South / Regional Reports

Service Company Lives Up to Its Name

May 24, 2001
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Kelly Vaughn stands in the parts department at The Service Company.
MERIDIAN, MS — The sign is simple: “The Service Company.” The message is clear: Service is the name of the game. Kelly Vaughn, owner of this commercial-residential service company, said some customers didn’t know the meaning of service until his crew showed up.

“Customers didn’t know what ‘service company’ meant,” he said. “Then my people showed up in the homes, putting down paper, cleaning up after themselves, etc. — acting professional.”

Vaughn has dedicated most of his life to the hvac service business. “I started 32 years ago as a service tech for a large mechanical contractor. I started this company 20 years ago with a partner. I bought him out five years ago and business has tripled since then.”

Coincidence? Maybe. But Vaughn has done the smart thing and offered a variety of services to keep his staff busy. This rural town of 41,000 in eastern Mississippi is “quiet and not fast-paced,” said Vaughn. But he is able to keep his 30 workers in the Meridian location and five in his nearby Philadelphia, MS, location busy year-round.

“We added plumbing services last year and electrical services four years before that,” he said. “We did it to help our business grow. A company either grows or dies.”

Vaughn said he has the largest commercial service company in the area, servicing many local schools and hospitals. The recent construction of a casino in Philadelphia has helped business, too. His market mix in Philadelphia is evenly split between residential and commercial service, while the split in Meridian is quite different — 85% is commercial service and 15% residential.

“We travel as much as 100 miles for our commercial customers,” said Vaughn. “We count on them for repeat business. Our regular customers are our best customers.”

The Service Company works closely with manufacturers on performance-based contracting; Trane holds the contract and Vaughn’s company does all of the service work. The contractor also works closely with the local utility, providing service and installation of heat pumps.

Vaughn picks up some referrals and business tips thanks to his affiliation with the local ACCA chapter — the first of its kind in Mississippi and less than a year old — and his membership in an ACCA MIX Group. He said the MIX Group has been valuable to him, while other “former” members may have learned its value a little too late.

“We lost some members of our group to consolidators,” he said. “And now some of them have regretted their decision [to sell to a consolidator].”

As for consolidation, “I think manufacturers are going to start buying more contractors instead of consolidators,” Vaughn said.

He added that the company depends on its workers to keep up the fine service record. Staff includes his son, daughter, and son-in-law. And he knows he has to compete with other industries to attract and keep young workers.

“We try to do everything the big companies do for the kids,” he said. “We sponsor a scholarship program with the local junior college. Right now we have six young men in the program.

“We have an agreement with the students to pay us back for their schooling or sign a noncompete agreement. I don’t want anyone here if they don’t want to be here.”

Vaughn has also worked through the ACCA chapter to help change the college curriculum for hvac students, but he said the hvacr trade needs to go one step further. “We need to make a standard exam for the entire country. That way we will know exactly where the graduates stand.”

If graduates are looking for a pleasant place to relocate to, Vaughn can give a strong argument.

“The community has been very good to us,” he said. “The average winter temperature is 47?F and the cost of living is low. We have a lot of good people working for us, too.”

This report provides information for contractors living in the South/Southwest region of the United States. This includes Kansas, Oklahoma, Texas, Arkansas, Louisiana, Mississippi, and Alabama. If you have information from this region, please contact John Hall at 734-542-6214; 734-542-6215 (fax); or halljr@bnp.com (e-mail).

Publication date: 06/18/2001

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