When Pavement Maintenance & Reconstruction last encountered Vinny Toth and V & V Line Striping, the Boonton, NJ, contractor had just completed layout and striping of a 2.2 million-sq.-ft. Six Flags Great Adventure in nearby Jackson that was so complex they brought in a surveyor to do the layout using a global positioning system.
That was in 2006, and since then the contractor has seen significant sales growth, pushing gross revenues near $2 million in 2009 and profits up more than 15% each year - without any change in company size, number of employees, or its focus on pavement marking. The company today employs 12 people, with three three-person crews in the field
"We just keep refining what we do, and as we refine it our gross continue to go up," says Toth, owner V & V. "What we've done has had a tremendous impact on profitability."
Refining the niche
So what does refining mean? First, Toth says, it means refining the niche the company will pursue.
"We're trying to find that niche where the little, little guy can't get in and the big guy isn't interested," he says. "We're the only striping contractor in North Jersey that has that niche and we're competitive with both."
One example is marking pavement at the gates at the Jet Blue terminal at the local airport. "We can do the gates at the airport more efficiently than the big guys because the big guys don't have specialty crews to run out to a small job like that; they only have big road crews," he says.
Another example is small thermoplastic jobs. "The big guys don't want the small thermoplastic jobs and the small guys don't have the equipment to do them, so we're bombarded with them. We can send three guys out with our thermoplastic truck and they can't send out three or four people with their big road trucks to do a $1,200 job. We can knock those all day long."
Toth says that in addition to defining its own niche V & V Line Striping works to stay in touch with the market and its customers, which has helped fuel the company's steady growth.
"When we feel a slowdown coming I sit down and analyze what we're doing and where the customers are going, and where we're getting our work from. That usually tells me what we need to target and we shift some of our focus," he says. "If I look at everything and I see we haven't been getting very many school systems or universities, for example, we target them and start calling on them, and pretty soon that part of the business starts growing again.
"It's always a weeding process as far as customers are concerned, and one of the reasons we've done so well is our clientele keeps getting better," he says. "Last year out of almost $2 million in sales we had only $5,000 in money we couldn't collect."
No $8-per-hour laborers
A second area of refinement V & V has pursued is how it views and handles its employees. Initially, V & V relied on a few higher-paid employees and a group of low-cost laborers to get the jobs done. But Toth says that over the years, and he admits it took a while, he realized that approach wasn't going to work for the long haul. So shortly after the 2006 article appeared in Pavement V & V Line Striping made significant changes based largely on input from its workers.
"They're in their 30s and 40s and they have families and they want to make a living at this, so when we realized we wanted those types of people working in our company we had to make some changes," Toth says.
To begin with V & V Line Striping decided to offer a good retirement plan, contribute to employee's health insurance, and offer achievable bonuses. In addition the contractor no longer has the $8 an hour laborer.
"The minimum we pay now is $18 an hour, but we've found that it's better to pay the guys a little more and put a little more demand on them," he says. Toth says his two lead foremen have been with the company for 20 years, and "we've found that retaining good employees improves just about every aspect of the business."