Phoenix contractor thrives on new construction

May 2, 2000
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PHOENIX, AZ — As most everybody knows, the economy in Phoenix is booming. Huge companies such as Motorola, Intel, and Allied Signal continue to recruit employees from around the world and bring them to the Phoenix area. These workers, of course, need places to live, which means more houses are required. Because of the incredible demand, new houses seem to be popping up on every available speck of land.

And it’s a good guess that in just about every one of those new houses is an hvac system installed by Chas. Roberts Inc., one of the largest hvac contractors (if not the largest) in Arizona. Many times you can’t even drive down the street without seeing a Chas. Roberts truck — and it’s guaranteed you’ll see a fleet of their trucks in any new subdivision.

The company has 900 employees and will generate sales in the neighborhood of $110 million this year in residential new construction alone. In fact, up until this year, that’s all the company has done — no service, no retrofit, no commercial work — just residential new construction. Of course, with 80% of that market in its pocket, it’s no wonder Chas. Roberts Inc. hasn’t been looking to move into other areas. But that will be changing soon.

Unique market

The Phoenix residential new construction market is probably unlike any other market in the country. One Dallas contractor noted that in most other major markets there are three to five other major players in the residential new construction market. “In Phoenix you’ve got one,” he said.

And that “one” is Chas. Roberts Inc. Don Roberts, president and ceo, doesn’t necessarily agree with that statement.

“We have lots of competition. We have a good hold, though,” he says.

Roberts’ grandfather started the business in 1942. The company was passed down to Roberts’ father and now to Roberts, who runs the company along with his sister.

But Roberts isn’t content to just stay in the residential new construction. He sees that service and remodel will be the way to really grow his business over the next few years. For that reason, the company is adding a service and remodel division, which will start with about 40 employees.

“But we plan on really growing it,” says Roberts. “I would eventually like to see our company doing as much service and retrofit as we do in new construction.”

In order to do that, Roberts estimates he’ll have to at least double the number of employees he already has.

“I think it’s a goal we can reach,” he says. “I don’t see any reason why we can’t reach it.”

He speaks confidently about the future growth of his company, and he definitely has a right to. He’s seen the company grow from sales of $25 million in 1990 to more than quadruple that in 1999.

Business concerns

Like just about any other contractor around the country, Roberts is concerned about attracting and retaining employees. Since he plans to see the company double in size over the next five to 10 years, Roberts needed a way to attract new employees. So the company started a school.

“We train our own people, and we pay them to come for classroom training for a month before they even start,” says Roberts. “They also get field experience during that time. We teach them enough to where they can get out to the field and make a contribution.”

He adds that employees stay with Chas. Roberts Inc. because the company pays very well and offers attractive benefits, such as a 401K plan and “fantastic” insurance. Roberts notes that the company is always looking for more benefits for the employees in order to keep them on board. One benefit the company doesn’t offer is continuing education for its technicians.

“We’ve looked at that,” says Roberts, “but I just don’t know if that’s something the people really want.”

Something that isn’t a concern to Roberts is the changing face of the hvac industry. Asked whether he thought consolidation would harm his business, he laughs, “You mean us buying them or them buying us?”

He has absolutely no plans to sell his company to a consolidator, energy service company (ESCO), manufacturer, or anyone else coming down the pike.

“Why should we consider consolidation? We want to be independent. There’s nothing they can do that could help us.”

He notes that the company already works closely with Arizona Public Service (APS) and Southwest Gas, two of the local utilities. Roberts says that if he were to ever consider being bought out, it would probably have to be a utility or a manufacturer that might be able to offer something.

“But I don’t see that happening,” he says.

Good relationship

Given that the company has 80% of the new residential construction market, it seems rather obvious that Chas. Roberts Inc. has a good relationship with local builders.

Now the company hopes to make it even better by building a showroom so that new homeowners can have the opportunity to choose their own hvac systems.

Roberts says the builders have been very open to this suggestion. After all, homeowners can upgrade their tile and their lighting fixtures, why not their hvac systems? Roberts notes that one of the reasons why this is a difficult upgrade to offer is because salespeople for the builder don’t always understand the basic hvac system, let alone all the upgrades available.

The concept of letting homeowners choose their own hvac equipment is becoming more popular around the United States, though, says Roberts, and he’s looking forward to taking advantage of that. He notes that the showroom will spotlight all types of upgraded equipment, from high-efficiency heat pumps to better filtration. Knowledgeable salespeople will be on-hand to discuss the merits of each system.

Roberts believes the showroom is just one more step in making Chas. Roberts Inc. a great company.

“I think we offer good price, good quality, and good service. My grandfather and father built something here that’s really special, and my sister and I plan to keep it that way.”

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