Mowing 'em Down: Canadian Weed Man Mega-Zee Also Franchises In The U.S.
After 10 years at Union Carbide, Ottawa-born chemical engineer Roger Mongeon wanted to spend less time traveling and more time with his family. He also wanted to test his entrepreneurial wings and started looking at franchise concepts. His 24-year relationship with Weed Man, the 40-year-old lawn care franchise, began with a casual dinner at a neighbor's home.
"He was running a Weed Man franchise out of his basement, and when he showed me his financials for the previous year I couldn't believe the profitability of the franchise," Mongeon recalls. "I looked more closely at the industry and visited a lot of dealers before I made a decision. I was impressed by the success and enthusiasm of the Weed Man franchisees."
In 1987, Mongeon, who says he's not a big risk-taker, nervously sold his home to buy a Weed Man franchise in Gatineau, in western Quebec. His goal was simple: he wanted to create a financially stable future for his family. "The first year, when I was down to $5,000 on my line of credit, I had this big lump in my throat," he says. "The second year, we actually made money. By the third year, we were ready to expand."
By 1996, as one of Weed Man's largest franchisees in Canada, he purchased the rights to sell franchises in the United States from Weed Man founder Desmond "Des" Rice, and created Turf Holdings Inc. to do business in the U.S.
Today Mongeon-the-franchisee has 47 Weed Man units in Canada, and Mongeon-the-franchisor has 257 Weed Man units in 35 U.S. states. That $5,000 line of credit balance is history: his total system sales are top $100 million, with close to half coming from U.S. interests.
CEO Mongeon, who works closely with his daughter and Turf Holdings COO Jennifer Lemcke, attributes his success--both as a franchisee and a franchisor--to detailed, culture-based business plans, somewhat "maniacal" measuring and monitoring of "everything," ongoing training, and an extremely talented management team. Stringent environmental and marketing laws present constant challenges to his industry, he says, but there's plenty of room to grow, especially in the U.S.
The family man and avid golfer who spends seven months of the year in Canada and five in Florida, has simple but profound advice for aspiring franchisees. "You'll spend a lot of money buying a franchise and getting equipped. When you start, you'll find that even though you've been trained, everything is new and you have a lot of doubts. My best advice is to keep with the system and be tenacious. In the end, it's not the smartest guy who'll be successful--it's the one who's a bulldog in executing the system."
Name: Roger Mongeon
Company: 1051080 Canada Inc., a holding company for several companies in the U.S. and Canada; Turf Holdings Inc., the U.S. operating company for Weed Man.
No. of units: Operate 47 Weed Man units in Canada; U.S. franchisor for Weed Man, with 257 units in 35 states.
Family: Wife Louise; daughter Jennifer Lemcke, COO for Turf Holdings in the U.S.; son Daniel, who has just started in the company in franchise development.
Years in franchising: 24
Years in current position: 18
Key accomplishments: Developing Weed Man franchises in Canada, where we service 95,000 customers and make $30 million in sales, and developing and continuing to grow Weed Man in the U.S. after buying the rights in 1996.
It came in 2001, when the Supreme Court in Canada upheld the Hudson case saying cities had the right to ban pesticides. I felt that we had to hunker down and rein in the business just to survive. For two years, we cut capital expenditures and held back on salaries, and of course this did affect our business. When I looked at growth patterns, I saw that our business had been in trouble and I was the instigator. I realized that, although the environmental issues were still there, we needed to change that strategy. We spent double bringing the business back and things took off.
In 2008, at an industry trade show, everybody was depressed, with suppliers saying this economy is the end of our business. I didn't know if I was doing the right thing, but I went back to the office and talked to our franchisees. I told them 2008 was going to be a great year, not to hunker down, just to be aggressive in marketing and keep doing what they were doing. That turned out to be the right thing to do. We grew 2 percent that year, and in the last three years we've grown at a compounded annual rate of 15 to 20 percent in organic growth. My feeling was that our product was only a $300 item. and that even if 10 percent of people were unemployed, the rest were not going to let go of their biggest investment, their homes. It was the correct call, although I wasn't sure at the time it would be.
How do you spend a typical day?
There is no such thing. I live seven months in Canada and five months in Florida. With my job, my primary focus is strategic planning. I'm always looking at expansion, acquisitions, and other concepts. I also spend a lot of time setting the right culture for the company and mentoring my team. What distinguishes us from other companies is that we are culturally attached to our business plan, which includes everything from personnel to marketing. I set the criteria and the two COOs execute. From there, we're maniacs in terms of monitoring. I have a key matrix that I look at on a weekly basis.
My work week is whatever is needed. I've never not taken a call at 2 a.m. if necessary. My key people are very good, so I'm not involved in day-to-day operations.
Favorite fun activities:
Fishing, golfing, and traveling.
I golf a lot and work with a trainer three times a week.
Favorite tech toys:
I'm an avid reader so my Kindle is my favorite tech toy.
What are you reading?
I love history. I'm currently reading The Great Sea: A Human History of the Mediterranean by David Abulafia.
Do you have a favorite quote/advice?
1) If you can't measure it, don't do it; and 2) Trust and verify.
Best advice you ever got:
Three months after I trained a guy in the lab where I worked, he was my boss. When I went home frustrated, my very wise wife said, "He's a chemical engineer--go to university and get your degree." I did that and it changed my life.
One was making it through the University of Ottawa and the applied sciences and mathematics I needed to get my chemical engineering degree. Nothing could really intimidate me after that. Another was working for Union Carbide, which gave me training with a multinational brand. While there, Jan Kooy mentored me and showed me the importance of business plans and being disciplined at looking at the numbers. Because of that training, when I went to buy my first franchise, I brought business planning to the franchisor--something that wasn't their strength at the time--and it has been embedded in our business ever since.
How do you balance life and work?
I don't really have a problem with this. I'm always working but I'm also living life, enjoying fishing and walking and travel. The only time I really don't do work or even talk about it is the one week each summer when our three grandkids stay with us at our cottage.
We've developed a management circle. It all starts with the business plan, which is core to our beliefs and culture and which tells us when to hire, how many to hire, and how to train in a way that helps us execute our business plan. Once trained, we empower our people and give them a lot of room to make mistakes. We trust and verify and measure everything. With a solid business plan, the right people, the right measurements, and proper feedback, we're going to succeed.
Are you in the franchising, real estate, or customer service business?
In Canada, our operations concentrate on our customers; we're very service-oriented. In the U.S., we concentrate on our customers, who are our franchisees. We spend a lot of time developing training programs and marketing programs to help them be successful in satisfying their customers.
What gets you out of bed in the morning?
New ideas, opportunities. We're working on a new marketing idea and I can't wait to get to the computer and look at the spreadsheet. I've really enjoyed working with an outside consultant for the last 3 years--not something I've been inclined to do in past--and he has really helped our business.
What's your passion in business?
It has evolved from the beginning when I was simply trying to create a secure financial base for my family. As time has gone on and we've become successful, my passion has been seeing our people grow and develop as people, buy houses, and raise kids. It's motivational to see the impact we've had on so many people.
Management method or style:
I spend a lot of time with the business plan and offer the team plenty of room to operate and make mistakes. If there are different ideas or disagreements, we hammer it out in the business plan.
Environmental issues have been, by far, the biggest challenge for our business. It's also been the biggest disappointment to see government operate on emotions and not on science and to be forced to change to products that are muchd more expensive and deliver lower results to customers. Another ongoing challenge is dealing with marketing laws put into place by governments trying to justify their existence. I understand the bigger picture, but somehow it's got to be based on science.
How close are you to operations?
Not at all in the day-to-day.
Have you changed your marketing strategy in response to the economy? How?
We have changed our marketing strategy not because of the economy but because of legislation, such as the "Do Not Call" list. Also, we saw a shift in 2011 with more people buying on the Internet, so we've changed our marketing strategy and are developing our cyberspace strategic presence in response to customer buying behavior.
My daughter says I'm an analytical, driven individual with my eye on the results. I'm not a risk-taker but I'm extremely tenacious and loyal.
How do others describe you?
My daughter says people view me as a leader who is tenacious, analytical, and loyal.
Fire and hire?
I haven't really done much of that in years; the same six key reports I recruited are still with us. They've been allowed to buy shares. They've made a lot of money and they're worth a lot of money.
How do you train and retain?
We continually do that, using the management circle to adjust training for results.
How do you deal with problem employees?
In the past, I've been loyal to employees to the point of keeping them on too long. Two years ago, I hired a consultant who helped me understand what a problem employee can do to the rest of the people. We let some fairly senior people go and found that the managers who worked for them became better managers and more excited about the company. In one branch, we increased profit by 250 percent in one year by letting one person go.
Total system sales are $100 million-plus, with close to 50 percent of that in the U.S.
In Canada, we're budgeting for between 10 and 13 percent; in the U.S., our franchisees are doing their budgets and we're budgeting for between 15 and 20 percent growth.
Growth meter: How do you measure your growth?
In Canada, we measure through the top line. In the U.S., we measure by total system sales, number of customers, and number of new units added.
Vision meter: Where do you want to be in 5 years? 10 years?
In Canada, we want to maintain double-digit growth and better target our marketing programs to homeowners. We're also considering other concepts. If we don't do anything, we'll have a hard time meeting our goals, but it's important to choose the right concept. In the U.S., our vision is to establish a national brand across the country. We're still localized, but in the next 5 to 10 years, we'll be there. Our goal is to be in every state and every major market, to maintain organic growth of 15 percent, and to double our units in the next 10 years.
How has the most recent economic cycle affected you, your employees, your customers?
Are you experiencing economic growth/recovery in your market?
We continue to show solid growth, and I sense that the consumer is more at ease. We knock on millions of doors and phone millions of people every year, so we have a good sense of what's going on. I think a lot of it is attitude. If you feel you're going to have a bad year, you're going to have a bad year. We've taken a different approach.
What did you change or do differently in this economy that you plan to continue?
How do you forecast for your business in this economy?
When we sit down with our business plan, our historical data is already in the plan, so we know what our contact and closing rates are. We use that, and it's pretty accurate in terms of where we'll be at the end of the year.
Where do you find capital for expansion?
After 1993, all our acquisitions have been made using banks and cash flow. In the past four years, we've used only cash flow.
Is capital getting easier to access?
Not for our franchisees, who have experienced serious difficulties in accessing capital. We've provided our franchisees with business plans and helped prepare them to go to the banks. We've also started a program in which we self-finance part of the startup costs of franchisees.
Have you used private equity, local banks, national banks, other institutions?
Before 1993 we used family, friends, and colleagues. Since 1993, it's been all banks or cash flow.
What kind of exit strategy do you have in place?
I'm not sure about that yet, but we have such an exceptional management team, including my daughter Jennifer, that I could retire tomorrow and have minimal impact on the business. However, we're happy and still have lots of room to grow, especially in the U.S., so I'm not really thinking about that right now.
What are you doing to take care of your employees?
The biggest thing we can do for our employees is to continue to grow and create opportunities for them. We also pay our employees really well.
How are you handling rising employee costs (payroll, healthcare, etc.)?
In Canada, of course, healthcare is not an issue. In the U.S., it's a different story. Generally, our payroll has been covered by price increases.
How do you reward/recognize top-performing employees?
In our company, we like to have our employees motivated, so a portion of everybody's salary is geared to bonus and commission. We have a matrix that determines allocation of these benefits.
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