There’s no denying it. Prices are going up, and it’s hard to find laborers to mow commercial property lawns. There are supply chain woes, and fuel costs are also rising.
How will you deal with running your commercial lawn maintenance company with 2022 business challenges?
What is Inflation?
Investopedia.com defines inflation as the supply and demand of money. Each dollar produced causes the dollar’s value to go down, which leads to higher prices.
Here are five inflation signals:
- Prices rise
- There’s more supply of money than demand for it
- Sometimes inflation is good for business because there’s a higher consumer demand and use that drives economic growth
- Some experts believe that inflation is necessary to control deflation of the dollar, and others think that inflation drags down the economy.
- Some inflation prevents delayed consumption when consumers tighten up their spending.
What does that mean for commercial lawn maintenance companies? Good and bad news.
The good news: The housing market is still hot. You may have more HOA and retail property contracts this spring.
The bad news is that you still need to deal with supply issues, a lack of labor, and the rising cost of mower equipment and fuel. But there are ways to cut down and still profit in 2022.
What to Do When You Have the Work, But Not the Laborers?
All is not lost if you don’t have a whole stable of laborers to handle all of the work that you procure in the New Year. However, you may need to make some switches to care for your commercial clients’ lawns.
For example, 2022 may be the year that you start using robotic mowers, which cuts down on the need for laborers. Fortunately, technology is moving fast enough that robotic mowers can now cut grass on commercial grounds.
You may also need to change your perspective on hiring. Some business experts say you need a dedicated web page for careers beyond job listings. You need to market your commercial lawn maintenance company to prospective hires like you do to bring in customers.
You need to sell your company’s culture and list the benefits of working for you. Right now, it’s an employee market, and if you don’t draw in employees using marketing techniques, your competition down the road from you will do it.
It would help if you also recruited differently. For example, it may be time for you to connect with high school guidance counselors to introduce commercial lawn care jobs to students.
You have an advantage when hiring high schoolers and recent high school grads. Since you’re probably paying new hires at $15 per hour, you’ll attract them because that’s a lot of money for a young adult to make right off the bat.
You also have the opportunity to start an apprenticeship program to teach these young folks how to do professional mowing, edging, and cutting. Hopefully, they will stay with your company for the long haul.
Of course, you may need to raise your mowing package prices to meet the demand of paying higher wages. Since property managers may be dealing with the same issue, it won’t be a sticker shock to those in retail spaces.
How to Handle Rising Fuel Costs
If you grew up in the 1970s and early 1980s, you might remember having to wait in line to buy gas. While we don’t have fuel shortages right now, we’re seeing rising fuel prices.
According to GasBuddy, the national average is supposed to reach $4 per gallon this spring because of the Covid-19 pandemic recovery and the demand for gas while waiting for an increase in supply.
How can you save on fuel costs? There are a few ways to save at the pump:
- Invest in software that helps makes your routes denser
- Raise the cost of your lawn care services to cover the rising cost of fuel
- Keep your fingers crossed that economic folks are correct, and the oil price will peak in early summer and start to go back down in price.
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LandscapeManagement.net, State of the Industry Report: Won’t Back Down in 2022.
LawnandLandscape.com, Results with Worries: State of the Industry Report – 2021 State of the Industry Report.