Nate Fetig
General Manager / Vice President
Are you having trouble hiring laborers at your landscaping company or other positions like foreman or even office staff? Well, you're not alone. And it could be that the wages you're offering are from like 10 years ago. And in today's podcast interview, I'm going to interview a successful landscape company in Colorado and how they actually increased their wages 30% for their existing staff so they could also afford to pay new employees at the current market rate. And how did that work out for them? So let's find out in today's episode.
Interview
Jack Jostes:
Hey everyone, Jack Jostes here and welcome to The Landscaper's Guide to Modern Sales and Marketing Podcast. This show is all about growing your lawn and landscape company with the right customers, increasing your profit, and enjoying a better lifestyle. And a key part of all of this is having great people on your team to help you serve your customers. And right now it's September 2021, what a weird time. I don't even know how to describe the time, but I can at least say that wages have certainly increased drastically. It seems like they have for the last 10 years, but especially in the last couple years.
Jack Jostes:
And so I'm here with Nate Fetig where we're on a job site in Windsor, Colorado. It's really cool. You may have seen our other interview that we did here. If you haven't, they're installing a water feature. And fun fact is that they, when this was a development community, you all did the design but didn't install it, right?
Nate Fetig:
Right.
Jack Jostes:
So another contractor installed this. It's looking really good, and now you're doing this enhancement project that you're doing some hardscaping. And anyway, it's been fun meeting your team. We shot a recruiting video today and I have to say they did an incredible job. They were all nervous. None of them liked being on video. Nobody likes being on video except for weirdos. You're pretty good at it, but your roommate in college was into video, right?
Nate Fetig:
Yeah, he was a film major.
Jack Jostes:
Well, so for people who haven't seen you or heard of you before, who are you and what is Alpine Gardens?
Nate Fetig:
Yeah, I'm Nate Fetig, General Manager and Vice President for Alpine Gardens. We're a design, build, maintain contractor in Fort Collins, Colorado. We've been around for a little over 43 years now.
Jack Jostes:
Right on. And what have you seen, and maybe even, since you've worked in the industry for so long, what has changed with labor and with hiring people?
Nate Fetig:
Yeah, I mean, I think it's no secret that labor's become extremely difficult to find and maintain. And the methods of which you come across employees has changed drastically even in the last couple of years.
Jack Jostes:
Yeah, it really has changed a lot. And one of the things that you shared in our mastermind was that you actually don't use H-2B program. You only hire local people in the community, right?
Nate Fetig:
Yeah.
Jack Jostes:
And why is that?
Nate Fetig:
Well, we feel there's too much uncertainty in the H-2B program and we'd rather go into the season knowing that we're going to have a hard time finding our guys than find out in April that we're not getting any guys because somebody forgot to renew a bill.
Jack Jostes:
Right, yeah. There's a lot of uncertainty with that. I know I have clients who do both. I'm intrigued though about people like you who choose not to use it because now you've got this limited labor pool of the kind of Northern Colorado area. There's a lot of great landscapers here. There's a lot of great construction companies. There's just a lot of competitors. So one of the things that you did that was really interesting was you realized that what you were currently offering was like way below market. And then you brought your current staff up to market and then increased your rates. So tell me, how did you kind of arrive there? What were some of the challenges you were having?
How Alpine Gardens Increased Their Wages
Nate Fetig:
Yeah, I mean, for the last several years, it's been hard to hire, but it seemed like this spring, the applicant pool just dried up. We weren't getting any applications. And so we, I took it upon myself to go look at what other jobs were offering, not even necessarily in our industry, just in our area. And I decided we need to raise our starting wage to be competitive and attractive.
Jack Jostes:
And by how much?
Nate Fetig:
We raised everyone, every current employee's wage around 30%.
Jack Jostes:
And so, how did you tell them about this? Did you just suddenly like, hey, the next paycheck had this huge increase? Or did you have a meeting? Or how did you tell people?
Nate Fetig:
Yeah, well we were starting to get in dire straits for needing people and so, but we certainly didn't want current employees seeing on Indeed that we were offering $3 an hour more than they were making. So we disseminated the information through all the supervisors and just told everyone, "Hey, you need to go have a talk with your staff today, so that we can post these ads tomorrow and everyone's getting a raise effective immediately."
What Was The Staff's Reaction?
Nate Fetig:
Well, I mean, the people that were here like working here already, and so they were pretty ecstatic.
Jack Jostes:
That's amazing. So did any of them then find a referral? Or did any of them suddenly like, oh, I have three people. Or I guess just from a word of mouth standpoint, how did that...
Nate Fetig:
We actually at the same time started an employee referral program. And we had some success with that, but honestly it more happened organically that I think we found that we were better in line with the market after we did that.
Jack Jostes:
And so, did you notice an increase in response to your online ads for positions?
Nate Fetig:
Yeah, almost immediately. We went and we posted a laborer position and in three days we had 16, 18 applications when the week before we got none.
Jack Jostes:
Wow, that's a huge increase. I have to share that I went through this experience myself, and it reminds me of the topic that I was talking to you about of being an accidental employer versus an intentional leader. And I'm at the point now where I've realized I am the leader, and I need to choose to be, and I need to own it. And there was a while where I actually resisted that, where I was the Internet Marketing Director at Ramblin Jackson, and there was no CEO. And then I started hiring people. And my hiring process was like, I would go and have a beer with people. And if I think I liked them and I thought I could trust them, I hired them. And that didn't work out. And then I kind of got better. But I had a really hard time starting to fill positions, and I realized that I was way under market.
Jack Jostes:
And one of the things that helped me get to market was actually closing my office. We became a remote company two years ago. So it was six months ahead of the whole COVID, when it became cool to meet on Zoom. We started six months ahead of that. And I was able to alleviate that overhead and then increase this similarly. And I increased the salary of my current people and then start hiring at an appropriate rate. And it definitely helped.
Jack Jostes:
But you can't just suddenly get rid of your office and your nursery, all this. You have overhead. So how do you find a 30% increase in labor? Did that day, did you also go to your customers and say, "Hey, good news everyone."
Nate Fetig:
No, we understood it as a business decision that we couldn't go to our clients that had already signed a contract and make our problem their problem in that instance. But that day I can tell you that we went into our estimating system and adjusted our crew average wage by 30%.
Jack Jostes:
So not only did you increase the wages of your current people and the new hires, but you also adjusted promptly on your cost of goods. So what kind of reaction came from the other side of the market? The customer.
Nate Fetig:
Yeah, honestly, we didn't notice a slow down at all.
Do You Wish You Had Increased Wages Sooner?
Nate Fetig:
Yeah, a lot. I mean, it was a scary decision and we talked a lot about it in our management group once I brought it to them. And we just decided we didn't have another choice, because if we didn't do it, we wouldn't have anybody to put the jobs in.
Jack Jostes:
So walk me through how do you just make a decision in those scary moments? Because I'm sure that you probably lost a little sleep. I don't know. I mean, I imagine you have a pretty big staff. You're not talking about 3-5% here. You're talking about 30%, and then increasing your price to customers.
Nate Fetig:
Like I said, I kind of had explored other options of what we could do to attract applicants over the preceding months. And if it wasn't working, this was kind of the nuclear option, so to speak. We didn't know what else to do. And so that kind of occurred to me and I took it to our management team. We all discussed it. We discussed the pros and cons. And we as a group decided that's what we were going to live with. And so that was what we moved forward with.
Jack Jostes:
Right on. Well, hey, thanks so much for sharing this. I share this with a lot of clients and they don't do one of the key things that you mentioned in this interview, which is you went out and looked at what other jobs can people get? I had a client who sent me one of their Indeed ads and it was like $12 to $15 an hour. And for an experienced position, and you're laughing, right? And I couldn't laugh in the meeting, but I had to be like, "Hey, let's just look on Indeed." And we found jobs that were $20 an hour with benefits, with no experience, inside. So would you rather be like, "Some people you couldn't pay to do that job inside." But a lot of people are like, "You know what? I think I'm going to go take this other job that's way easier, that pays me more, that's inside." And so you looked around and did you see anything like that? Where you're like, "Oh my gosh." What were some of the positions?
Nate Fetig:
Yeah, I mean, when you started looking at or seeing fast food jobs where they were offering $15 plus an hour and it's like, okay well, I mean, compared to what we do is hard work.
Jack Jostes:
And it's a skilled trade. I mean, I know that you can take entry level people and teach them, but a lot of this is hard work. It's outside. It's physically demanding. It's hot.
Employees Need To Be Compensated Fairly
Nate Fetig:
I mean, you just have to make sure that the people that are doing the work are compensated fairly and enough so that they want to come and work hard.
Jack Jostes:
All right, Nate. Well, thanks so much for coming on the show today. I'm super inspired by what you did. Seriously, that was really cool. And I hope that people listening take action and know that you can do this too. My name is Jack Jostes and thanks so much for listening to The Landscaper's Guide to Modern Sales and Marketing podcast. I am releasing a new book called the Tree of Good Fortune, and I actually have a short interview with Nate in that book. And you've got to get yours. I'm going to send you a free copy. All you have to do is pay for shipping. It's available at treeofgoodfortune.com and I'm having a book launch party on October 20th at the GIE+EXPO. So learn more about that at treeofgoodfortune.com.