7 out of 10 landscaping businesses fail in their first 18 months.
This shocking fact comes from the 2024 State of the Landscape Labor Market report. It shows a tough truth: most green industry businesses struggle when they try to grow.
Do you run a landscaping company? A tree care service? A pest control business? If so, growing your business brings special challenges. These challenges can make or break your company.
The green industry has huge potential. The landscaping market alone is worth $158.9 billion. It grows 4% every year, according to IBISWorld. People want these services. But many business owners make expensive mistakes. These mistakes stop them from growing successfully. Learning about these problems—and how to avoid them—could save your business.
The biggest scaling mistakes that hurt green industry businesses
1. Poor cash flow management during seasonal changes
The mistake: Many green industry businesses don’t plan for seasonal cash flow gaps. Revenue drops during slower months. But fixed costs keep going. Equipment payments, insurance, and facility costs continue all year.
Why it hurts: Research shows that 82% of small businesses fail due to cash flow problems. About 40% report cash flow issues every year. Seasonal businesses face this challenge even more.
The solution: Build a cash reserve. Save enough to cover 3-6 months of operating costs. Track cash flow every month. Use accrual-based accounting instead of cash-based systems. Create different financial plans for various seasonal outcomes.
2. Using annual budgets instead of monthly tracking
The mistake: Some owners rely on yearly sales goals. They don’t monitor monthly performance. This makes it hard to spot problems early. You can’t adjust strategies quickly.
Why it hurts: Industry expert Jeffrey Scott says you can’t manage a growing business this way. You need to look at actual performance versus budget every month. Break it down by salesperson and service type.
The solution: Do monthly financial reviews. Create weekly operational reports. Set up automated dashboards. Track revenue, expenses, and cash flow in real-time.
3. Underestimating job costs and overhead
The mistake: Most landscape businesses guess job costs wrong. They underestimate job costs by at least 1%. They underestimate labor costs by 50 cents per hour. For a $6 million company, this means $96,000 in lost money each year.
Why it hurts: Wrong pricing hurts profits as you grow. This makes growth financially impossible.
The solution: Build overhead recovery into every estimate. Nearly 20% of landscaping sales goes to overhead costs. Review pricing often. Adjust for true costs. Include equipment wear, insurance, and office time.
4. Failing to delegate as operations grow
The mistake: Business owners try to control everything. They don’t build systems that work without them watching.
Why it hurts: This creates bottlenecks that stop growth. It leads to owner burnout. One successful business owner learned this lesson the hard way. After 20 years, it took a medical emergency to show him this approach wasn’t working.
The solution: Write down standard operating procedures for core processes. Hold weekly one-on-one meetings with key team members. Slowly give them decision-making power. Focus your time on planning strategy, not daily operations.
5. Wrong crew sizing for jobs
The mistake: Sending crews that are too large to job sites—one of the most common profit killers in the green industry.
Why it hurts: Having too many people doing jobs that could be completed with fewer workers directly reduces profitability and makes scaling unsustainable.
The solution: Analyze productivity data to determine optimal crew sizes for different job types. Train supervisors to evaluate staffing needs for each project rather than using default crew sizes.
6. Poor hiring and staffing strategies
The mistake: Not making hiring an ongoing priority. Using old recruitment methods.
Why it hurts: 86% of landscaping companies had at least one empty position in 2023. This comes from the National Association of Landscape Professionals. Empty positions create problems during busy growth periods.
The solution: Create a complete recruiting plan. Use social media, updated websites, and employee referral programs. Write detailed job descriptions. Include both technical skills and cultural fit. Invest in training systems to help new hires succeed.
7. Taking on jobs too large for company size
The mistake: Taking contracts worth more than 25% of annual revenue. This creates dangerous dependency on single clients.
Why it hurts: When large clients don’t pay on time, it can “kill” the business. One industry expert learned this firsthand.
The solution: Spread out your client base. Set rules limiting any single contract to no more than 20-25% of annual revenue. Build multiple revenue streams to reduce dependency risk.
8. Over-reliance on referrals for new business
The mistake: Depending too heavily on word-of-mouth marketing without building systematic lead generation processes.
Why it hurts: Referrals are unreliable for consistent growth and don’t provide enough volume for scaling operations.
The solution: Develop multiple marketing channels including digital marketing, targeted advertising, and strategic partnerships. Create systems that generate predictable leads rather than hoping for referrals.
9. Poor equipment investment planning
The mistake: Not planning for the significant equipment investments required for scaling, or buying equipment that isn’t being utilized efficiently.
Why it hurts: This ties up capital in non-productive assets while creating cash flow strain that prevents accepting new work.
The solution: Create detailed equipment utilization reports before purchasing. Consider leasing options for seasonal equipment. Track usage rates and return on investment for all major equipment purchases.
10. Lack of systematic business processes
The mistake: Operating without documented systems for operations, safety, and customer service.
Why it hurts: Without systems, businesses can’t maintain quality or efficiency as they scale, leading to inconsistent service delivery and training difficulties.
The solution: Document core processes using shared documents and checklists. Invest in integrated business management software for scheduling, job costing, and customer management. Create quality control systems for consistent service delivery.
Building a stronger foundation for growth
The International Society of Arboriculture represents over 22,000 tree care professionals. They understand these scaling challenges firsthand. Successful businesses in this industry share common strategies. They track finances monthly. They build strong operational systems. They add different services to create more stable revenue streams.
Smart business owners know something important. Scaling doesn’t mean doing everything alone. Many successful green industry businesses partner with established franchise systems. This provides the infrastructure, marketing support, and proven processes needed for sustainable growth.
A proven path to growth and diversity
Are you ready to scale your green industry business? Want to avoid these common mistakes? Consider the power of adding different services. SpringGreen was founded in 1977. They have helped over 155 franchise partners across North America build stronger, more profitable businesses. They do this by adding recurring revenue services to existing operations.
SpringGreen’s services don’t compete with your current work. Their lawn, tree, and pest care programs work well with landscaping, mowing, and other green industry businesses. This creates steady revenue streams. It reduces weather dependency. It builds predictable monthly income.
Ready to explore how adding services could strengthen your business? Learn how SpringGreen’s proven systems can help you avoid scaling mistakes. Build the recurring revenue foundation your business needs. Learn more about growth opportunities for green industry businesses.
