercial, public prevailing wage work is a new level in paperwork, supervision, job conditions, other trade coordination etc., etc. – not to mention collecting a check!
You need to be sure and committed that this is a viable business. Without that commitment, you will not succeed. Some contractors are committed to builders, guys that started small and are now building multi-home developments. Some have great relationships with landscape architects and do many high-end projects each year.
The second key to successfully diversifying is to devote the time and personnel to the effort that will keep the business strong and attended to even in the busiest time of your irrigation business. Many irrigation contractors have tried low-voltage lighting. The successful ones are the guys that have literally set up a different company. They treated lighting as a separate business, marketed it on its own, with its own merits and never put it to the back burner when it came to handling leads and follow-up service.
Often this means taking on a “limited partner,” someone who can look over the new venture as if it were his own, like a trusted foreman who can devote his time and training to the many details in a new start-up venture. Do you really want to be doing demos and adjustments after dark on a lighting job? Delegate a key person to help get a new venture going.
Here are some of the things I have seen irrigation contractors try, with varied successes, as a way of diversifying their businesses
- Low-voltage lighting
- Light construction, patios and decks
- Gutter cleaning • Power washing
- Major construction, pools, tennis courts
- Hidden dog fencing
- General yard clean-up and maintenance
These are a few of the ways some contractors try to balance out the weather and economic cycles that affect our business. Deciding what opportunity could add income and worth to your business is not an easy proposition, one that certainly needs tremendous thought and consideration before committing the resources necessary to begin a new venture.
To be honest, most contractors who try to diversify often are not successful. The avoidable mistakes they make are poor planning and lack of focus. Dedicate yourself to a business that supports your irrigation efforts, helps create synergy between businesses and encourages more people to seek your services, and your chance of success will increase significantly.
written by Tom Armbruster, Hunter Irrigation