Wednesday, July 27, 2011
Acadiana’s Top 50 Privately Held Companies, led for the second year in a row by Moreno Group and Schumacher Group at Nos. 1 and 2, respectively, got back on track in 2010.
Only 20 percent of the companies on the Top 50 list experienced a decline in revenues, compared with 52 percent showing revenue drops from 2008 to 2009. That means a whopping 76 percent of the companies on the list boosted their revenues.
So as the national recession dominated headlines and the drilling moratorium kept fear of the unknown hovering over us for months, threatening to draw us into the country’s economic doldrums, Acadiana companies refocused with dramatic results.
New additions to this year’s list caused a bit of a shakeup in the top 20. Debuting on the list at No. 11 is Crowley-based Louisiana Rice Mill; No. 17 is Louisiana Crane Company of Eunice. Both companies reported substantial revenue increases.
But there were challenges across the board. Fire & Safety Specialists President Chad Meaux says competitors lowering their rates to get work has been a major issue. “We had to continue to sell FSS on our superior service to keep from lowering our rates,” he says. “It’s sometimes difficult to have a customer look at the overall picture rather than just a per hour dollar rate.”
Meaux also cites the ongoing increase in operational costs. “Every year it’s getting more expensive to do business, higher training requirements, increased employee wages, higher insurance costs, increased fuel and maintenance costs, and we still have customers that want our 2006 rates. It’s a daily battle to grow a business, to stay competitive and to still maintain good profit margins without cutting quality.”
Other local businessmen say they can relate to those challenges, especially the anchor companies that have been driving the local economy for decades. While the food manufacturing business remains extremely competitive, the 8-decades-old Bruce Foods in Iberia Parish met — and slightly exceeded — its sales goals last year. “During 2010 we saw significant increases in our traditional trade channels plus increases in new business as a result of internal investment and additional employees,” says company President Si Brown. Bruce Foods introduced several new items that were well received by both domestic and international customers, Brown says, among which were Casa Fiesta Peppadew Salsa, Bruce’s Baked Sweet Potatoes (in a pull top can) and Magic Garden hummus.
Like Bruce Foods, Acadian Companies hasn’t missed a beat in the last few years. Its growth from 2008-2010 was 32.2 percent, and during the last year alone, it grew 23 percent.
A number of companies on the list, including Acadian, attribute a portion of their sales increases to work that resulted from the Deepwater Horizon disaster. Acadian’s Safety Management Systems was the primary provider of medical services after the blowout, says Chairman and CEO Richard Zuschlag. “In addition to setting up and staffing several Mobile Medical Command Centers across the Gulf Coast, SMS continued to provide medical standby services for months after the explosion,” he says.
View the list of Acadiana's Top 50 Privately Held Companies and the region's eight locally based publicly traded companies here.
|Moreno Group President Emile Dumesnil|
Top of the Heap — Again
Topping the list of Acadiana’s largest privately held companies once again, Moreno Group has gone by several different names in the past. Readers may remember it as Dynamic Offshore Contractors, Moreno & Associates or recognize one of the group’s subsidiaries like Dynamic Industries or Southern Steel & Supply.
The many faces of Moreno Group over the years do not represent an identity problem, though. At the age of 42, founder Mike Moreno’s ability to take the company from a small maintenance contractor to an international energy services company with locations in four countries and revenue of $616 million represents a business strategy that’s working well.
“[Last year] was a great year for us,” says Moreno Group President Emile Dumesnil. “Our revenue was steady from 2009 to 2010, but our earnings reached the highest point in the history of the company last year.”
Dumesnil credits the strong performance to two large projects, which helped offset the effects of last year’s moratorium. Moreno is working in Angola, Africa, on modifications and additions to a platform for Chevron, and, closer to home, the fabrication division is building modules at its yard in the Port of Iberia for a BP refinery in Whiting, Ind.
These two projects are a perfect example of Moreno’s diversification over the years, which has allowed the company to stay profitable. “The overarching strategy back in 2002 was to acquire and/or start up companies that represented a vertical integration strategy,” says Dumesnil. “So, if we spent a whole lot on pipe valve fittings and steel, and it was important to our customers to control the supply chain and have quick turnaround of critically sourced items, then we went and acquired a company that supplied pipe valve fittings and steel.”
The company Dumesnil is referring to is Southern Steel & Supply, but the Moreno Group story actually starts several years earlier. In 1998, Moreno purchased Dynamic Offshore Contractors. A struggling New Iberia maintenance contractor with a challenged safety record, the company has since morphed into Dynamic Industries. Moreno’s other subsidiaries came about because of a client’s need for expanded services.
A lack of offshore living quarters after hurricanes Katrina and Rita led another subsidiary, ARC Industries, into the portable living quarters business. DII LLC is also a direct result of the hurricanes, as Moreno found itself filling a need for disaster recovery services in early 2005. Next up is Dynamic Power LLC, which capitalizes on Moreno’s core competency of modular fabrication but targets a new industry — utility and power generation.
Dumesil explains how power fits into the picture. “If there is going to be a renaissance of newly constructed power plants in this country, then it follows the same sort of construction strategy that allowed us to build refineries on budget and on schedule.”
That construction strategy is modularization. Instead of being influenced and often delayed by weather and workforce limitations on a job site, Dynamic builds projects in modules at its two fabrication yards, at the Port of Iberia and in Lake Charles, and transports them to the site.
“That’s the whole idea with the power generation industry,” Dumesnil continues. “We’re going from upstream to downstream, now power. We’ve actually evolved into a company with a great specialization in modular fabrication. All the major engineering companies in this country view us as the go-to yard. We’ve built modules for BP, Total, Exxon, Valero, so we’ve got a big footprint in this market.”
At the end of the day, Dumesnil, who has a background in investment banking, shipbuilding and fabrication, says it’s about being creative and looking at business a little differently.
“The way we made money last year is not going to be the way we make money next year,” he says. “We’ve got to constantly reinvent ourselves. To survive, last year’s Gulf of Mexico fabricator has to evolve into next year’s global EPC contractor. If Chevron or BP or Shell or Exxon wants Dynamic in Angola or Canada or Latin America, Dynamic will be there.”
While glimpses of Mike Moreno’s original company are still visible today in terms of a focus on safety and presence in New Iberia, Moreno Group may be otherwise unrecognizable to those who remember the early days. As Moreno continues to add more of the supply chain under its umbrella of services, customers are rewarded with a one-stop shop mentality, and revenue goes up.
For Dumesnil, the strategy is simple. “If we can make our clients’ lives a little easier, obviously there’s some revenue growth opportunity for us,” he says.
|Chris Vincent of Global Data Systems, with Network Engineer David Reichel|
All About Access
Chris Vincent is leading companies into the clouds.
Global Data Systems Inc., led by President Chris Vincent, is a networking solutions provider that started in 1987 and is headquartered in Lafayette. The mission of GDS is to “partner with our clients in the delivery of world-class IT solutions designed to solve business needs and maximize productivity.”
One of the most recent steps in the delivery of such prime solutions is companies beginning to use GDS for cloud computing architecture, which is essentially the storage of information where it can be accessed on-demand from the Internet instead of just saving information and processing power to local servers. Vincent, along with many professionals who work in IT and computing, says cloud computing’s attraction comes from its capacities to increase storage and processing power, making a company more efficient, while reducing costs.
Cloud computing, termed the “phrase du jour” by several IT experts, is an emerging standard that can unfold into the future under the GDS model, Vincent says, because once companies upgrade to cloud, they can buy for today’s needs and then call GDS to add in additional future necessities. This different operating model, Vincent says, lets companies buy service for less money.
“It’s on-the-fly access to processing power, memory and storage,” Vincent says.
He says with new GDS innovations, companies will not have to hire IT operators to support them because GDS lends support from its data centers. GDS has become a competitive local exchange carrier now that GDS has integrated all telecommunications offerings, he says.
Vincent says his company is now building around an operating expenses model, where companies pay off expenses within the year expenses are incurred.
GDS has seen a revenue increase from about $32 million to $37 million during the past year, which Vincent attributes to the economy picking back up, adding employees, growing “net-due divisions” and expanding facilities.
In terms of expanding facilities, Vincent says they have added antennas and are about to continue growing their network by implementing teleport antennas. He says their footprint is on the horizon of spanning from Canada to Panama along with the east and west coast. GDS has three sales divisions: exclusively oil and gas; government, which encompasses state, local, K-12 and higher education; and commercial sales organizations.
Amid revenue increases and facility expansions, “the people in the company are the largest asset,” Vincent says. He says it’s vital for his company to continue investing in training and education for employees, which in turn allows customers to become competitive in their respective industries.
“We’re constantly investing in our employees,” he says. “We’ve got to stay on the leading edge of technology to bring our customers to the leading edge of technology.”
Technology advancement is not the only kind of training GDS employees receive. Vincent says his company takes a “different approach” by engaging in a variety of trainings, such as the business-leadership Rockefeller Habits. Since employees are the company’s largest asset, he says, leadership training “creates a return on investment.”
While not all customers are accustomed to the different technologies and operations GDS offers, Vincent says his company focuses on the need of the customer and fulfilling that need, which bridges any gaps caused by unfamiliar terms.
“We define our technology architectures by applying technology to our customer’s need to reach productivity, where our customer receives a return,” he says.
|Sharon Moss of Moss Motors|
Keeping Up With the Mosses
“The luxury market suits me very well,” says Moss Motors owner Sharon Moss. A seasoned businesswoman, Moss also isn’t afraid to adapt her luxury ideals when the market takes a turn. “Business over the last two years has been off,” she says, “but used cars are at a tremendous premium and will be for some time.”
It’s this line of business that’s allowed the import dealer of Honda, BMW and Mercedes Benz to show a revenue increase of $16.6 million from 2009-2010. Moss says the dealership’s pre-owned lots on Johnston Street and at Lafayette Regional Airport, in addition to a certified pre-owned lot on Surrey Street, are doing very well and helping to offset a lack of Honda inventory stemming from the tsunami in Japan earlier this year.
“We’re just not getting enough cars,” says Moss about Honda. But when it comes to a used car, “you can get a BMW for what you could get a loaded-out, American-made car.”
The used car side of the business has been so successful, in fact, that Moss recently leased property from the airport commission on Highway 90 for a future used car superstore. Located next to the Shell station on the corner of Surrey and Evangeline Thruway, the superstore’s planned inventory of more than 400 units will rival that found in much larger cities.
This isn’t the first time Moss has found opportunities for growth in a tough economic climate. She started out as Moss Motors’ first receptionist after her husband founded the dealership in 1979. When he died 10 years later, her financial advisers told her to sell the business. Instead, she chose to sell off two franchises and invest the insurance money in growing the company’s luxury lines.
Her gamble paid off, and Moss Motors has been going strong for more than 30 years. It’s currently the seventh largest dealership in the state. In such a highly competitive industry, Moss is tight-lipped about plans for additional luxury lines. “I feel lucky to handle the lines that I handle,” she says.
Instead, she talks about the effect of the Internet on the automotive industry. “The Internet has changed the way we do business,” she says. “Consumers are a lot smarter, and it’s good to have a consumer who is informed.”
Customers also want more options for shopping, including being able to browse available inventory without having to leave their home. Moss Motors now offers online shopping for both new and pre-owned vehicles through its website, mossisboss.com, and Moss says customers can look forward to virtual tours of cars coming soon.
Of course, Moss still wants customers to visit the Surrey Street dealership and experience the customer service Moss is known for. “We’re proud that our mission of exceeding customer expectations with our products, people and service has remained strong,” she says. “We’re just a different game in town.”
|Randy Paul of Home Furniture|
Right at Home
In 2006, Home Furniture experienced a banner year due as customers needing furniture during their rebuilding process after Hurricane Katrina flocked to stores. That year also marked a big announcement for the Lafayette-based business. Home Furniture opened a 450,000-square-foot distribution center on Pont des Mouton Road, in what had been an Auto Zone facility, allowing the company to stock more inventory and expand its retail showrooms.
Five years later, President Randy Paul says business remains stable, but the company’s growth has tapered off since. Coming in at No. 28 on the list, Home Furniture experienced a $6 million decline in revenue from 2009-2010.
“I think that disposable income is down, so that’s definitely a factor,” says Paul about the drop in revenue. “We’ve had an increase over last year right now, so we’re happy about that, but we’re kind of staying where we are until the economy gets a little bit better.”
Even if Home Furniture did have new product lines to announce, they probably wouldn’t be names recognizable to the customer, he explains. As imports from China, Vietnam and Malaysia have flooded the market, American furniture makers are few and far between.
“When we get into regular furniture brands, there’s not that many name brands left anymore,” says Paul. “There’s so much import stuff that we’re buying now, nobody would recognize the names.”
While imports have changed the way stores like Home Furniture do business – pieces arrive in huge containers and warehouses are necessary for storage – Paul says the customer is ultimately getting a better deal and a better product.
“The furniture is better built and better priced,” he says. “The quality of the furniture now is probably better than it’s been since I’ve been in the furniture business for 40 years.”
Home Furniture started in Lake Charles in 1949. Founder George P. Fleming franchised the business in 1972 to his son, Ged, who opened the first store in Lafayette. In 1974, Home Furniture opened a New Iberia location, and Ged eventually bought the business from his dad. Stores in Beaumont, Baton Rouge and Port Arthur followed throughout the 1970s, bringing the company total to eight locations today.
In addition to sofas and dining sets, Home Furniture also sells mattresses by Simmons, Serta and Tempurpedic. Unlike the furniture, these are brands customers are very familiar with, and Paul says the recent addition of Serta has been great for business.
Home Furniture does plan to begin offering its products online in the next year, but Paul doesn’t expect sales to have much of an effect on the bottom line. “There are some people that will buy a sofa online without sitting on it,” he says, “but the vast majority want to lay or sit on a sofa or mattress before they buy it. They want to see that bedroom suite. They still want that experience, so it’s never going to be where it’s bigger than the sales in the actual store.”
Thanks to Home Furniture’s distribution center stocked full with furniture, customers don’t have to wait long for a piece to arrive at their home.
“We pride ourselves on customer service, taking care of the customer after the sale,” says Paul. “The distribution center allows us to have it in stock, so when you buy a piece of furniture from us, you can be guaranteed next-day delivery. That’s pretty unusual in today’s times.”
|Taylors International’s Jamie Tarpley, G.T. Butch Darce, Dot Darce and Jon Murphy|
From Gulf to Globe
One crisp fall day back in 1996, G. T. “Butch” Darce was getting off a plane from his work with an international food service company and had a revelation. He decided he could provide a better quality of work than other catering companies by providing better service and being more customer friendly.
With help from his wife Dot, Darce founded Taylors International Sevices, Inc. with the idea of providing the best quality catering services to oil and gas companies in the Gulf of Mexico.
“We had zero customers and zero sales when I first started the business,” says Darce.
Darce says his young company evolved quickly by making the clients he knew aware of what his new company could offer over the others. “It’s like having a new idea and making the new idea work,” he says.
Fast forward nearly 15 years later and you can see how that kind of savvy thinking has paid off for him. The company now operates in and out of 10 countries and employs more than 600 employees all over the globe with 325 right here in Acadiana. It has offices in Baghdad; Kabul, Afghanistan; Houston; Sonkla, Thailand; an office soon expected to open in Brazil; and of course its worldwide headquarters right here in Lafayette. The company also raked in more than $55 million in revenues in 2010.
According to Darce, anywhere between 90 and 95 percent of the seafood and produce it uses to cater its projects in the gulf area is supplied regionally from Louisiana, Mississippi and Texas. And for its global operations, the company tries to buy the freshest produce within that region.
Taylors also does work for military and military-related services, the Department of State, private firms, several embassies around the world, pipelines and mining.
Darce says he has specific goals for his company in the coming years, projections of 10-12 percent growth for 2011 and 12-15 percent for 2012, which he will reach through marketing, customer needs, basis on the world economy, input from employees and his own strategies.
“You can grow a company but there are times you have to stop your growth to look at what you have in management and operations and you have to re-evaluate your company every so often,” he says. “You have to reassess yourself and your company and you have to make sure you have the right people in place.”
As one of the few caterers in the world to have its own operations and maintenance group, the company created the Taylors Operations Management System to help manage its global operations. TOMS is a copyrighted private system that helps managers and dispatch personnel work within the system to keep communication lines widely open to all management and team members.
“My people in Thailand have the same connection that my people here in Lafayette have; the same one my people in Iraq, Afghanistan, Northern Africa and South America have. Everybody has the same network that we use,” he explains.
The company also helps with disaster relief. Currently, Taylors has an ongoing operation in Haiti helping the battered country rebuild its infrastructure and bids have also been put into Japan.
“I think everybody has pretty much the same abilities to do what we do, it’s just the way you do it,” says Darce. “It’s the way you direct your group to define what you want to be and what you want to do.”
|Bill Fenstermaker and Kam Movassaghi of Fenstermaker & Associates|
When William Fenstermaker Jr. went a step further from his father’s land surveying footsteps and founded C. H. Fenstermaker & Associates Inc. in New Iberia in 1950, his son, William “Bill” Fenstermaker Jr. jokes that “when it opened, I think my father took my bedroom and opened his office.”
Now headed by Fenstermaker Jr. and former state Department of Transportation and Development Secretary Kam Movassaghi, “today, the company’s a lot different.”
“My father started out doing survey work for oil companies,” explains Fenstermaker. “We do a lot more of that work, but also a lot of engineering services outside of the energy industry, a lot of work around the South. The majority of our work comes from energy related activities and engineering activity that takes place away from Lafayette or out of state, along with a good mix of projects that come from within the state and within Lafayette Parish itself and the surrounding areas.”
Fenstermaker & Associates employs roughly 280 people at its five offices in Lafayette, Baton Rouge, New Orleans, Shreveport and Houston, and the company’s work can be seen far beyond the private sector energy companies that the firm relied on when it first opened 60 years ago.
Roads, bridges, dams, levees and other essential public infrastructure projects have been completed at the hands of Fenstermaker employees, whose recent major infrastructure project was the completion of a new $4.5 million water plant in Carencro.
“We’re pretty proud of that project,” Fenstermaker says. “Our engineering group did a wonderful job on that facility.”
One of the largest public projects ever undertaken by Fenstermaker was its portion of the $5.2 billion state project that built 500 miles of road and two bridges on U.S. Highway 165. The firm’s portion was rather small, Fenstermaker says, but “it was large for us.”
Other significant public projects date as far back as 1988, when Fenstermaker and Associates was hired by the U.S. Army Corps of Engineers to map the entire Atchafalaya Basin.
Fenstermaker, who took over the company in 1980, is modest when asked to what he attributes the decades of success the company has had in Acadiana and around the South.
“I’d have to say good people,” Fenstermaker says. “We employ people, and our clients hire them. I don’t think our clients would hire us if we didn’t have good people. We have the right people doing the job. It’s a great place to hire people. This region’s been very good to us. We have to participate in the area that’s supported us.”
Movassaghi agrees, but says the overall success should be credited to much more.
“For any business to be successful, you have to have a vision, have to know where you’re going, have to realize economic forces around you, how you can survive and progress,” says Movassaghi. “Bill has from very early on always had a vision for using technology as much as possible in his everyday activities, and he’s absolutely right, people are the key, but the people without the tools are not going to be effective. You have to have the proper tools at their disposal to reach their maximum potential. A combination of those two have been the key to success for the company. I think we do a great job in this community. Not only are we a first-class engineering company, we both are community minded, both involved and try to give back to the area that’s been very good to us.”
|Paul McIlhenny of the McIlhenny Company|
Still Bringing the Heat
Whether it’s sprinkled on gumbo, étoufée, eggs or now even chicken wings with its own special buffalo sauce, the most famed pepper sauce in the world is undoubtedly Tabasco, a household name that’s been manufactured in Acadiana for more than 140 years.
Avery Island’s Edmund McIlhenny was a foodie and gardener in the 1860s who needed something zesty to add to the “bland” food that was served during Reconstruction. His cultivation of Mexican pepper seeds that started as a hobby turned into what is now known as Tabasco sauce, believed to mean “place where the soil is humid” or “place of the coral or oyster shell” in an ancient Mexican Indian language.
But what began as a sauce to share with friends and family has turned into more than an international company, or “more than heat.” It’s a brand that encompasses more than a century of family traditions and an island that draws thousands of tourists every year and is home to more than half of the 200 employees who work for Tabasco. Today, Avery Island’s attractions are as well-known as the sauce itself, with daily tours of the pepper plant and bus loads of tourists heading to the island to explore the majestic Jungle Gardens.
As for the branding, Tabasco is the only nationally and internationally marketed pepper sauce on the planet, relying on its reputation and the fact that so little has changed in the company since its start in the 1860s.
The peppers used in the sauce are personally selected by a member of the McIlhenny family every year, then made into a “mash” that includes a bit of salt mined from Avery Island’s underground salt domes. The mash is stored in white oak barrels that are covered, topped with more salt and aged for three years before going to bottling.
In addition to the original pepper sauce, Tabasco has released several other flavored sauces since its inception, including Chipotle Pepper sauce, green Jalepeno sauce, Sweet and Spicy Pepper sauce and very recently its buffalo sauce, which is described on its website as the “perfect” wing sauce when mixed with melted butter.
Other Tabasco products include steak sauces, salsa, snacks (like Cheez-It) infused with Tabasco sauce, chili and bloody mary mix. Last year, the company teamed up with Popeye’s for a national marketing campaign to promote Tabasco through Popeye’s wicked chicken meal.
Chefs from across the country who want to get a little creative with Tabasco products can enter the The TABASCO® Brand Hottest Chef Contest, a biannual competition that in 2009 awarded $10,000 to its contest winner. Tabasco also has been known in the past to host Hottest Bartender and Ultimate Bloody Mary contests as part of its dedication to using pepper sauce in mixology.
Now headed by the fifth generation of McIlhennys since the company was founded, Paul McIlhenny is the sixth McIlhenny to serve as president of the Avery Island pepper manufacturing operation that labels its pepper sauce in 22 languages, is sold to more than 160 countries worldwide and is even “included in soldiers’ rations.”
A Good Year for the Top 50
The year in rear view was better than expected for most company execs.
In 2010, 38 companies’ revenues were up, 10 were down and two were flat. The Top 50 companies confirm just how energy-dependent the local economy remains, as roughly 40 percent of the businesses on the list derive all or a portion of their revenues from the oil and gas industry.
One such company was Fire & Safety Specialists, a safety products and services company founded in 2002 and headquartered in Maurice. It’s important to keep in mind that a revenue decline doesn’t necessarily translate into softer earnings. Again FSS is a prime example. Last year presented new competitive challenges for the company, says founder Chad Meaux, but with the closing of the books came a sigh of relief. “It’s the first year in our history that we did not have a good percentage of revenue increase, and we probably worked harder than ever,” Meaux says. “We did not drop much, but we did not gain revenue. We were very fortunate that our profits were where they were; in fact they even increased a little.”
Faced with uncertainty due to the offshore drilling moratorium, local companies more than held their own. Here’s how the top 25 on the 2010 list fared:
Who Was Up:
Schumacher Group, 13 percent
Stuller Inc., 8 percent
Louisiana Wholesale Drug, 8 percent
Acadian Companies, 23 percent
Sunland Construction & Affiliates, 3 percent
Doerle Food Service, 15 percent
Frank’s Casing Crew & Rental Tools, 6 percent
Bruce Foods Corp.,* 9 percent
Courtesy Automotive Group, 45 percent
Louisiana Rice Mill, 19 percent
The Lemoine Company, 18 percent
The McIlhenny Co.*, 7 percent
Dupre Logistics, 14 percent
C&C Technologies Inc., 3 percent
Louisiana Crane Co., 39 percent
Moss Motors, 19 percent
Lafayette Surgical Specialty Hospital, 6 percent
Hub City Ford, 25 percent
Synergy Outdoors, 41 percent
St. Martin Oil and Gas, 18 percent
Kergan Brothers/Sonics, 12 percent
Doug Ashy Building Materials, 1 percent
*Denotes estimated revenues
Who Was Down:
Giles Automotive, 2 percent
Musson-Patout Automotive, 1 percent
Who Was flat:
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