How our industry does in recessions.

Discussion in 'Business Operations' started by georgialawn88, Aug 14, 2019.

  1. georgialawn88

    georgialawn88 LawnSite Bronze Member
    Messages: 1,098

    this is mainly for the guys that’s been in this business for a long time. As y’all know we have been on a great bull run for the last 9 or 10 years. I’m not trying to start a political debate but recessions and down turns are part of this world. I know 2008 was a bad one. 2001-2002 was a slight recession. How does our industry fair in a down turn? I started in 2013 and it’s been nothing but easy growth year after year. I have around 525 spray accounts. Those guys that fought through 2008 or any other down turns how big of a difference did you see in your business. Share your story here. And any other opinions on this matter.
     
  2. sjessen

    sjessen LawnSite Fanatic
    Male, from Knoxville, Tn
    Messages: 10,572

    Maintenance only here. Was prepared for a 20% drop in 08-09 or more. Turned out to be the best year ever to that point. My clients mustn't have been affected as much as in other areas. Big ticket items were down though. Guys doing hardships and major improvements were hurt. Installs for new homes were way down also. The nursery I used was hurt badly and never really recovered.
     
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  3. 1620cwj

    1620cwj LawnSite Member
    Messages: 7

    well, went through both times and 08 was the worse. i dropped 10% in 09 over 08 then in 010 gained 20%. it depend on your mix of customers, service you offer and where you are located. I would figure at least 10% drop on new business and do a lot of customer relations with current people to keep them around. basics service usually stays intact but extra work usually goes on hold and then that is dependent on your clientele. hope this helps.
     
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  4. JLSLLC

    JLSLLC LawnSite Fanatic
    Messages: 15,347

    I got into business because of the recession! I couldn’t get a decent paying job anywhere turning wrenches local, at the time..
     
  5. OP
    OP
    georgialawn88

    georgialawn88 LawnSite Bronze Member
    Messages: 1,098

    Jlslls, you start on 08? How easy was it to grow?
     
  6. JLSLLC

    JLSLLC LawnSite Fanatic
    Messages: 15,347

    Growing wasn’t a big problem back then, I was a bit cheaper than I am now.

    Went on the books in 11’ to avoid any state hang ups,

    I’m solo and last few seasons ive became really selective of who I take on for a client
     
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  7. Mark Oomkes

    Mark Oomkes LawnSite Fanatic
    Messages: 18,757

    Extra work slows down.

    Prices drop.

    Laid off workers see it as a low barrier to entry biz, so competition increases. Prices drop.

    Those in the install side see a much larger slowdown, so they try to keep good employees by doing more maintenance. Prices drop.

    Unemployment rates go up and those that are a warm body are the first to go.

    Not quite sure how much this affects the fert and squirt side of things, but I'm sure the extras (high profit) will slow down unless you do high end work.
     
  8. sjessen

    sjessen LawnSite Fanatic
    Male, from Knoxville, Tn
    Messages: 10,572

    Key repeated phrase is “prices drop.”
     
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  9. starry night

    starry night LawnSite Gold Member
    Messages: 3,734

    Recession effects can depend on your market. When I was in landscape maintenance, my market was Findlay OH and surrounding area. Right on I-75 south of Toledo. Home of Marathon Oil, Cooper Tire, and one of Whirlpool's plants. Plenty of tech companies as well. The city blew right through 2008. Growth, growth, growth with sometimes a breather for a few months before the next leg up. No such word as recession there.
     
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  10. Mark Oomkes

    Mark Oomkes LawnSite Fanatic
    Messages: 18,757

    You were fortunate. '08 wasn't as bad as it could have been in Michigan since we had been in a 1 state recession for the previous 6-7 years. It was almost humorous seeing everyone complaining on the news about what we had been experiencing for many years.

    Hopefully due to the medical industry around GR things won't be as bad this time around.

    BTW, if you don't have a financial advisor that has told you this is inevitable, you need to find a new one.
     
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