Economic Data


What economic data is the most important for the small landscape company to try and monitor? Staying on top of key economic indicators can help you stay on top of your current costs structures, and provide you some insight into future revenue and cash flow considerations.

This article has been developed to help existing businesses, or new business entrants, an assistance when developing business plans in summarizing what economic factors impact the landscape industry and some economic indicators to watch.

What are the macroeconomic factors that most impact the landscape industry?

In major sectors of the U.S. economy, there are a lot of measurements and guidelines in place to help stay on top of what the current status is of the industry.

Often times these measurements are provided by government agencies, or large trade associations that help monitor important metrics and indicators. For example, if you are home builder, the government tracks key economic indicators such as new housing starts, new housing permits and more to track this economic indicator.

A long standing problem for the landscape industry is how to monitor and gauge the current status and health of the landscape industry at different points of time. There are many reasons why this difficulty exists.

As mentioned, the government does not track the economic impact of the landscape industry on the U.S. economy. State and federal governments may regulate parts of the industry, but only certain sectors of the landscape industry, primarily at the manufacturing level, may be able to gain some market intelligence as it relates to the landscape industry.

Mostly all of the participants in the landscape industry are privately held organizations, and of the companies that may be publicly held, information which may yield clues as to the state of the industry are often buried within other financial numbers.


Like many other industries, weather plays a significant role in being able to gauge the health of the landscape industry. Even if the economy and housing starts are strong, the weather can impact working days which in turn effects revenue.  The impact of weather, can also be even more dramatic in more seasonal northern markets that have a shorter season to create their revenue.

Besides the number of working days that impact revenue forecasting, the timing of weather events on a year over year basis can also be significant. For example, an early spring may create not only more working days for the landscape industry, it may also spike different demands for products earlier in the season.  Another example is when a seasonal market may have above average rainfall and end users may delay or forgo hiring a landscape professional for certain projects not only for the current season, but for an entire year.

Weather patterns can impact not only revenue projections, but the industry in total. Long periods of drought can severely impact the health of plant material, and change the types of products that are used in landscape projects.  Droughts continue to bring increased government and regulatory pressure into the industry to protect critical water supplies. The increased scrutiny of government combined with public perception of how to properly use water resources impacts industry trends.

The impact weather can have on the landscape industry cannot be overstated.


The raw material costs of fertilizer is a significant cost input to monitor for the landscape industry. Of course, for lawn and landscape maintenance professionals, it is a significant part of their cost of goods sold.  The raw material inputs into fertilizer production can change dramatically and are largely driven by factors outside the landscape industry, examples include natural gas and agricultural markets.

The costs of fertilizer impacts not just what the lawn and landscape company may purchase to sell as a service, but it is a significant cost input for producers of nursery material, sod and seed.


Fuel costs are a significant cost input for landscape professionals to operate their equipment and travel between projects. The landscape industry also has significant delivery costs to get freight intensive products to job sites. All suppliers of delivered products to landscape professionals will want to pass these costs through in the form of higher prices or delivery fees.

But the raw input cost of oil is much more widespread than just in fuel costs. Resin, which is a derivative of oil, is critical in the products of plastics and pipe. For landscape irrigation systems, pipe is a major cost input which can fluctuate dramatically impacting suppliers and contractors. The cost of resin is a significant cost input for irrigation manufacturers, and any landscape manufacturer that produces plastic components.

Housing Starts and Construction

Housing starts are one of the most important economic barometers used in the landscape industry to try to gauge industry performance. Many sectors of the industry can see revenue trend lines to housing starts. Because irrigation and landscape are among the last installed parts of new construction, there will be a three to nine month lag time between housing starts and landscape services.

Construction project estimating and bid contracts are iterative in nature, and often overlook the impact cost variables can have between project bids, awards and the actual installation. This is true across all of the trades in construction, but can have a very large impact on the landscape industry because irrigation and landscape are the among the last portions of the project. Projects which are over budget will often look to cut, or significantly curtail, the final costs of landscape and irrigation.  Obviously, this impacts revenue and can even pressure margins.

Human Resources

Like almost all businesses, the cost of human resources is one of the largest costs in operating a landscape business. The landscape industry requires a lot of manual labor and depending on the products and services being sold, there are many portions of the industry which require a high level of technical skills and critical thinking.

Finding and retaining a high quality work force is one of the biggest challenges landscape companies face.

Business Planning Data

There are a lot of excellent resources available for landscape professionals who are developing or refining their business plans.

Once again, the federal government’s Small Business Administration’s website is a tremendous resource for the small business owner. The Office of Advocacy has put together a consolidated list of Small Business Data. This page of the SBA website clearly explains the benefits of this consolidated report.  Here are the some of the links we have found most useful for the small business landscape company.

With the right links to different websites, a little bit of direction, a small business owner, or an aspiring entrepreneur can do a lot of basic research on the industry.

North American Industry Classification System

North American Industry Classification System – from the U.S. Census Bureau

Being able to do research on our industry requires you to know the codes for the North American Industry Classification System (NAICS).  For a more thorough explanation of the detail behind the NAICS code there is a robust FAQ.

NAICS Codes for the Landscape Industry.

  • 561730 Landscaping Services – This industry comprises (1) establishments primarily engaged in providing landscape care and maintenance services and/or installing trees, shrubs, plants, lawns, or gardens and (2) establishments primarily engaged in providing these services along with the design of landscape plans and/or the construction (i.e., installation) of walkways, retaining walls, decks, fences, ponds, and similar structures.*Cross-References. Establishments primarily engaged in–
    • Installing artificial turf or in constructing (i.e., installing) walkways, retaining walls, decks, fences, ponds, or similar structures–are classified in Sector 23, Construction;
    • Planning and designing the development of land areas for projects, such as parks and other recreational areas; airports; highways; hospitals; schools; land subdivisions; and commercial, industrial, and residential areas (without also installing trees, shrubs, plants, lawns/gardens, walkways, retaining walls, decks, and similar items or structures)–are classified in Industry 541320, Landscape Architectural Services; and
    • Retailing landscaping materials and providing the installation and maintenance of these materials–are classified in Industry 444220, Nursery, Garden Center, and Farm Supply Stores.*
  • 541320 Landscape Architectural Services – This industry comprises establishments primarily engaged in planning and designing the development of land areas for projects, such as parks and other recreational areas; airports; highways; hospitals; schools; land subdivisions; and commercial, industrial, and residential areas, by applying knowledge of land characteristics, location of buildings and structures, use of land areas, and design of landscape projects.*Illustrative Examples:
    • Garden planning services
    • Landscape architects’ offices
    • Golf course or ski area design services
    • Landscape consulting services
    • Industrial land use planning services
    • Landscape design services
  • 238110 Poured Concrete Foundation and Structure Contractors – This industry comprises establishments primarily engaged in pouring and finishing concrete foundations and structural elements. This industry also includes establishments performing grout and shotcrete work. The work performed may include new work, additions, alterations, maintenance, and repairs.*
  • 444220 Nursery, Garden Center, and Farm Supply Stores– This industry comprises establishments primarily engaged in retailing nursery and garden products, such as trees, shrubs, plants, seeds, bulbs, and sod, that are predominantly grown elsewhere. These establishments may sell a limited amount of a product they grow themselves. Also included in this industry are establishments primarily engaged in retailing farm supplies, such as animal (non-pet) feed.
  • Cross-References. Establishments primarily engaged in:
    • Retailing nursery and garden products via electronic home shopping, mail-order, or direct sale–are classified in Subsector 454, Nonstore Retailers;
    • Providing landscaping services–are classified in Industry 561730, Landscaping Services; and
    • Growing and retailing nursery stock–are classified in U.S. Industry 111421, Nursery and Tree Production.*
  • 111421 Nursery and Tree Production – This U.S. industry comprises establishments primarily engaged in (1) growing nursery products, nursery stock, shrubbery, bulbs, fruit stock, sod, and so forth, under cover or in open fields and/or (2) growing short rotation woody trees with a growth and harvest cycle of 10 years or less for pulp or tree stock.*

* Note: All descriptions come directly from the U.S. Census Bureau website.

U.S. Department of Commerce – Bureau of Economic Analysis

Bureau Economic Analysis – Regional

As a small business owner you may want more detailed information about the size of the market you are participating in or more specific information such as how much has construction spending changed one period to a next.  This information may also be helpful for you when trying to determine the size of a market and your opportunities in the market.

The government breaks down different regions of the country into different categories and provides specific economic information on these areas.

  • Metropolitan Statistical Areas (MSAs)
  • Micropolitan Statistical Areas
  • Metropolitan Divisions
  • Combined Statistical Areas.

This government resource can give you some very quick and helpful market research information. For example, if you wanted quick information on the Metropolitan Area of San Antonio-New Braunfels, Texas MSA you are in luck. If you want to know what counties are in each MSA and economic break down for those counties you can accomplish this as well . You can also determine which Metropolitan Statistical Areas roll-up into larger Combined Statistical Areas.

This is also a quick tool to get you information about Local Area Personal Income and Employment Information for the construction industry for each of the Statistical Areas. This information may be helpful in adding a data point to how you structure your wage programs for your employees.  You can also compare markets growth rates in the same period of time.

While some of this data may be more valuable to manufacturers or distributors of products in the landscape industry, these are valuable government provided resources to improve your business intelligence. This information may also be valuable in developing or refining your business plans.

There are 381 Metropolitan Statistical Areas (MSA) in the United States.

American Fact Finder – The U.S. Census Bureau

For very fast information on the communities you are targeting for your business, you will want to quickly go to American Fact Finder.

This is a very robust database of information, but the simple enter the community you want to reach on the first page will give the high level demographics you need in developing your business plan.  For example, just knowing how many households are in a specific zip code would allow you to start to determine the size of your addressable market.

Example: Johnny Wolverine Landscape

Market to Target: Zip code – 48236 (Grosse Pointe Farms and Grosse Pointe Woods, MI area)

Useful information we can retrieve in just a few minutes on American Fact Finder.

  • Population: 30,607
  • Total Housing Units: 12,596
  • Median Income Level: $91,782

Under each of the basic demographic reports there are more detailed reports that break down all of these categories.

You can also get more information quickly on Quick Facts from the Census Bureau.

Quick Facts – from the U.S. Census Bureau.

Using the Quick Facts website we can break down the two communities that make up our target zip code into one table.

Economic Data Sources – Cost Impact

  • Human Resources
  • Interest Rates
  • Fuel
  • Insurance

Economic Data Sources – Business Impact

  • New Housing Starts – from the U.S. Census Bureau
  • New Residential Sales – from the U.S. Census Bureau