By Peter Cozzi & Brett Stoehr
Maintaining beautiful outdoor areas demands time and dedication from landscape professionals who care for and cultivate lawns to enhance their health and aesthetic and functional appeal. In the United States alone, the broader landscape industry boasts a staggering ~$130 billion market size, with a steady compound annual growth rate (CAGR) of 4-5% per year, according to IBISWorld. In 2023, 58% of landscape professionals reported an increase in project demand, and a recent study by the National Association of Realtors found that due to the pandemic, 86% of consumers surveyed are investing more time and money in their lawn maintenance.
Despite this growth, the industry faces several challenges in 2024 that can hinder profitability and expansion. These include limited outbound marketing, difficulties in designing the right business infrastructure to achieve breakthrough growth, allocating resources towards various growth initiatives, attracting and retaining talent, and the complexities of remaining focused on profitability while scaling. The right investment partner can significantly alleviate these challenges by providing access to resources, expertise, and support networks, enabling lawn care professionals to capitalize on the growing demand for outdoor maintenance services.
Omni-Channel Marketing
Similar to other home services such as HVAC and pool cleaning, the lawn and tree care sector has an opportunity to embrace omni-channel marketing. With consumers increasingly turning to online platforms to find services, and heightened competition, businesses can leverage digital marketing to capture demand. This requires investments in tools including email and SMS capabilities, online advertising, and robust lead tracking and data analytics systems.
Software Infrastructure
In tandem with effective lead tracking, businesses must invest in operating software to manage complex field operations, nurture thousands of customer relationships, and streamline repetitive tasks. The right software is critical for creating the operational leverage and real-time data required to manage a growing business. However, figuring out the right technology solution for your company, and how to budget for that technology, is no easy task. Partners with experience building similar service-based businesses can help management teams select the right software to address the specific needs of each company.
Ongoing Equipment Innovation
Equipment innovation is happening fast in the lawn care market. Whether it is battery-powered equipment, motion-based measuring tools, or robotics, there will continue to be an influx of new equipment for owners to evaluate and determine which investments to prioritize to ensure their company is staying ahead. Financial partners bring investing expertise to help leadership teams refine their resource allocation strategies to build better, more efficient businesses.
Tight Labor Market & High Turnover Rates
A 2024 report published by Lawn & Landscape Magazine highlights the ongoing challenges posed by a tight labor market, with 59% of respondents reporting that hiring remains difficult compared to pre-COVID-19 levels. Retention also remains a significant issue, with key employees often being lured away by other job opportunities or facing seasonal layoffs. Combating this talent exodus requires providing value to employees through attractive compensation packages, benefits, and opportunities for growth. The right partner can help management teams identify which roles to fill, when to add personnel, and where to find key talent.
Private equity partnerships can offer a potential solution for certain business owners who are seeking to address these challenges and unlock their full growth potential. Working with a partner like Unity Partners can facilitate investments in marketing, technology, and employees, ultimately enhancing operational efficiency, the employee experience, and customer satisfaction. With the support of the right investment partner, businesses can navigate challenging obstacles, seize growth opportunities, and establish their position as leaders in this rapidly evolving industry.
Reach out to learn more about how Unity Partners supports businesses.