NECA’s Academy of Electrical Contracting honors leaders in the industry. To tap their experience and knowledge, ELECTRICAL CONTRACTOR posed a question to some members. Here are their answers.
I was 34 years old in 1987 when we started our company. I’ve said this many times to my partners, “We didn’t know what we didn’t know.” There were business decisions we made that weren’t in any textbooks. Thirty-two years later, some of those decisions weren’t very good, but they didn’t sink our company. We knew the electrical business, but the people side of the business—both internal and external—was something that we had to mature into.
David F. Firestone, CEO, Commonwealth Electric Co. of the Midwest, Lincoln, Neb. (40 years)
If I had the knowledge that I have today when I started as an electrical contractor, I would have gotten involved in NECA sooner than I did. The relationships we have built over the years with other contractors, members and staff has helped our business grow and develop, just like our friendships. They are priceless!
Mark A. Huston, Owner/President, Lone Star Electric, Fort Worth, Texas (42 years)
Make sure that you are not undercapitalized when starting or growing your business. Banks are in the business of “renting money” and will do so as long as they are confident that you can pay them back. With typical gross margins of 15–20% on projects and overhead in the 8% to 12% range, that does not leave a lot of profit. Don’t be a milk cow for the banks. Grow your business slowly, and work with your own money instead of borrowing.
Jim Mackey, President, Evergreen Power Systems, Seattle (49 years)
I believe one of the most important things to do when starting out is to establish your values as an organization and to make sure everyone knows what those values are and that they are committed to them. Secondly is the importance of getting involved. Get involved in NECA, and use that involvement to influence labor management, apprenticeship and fringe benefits. Get involved to learn from your peers and the many educational opportunities that are available. Also get involved in your community. The Chamber of Commerce is a great place to start in many cities. Don’t just join; participate, get on a committee. Get involved in a nonprofit as well. I know that sounds like a lot, but you will learn so much from other leaders in the community. It is an education that you cannot get anywhere else.
Skip Perley, CEO/President, Thompson Electric Co., Sioux City, Iowa (43 years)
There are a number of things to consider when starting your own electrical business, from registration, qualifications, insurance and finance. But once you have set up, chosen a business name and have started trading, the importance of the following cannot be understated: No. 1 Build your brand. No. 2 Clients, clients, clients. Without clients, a business simply cannot function. No. 3 Your employee base is your team. No. 4 Protect your business. You need to be able to protect yourself and your business should the worst happen, which means you will need to purchase the correct insurances to cover the likes of injuries, accidents and damage.
Dennis F. Quebe, CEO, Chapel Electric Co. LLC, Dayton, Ohio (43 years)
Having gone directly from journeyman status to starting out from scratch in business, I wish I had known where to find out more of the business aspects (incorporation, insurance, bonding, lines of credit, etc.) as these pertain to electrical contracting. It also required that I research the bargaining Agreement from an employer’s position to determine those responsibilities. Today, I encourage anyone starting out as I did to touch base with your local NECA chapter for some guidance.
Duane Siefert, President, Current Electric Inc., Michigan City, Iowa (52 years)