Family, History Are Secrets Of Success

March 5, 2003
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ATLANTA — There are many components that give Estes Heating & Air Conditioning a “family within a family” feel.

There is a sense of history. Founded in 1949 (almost ancient history in the New South), Estes has always been a family-owned business, now with second-generation Tommy Estes as president and third-generation Brian Estes as vice president.

There is a sense of closeness. Despite a customer base of more than 200,000, company service vans and trucks don’t venture much beyond a 50-mile radius. The company’s 83 employees are all under one roof in an upscale industrial park next to Atlanta’s Hartsfield Airport.

There is a sense of communication. Phones are answered by real people, not machines. Calls to the bosses go through without being screened.

And there is a sense of concern. The bosses keep an open-door policy for employees. Family is stressed to the point that if employees submit their kids Little League schedules, every effort will be made to schedule them around the games, even in the hot and humid summer months.

The company’s concern for its employees, its family atmosphere, and its drive to succeed are some of the reasons that The News named Estes Heating & Air Conditioning the 2002 “Best Contractor to Work For” in the South Mid-Atlantic/Southeast region.

Brian Estes, Tommy Estes, and John Waldorf stand outside the new offices of Estes Heating & Air Conditioning in Atlanta.

Foundings

A literal sense of family resulted in the founding of the company. N.B. Estes had come home from the war, married, and taken a job at a local five-and-dime. With the birth of son Tommy in 1949, N.B. knew his income needed to improve. He had been taking heating and air conditioning classes at night at a trade school.

“My dad never graduated from college, but he was very technically oriented,” said Tommy Estes. “He started the business out of the trunk of his car, installing floor furnaces.” N. B. would sell a job, go home to change clothes, and return to do the installation.

Within 10 years, the company had grown to six people and was installing forced-air furnaces. By 1969, 30 employees were dealing with a growing metropolitan area. By 1979, 60 employees handled projects such as the Underground Atlanta shopping complex. By 1989, up to 70 employees increased the company’s focus on residential service, add-on, and replacement work. In 1999, the company’s 79 employees marked its 50th year in business.

Tommy Estes became involved in the company while in high school, doing installations on weekends and in the summer. While in college and still working for the company during summers, he gave thought to a career in dentistry — until that “family” thing surfaced. “I had been working in the company, so when I graduated from college, I decided the smartest thing for me to do was to continue on.”

N.B.’s grandson, Tommy’s son Brian, had a different approach. He spent many of his summers in sports camps and after college graduation spent time with the Carolina Panthers in the National Football League. When the football career didn’t materialize beyond the first season, he came to Estes — also with a sense of family. “I looked at what the company had done for our family,” he said. “It is something you can’t turn your back on.”

Jerry Faircloth, warehouse manager, and Danny Foster, IT manager, discuss technology used to monitor the flow of inventory.

Furnishings

The most recent sign of growth came last month with the move to a new 27,000-square-foot building on a three-acre site. The move was from a 15,000-square-foot building on one acre. In order to avoid disrupting the commute of employees, the old and new are only about a mile apart.

The new headquarters is a state-of-the-art facility with numerous personal touches. Most of the flooring is tile. Artwork and motivational pictures hang along the hallways.

There are no cubicles, and almost everyone has his or her own office. There is expansive use of glass, so even many of the inner offices have sightlines to the outdoors.

There is some three miles of wiring for a system that includes a number of security cameras, closed-circuit TV to several locations, and a sophisticated locking system that automatically secures the building each evening. The building’s HVAC is controlled from a laptop computer. The heart of the computer system is in a small room, where a ceiling-mounted Mitsubishi ductless ventilation system operates. Besides the practical aspect of the unit, it also gives Estes a chance to showcase the technology, since the company also sells wall-mounted Mitsubishi units.

The complex includes a technical training room wired for 30-V, single- and three-phase power, as well as a gas line and a drain.

A classroom seats up to 80 people. In addition to in-house training, Estes offers the space to vendors and to organizations like the Comfort Institute.

A conference room has a pull-down screen and is part of the closed-circuit TV hookup that also includes Tommy’s and Brian’s offices and the classroom.

A space is set aside for a showroom near the main entrance. While the company does not expect much walk-in traffic, the space was designed to help salespeople showcase the company’s offerings to customers, including its line of Amana products. (Tommy Estes said the company is the largest Amana dealer in the country.) The company also has a relationship with Georgia Power, so the room is scheduled to have the utility company’s display of dual-fuel heat pumps.

The company’s six salespersons have their own offices and meeting rooms. Telemarketing is also stressed. “And we contact previous service calls to make sure we did a good job,” said Tommy Estes.

The service department has a fleet of 24 trucks for the residential market and another eight for commercial. Dispatching is computerized. A glance at the screen shows trucks on the road in green and those yet to head out in yellow. Within the past few months, the fleet was equipped with global positioning system technology to help in dispatching, getting trucks to jobsites, and scheduling vehicle maintenance.

The commercial component operates in a section of the building with its own entrance. Jobs there range from small to medium with a focus on service and replacement. Currently there are more than 140 commercial maintenance contracts. The Estes see that sector growing and plan to put more emphasis on commercial work in the future, but without taking away from their core residential business.

A warehouse at the rear of the building has a secured inventory and tools distributed across a counter equipped with computer terminals. “This is run like a parts house,” said Estes. The company also has an arrangement with Amana, whereby part of the space is used as a warehouse for the manufacturer.

The “under-one-roof” concept extends beyond the employees. An outside advertising agency person the company uses has an office in the building. The owner of an independent company that services trucks and vans maintains the Estes fleet in a specially designed garage attached to the building.

Estes Heating & Air Conditioning has more than 50 vehicles in its service fleet.

Flurry Of Activity

Tommy Estes said the company has a customer base of more than 200,000 names, with about 10,000 maintenance agreements. Each day, anywhere from 150 to 250 calls come in.

The company remains 85 percent residential in primarily service-replacement work. “We stick to what we do best. That’s why we’ve been in business for 54 years,” he said.

The plan has resulted in a company that did $9.4 million in business in 2002, and is expected to top $10 million in 2003.

The company operates regular hours from 8 a.m. to 8 p.m., with two shifts of technicians; the second shift starts at 11 a.m. Pricing is flat rate. For the most part, technicians are paid per job rather than by the hour.

Tenure is a key component of the company with the average being more than 10 years, considered high for the HVACR industry. There are those in the company with 20-, 30-, and 40-year tenures.

Twenty-two-year employee Jerry Johnson, a design engineer, came to the company from the wholesale side. “I called on the other [area contractors] but [Estes] is the only one I’ve wanted to work for and the only one I interviewed with. I’ve never considered leaving. I’ve had offers, but there is an atmosphere here of a family within a family. I also think about the number of families we are providing jobs for.”

Providing services to a large base of established customers has allowed Estes to focus more on doing a good job in servicing them, rather than trying to rapidly grow the base. The focus on service and maintenance allows the company to steer away from the new installation sector. “I like to deal with homeowners rather than general contractors,” said Tommy Estes. “And frankly, we try not to do anything we can’t make money on. In new construction you can miss [pricing per unit] by a little bit and get in a lot of trouble.”

Family

The idea of a family within a family is endorsed by Residential General Manager John Waldorf, who came aboard in 2001 after serving as a regional representative for Amana and calling on Estes. “There a sense of security here,” he said. “It is a family atmosphere.”

The company finds itself in a somewhat enviable position of having service technicians coming to Estes for jobs, and the company does its homework when it comes to evaluating prospective employees. Here the focus is on attitude, personality, trade schooling, and some field experience. “If they are mechanically inclined, you can teach the technical part,” said Brian Estes. “But attitude is ingrained.”

There is a full-time technical service administrator whose main job is training. Service techs have a weekly Friday morning meeting. Recognition includes the Extra Mile Club for work above and beyond the call of duty. This can involve more than work-related activity, such as when one technician stopped and changed a tire for a woman.

Waldorf recounted a conversation he had with a service technician that reflects the approach of the company in dealing with employees. The tech said, “If I do something wrong, I fully expect to be chastised. But when I do something right, I get complimented, I get recognition. In the company where I was before, when I did good it was, ‘Hey, that’s your job.’”

There are many other perks, such as an annual fishing trip, outings to Atlanta Braves baseball games, and a $50 bill along with paychecks during one especially hot summer spell. The company is always on the lookout for ways to improve methods and morale. “I’m sure we can do better,” said Tommy Estes, “but we are trying.”

The sense of family kept the company from becoming part of the consolidation trend of about five or six years ago. Said Tommy, “I thought about it plenty, and I came real close. But I realized it wasn’t the right thing to do.”

The Future

The company is in a transition phase, although retirement for Tommy Estes is still a number of years down the road. He noted, “We are building a team that will carry on whether I’m here or not.”

To Tommy Estes, the keys to success are no big secret. “Success of the company from 1949 up until now, and for the future, is people. Recognition is fine; the right products are great. But you need the right people in place.”

Sidebar: Just The Facts

Name: Estes Heating & Air Conditioning

Owner: Tommy Estes

Location: Atlanta

Years in business: 54

Bulk of market: Residential

Total revenue for 2002: $9.4 million

Total employees: 83

Total service technicians and installers: 50-plus

Average hours employees spend in training: 84 per year

Benefits offered beyond medical/dental insurance: 401(k) plan with 50 percent company match, profit sharing with annual contribution and full vesting in seven years, Christmas bonus, safety program with cash benefits, sales commissions and incentives, employee life insurance, long-term disability program, company-paid training, two weeks’ paid vacation, paid sick days, paid personal days, and company vehicles are provided. The company also supplies uniform programs, tool allowances, signing bonuses, employee referral fees, and company-paid fishing trips.

The News selected this contractor because: Estes is a large company that still has a sense of family within a family. Long tenure from many employees shows strong loyalty to the company, and a good work environment includes a state-of-the-art headquarters and a travel radius that doesn’t extend much beyond 50 miles.

Publication date: 03/10/2003

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