Like a lot of foundation contractors, Van Wyks, Inc. is finding the competition a little tougher lately as the residential market has slowed.
"The last few years, there's been enough business for everyone," says company president Arie Van Wyk. "Now, we're bidding against 10 other people on every job."
Standing their ground
Van Wyk estimates that the company's residential business is down 40 percent this year, but the company as a whole will actually see an increase in revenues because of its focus on other parts of the business.
Besides an increased emphasis on commercial work, in the last few years the company has added services such as excavation, waterproofing and concrete repair.
"We want to do everything for our clients, become more of a turnkey company," Van Wyk says.
The company's size and diversity has allowed it to continue to hold the line on prices despite pressure from its residential builder clients.
"All the builders are asking us to take a pay cut," he says. "We're standing our ground, because we're booked up and things are going well."
So far, that stance hasn't cost the company, as its reputation for service and quality has kept its customers loyal. Still, pricing is the biggest concern Van Wyk has right now.
"Even holding prices steady is really a loss for us, because normally we'd be raising prices for next year," he says.
While none of his competitors in the residential market have gone out of business yet, it may only be a matter of time, he says.
"We're hearing more and more rumors about this company or that company having problems," he says.
With a large yard, a warehouse, repair garage and offices, Van Wyks has more overhead than a lot of its competitors. In an industry that is increasingly price sensitive, that means the company needs to always be looking at ways to lower its costs.
"I'm constantly on the watch for equipment and materials that will lower our costs and help us be more efficient," Van Wyk says.
In 1998, the company added waterproofing services. The company now installs waterproofing systems on all of its foundations. There wasn't a demand from the customers for the service. In fact, it was a hard sell at first because of the higher cost, but it has saved the company money by eliminating many complaints.
"I was sick of answering the phone calls from customers telling me their basement was leaking," he says. "I was actually scared to answer the phone when it was raining."
Now, his employees can be out making money doing new work instead of going back to fix old problems.
"It sure made our lives a lot better," he says. "The phone calls are a thing of the past."
Another labor saver has been the CertainTeed Form-A-Drain, which the company uses for all of its footings.
"It's faster and more efficient, which means savings in labor costs," Van Wyk says. "We've also had zero callbacks with Form-A-Drain."
The company has also reduced its labor costs by switching to aluminum forms from B.E.P., which are lighter and therefore can be moved more quickly and easily by the crews.
"You have to get efficient or die," Van Wyk says. "We just try to stay one notch ahead."
As the builders and general contractors get bigger, price is becoming increasingly more important than relationships.
"We have been able to command a higher price than the other contractors, but the line is thinning," he says "Quality just isn't the sales tool it used to be. They all expect good, quality work, but price is what really matters."
Van Wyk is quick to say that most of the credit for his success belongs to lot of people besides himself.
To be successful, a contractor can't be afraid to learn from others in the industry, he says. Since the time he started his company in 1979, Van Wyk has been a member of the Concrete Foundation Association. This year he was selected as their Contractor of the Year. One of the biggest reasons was his willingness to share the secrets of his success with other CFA members, says CFA executive director Ed Sauter.