J&r Sprinklers

Executive Summary

J&R Sprinklers: We are a small family business that started serving the Denver area in 1977 that specializes in residential and commercial irrigation systems and landscaping. Our customer base has been built from our reputable service and by word of mouth. Currently we have several thousand residential customers within a 50-mile radius of Denver, and we work with several general contractors on schools, parks and office buildings. Over the past four decades we have maintained constant and conservative growth and as a result we are financially stable company that is primed for future explosive growth.

Business Description

Description of Services:

Our business revenues stem from five main service areas listed respectively to amount: irrigation installation, landscaping installation, sprinkler maintenance, snow removal and landscaping maintenance. The majority of our business results from commercial installation. We engage on commercial jobs ranging from small to medium but don’t participate on unusually large jobs.

Industry Background

        According to the IBIS World market, the landscaping and lawn industry had revenues of $74 billion for 2013. Of the roughly 400,000 businesses in the industry 67% are single family residential and 25% are commercial and industrial. Of the services that these businesses offer, irrigation installing, our highest revenue stream, is only offered by 6% of companies (IBIS 2014).

Firm Background

        Since our businesses conception in the late 1970’s, we have experienced all conditions of markets and weathered each one. In the late 2000’s after the Great Recession, many landscapers found work difficult to acquire and desperately struggled through this time; however our company has not ceased to acquire more work than we are capable of accepting. At this moment the business is operated by three individuals: Steve the founder and his two sons Rex and Sky.

Goals and Objectives

        Our short term goals include hiring a new project manager, who would be qualified on leading a team of workers, overseeing general job development on the commercial side and adequately knowledgeable in the irrigation trade, and to set up a retirement plan for the three owners and to bring in and retain valuable employees.

Currently in the first part of the season were business is starting to pick up we serve around 60 customers a week, while in the heat of the summer we serve around 110 customers a week and we would like to grow the sales by 5% because it would be a growth amount that we could adequately handle. The number of service calls we receive are far greater than what we can serve so to boost our sales we would also need to hire a trained sprinkler technician.

 Long term we wish to grow profits by 10% a year. With additional trained employees we would have no problem boosting our profits by this much each year as we are very cost efficient and profitable in our current state.

Marketing Plan and Strategy

Target Market and Customers

Residential Target Market

        The first requirement for our customers is that they be homeowners, as the majority of renters can’t or don’t wish to purchase a landscaping or sprinkler service. We offer a variety of services that range from $75 and up so our target market should have a gross income of at least $40,000 per year for per household up to customers with a gross income of $200,000 and up per household. (As we can only perform one type of service once per house, we are more concerned with the aggregate income of individuals living in the house, and not specifically concerned with each persons income.) Our target market applies to both men and women, ages 30-75, and as we are headquartered in Elizabeth, Colorado, we can serve all areas within an hour and a half drive radius around Parker, Colorado.

Commercial Target Market

        Our commercial target market is much more flexible and varies from year to year based on the workload we expect to have. However, our commercial target market would include schools, hospitals, apartment complexes, commercial companies, parks and churches of nearly all sizes excluding abnormally large jobs or jobs within abnormally short time frames. The revenues we seek from one of our commercial target market customers most often range from $40,000 to $150,000.

Competition Analysis

        The exact number of landscaping and/or sprinkler companies that would also serve the Denver area could not be found but a large portion of the companies would be small in size and only compete with us on sprinkler winterizations and small scale landscaping, which isn’t a significant part of our business.

        Our most significant lines of service we offer are commercial jobs and sprinkler repair. For commercial landscaping jobs we compete directly with Valley Crest (the largest landscaping company in the world), Design Scapes, Ecocape Solutions Group, Greenscapes, Girard Environmental Services, Lawn Doctor, Swingle Lawn, Tree and Landscape Care, The Brickman Group and Weedman. For sprinkler repair we have no real competition, other than shaky “one-time” repairmen, as it is extremely difficult to find companies in the Denver area who are willing and knowledgeable to repair sprinkler systems.

        Our strengths are our personal customer service, that many larger companies cant offer, knowledge from being in the industry for nearly 40 years, our deep and happy customer base, our wide base of assets that allow large jobs to be done quickly and efficiently with very few employees, our superb credit rating and our outrageously low overhead costs.

        Our major weakness is our lack of manpower and qualified employees, which to most of our competitors is not as large of a problem as it is for our company.

Pricing Strategy

        Since we are a service company, our pricing strategy is time based, with a base fee of $75 that includes the first half hour of service work with each additional quarter hour charging $18. Our repair parts we mark up to an average of 20%, depending on the difficulty of installation.

         Commercially, our strategy is more complex and varies due to the large differences in job requirements but ultimately pricing is structured to cover our direct costs, such as number of plants, sprinkler head, valves ect., with a 20%-40% markup, and estimating the implied length of the job labor.