Contractor of the Year: Duke Long, Interstate Sawing, West Bend, Wisconsin
| June 12, 2007 |
During his 12-year stint as a concrete cutter working for another company, Duke Long would practice a mind game. “Every time I stepped out of a truck on a job, I pretended it was my business and my job,” he says.
The fantasy only went so far, however. When he was 33 years old, Long turned his back on the good living he made working for others. In 1997, he and his wife Sandi sold most of their possessions – from their cars down to the weed whacker – and started Interstate Sawing by buying their first truck and two concrete saws. “Sandi went from an Eddie Bauer Explorer to a 1968 Buick,” Long says, “but she never, ever flinched.”
At home, Sandi worked the phones – “by the fourth week, she knew all the people to talk to, plus their spouse’s names,” Long says – and did the office work while Long sawed. Because of the specialized nature of this work, most client calls were to other contractors.
The company soon landed a large Interstate 94 repair and repatch job, work that required a strict 5 p.m. to 5 a.m. schedule. “I left a lot of money on the table,” Long comments, “but then I also worked 100 hours a week and slept in my truck.”
While he knew how to put in the hours and do the work, the business side eluded Long, who had quit school at 15 and entered construction at 18. He formed a team with a local accountant, attorney and insurance agent. He found a banker who set up a $30,000 line of credit and financed three trucks. “We went full bore then,” he says. After the first nine months, Interstate had four trucks; within two years, the number had risen to 12.
The Long’s two-car garage initially served as the company shop. “We were getting some severe burnout when we had mechanics going in and out of our garage 24 hours a day,” Long relates. The fire to move was lit, however, when while working on his trucks one day, Long turned around and discovered his then-two-year-old son had used the tools he had laid out to cut wires on 12 trucks.
So the company started renting an equipment bay near U.S. 45, on property it ended up buying within a couple of years. Constant growth has kept the property in an ever-evolving state, with office space, equipment bays and a fuel tank added. In the past year, the firm went through yet another metamorphosis, revamping and adding more office space.
Long calls Interstate Sawing’s 24/7 weight room a recruiting tool – and spouses are welcome.
It’s all about the operator
When he worked for others, Long saw practices he wanted to change, especially when it came to operators. He remembered getting into a sweltering truck after a 14-hour day and then seeing company officers run from their air-conditioned office to their air-conditioned vehicles. “It drove me nuts,” he says.
So he resolved to set his company up from the operators’ standpoint. Every truck has air conditioning, tilt steering wheel, cruise control, tinted windows, even aftermarket stereos. Besides giving the company a recruiting tool, Long says these extras recognize the double and triple shifts the operators are sometimes required to work.
Most of Long’s operators are essentially a one-man, one-truck crew. Once they learn the trade, they’re out on their own. After they get their work tickets, they may be gone a half-day, day or a week. They run the jobs and have full discretion to make decisions. (Wall saw crews with two operators are the exception.)
“We’ve had truck washers who’ve made mechanic and then have gone into the field,” Long says. “I give anyone the opportunity to do whatever they want to in this company.”
…and the trucks
Not breaking down is a mantra to Long, who estimates it costs him $3,000 per day to have a truck down. He organizes his operation so trucks can easily be moved from another location or job if a truck breaks down. In fact, he says this aspect of his business has gotten easier as he’s grown larger. “You wouldn’t have that freedom if you just had four trucks,” he says.
Each road sawing truck carries two concrete saws behind it, and the equipment is doubled up in each wall sawing and core drilling truck. “It makes for incredible overhead,” Long comments, “but there’s a definite payoff. We’ve never had to pull off a job because we broke down.”
His four full-time mechanics – two on the day shift and two on the night shift – have standing orders to not let any brake pads or tires get past 50 percent of the wear life. It’s simply not worth it to be late for a job because of a flat tire.
Each night company trucks not working the night shift come in for a thorough once over: after being inspected and serviced, a truck is loaded, hand washed and towel dried. The process ensures everything’s ready to go when the operators show up in the morning.
Long always buys new equipment he deems the best on the market. “There’s no compromise when it comes to spending to maintain our fleet,” he says. “It’s got to be in top order all the time.”
Long emphasizes the rolling billboard nature of his trucks, and says about 10 trucks in his 26-truck fleet are repainted and relettered with blue-and-silver reflective lettering each year. Because the company does a lot of nighttime sawing, every road sawing truck, or about a third of his fleet, has a $4,000 light package, including an arrow board and strobes on all four corners.
All this visibility has paid off – Interstate Sawing shrunk its Yellow Page ads because Long says he gets more exposure from the trucks. The vehicles also give the impression he’s been in business far longer than seven years. “I’ve even heard people say ‘yeah, I knew his dad when he started the business 50 years ago,’ not knowing I was the owner,” he laughs.
Even though some of his trucks have more than 200,000 miles on them, Long claims they look better than the day they were bought. He thought he’d start phasing out his older trucks – bought in 1997 – this year, but he contends there’s no reason to get rid of them. They run great, they look great and they generate the same amount of money as a new $40,000 truck.
Interstate Sawing is in the process of putting GPS systems on its trucks to help guide operators to projects, especially new subdivisions that don’t appear even on current maps. With an update every 24 hours, GPS would make them easier to find. Long’s also aware of the security advantages of GPS, especially since he had a skid steer with just 20 hours on it stolen this past Labor Day. “We could have tracked it down,” he says.
In addition to the trucks, the majority of Long’s fleet consists of concrete saws, drills and cutters. The company also owns two skid steers since it’s been doing more of its own concrete removal work. It regularly rents a variety of machines, including telehandlers and boom lifts.
Long and dispatcher Jeramey Werbelow review the company’s at-a-glance job board, by which they keep track of an average of 35 jobs daily.
Figuring out a better way
Long not only likes equipment, he designs it. Interstate Sawing’s road saw trailers allow the saws to be transported with the blades in place, a design he cooked up and then had a local fabricator make. “You can drive the saw right up, lock it in and drive it away with the blade still turning,” he says. “Since most trailers require you to take off the saw blade, I figure it’s helped us reduce our labor costs by 3 to 4 percent.” The trailer is now in its fourth iteration, but probably not its last. Past improvements have included dual, 6,000-pound axles; sealed lights and equipment boxes.
He also eliminated the fuel cans his operators used to carry, citing dents, leaks and safety concerns. He replaced them with 100-gallon, aluminum-lined, steel outer shell fuel tanks equipped with an electric pump. Long is gradually converting his saw fleet from gas to diesel engines, sold on diesel’s lower fuel consumption, additional power and longer life.
With union labor his No. 1 cost, Long always has an eye for possible savings. After noticing his trucks were taking a 6-mile roundtrip into town to fuel up, he installed a fuel station at his facility. The result is a 2.5-percent reduction in labor since his operators no longer have to negotiate traffic or wait for a free pump. The fuel station tracks fuel consumption by each truck.
Sometimes generating such cost saving comes from a chance conversation. While at a motocross race Long talked with a cellular telephone salesman, a discussion that led to a $3,000-per-month reduction in the company’s cell phone bill.
Long, 41, has a passion for fitness. “I’ve got this real competitive thing,” he says with a little smile. “For 15 years, I trained 40 hours a week.” Before he started his company, he was a nationally ranked competitive bicyclist and a cross-country ski racer.
But running your own business can shove all that into a corner. Long’s now 60 pounds heavier than when he started Interstate Sawing, and he’s struggled with the physical withdrawals of not working out as intensely as he once did. And it didn’t help when he broke both his ankles at the same time on a dirt bike last October.
“I’m going to get back,” he vows. “I’ve been swimming hard and getting in about 10 hours of training a week.”
Help is just down the hall. Long installed a 24-hour-a-day employee exercise facility three years ago, and expanded it when he revamped his offices in late 2004. “It’s been a creative way to attract good talent,” he says, “especially since our employees have physically demanding jobs.” The facility, complete with a locker room and showers, is open to spouses as well.
Long also exercises his competitive juices with two Interstate Sawing race teams – one snowmobile, the other motocross. He’s joined in the latter team by his and Sandi’s three children: Sam, 12; Ben, 8; and Emma, 7.
When asked which division (see box on page 54) offers the greatest opportunity, Long says “all of it.” Initially the firm only did road sawing, but now Long says its strength is in its diversity. Some types of jobs are seasonal, so when something slacks off, the company can fill up its scorecard with other work.
Long just started a new firm, Interstate Scanning Technologies, to offer ground-penetrating radar, a technology that goes hand in hand with concrete cutting since utility locating is required prior to cutting concrete inside buildings.
Other opportunities beckon. Because concrete cutting uses up blades and other wear parts at a significant rate, Long estimates the company spends about $35,000 a month on parts. “Concrete cutting is an abusive process,” he says. And so in addition to its services, Interstate Sawing follows an industry practice and sells sawing wearables such as blades to its clients. Although these sales average about $20,000 a year now, Long sees the company developing a store-front operation to up the ante on this business.
Since he takes such diligent care of his own fleet, Long is also interested in providing truck fleet maintenance services. “People call me asking if I could paint and letter their trucks,” he says. “We can make a construction vehicle look very nice.”
Field to office
Last year, Long – who got his nickname from the ribbing he took as a teen who listened to country music – left field work behind him. “There came a point when I would go out into the field and the company growth would go on hold,” he says. Unable to visualize the future – which Long insists requires being in the office and talking to his customers – he stopped spending the majority of his time in the field. “You become scatterbrained when you’re micromanaging,” he states. “I needed to start being a manager.”
There’s no doubt the scope of Long’s role has changed. During its first year of operation, Interstate Sawing brought in $450,000 in revenue; by the end of 2004 that figure had risen to $4 million. Since the average job ticket is $1,200, that $4 million involves a lot of paperwork. Long can still keep within-spitting-distance accounts receivable and accounts payable figures in his head.
“I’m always studying the income statement, cash flow and balance sheet,” he says, indicating the company finances a lot of long-term growth on short-term cash flow. “I don’t want to put us in a cash-flow crunch,” he comments. “We have a line of credit we haven’t touched in three years and we pride ourselves on paying our bills on time.” In addition to better pricing, Long relishes the respect this practice generates.
The company averages about 35 jobs a day, all in a state of flux. Jobs regularly change, are canceled or double in size. While most of its work is in Wisconsin, the company has ventured into seven other states.
Long relies on his managers, including a sales manager and shop manager. He gives his four salespeople leeway to wine-and-dine clients; he’s more interested in results.
The attorney-accountant-insurance-banker team he started with is still on call. When it sometimes felt like the business was falling apart, the team would pull out Long’s numbers and tell him not to worry. Long would worry anyway – about making it to the next job, about where the next job was coming from, about how he was going to make payroll.
Another part of his moral support structure was his brother Clete Long, a masonry contractor. “He’s got a whatever-it-takes-to-get-the-job-done mentality,”
But through it all and above it all there was Sandi. “When things get emotional, you need to have someone who will listen to you and not fight against you,” Long says. “Sandi backed me up 100 percent.”
Want to start your own firm? Here’s what Long advises:
- Make sure you know your trade.
- Don’t have any bad habits.
- Have an excellent support system.
- Be passionate about what you’re doing.
- Don’t go crazy after a good year. There needs to be 100 percent sacrifice for at least five to seven years. “You’re going to make a lot of mistakes and you’ve got to be able to absorb them financially,” he says.
- Worry about your own business, not your competition’s.
- Don’t forget where you came from.
The Equipment World Contractor of the Year contest is sponsored by Caterpillar and Wacker.