When Mike Rorie laid the groundwork for GroundMasters Inc., he was burned out and bored with his first job in sales at an air cleaning company.
Self-employment appealed to the 19-year-old, who wanted freedom and flexibility. His grassroots start-up consisted of a single pickup truck and a slew of odd jobs, from mowing to raking leaves to plowing snow.
“It was my chance to be in charge and accountable for my own direction,” says Rorie, president of GroundMasters. “I started mowing lawns individually.”
The landscape is different now at GroundMasters’ since Rorie reversed the “be your own boss” mentality that initially attracted him to the business. Rather than steering a one-truck start-up, Rorie drives a corporate caravan, a full-service commercial lawn maintenance and design/build firm with branches in Cincinnati, Florence, Louisville, Dayton, Columbus, Lebanon, Loveland, Springdale and, soon, Indianapolis.
GroundMaster’s growth was inspired by Rorie’s realization that he needed to get his company in order before he started short-changing his customers.
“In the service business, owners get inebriated with doing the work,” says Rorie. “We immediately get caught up in the fact that we made a commitment, the customer wants it and we have to deliver it. You are consumed all the time.”
This, Rorie says, is why many small businesses stay small, and he had much bigger ambitions. To achieve them, he needed a model he could manage and successfully expand so he could fabricate “clones” with identical systems, measures and service expectations.
“We’ve been busy,” Rorie says, reflecting on the three branches GroundMasters has set up since 2003 — steps toward a regionalization plan that he expects will double his company’s revenue in five years.
Systems check
Piecemeal projects fed GroundMasters’ first days, but Rorie wasn’t satisfied was that. Soon, corner lots multiplied into subdivisions, a business partner and, then, commercial work — corporate campuses, home owners associations, retail properties and the like. Before long, Rorie had clocked 10 years as sales director, operations manager, administrative guru and front man.
Then, Rorie turned 30.
“Ten years went by, and we were working just as hard as when we started and nothing was getting easier by economy of scale,” he says.
Rorie says this epiphany sparked assessment, planning and, ultimately, a set of systems that he reproduced in five regions. GroundMasters had customers and a solid reputation, quality services and market share, but he had not documented the operations process. That made it difficult for him to remove himself from the day-to-day work, because without his oversight, the business was not sustainable.
He knew he needed to figure out his goals, then work up an operations plan with the process needed to get there so employees understood how to get to the finish line.
“The biggest barrier for small business owners is understanding that rather than being personal and customized, you need systems, standards and a replicable [model] that your employees can understand,” Rorie says. “Most people who start small businesses build them on their own backs and knowledge base, and they don’t realize that if they spend that energy on developing systems and hiring competent employees, everyone is accountable and the model is growable.”
The franchise industry does it best, Rorie says. Consider fast food, grocery stores or retail outlets. Quantities are measured. Products are predictable. Employees are trained, evaluated and promoted in a systematic way. A regional headquarters supplies franchises with marketing, products and other resources.
“The stores simply deliver the goods to an identified customer base,” he says.
Owners in the trades adopt a different mindset, and Rorie says his method was no different than most.
“Information is controlled, not discussed,” he says.
That’s why Rorie says franchise companies are valuable training grounds for future business owners.
“You learn how a business works; you learn a system,” he says. “Though you might not want to remain a manager there forever, you at least will understand the flow of business.”
Business is personal for owner/operators, but when managers can share, delegate and invite their employees to participate in growing the business, significant expansion becomes possible.
“You don’t grow a General Electric or a Procter & Gamble without having systems and competent employees,” Rorie says.
When GroundMasters invited consultants and industry peers to help evaluate and rebuild its infrastructure, Rorie discovered that employees don’t assume you want their loyalty and ideas until a manager tells them so. And until this conversation takes place, an owner will play on a one-man team no matter how big the employee roster.
“We had to share,” he says. “We had to say, ‘We would like you to do this.’ And then, there was a separation again — people who don’t want to do that vs. those who want to do that.”
Rorie retained the dedicated, strong players and invested in training them to execute on decisions so he could continue to work on the company’s internal organs — a process that took several years.
“What we know now that we didn’t know then was, develop the answers to the test, set up training and then, you determine whether you have the right people and if you can hold them accountable,” he says.
Though GroundMasters was a multimillion-dollar business, its core needed nurturing.
“The fact is, you don’t have [your infrastructure] outlined because you are still trying to survive running your business day-to-day while you learn, develop and implement this new knowledge in a new way,” Rorie says. “That is a feat.”
Branch building
Rorie envisioned a growth land-plan dotted with variations on his original theme. Branch operations would unlock market barriers and ensure GroundMasters maintained high-level customer service. In 1998, Rorie replicated his $4.5-million business model and set up a satellite office, a $500,000 branch in Northern Kentucky.
“Because this office was only 10 percent of our business, I could keep the 90 percent on track while we learned what it was like to separate and duplicate the second business,” Rorie says.
Three months later, the company launched another service center in Dayton, covering markets 40 miles north and south of headquarters. Proximity to the headquarters is paramount when entering a new market, Rorie says, “because of the need to control, manage and have quick access at first. I had to be able to trouble-shoot and solve problems.”
Market research is equally critical to the success of a satellite office. GroundMasters’ typical client is a commercial customer in a high-end community, and nailing that down allows GroundMasters to tailor its marketing strategies and sell smart.
Most of all, branching out requires decentralizing the operation.
“When you own one business, you are centralized,” Rorie says. “Everyone is in one place. When you replicate, you decentralize. Whether it’s the copy machine or paper supplies, those items have to be replicated. Then you must ask, ‘Do we need two copiers? Do we need another salesperson or another manager?'”
These questions roll into long-term plans. Can the branch wait before GroundMasters hires another manager, or is this a critical first step? Can administrative functions take place at headquarters, or will centralized invoicing, accounts receivable and even copy machines hamper operations? What does the business need now — and what can wait?
“One of the biggest mistakes in building branches is lack of planning — everyone is guilty of that,” Rorie says. “And once you have a plan, you have to roll it out, implement it.”
Without execution, strategies are simply words stuck on paper. Without measures, owners cannot benchmark to determine their success. And replicating without a recipe is not branching out but starting from scratch.
“How will you know when you need more people or equipment
o
r another mechanic or building without benchmarking?” Rorie says. “How do you know you need to put more proposals on the street to reach your sales goal? To duplicate the business, you must study how it operates and develop a package that you can implement.”
Rorie learned this the hard way before he discovered the branch office revenue sweet spot — $4 million. When a branch manager of a $6 million location repeatedly called headquarters for assistance, Rorie wondered why he didn’t field concerns from his $3 million location.
He discovered that when revenue increases, so must manpower and resources.
“If you are too small, revenue is a concern; if you are too large, control is a factor,” Rorie says. “Running a $3 million business is twice as easy as running a $6 million company. Four million dollars is the sweet spot because there is enough revenue to support the overhead structure you need — buildings, people and resources — and to cover those costs comfortably and still produce a solid bottom line.”
Hamburger chain McDonald’s figures its sales capacity this way, as do most franchises, Rorie points out.
“McDonald’s says, ‘Our stores will do X dollars per year,'” he says. “Once they hit that, statistically, they know the store is at capacity. Instead of expanding that location, McDonald’s moves up the highway three exits and starts another restaurant and does another X dollars in revenue.”
When Rorie considers his $4 million replication model and the markets GroundMasters serves, the numbers register more zeros — exponential growth. Among the Columbus, Indianapolis, Dayton, Cincinnati and Louisville metropolises, he calculates revenue potential nearing $40 million, double today’s books.
“It’s simple once you decentralize your business,” he says, returning to the importance of having systems to model building and revenue growth. “We know the answers to the test. Now, the company is infinitely replicable.”
Select servings
The consistency a companies that can carbon-copy its formulas keeps commercial clients. Professional audiences turn up their noses at half-baked performance, and property managers are more squeamish today.
“We work very hard now to build relationships that used to come easy 20 years ago,” Rorie says. “The U.S. business world is much different. At its best, everyone wants faster, cheaper, better.”
What’s more, the decision-makers no longer carry budgets with wide, open space for landscape services. Today’s point of contact is a woman with high standards who arranges service agreements during a formal meeting.
“You fight hard to get the audience, and it’s very much a purchase/vendor relationship initially,” Rorie says.
To meet the changing needs of the market, GroundMasters has remastered its sales approach and customer promise.
“We adjusted to meet different value systems,” Rorie says. “It’s harder to reach our customers because the environment is more formal; therefore, marketing has to be different.”
Dressed-up clients want professional service providers, and most of them want the best price. Rorie chooses to cater to service-minded customers.
“Our best clients understand they are seeking a relationship from a professional they know is proven and competent, and they dial in their needs and negotiate the best price with those things in mind,” he says.
As part of that service, when clients call, GroundMasters’ account managers can respond immediately because service centers are no more than 15 miles away. That convenience sells well in a time-crunched corporate environment, Rorie says.
“Above all, customer service will save us, not quality, product or price,” Rorie says. “We know people won’t fire us over price or a mistake. They will fire us over poor service. When they want something, they want it, and they know we can deliver superior service to the markets we serve.”
And while Rorie fills in regional gaps with the GroundMasters service model, internally, he watches the calendar for cash-flow leaks and caulks these holes with lucrative, add-on services. His business is no more seasonal than the garment industry or hotels and resorts, he figures.
“When you are in a seasonal business, your challenge is to fill in the blanks — deseasonalize it,” he says. “Look at winter coats. When do you sell them? When do you sell sandals and swimsuits? Clothing companies sell items all year long. You can’t just be a swimsuit maker, you need a winter coat line, a spring line, sweaters and T-shirts.”
Similarly, GroundMasters offers winter services such snow removal and early-spring products including flowers and mulch. Giving clients a reason to call GroundMasters year-round also solidifies relationships, Rorie says.
“[Commercial customers] won’t replace us with a snow-only vendor or a competitor because they know we will give them priority status, we are competent and we can deliver the service,” he says.
“You can continue to grow and expand if you have the passion and courage to do it — and it takes both,” he says. “You can say, ‘I’ve done enough and I don’t have that energy,’ or, ‘I don’t want to take more chances,’ or you can turn that around and say, ‘This is fun. Why quit now?'”
How to reach: GroundMasters, www.groundmasters.com
