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guides growth that lasts

Better, not just bigger,
guides growth that lasts

(First Person features local businesspeople relating–in their own words–experiences and lessons that have shaped their company’s development. The goal is to inspire and inform others through first-person accounts.)
Prior to 1988, my tree- and lawn-care company, One Step Tree & Lawn Care, was simply another player in a saturated market with price being the only differentiating factor between services. The company was plagued by low customer-retention rates, even worse lead generation and a sales-closing rate that predicted a gloomy future.
In addition, the environmental movement was causing customers to question the safety of the products and application methods being used on their lawns. Consumers still wanted weed- and pest-free lawns, but were switching to services that touted natural products and processes that did not necessarily control weeds and pests.
Eager to increase the company’s customer base, I bought another independently owned lawn-care company. Those new customers taught me the lesson that started One Step down the customer-service path to growth.
My new customers had been thrilled with the lawn care provided by the previous owner. I realized that the previous owner’s ability to retain customers had been rooted in his desire to provide services and products that customers wanted in addition to those their lawns needed.
Armed with this information, I hired an independent firm to conduct a customer-service telephone survey. Existing customers were contacted, as were those who had canceled service and those who had not contracted with One Step after an initial estimate.
The survey indicated that customers had no loyalty to One Step. In fact, a majority of our customers did not know the name of our company. The survey also showed that customers did not know the service representatives providing their lawn care.
In addition, the information collected demonstrated that One Step’s corporate and customer-service goals were poorly defined. Data to track customer satisfaction amounted to little more than guesswork. There were no incentives for lawn-care technicians to keep customers happy.
The information gathered from the survey prompted me to turn over all my administrative duties to the vice president so that I could concentrate on other things: observing employees on the job, interviewing assistant managers who dealt with customers, increasing my contact with customers and becoming more involved in organizations that affect the lawn-care industry. With this information, I began working with employees to institute radical changes in company policies and operations.
We developed a customer-service philosophy that acknowledged the importance of customer satisfaction and encouraged it by developing trusting relationships between each customer and the area representative who provided the service. By forging these relationships, customers would be more likely to express concerns about environmental and other issues, and area representatives could provide reliable, accurate information in response.
In order to realize the new philosophy, we made changes in job responsibilities. Rather than having a sales representative make the initial customer contact and then turn over the lawn care to another person, the lawn-care technicians would be responsible for their own new sales, renewals and service. This new system established direct accountability between the area representatives and their customers. It also meant that the customers had consistent, regular contact with one individual.
Along with an improved customer-relations system came the initiation of a new compensation structure. Area representatives would receive sales and production commissions in addition to their base salary. The same commission would be paid for first-time sales as well as for annual renewals. This would encourage area representatives to keep their customers satisfied so they would renew their contracts for the following year.
One Step also developed an annual bonus program that was tied to each area representative’s yearly goals. At the end of the lawn-care season, I would meet with each area representative to review the past season’s accounts and establish customer-retention goals as well as new-customer account goals. If the goals were met, then a bonus would be paid at the end of the following season. An additional bonus would be paid for exceeding the goals.
One Step’s company goal for the following season would equal the sum of all area representatives’ goals. Basing our financial goals on customer satisfaction and retention gave area representatives a direct line of responsibility to the success of the company. It also provided One Step with projection figures for the following year, which helped determine the purchase of new vehicles, equipment and products that could better serve the customers.
At a time when the lawn-care industry was riddled with employee turnover, primarily because employees were hired for the season only, One Step decided to offer area representatives full-time, year-round employment. Because the company’s success depended upon developing honest relationships with its customers, it was imperative for area representatives to work with the same customers year after year.
In 1994, One Step experienced zero turnover for full-time area representatives. Since then, the turnover rate has continued to be virtually non-existent.
In 1988, prior to the changes One Step initiated, the company experienced a 67 percent customer-retention rate. The first year the customer-service changes were implemented, One Step improved its customer-retention rate to 80.8 percent. The retention rate has continued to increase to a point where One Step is well above the national average for large lawn-care companies.
Since 1988, One Step has made significant strides in both identifying customer needs and adopting ways to meet them. The company has experienced substantial, continous growth by changing its focus from becoming the largest locally owned tree- and lawn-care business to retaining customers through superior service. We wanted to be the best, not just the biggest.
The new approach has indeed ensured that One Step is the largest locally owned company of its kind in Monroe County, having increased its customer base by 73 percent through 1995.
That proves we can be the best and the biggest.
(Bob Ottley is president of One Step Tree & Lawn Care.)
(If you have a story to tell, fax a brief synopsis (no more than a page) to Associate Editor Christina LeBeau at 546- 3398, or e-mail it to RBJournal@aol. com.)

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