How this woman-owned tree service company learned that not all leads are created equal
Lisa Tadewaldt has been in the business of taking care of trees for 20 years, but as her company scaled up, it faced a different issue.
Many startups fail because they bark up the wrong tree. Others fail because they learn money doesn’t grow on trees.
Lisa Tadewaldt has been in the business of taking care of trees for 20 years, but as her company scaled up, it faced a different issue: not being able to recognize which leads to pursue. This problem caused havoc at her company, but as she explains in the Q&A below, she and her team were able to fix the issue by seeing the forest for the trees.
Tell me what your company does.
I co-founded Urban Forest Pro, based in Portland, Oregon, in 2000 and today we're a regional provider of arboriculture services, which is a fancy way of saying we perform tree services in the Pacific Northwest. Common reasons that business and residential customers will call us often include tree removal, tree planting, limb trimmings, pruning, stump grinding (removal), organic pest control for their vegetation, and, sometimes, design elements. Whenever you're driving around your town and see workers climbing tall trees with chainsaws dangling from their belt or using cherry-pickers to cut limbs, that's the stuff we do. It's traditionally a male-driven industry, with regards to personnel and ownership, but we've done a nice job of separating ourselves from the pack, and I'm really proud of that!
“We hadn’t factored in that not all leads are created equal.”
At what point did you scale up, and what did that growth look like?
When we initially formed the company, it was out of necessity in an effort to have consistent work and be in charge of our own schedules, so we didn't really have any long-term goals. We probably didn't even consider business terms such as scaling then, and we just wanted to stay afloat. That said, over time and with more confidence, we saw that it could be a long-term and fruitful entrepreneurial endeavor, so we thought of how we could grow. Back then, that translated to securing more leads, so we went on a mission, for many years, to not only increase the number of quality leads that came in but identify what worked best. This translated into us trying everything marketing and advertising related to increasing our leads. Eventually, more and more leads came in, consistently, which lead to more work being sold and the business grew into a bonafide company.
What went wrong when you scaled up?
We didn't understand all the intricacies of lead generation or how one part of the business translated into successes or failures elsewhere in the business. As a primary example, there was a time when the leads grew really nicely and higher than we had achieved, but the top-line growth stopped. Top-line growth is the revenue or gross sales by a company, and it's used to indicate the financial strength of a business. Having stagnant top-line growth is a bad place to be in, considering we were spending more than ever but not getting an ROI. It took us a while to even recognize this was happening, as we had always used the number of leads we were getting as an indicator for every other part of the business. Our error was thinking that more leads and more sales calls meant more revenue, when the reality was hardly that. That was a huge mistake and one that we prioritized to never make again once we had identified it.
How bad did things get?
We spent so much money to meet the demands of keeping our workforce employed and maintain our core business sectors as based on our forecasts. While we spent this unnecessary money to keep those areas of the business secure, we essentially hemorrhaged money elsewhere while we fine-tuned the process and identified what truly worked for us.
“Any business owner who says they've solved their issues isn't being honest.”
How did you fix the issue? Where did you get the idea for the fix?
When you're running a new business or in the growth stage, you view leads as an opportunity to sell more and secure more business, and that's how our sales team was proceeding. We were so focused on growth that leads were essentially all we cared about. Unfortunately for us, we hadn’t factored in that not all leads are created equal. Our team was treating each lead as if they were a client already and devoting too much energy and effort, even compared to what the prospect had asked for. This alerted us to potential waste in our labor time, as I thought we were likely spending too much time with consults that weren't ready to begin work. You have to prioritize and learn to read each customer's needs really quickly and effectively.
So we started our troubleshooting by heading down the sales pipeline, and we took a look at every stage of the process, focusing on being efficient and prioritizing leads better. One of the things I got asked by members of the sales team when we started that process of fine-tuning is, “Why don’t you trust me just to do my job anymore?” They felt they knew how to sell best. That question hurt to hear. But in a matter of days, I realized that receiving that question from our team showed us a big gap in our process and business model. We decided that the solution needed to come from the team and not the top. Bottom-up versus top-down. We went through the sales process step by step with the team and discussed solutions that could work for all of us, and built a new process from top to bottom anchored in efficiency. We also continuously revisit this process to make sure our sales pipeline is as healthy as it can be at every stage.
What do things look like now that you’ve corrected the problem?
While we've had incredible improvements since then, I think any business owner who says they've solved their issues isn't being honest. It's my opinion that the problem is, unfortunately, never fixed. But now we have a process that ensures we know when problems arise and we can easily look at what might be going wrong because we have a process in place. That minimizes the instances of concern and has been incredibly rewarding to see “take off.”
What did you learn from this experience that other business leaders need to know?
Operating a business is all about the people and the processes. I have always been good at the people part, as my employees generally like and respect me. I have always wanted those employees to feel empowered to solve problems in the business, and for that reason, I avoided having a detailed process that could disfranchise my employees. The reality of the situation was that we had secured some of the most proficient and effective arborists that the Pacific Northwest had, and I definitely didn't want to lose them, as I knew they were aces at their jobs.
However, the cold hard truth is that you need these processes to scale, and as long as the processes are built and then refined by the people who are doing the work, your employees still feel empowered. That empowerment breeds ownership and ownership breeds longevity with a company. As we all know, that cohesion among a team and the almost clairvoyance they can share after working together for a long time is where things really take off, and you become a force to be reckoned with. That's where we're at now. Sure, we have small hiccups here or there, but overall, we're just marching forward with purpose and intent.
Scaled Up is a weekly interview series by Inverse with entrepreneurs. They share how almost everything went wrong while growing their business — and how they fixed it.