Companies Growing Despite Downturn
Market Tech boosted sales by changing the product mix to suit customers. Ameri-Kleen emphasized customer retention, with bonuses for employees when they meet company goals. The Armada Group, recognizing customers were more cost-conscious, offered services to reduce costs for clients.
With a laser-sharp focus on customers, all three kept revenues on the fast track despite the downturn. They earned a place on Inc. magazine’s fast-growing 5,000 list for a second straight year while two other local companies on the 2008 list did not repeat that feat.
Market Tech
Market Tech, the smallest of three locals recognized by Inc., built up its revenues over three years from six figures to seven figures.
“It’s easy to do when you’re small,” said Phil Crowley, who founded the Scotts Valley company in 2002. “Once you get to $10 million or $20 million, it’s harder to double sales.”
He has five employees selling measurement and fiber optic products to companies in biotech, aerospace and research.
“We’re not selling to industries like automotive,” Crowley said, referring to a sector hard hit by the recession. “We’re diversified. We didn’t rely on one market sector.”
The company is always refining its list of products, adding new those in demand and dropping others with less potential or fewer sales. As a reseller, that’s easier to do, compared to a manufacturer committed to products it has designed or has in the pipeline.
Crowley didn’t add sales staff in the past year but that could change.
“The first quarter was a little scary but things are looking good for the rest of the year,” he said. “We might have to add people. It seems like we always have more work than time in the day.”
Ameri-Kleen
Ameri-Kleen started out as a small cleaning business but since Brett Meyers, 35, son of the founder, took over in 1998, the Watsonville company has expanded into Arizona and New York. The growth spurt started in 2002 with acquisition of a company in San Luis Obispo.
“We’ve continued to add positions at all levels,” Meyers said, including management, accounting and human resources. “We’re hiring frontline employees all the time.”
Employees not only follow a set of procedures for vacuuming, carpet-cleaning and restrooms, they also get a list of requirements for each specific worksite. One client may insist on all interior doors being locked but another may prefer they stay open.
Employee turnover is a quarter to a third of the industry average, Meyers said, citing a companywide bonus plan that depends on everyone working as a team.
“We report on it daily,” he said. “We have a weekly conference with the manager. Everybody knows the number.”
Meyers, who worked for his dad as a teen before attending Cabrillo College, gathers ideas at conferences and trade shows.
He’s part of the ISSA, a worldwide cleaning industry association, and is working toward certification to the Cleaning Industry Management Standard.
“We’re reviewing every process we do to see if this is the best way to do it,” he said.
The Armada Group
The Armada Group, an information technology consulting firm in Santa Cruz, anticipated the market would contract, creating more competition for clients.
“In the fourth quarter, we knew it was coming,” executive vice president Dan Mickwee said. “In a time like that, you can’t take any business for granted. Employees need to talk to clients differently. Clients expect a lot more.”
He compared the situation to the switch in the real estate market from agents expecting multiple bids to agents working hard to attract a buyer.
Mickwee focused on evaluating existing services and finding ways to improve, which led to new services built around cloud computing, an advanced technology that can cut costs for customers.
He credited Jeff Tavangar, founder of The Armada Group, with establishing a cost-effective internal operation so when the downturn hit, the company could still focus on helping customers instead of cutting costs.
“We have no debt,” Mickwee said. “Any company that came into this recession with a lot of debt is having trouble.”
The Armada Group is taking advantage of the shifting job market to attract talent.
“We’ll be making hires on the consulting staff, some internal hires as well as sales,” Mickwee said. “We think the skies are opening up — not a boom, but things have leveled off.”
INC. 5000
Three local companies made Inc’s 2009 list of 5,000 fast-growing companies based on growth over three years. Market Tech and Ameri-Kleen made the list in 2008; this is The Armada Group’s third year. No. 104 Market Tech Specialty: Distributor of lasers and fiber optics Location: Scotts Valley Founded: 2002 by Philip Crowley Growth: 1496.5% 2008 Revenue: $5.2 million 2005 Revenue: $325,403 Employees: 5 Information: markettechinc.net or 461-1101 No. 1,688 Ameri-Kleen Specialty: Janitorial services for offices Location: Watsonville Founded: 1969 by Steve Meyers President: Brett Meyers Growth: 189.4% 2008 Revenue: $9.5 million 2005 Revenue: $3.3 million Employees: 275 Information: ameri-kleen.com or 722-8888 No. 3,711 The Armada Group Specialty: IT consulting and staffing Location: Santa Cruz Founded: 1997 by Jeff Tavangar Growth: 61.5% 2008 Revenue: $13.3 million 2005 Revenue: $8.2 million Employees: 95 Information: thearmadagroup.com or 459-6550
Courtesy of San Jose Mercury News