OUR BLOG

In business, competitive advantage always comes down to two simple strategies that can be applied to all industries, including lawn care.

These two strategies, originally devised by Harvard Business Guru Michael Porter, are cost leadership and differentiation. What exactly does all that mean?

Cost leadership Strategy

Cost leadership strategy is all about having the lowest prices possible in order to wipe out the competition.

In order to capitalize on this strategy, you also must have a low cost of production. This allows you to increase your profit margins while simultaneously decreasing the cost for your clients.

A well-known company in our industry capitalizing on cost leadership is TruGreen.

As a large, national company with access to cheap fertilizer, TruGreen can lead in terms of the cheapest cost. Often times, other lawn care companies are forced to meet TruGreen’s prices in order to earn new customers, even if that means making less profit that season. Customers that use TruGreen’s services are often looking for the best price for the services they buy.

Differentiation

Companies utilizing a differentiation strategy don’t necessarily focus on price; instead, they try to draw in new customers by being the most unique.

An example of a company that might utilize this strategy is Whole Foods. Whole Foods is a large grocery store chain that differentiates itself through its core values and shoping experience.  

Whole Foods' core values push the grocrey store to incorporate organic and local food in its stores, making each store slightly unique to its location.

Whole Foods also has created a special experience whenever you shop at its stores because employees are passionate about food and well trained. They have also designed each store to make grocery shopping enjoyable and relaxing. Instead of capitalizing on price like Giant or Acme (in fact, Whole Foods charges much more for their products), Whole Foods differentiates itself and markets its grocery store as being “wholesome,” “organic” and “local.”

People that shop at Whole Foods aren’t interested in what’s cheapest; instead, they want what’s “wholesome.”

What does this mean for your lawn care company?

Utilizing one of these strategies may be your ticket to success!

Ask yourself:

“How can I be the cheapest lawn care company out there?”

“How can I differentiate my company?”

“Is there a certain kind of customer I relate to best?” Remember, Whole Foods markets to different kinds of customers than TruGreen.

How can you compete with cost leadership? 

Cost leadership may seem like a difficult strategy to undertake for a lawn care company, especially with TruGreen as a competitor. However, there are ways for you to make TruGreen’s cost leadership irrelevant. 

For example, you can lower the cost of production through density and by maximizing the return on marketing dollars. Instead of servicing and marketing to a scattering of customers, focus your efforts on key neighborhoods called golden streets.

Golden Street Neighborhoods contain your most profitable customers. By focusing your efforts on golden streets, you increase the productivity of your employees by decreasing their windshield time (the time it takes for your employees to go from one house to another). It also allows you to increase your return on marketing dollars by winning new customers in neighborhoods with the most profit potential landscapes.

Check out our golden street entry to learn more.

How can you compete with differentiation?

If cose leadership isn't your thing, try differentiating yourself from the competition. What makes your company unique and special? What makes it stand out?

Check out our blog on differentiation to jog ideas on how to position your company as unqiue. 

One way to stand out from the competition is by going organic. Utilizing an organic product like Holganix allows you to reduce your fertilizers and pesticides by up to 75% while increasing your quality of results!