The brutal summer heat has cooled demand for many small landscaping businesses, adding distress to a sector already hurt by the recession.
Last month, temperatures were above normal along the East Coast and several central U.S. states, with some cities—such as Hartford, Conn., Providence, R.I., and Washington—breaking records, according to the National Climatic Data Center. Precipitation levels were also below normal last month throughout most of the Southeast and several states in the upper West Coast, the center says.
The mostly small businesses that serve these areas in the landscaping and lawn-care sector say the extreme heat has been killing grass and in some cases triggering the onset of weeds, insect invasions and diseases. As a result, consumers will likely need to wait for cooler weather before lawns can be revitalized through seeding and fertilization—services typically provided by lawn-care professionals.
Meanwhile, landscapers say the extreme heat is prompting many consumers to put off investing in planting, mulching, fencing and the installation of patios and walkways. Such services, which landscaping and related businesses provide, are more popular when yards are plush and green.
With more lawns turning brown, "business has dropped substantially," says Tim McCarey, owner of McCarey Landscaping Inc. in Middletown, N.Y., which offers lawn-care and landscaping services. He estimates revenues are down by about 30% from this time a year ago, and says he's had to reduce the number of workers he employs during summer to 38 from more than 50. "We've had to lay off people because the dryness affected us so much."
The economy also has been a factor. "People who would normally have us install decorative mulch or stone around their house are buying materials and doing it themselves to save," says Mr. McCarey. And other customers "are saying 'cut our services from weekly to biweekly,'" he adds.
Kevin Culbert, an analyst for research firm IBISWorld Inc., expects revenues to decline 4.7% this year for landscape-services companies as customers do their own work. "Not everybody can do plumbing but everybody can get outside and mow their lawn," he says.
For Guier Fence Co. in Kansas City, Mo., which has also seen sales decline in recent years due to the recession, the intense heat is discouraging consumers from investing in its fence installation and repair services, says owner and president Lea Bailes. "They're not spending time outside," he says. "It's just out of sight, out of mind."
The 80-employee business, which was founded in 1979, has increased its advertising spending by 20% for the month of August to make up for lost sales in July. That's helped a bit, "but my prediction is it won't help as much as we hoped," says Mr. Bailes. "The heat wins."
The scorching hot weather is even dictating the amount of hours that lawn-care and landscaping laborers spend on the job because of the potential health hazards associated with being out in the sun. "It cuts off probably two hours of our workday," says Mr. Bailes. "We don't want them getting a heat stroke."
The heat has also forced some lawn-care professionals to use more expensive products, boosting overhead costs. Grasshopper Lawns Inc. in Larksville, Pa., is using a slow-release fertilizer on all of its customers' properties that costs about 15% more than traditional growth stimulant, says Michael Kravitsky, who co-owns the 20-employee lawn-care business with his brother Shawn.
On the bright side, some lawn-care providers say they're fielding more calls from existing and potential customers seeking help in reversing damage to their lawns caused by the heat. But until the weather cools down, little can be done, and so the influx isn't necessarily translating into increased sales—at least not until the fall.
"It's a double-edge sword," says Clifford Drezek, part owner and general manager of Arbor-Turf Services Inc., a lawn-and- tree-care company in Marlboro, Mass., with five full-time employees. "We're not adding a lot of new customers and we're dealing with more concerns of existing customers."
Lawn-care and related businesses, however, may be able to benefit later when the heat finally subsides, if they can retain their customers.
"It's an educational opportunity," says Scott Frith, vice president of marketing and development for Lawn Doctor Inc., a 460-unit national franchise business in Holmdel, N.J., which has prepared information packets about the heat and its impact on lawns. An organization that fails to communicate with customers "would probably see a significant cancellation rate," he says. "You have to set the expectation that you're the expert rather than being reactive."