Lean Landscaping
- 1. Times are tough.Get efficient.Lean Landscapingwww.landscapemanagementnetwork.com
- 2. IntroductionProductivity vs. Price compete on betterWhat is Waste?What is the Cost of Waste?How do I get lean?
- 3. How Can you Compete?Charge less (reduce profit)Improve productivity (reduce costs, improve efficiency)
- 4. Advantages to Reducing Price?Law of supply + demand At lower a lower price, you should sell more work
- 5. Advantages to Improving Productivity?Lower costs = lower prices, without lowering profit
- 6. Better stability in a downturn
- 8. More opportunity for growth
- 9. Less work for more money (owner)
- 10. Better able to keep and retain the best people
- 11. Simplicity - Less problems, stress, hours
- 12. Problems surface to the top, where they can be solved
- 13. Better culture
- 14. Better training + development
- 17. Happier boss!=$1 million in sales20% profit$200,000 net profit$5 million in sales4% profit$200,000 net profit
- 18. A Penny Saved is a DOLLAR EarnedIBM found the cost of fixing a mistake is 100x greater than the cost of doing it right.Would you agree this is true for landscaping?
- 19. A Typical Problem.We had a problem on a jobsite where the crews didnt fine grade the topsoil before laying down new sodWe installed a tractor trailer load of sod, only to rip it up again 3 weeks later when the client discovered the problem
- 20. A Typical Problem.To illustrate the costs of the problem to the crew, we had everyone write down what they thought the mistake cost.. The average guess was about $2000
- 21. The Actual Costs of the Mistake
- 22. The Actual Costs (contd)The costs of the re-doing the work were just over $5,000Worse yet, the crew should have been working on new, billable work we lost a full day of billable opportunity, also worth $5000.
- 23. A Penny Saved is a DOLLAR EarnedA $120 task notdone rightjust cost the company:$10,000 or about 83x the cost of doing it right the first time.
- 24. Typical Landscape WasteA typical landscape company operates at between 60% to 70% of their capacity that means 30% 40% of sales is lost to waste!!
- 26. Eliminate Waste for Profit + RewardReplacing waste (non-billable hrs) with sales (billable hrs) is the key to maximizing profitWith less sales lost to waste, company profits increase and so do employee rewards (wages)
- 28. How do you do it?
- 29. 1. Reduce WasteOverproductionWaitingTransportationExtra ProcessingInventoryDefectsUnnecessary MotionHuman PotentialResistance to Change
- 30. 2. 5S.SortSet In OrderShineStandardizeSustain
- 31. 3. Continuous ImprovementSweat the small stuff deal with problemsAsk Why? 5 times
- 32. 3. Continuous ImprovementFor any problem, ask WHY 5 timesKeep tracing the problem back to its ROOT CAUSEIf you solve just the problem, you only solve one problemIf you solve the cause you might solve 20 problems that all stem from the same cause
- 34. 3. Continuous Improvement100 small fixes are easier than 1 big oneIts easier to climb stairs then to scale a cliffDont wait for the best solution. Just get better
- 36. How do youactually DO it?Trainingand employee developmentDont depend on discoveringtalent. Develop it.Think outside the way weve always done itSystems and proceduresThink McDonalds! Clear systems that answer:Who, what, when, where, whyHow do I actually DO it?Employee rewards that are tied to productivityAre your employees paid by the hour?
- 37. Do you have a pay-for-performance system?
- 38. Do you have clear productivity goals?
- 39. Are they measured? Held accountable?LandscapeManagementNetworkwww.landscapemanagementnetwork.com
Editor's Notes
- The Landscape Management Network. Run a better landscape business for $99/month. For more information on how Dan uses his budget, watch the next video in this series, Price for Profit.
- This is a far easier way to grow your business. Instead of throwing more people at more work and scrambling even harder to stay on top of it all, you can focus your efforts on doing your work very, very efficiently. The results will surprise you. Increased sales, increased profits, and decreased headaches. ***After all, a $1 million dollar company who makes a 20% net profit makes the same money as a $5 million dollar company who makes a 4% profit. Which company do you think would be easier, and more enjoyable, to own and operate???
- The Landscape Management Network. Run a better landscape business for $99/month. For more information on how Dan uses his budget, watch the next video in this series, Price for Profit.