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Matt Whaley had a passion to run equipment from an early age, but had to constantly nag his father to let him to do it. His father, Ken Whaley, wanted his son to one day run the company he started in 1972 – not a bulldozer.
Matt’s rise in the company was incremental. He started by laying storm drainage, made his way up to excavator operator, stepped up to having his own utility crew and ultimately managed large projects. He started running the company in 2010.
When Matt took over, however, the company was down to 15 employees and one job. As he sat running a bulldozer on that lone job, he realized it was time to make major changes. Similar to the process he underwent to hone his work skills, Matt decided to chip away at every aspect of the company. The first step: Restructure everything with the help of his brother Austin, vice president of the company.
“Coming out of the recession, every construction company was struggling,” says Matt. “This business is a debt-heavy business and only grows when the economy grows, unless you offer some specific specialized alternative. There is nothing patented about what we do for a living; there are a lot of people who do what we do.”
He believed that while Whaley & Sons was potentially on the brink of failure, it could make a comeback. They had a decision to make. He and the handful of employees could turn the company around or go bankrupt.
“At that point, that level of stress is really what changed my life, because I worked harder on myself at that point than I did on my job,” he says. “I underwent a self-taught school of reading business books and studying what is good debt, what is bad debt. We knew the construction process, but I didn’t know until I took over how much hadn’t been done on the business side. Working hard on myself meant I had to read more, study the specs more and understand the plans more. That way when I went to these meetings with engineers and architects, I made sure I could answer any question they asked.”
He also realized a key management person had let many of his duties slide. “I thought he was doing everything and came to realize he wasn’t looking at the accounting, not dealing with the insurance companies, not dealing with the debt burden we had and not streamlining the estimating department.” He was let go.
Matt rounded up the remaining employees and explored some basics, such as how much their equipment cost them per hour and their production rates for work completed in a week, a day and down to the hour.
“We took that information and applied it to our estimating department where we had our quantity takeoffs and determined we’d been bidding all wrong,” Matt says. “We’d been bidding not knowing what these values are. So once we plugged these values in, out spits a number that was 75 percent less than what was originally being bid for jobs.
“Well, no wonder we weren’t getting work.”
His focus became winning work based on the company’s cost to do the job. But there was still more to learn.
“We took that information, and bid a few jobs that way,” he says. “Well, we learned real quick that maybe we were a little too cheap. We were leaving quite a bit of money on the table. It only takes a few of those jobs to realize what your mistakes are.”
The first three years of his tenure became a quest for work in a market in which jobs were rare. But he managed to find a niche in smaller scale projects, expanding from the company’s core government work to private development.
“Our workload was based on municipal, county, federally funded projects; there was no commercial or private work,” Matt says. “Those were the projects that we pursued, and we were successful at getting four projects the first year. And we ran somewhere around $600,000 to $700,000 of revenue.”
“That first year I was scared to death, but it was one of the greatest parts of my life because it was a struggle,” he adds. “There was no turning back; there was no plan B. It was the only thing that we knew at that time.”
Matt says this work ethic helped create a snowball effect. Whaley & Sons’ revenue grew from $700,000 or so his first year of running the company to about $14 million at the end of 2016. It now has 114 employees.
“As every year went by, we got better,” he says. “If you want your business to be better, you have to become better. So the more that we learned, the more we studied, the more that we knew, the more we understood how money works, how debt works, how relationships work – everything got better.”
The company’s policy revolves around honesty and integrity, Matt adds. “We get buy-in from our employees on that philosophy. It’s a common thread I see with successful contractors, and it’s how you build relationships and your business. Trust is like a bank account. You make one withdrawal, and you’ll never fill that trust account back up.”
Matt has also built trust with his clients. He calls his approach “leaving a profit for the customer,” by determining what “little extra” he can provide at no charge to the client. He says he approaches a job from an owner’s perspective and continues “the service process” long after the project is done.
“Whaley & Sons could teach other contractors that there is more to success than big profit on a single project,” says Bob Mohney of Saddlebrook Properties. “They have succeeded in building a teammate relationship with us by being fair. Matt Whaley has done an excellent job structuring his operation with competent people in defined roles, making our projects with them run efficient and effectively.”