PITTSBURGH, April 20, 2022 (GLOBE NEWSWIRE) -- With landscape construction and maintenance shifting into high gear, LandOpt is sharing expert advice with contractors who are facing record high fuel prices. It also is offering contractors a complimentary fuel spending analysis.
LandOpt helps independent landscape contractors increase profitability, cash flow and revenue through consulting, coaching, training and marketing support.
According to Andrew Dickson, a LandOpt coach and vice president of Operations, contractors need to proactively manage their fuel costs. “That begins with knowing your numbers and understanding the role fuel plays in your expenses,” he said. “We work with our contractors to prepare annual budgets, which are even more critical when unexpected events like this year’s fuel price inflation happen,” he added. “Let’s say in December you budgeted $120,000 for gas this year. With prices up 50%, you need to plan for an additional $60,000 in expenses and adjust your budget accordingly.”
When fuel costs started to jump, LandOpt quickly helped its contractors revise their budgets and develop action plans to improve efficiency, control costs and increase revenue. With prices expected to remain high throughout the growing season, here are five strategies LandOpt recommends:
- Optimize routes. For many contractors, maintenance makes up the bulk of their revenue. With some vehicles making eight stops a day, having very efficient routes significantly reduces mileage and fuel use. “The technology used to design routes has gotten much better,” Dickson said. “There are a number of tools that help contractors create routes that save time and money. It’s a matter of knowing what’s available and determining which one is best for a particular contractor.” Aspire Software and LMN are among the providers that offer products developed for the landscape management industry.
- Improve training and team communications. Requiring drivers to turn off their vehicles when they’re not needed is one simple way to reduce consumption, but that requires consistent training. “It’s one thing to have a policy to limit idling, but you need to train crews on it and constantly remind them to turn off vehicles when they’re not in use,” Dickson said. LandOpt also suggests offering bonuses to crews that do the best job reducing fuel consumption.
- Raise prices or add fuel surcharges now. Many contractors are hesitant to hike rates or add surcharges, having already raised prices because of labor costs. Dickson says waiting is a bad idea, as fuel prices are expected to stay high. Recouping costs and getting back on budget later in the year will be difficult. He noted that companies including Amazon are passing on fuel costs to customers.
- Communicate price increases to customers in advance. “Rather than surprising customers with notes about increases and surcharges on invoices, be proactive,” Dickson advised. “Phone calls, e-blasts and letters sent before invoices go out help to build and maintain good customer relationships.”
- Consider adding on-site fuel facilities. Larger contractors can benefit from maintaining their own fuel tanks. According to Dickson, this is one of the best strategies to improve efficiency and reduce costs. “Think about how much time is wasted when an entire crew is at a gas station filling up vehicles and tanks for 15 or 20 minutes at every stop,” he said. “It’s far more efficient to maintain your own storage tanks and have one employee fill up all of the vehicles and other equipment at the end of the day. Fuel purchased in bulk will be cheaper, too.”
Based on a recent analysis, LandOpt contractors’ operating profits last year averaged 9.76%. By comparison, according to the National Association of Landscape Professionals, contractors nationwide with 51-100 employees averaged 7.6%. LandOpt contractors in 2021 also beat their own sales goals by 26%, with overall revenues up 42.7%.
To help contractors who are not part of the LandOpt system cope with this year’s record fuel costs, the company is offering a complimentary fuel cost analysis. Contact Alison Blobner at 412.567.4328 x 303 or alison.blobner@landopt.com to schedule a call or video meeting.
About LandOpt
Founded in 2004, LandOpt works with independent landscape contractors across the U.S., helping them increase productivity, profitability, cash flow and revenue. The LandOpt system addresses all areas of a green industry business, including sales, marketing, operations, human resources and business management. On-site and remote coaching ensures that LandOpt contractors achieve their financial goals. To learn more visit: www.landopt.com.
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