|
By Bob West
bwest@lawnandlandscape.com
7/13/2000 12:02:00 PM
"Published with the permission
of Lawn and Landscape magazine" .
Last fall, Canada's largest lawn care operation
fired a shot across the bow of the world's largest lawn care
company.
"There are a lot of landscape contractors who are re-examining
the way they handle their chemical lawn care work either because
they've subcontracted the work to TruGreen-ChemLawn and they
don't want to do that anymore since TruGreen-ChemLawn has
gotten into landscape work, or these contractors have realized
how strong the margins are in lawn care," said Terry
Kurth in Lawn & Landscape's November 1999 issue.
At the time, Weed Man outlined a strategy to expand its franchised
lawn care system throughout the United States via a plan that
would include a series of master franchisors who would purchase
the rights to sell franchises throughout their own territory.
Now, Weed Man has begun moving on its plan to build what it
expects to be the second-largest lawn care company in the
United States within five years. Company officials are projecting
to sell 100 franchises within the next five years and 400
to 500 franchises within 10 years. Some of the industry's
biggest names have purchased the first master franchise territories:
Terry Kurth and Bob Ottley are past presidents of the Professional
Lawn Care Association of America (PLCAA).
Jon Cundiff is very involved in PLCAA and the Mid-America
Green Industry Council.
Ken Heltemes built one of the largest and most respected Barefoot
Grass franchises.
Steve Russell owns one of Michigan's largest lawn care companies.
Phil Fogarty owned one of the largest lawn care companies
in Cleveland, Ohio, before selling that to Scotts Lawn Service.
These subfranchisors purchased exclusive rights to territories
containing approximately 10 to 13 million people, and they
will now begin selling anywhere from 65 to 85 franchises within
their territories. The subfranchisors will retain a portion
of the royalty fees paid by the franchises they sell, with
the remaining royalties going to Turf Holdings Inc., the master
Weed Man franchise company for the United States. In addition,
the subfranchisors will turn their current lawn care companies,
which represent combined annual revenue of nearly $5 million,
into
Weed Man operations.
"I think we've really put together an 'A team' here,"
noted Kurth. "Managing a business is OK, but building
a business is where most of us want to be. We're entrepreneurs."
WHAT THEY'RE THINKING. One of the most interesting aspects
of these announcements has to be the caliber of individuals
who have signed on as subfranchisors. These are not people
who struggled to achieve profitability or build successful
businesses. A logical question, then, is why they are making
this investment.
"When my non-compete was done [after
selling to TruGreen-ChemLawn], I had a couple of people contact
me to talk about developing a new franchise company, but I
felt that developing the computer software, the systems and
the licensing was a lot of effort I didn't want to take on,"
noted Kurth, also a Barefoot Grass veteran. "Then I came
to Toronto to talk to Weed Man, and I got excited by the infrastructure
already in place.
"Also, a lot of us have grown a company to $750,000 to
$2 million, and we wanted to continue growing, but we decided
that growth would create a whole new animal that would be
difficult to manage," Kurth continued. "This model
gives us the opportunity to parlay our knowledge into growth
for others."
"Our company started as a pest control company in 1931,
and we added lawn care in 1982," explained Steve Russell
president, Eradico, Farmington Hills, Mich. "We went
through the rigors of starting the lawn care service, and
I'm convinced that we would be between 2 and 2½ times
the size we are today had we had the Weed Man system in place
back in 1982."
"I don't think our timing could be better in terms of
the state of the lawn care industry with Leisure Lawn now
being gone (after being acquired by TruGreen-ChemLawn in June),"
explained Fogarty. "A lot of people have been gobbled
up in mergers, but some people don't want to work for TruGreen-ChemLawn,
and this gives them an alternative. At the same time, there
are a lot of customers out there who are going to be looking
for someone who is going to provide the value that Weed Man
has always stood for."
Discussions with other potential subfranchisors continue in
the Pacific Northwest, California and Texas markets, and this
team is confident of its ability to attract interested lawn
care professionals to the program.
"I predict we will have sold out all the subfranchisor
territories within the next year," related Kurth.
There are two fee structures for purchasing a franchise. For
areas with populations up to 150,000 people, the fee is $20,000,
and up to 300,000 people, the franchise will cost $33,000.
Weed Man will supplement growth of franchise sales by opening
one corporate store per year. The company has corporate stores
in Denver, Minneapolis and Seattle to go along with franchisees
in Portland and Albany, Ore., Springfield, Ill., and Rochester,
N.Y. The next store will be in Detroit, Mich., and Weed Man
will sign a franchise agreement with Russell to operate in
that area.
"We used these stores and franchises to learn the differences
between the U.S. and Canadian markets, and this taught us
that marketing is very similar and our closing rates are fairly
consistent in the two areas," noted Roger Mongeon, president
of Turf Management and Turf Operations, the two holding companies
that own master franchise rights to the United States for
Weed Man. "We are very confident we can export our system
to the United States."
The author is Editor of Lawn & Landscape magazine.
By Bob West
bwest@lawnandlandscape.com
11/2/1999 8:23:00 AM"Published with the
permission of Lawn and Landscape magazine"
MISSISSAUGA, ONTARIO - The biggest name in Canadian lawn care
is joining forces with some big names in the U.S. lawn care
industry with the goal of building the second-largest lawn
care company in the United States within the next five years.
The Weed Man, a 30-year franchisor of lawn care services with
135 operations grossing approximately $50 million annually
throughout Canada, shared its new plans for expansion into
the U.S. market in an exclusive interview with Lawn &
Landscape.
"Our goal is to open up 100 territories servicing about
70 cities throughout the U.S. within five years," related
Roger Mongeon, president of Turf Management and Turf Operations,
the two holding companies that own master franchise rights
to the United States for Weed Man.
"Our biggest problem with entering the U.S. market until
now has been the lack of key people, but now everything has
come together bringing the necessary people with the expertise
in the U.S. market," explained Dez Rice, Weed Man president.
One of the key people joining the Weed Man team is Terry Kurth,
a former employee of The Scotts Co. and a long-time franchisee
in the Barefoot Grass organization before it was purchased
by TruGreen-ChemLawn in early 1997.
Kurth will serve Weed Man in developing master franchisors,
which are individuals who own the territory rights to a number
of territories in a geographic region and who then sell the
various franchise rights to the individuals who will run the
operation in the area. The master franchisors will then retain
a percentage of the royalties paid by each of the franchises
they sell, set up and support.
Kurth and other Weed Man representatives pointed to the presence
of these master franchisors as a key strategic difference
setting Weed Man apart from other U.S. lawn care franchise
systems such as Leisure Lawn, Lawn Doctor and All-Green.
"With the labor situation as bad as it is, a lot of contractors
are tired of beating their head against the wall and now they
want an opportunity to leverage their experience," Mongeon
noted.
"I've talked to a lot of lawn care operators who have
thought about expanding their businesses but they don't know
if they've got the necessary support to do so," Kurth
explained. "Franchising with Weed Man means these contractors
have an immediate infrastructure to grow from and computer
software to manage their business with and all of the other
benefits of being part of this group."
Kurth added that the first master franchisor agreement should
be finalized with a prominent industry veteran in the upper
Midwest by November, and he sees a great deal of potential
for Weed Man across the country.
"There are a lot of landscape contractors who are re-examining
the way they handle their chemical lawn care work either because
they've sub-contracted the work to TruGreen-ChemLawn and they
don't want to do that anymore since TruGreen-ChemLawn has
gotten into landscape work, or these contractors have realized
how strong the margins are in lawn care," Kurth added.
"The problem for these contractors is that they may not
be familiar with the pesticides lawn care companies use or
they don't know the proper way to tank mix these products,
so that's where buying a franchise and obtaining all of the
support from the corporate office and master franchisor can
help."
Currently, Weed Man's U.S. presence is primarily represented
by corporately owned offices in Seattle, Wash.; Denver, Colo.;
and Minneapolis, Minn. These locations have served as testing
grounds for the last one to three years.
"We've been concentrating on getting our licensing paperwork
taken care of for the U.S. markets and looking for any differences
between the U.S. and Canadian markets," explained Mongeon,
noting that Weed Man found few variations between lawn care
businesses north and south of the border. "We feel very
well prepared to start offering these franchises now,"
he added.
Weed Man has historically focused on selling franchises in
smaller markets in Canada - populations of 50,000 to 150,000
- and although the group has plans to target larger markets
as well in the U.S., Mongeon and Rice explained that their
expertise in small markets will be an asset in the future.
"Selling a master franchisor a large territory to develop
through selling to individuals in the smaller, more local
markets will generate quite a bit of interest because right
now TruGreen-ChemLawn is just dominating in some of these
markets," Mongeon explained.
"And we've learned how to make operators successful in
the low population areas because Canada doesn't have the same
population density that the U.S. has," Rice added. "While
we will definitely sell franchises in bigger cities in the
U.S., the sheer size of the U.S. means our potential there
is phenomenal."
|