Russell Frederico loves transforming barren pieces of land into pristine, natural landscapes. In 1980, Russell Frederico of Provo, Utah had a small family to take care of and had just finished his Master’s degree in teaching. In order to make money on the side, he started a company that dealt with something he took pride in doing. His company, Frederico Landscape Management, has beautified commercial and residential properties in Utah, Nevada, Washington, and California.
It was my summer job after my Master’s program for teaching ended in March of 1980. I was a yard guy; I loved taking care of the yard. I needed money. I was a one man show for about five months. Once I obtained a pretty large account, I hired students from my sixth grade class to help during the summer. After summer, I went back to school to teach, but would still have the kids help me. I had the kids helping me for about two years. All we did was yard maintenance at the time. During the slow winter months, I got a job selling insulation door-to-door. They put me in the storm windows and doors division and I was pretty good at it. After Christmas, they shut the division down, so a partner and I started our own storm window and door company in 1982. All I did was yard maintenance and selling and installing storm doors and windows until 1986, when I got my license for landscaping.
My first customer was back when I was teaching sixth grade. An old neighbor of mine employed me and some kids to clean up her yard for fifty dollars.
On Funding I sold my wife’sDatsun B210. In the beginning, it was just me. I had no payroll. All I did was buy tools and gas for my truck.
Running the business
How did you learn to run a business?
I learned by making stupid mistakes. I knew I was good with people from my sales days, and I just put an ad out in the Provo paper. I took things as they came. I learned how plants grow, and how you can use them in a landscape setting.
I have three secretaries: one answers the phones, and the other two handle accounts receivable. I have one designer and one estimator on the payroll as well. It is fairly simple. You make month-to-month contracts with people, and you bill them at the end of the month.
What are the most difficult aspects of running your business?”
The most difficult thing about running a business is managing people. In the nineties, I had fifty highly-paid people on my payroll. When 1997 came around, things got slow, and I had to let a lot of those people go. There are recessions that you have to deal with.
To give you an idea, in 2008 we lost a lot of people. I had no secretary, no office. It was really hard. Bidding is difficult. It is hard to take into account the work that needs to be done, how long it will take. Also, your competition is something that adds a difficult aspect because you have no control over what they will offer the prospective customer. Your competition is always fighting for their part of the market.
What surprises you most about Frederico Landscaping?
Taxes. The more money you make, the more taxes you have to pay. I keep an accountant and a bookkeeper ALWAYS. I get a report from them at the end of every month. It’s incredible; some subcontractors I use don’t even know how much money they make.
Do you plan on expanding at all?
Absolutely not at this age! I have no need to. We have plenty of work to do. I just got the biggest contract since I have been in business and it is a shopping center behind my house. I’m not expanding anywhere.
What do you find is the most rewarding part of running your business?
The final product. When you take a raw piece of land and transform it into something beautiful. Staying close with customers that I have had since 1986. Joanne C. has been with us for over twenty years. Oh! Getting out of mowing lawns ten years ago! I subcontract that out now. I only do detail work now, sprinkler maintenance, and plant installation. In 2001, I spent one million dollars on maintenance for all my lawnmower machines. No more.
How have you learned from your business mistakes?
I have a motto – the best jobs you get are the ones that you turn down. Sometimes a job may not be worth your time. It can bog you down and it will affect your workload on the whole. Also, it helps to have a niche. Do things you will do well. I used to do sprinkler installation twenty years ago, but it became a problem for me, so I subcontract it out now. I do what I want to do; handle plant materials and style.
What I’ve learned
What advice would you give yourself if you could go back to when you started your company?
I would have told myself to get way more help. I would have tried to follow a mentor or someone in the business. I also would have studied business in college. I had no business experience, no business plan, and I was a bad accountant. You are going to learn by trial and error. Stay small. Bigger is not necessarily better. You may have too many jobs to handle. Our best year was 2001, and even then we lost accounts because we were too big. I would also surround myself with smart people.