From the Cincinnati Enquirer. Read the original story here. By Jeff McKinney
Lawn care companies and landscapers are feeling the sting of the sour economy in the midst of their peak season.
“The weak economy has prompted a lot to people to hold onto their money,” said Andy Doesburg, vice president at Thornton Landscape, one of the region’s largest landscaping companies.
He expects overall sales at the Maineville-based landscape and lawn care company to drop 30 percent this year from 2008, although he didn’t provide overall sales figures.
Rob Brown, owner of Lawn Butlers in Milford, said he’d be happy if sales this year met last year’s sales given the unstable economy.
The economy led Brown to cap prices this year for services such as cutting grass, edging, gutter cleaning and leaf removal. He typically raises prices 2-5 percent each year.
“I’m keeping prices the same because I value my customers, and I don’t want to lose their business,” said Brown, who said he was also trying to keep costs under control by refraining from buying equipment that costs $500 or more and hiring fewer workers.
Despite the general economic malaise that has impacted just about every industry, some local lawn-care operators remain optimistic.
Mark Toole, owner of Nature’s Way Complete Grounds Care of Burlington, said he expects sales this year to rise 10 percent over 2008, fueled by the company offering such services as landscape design, lawn fertilization and mowing.
Sales figures for the industry as a whole are not readily available.
But the U.S. Census Bureau’s 2006 County Business Patterns report (the most recent data available) gives some idea of the size and scope of the industry locally.
According to the survey, there were 664 lawn care and landscaping services businesses in Hamilton, Butler, Clermont, and Warren counties in Southwest Ohio; Boone, Campbell and Kenton counties in Northern Kentucky; and Dearborn County in Southeast Indiana. The companies had a combined payroll of 3,731 employees and an annual payroll of $111 million.
It’s difficult to determine what affect the extended recession has had on those numbers, but financial reports from some publicly traded companies with operations in the area offer some clues.
ServiceMaster, owner of TruGreen Lawn Care, a national provider of lawn, tree and shrub care services, reported in a regulatory filing this week first quarter revenue for TruGreen of nearly $134.7 million, essentially flat from last year’s first quarter. The Memphis, Tenn.-based company said a profitability measure for TruGreen rose to $2.2 million from a loss of $6.4 million in the quarter largely due to cost savings. TruGreen has several offices in the local region, including in Florence, Fairfield and Springboro.
Meanwhile, Lawn Doctor, the nation’s largest lawn care franchise with five locations locally, has forecast sales this year to be flat compared to last year.
“People are still using our service and doing more comparison pricing due to the pinched family budget,” said Paul Mumm, a spokesman for Holmdel, N.J.-based Lawn Doctor.
The weak economy has even sparked some diversification.
Thornton launched a landscape maintenance division a year and a half ago to minimize the impact of reduced sales from its landscape business.
Doesburg expects sales from the maintenance business to surpass $1 million this year, up from $500,000 last year.
Doesburg, who also is president of the non-profit Ohio Nursery & Landscape Association, said most businesses in the industry in Ohio have seen reduced activity since the recession began in December 2007.
But some homeowners refuse to give up landscape and lawn care services completely.
Doug and Cheri Myers of Villa Hills plan to keep using Nature’s Way to cut their yard and provide other landscaping services.
Cheri Myers said the couple spends about $2,500 a year to have the work done on their yard because they don’t have the time to do it themselves.
But Myers said the pair postponed plans for some landscaping projects this year like upgrading a screen porch that she estimates could have run $15,000 to $30,000.
“We’re continuing with the services that we feel we can’t do without, but being cautious on the larger projects,” Cheri said.
Larry Fish and his wife, Marty, of Miami Township used Lawn Butlers for a spring clean-up of landscaped areas in their front and back yards, but decided to lay down mulch themselves this year to save money.
The couple also delayed plans to have Lawn Butlers install a landscaped privacy screen, a project with an estimated cost of at least $1,000.
“We’re choosing not to spend money on upgrades that we don’t need to have,” Marty Fish said.
Additional Facts
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