Ross Industries Has Found Its Market Niche

Bradley Ross grew up in the parking lot line painting business his father owned, working weekends and after-hours. After high school he went off to college and after graduation got drafted and served during the Vietnam conflict. When he came home in 1972, Ross decided to start a business doing what he already knew how to do: parking lot line painting. As a result, his business plan included no intention of performing power sweeping. “Back in 1972 we didn’t have a lot of competition in the line striping industry,” said Ross, “I managed to get a lot of contractors to work for and my new business was very successful. I grew my business and doing thermoplastic. It was in 1985 that I purchased my first highway line painting truck. We started taking on some state and federal jobs painting the lines on highways and airports.” It was about then that the thought struck him that he should consider getting into the sweeping business. Although some of the municipalities had sweepers, virtually none of the contractors he was doing work for had the machines. Ross thought there appeared to be a business opportunity he could take advantage of if he added power sweeping to his services. During his investigation of the potential in sweeping, Ross saw an ad by now retired contractor, Tom Ostuni, and ended up buying two Mobil sweepers in March of 1992.  “I didn’t have any [sweeping] jobs,” Ross reminisced, “none whatsoever. But I bought the two Mobil sweepers to make sure that if one broke down then I could still provide service with the other. “We just went from there and it worked out fine. The next year, 1993, we joined the national sweepers association, which then was part of the National Solid Waste Management Association. We weren’t interested in doing any night sweeping, but because we were in the sweeping business we started getting calls about sweeping parking lots. Also, since we were painting lines on a lot of parking lots, we realized we could probably do some work for those same customers at night.” In 1997 the company purchased its first parking area sweeper. At the time this service remained a minor part of the company’s overall business, though. By this time they had four line painting trucks that covered Pennsylvania, and they also kept adding street-class machines, as needed, for municipal, construction and DOT work. Much of the demand for additional road sweeping, at the time, came from contractors who were out in front of the line painting equipment and who knew the quality of the Ross’ organization’s work product. “We found we had more and more opportunities as a result of our contacts in the line painting business,” said Ross. “We had more opportunities and we met those by purchasing more sweepers to support it. However, at the time I wasn’t all that interested in that end of the business. I was much more focused on the Penn DPT work doing the line painting and saw the additional sweepers as just a way to support the work that we had developed. Because of the rather severe winters in Pennsylvania, another factor to Ross’ thinking was that there wasn’t much money to be made in sweeping. The sweepers were parked for the winter but the payments continued. It wasn’t until after their first five years of sweeping, when the sweepers started getting paid off, that he began to see more possibilities in that side of the business. The sweepers started generating income and, as that income grew, it became clear that sweeping had more potential than he had realized. “We were fortunate in that about 80% of our business was line painting, and that was what financed our purchase of the sweepers. The revenue from our 20% of sweeping was just paying to service the debt on the sweepers. I had realized all along, though, that the sweeping business was a much less complicated business than the line painting. Going out and painting intersections and other intricate line painting locations gets very complicated and requires a number of trucks on the road in support.” Because of the relative ease of operation of road sweepers, Ross says he saw that as his company’s future not all that long after he started into the business. Because he were so heavily invested in the line painting side, it wasn’t like they could just flip a switch and change industries. By the late 1990s, though, Ross started steering the company toward more sweeping and, at the same time, started selling off all but one of its line painting trucks. Ross says he saw the pricing in the line painting industry being driven down by other contractors. In the day sweeping market, they offered an hourly rate and were hired on that basis. It’s not like the line painting business where there were always questions about how much was done, do-overs that had nothing to do with their original quality of work and more. Plus, they had long ago found that sweeping was a much less complex job to perform. “With line painting,” said Ross “we also had situations where we went out on the job with our expensive equipment and might only do $100 worth of work because that’s all they had ready for you, and a paver broke down or whatever, you only got paid by the foot of striping that was actually done. With sweeping, you’re on the job at your hourly rate and if you have to sit around for some reason that doesn’t involve you, you’re still charging for your time. Plus, rates were decreasing in the line painting business and increasing in the day sweeping industry. So, in about 2008 we started working on getting out of the line painting business and pulled that off by 2010.” In the last several years Ross Industries has also expanded into the nighttime sweeping business, purchasing its second parking area sweeper, a Nite-Hawk machine, last year. Today, Ross says the company is structured at 90% sweeping and 10% line painting. They bought the Nite-Hawk while their 2007 parking area sweeper was still in great shape, in order to have the option of expanding further into the night sweeping arena. In addition, Ross owns two smaller street-class sweepers, a Schwarze A4000 and a Husky broom sweeper, which can both be pulled into service as night sweepers if need be. At the moment, though, the older sweeper is just used on their one full nighttime route on Fridays to keep it from being in storage. In the audio podcast, Ranger Kidwell-Ross encourages contractors reading the article to consider the above to think about what other services – or expansion of sweeping types – they might be able to use their current sweeping revenue to expand into. However, Ross makes it plain that his company is not interested in doing other services besides sweeping and line painting until they are fully extricated from that service. “We have learned that those other services, like line striping parking lots or sealing them, are a lot more trouble and take a lot more effort than sweeping,” said Ross. “I know it sounds contradictory, but the truth is that, at 65 years old, I don’t need more aggravation. I don’t have to have multiple crews, either. Something I’ve seen other contractors do is get into these types of other services without recognizing that if they do that they need an entire new crew to do it right. And, they need to keep them busy so you need to go out and really, really hustle to get the work. So, you have to look at those sorts of things and how much effort you want to put into it. If you want to be successful, you have to put in a lot of effort. “By contrast, what we are doing now fits our business model very well. We have established clients and, because we are located in the snow belt we can get our best employee utilization the way we are set up. Our operators are all involved in the spring cleanup, when we’re completely busy. Then, by the time line painting starts in May, we can use some of those same people for our line painting crew. We’re glad we did those other things and we are doing a little bit of sealcoating and line striping of parking lots, but we don’t promote that at all. We’re exactly where we want to be, but we have been in business for 42 years and so that’s how it should be. “That said, I think it makes perfect sense for current parking lot sweeping contractors to perform other services for their current customers. They just need to keep in mind that it’s not an easy or simple process. Every time we’ve done that we’ve committed to going out and putting a professional crew together to perform the work, then we did the same to go sell the new services. You absolutely cannot jeopardize your professionalism and reputation in sweeping by doing a poor job in some other service.” Ross  says that, in retrospect, they started into sweeping in just the right fashion. Had they started trying to get municipal contracts, it wouldn’t have worked since most all do their own sweeping and, with the exception of the occasional overflow need, aren’t interested in hiring an outside contractor. Starting into construction sweeping with large sweepers, where there was a decent hourly rate and profit margin, he feels drastically improved the company’s likelihood of success. That’s part of having a correct market assessment and following through professionally, in Ross’ opinion. Plus, they had contacts through the contractor and DOT sectors due to their line painting business, since those entities already knew the Ross Industries work ethic. In the night sweeping business, Ross says, there are just too many people who do not understand their expenses and so are willing to sweep for too little money. It’s too tricky of a thing to start discounting below what the correct price should be for a professional sweep each and every time. All of Ross Industries’ night sweeping business have decent margins, he says, which allows them to always have a good result for their customers. “We also always give our best price to our customers for a professional job, whether line painting or night sweeping. If we then say we are willing to negotiate,” said Ross, “it really says we weren’t giving our best price to start with. I always explain that we’re really talking about a price for an amount of time. I know what it costs us per each increment of time and if we charge less it absolutely means we will have to spend less time on-site doing the job. A lot of times these third party national companies don’t even know what the properties look like, so you can’t start discounting your work based on the opinions and insistence of people who don’t understand the business and the costs involved. That doesn’t make sense. “My fees and expenses aren’t any different than the guys bidding against me. When he’s willing to do the work for less, it can only mean they’ll be spending less time on your property cleaning it up. And, that’s just what I tell them straight up and I leave it go at that. They either go with me or they don’t. In the nighttime sweeping business you lose your share of jobs. That’s not true in the large sweeper business that we like and that we concentrate on.” In the associated podcast, starting about about minutes 30, Ross makes a very well-reasoned argument that other contractors will find of help in talking to third party vendors, and others, who are bent on choosing the lowest price and haven’t thought through what that price might bring them in terms of quality of service. Ross credits a portion of his company’s success with their attitude that they have never “woken up in the morning and decided they wanted to go get as much business as possible.” Rather, Ross says, their mantra is more “Don’t bite off more than you can chew, and if you take on a service you make sure you have more than enough resources in place to provide that service. Remember: The customer knows that you did something very well 10 times but will remember that you screwed up once or twice. I think that’s why over 90% of our business is repeat business. “When you get into the stupor of trying to get all the low bids, it’s a road to bankruptcy. Unfortunately, when you are losing money on contracts it typically takes a long time to realize that fact. You don’t find out at the end of the week; rather, it can be months or years. That’s when you find you don’t have money for a new sweeper and don’t even have the down payment… I encourage contractors to insist on getting the amount of money they need to get to do a professional job and remember that low-balling will NEVER help you.” In the associated podcast, Ross discusses the company’s move into new technologies through the years, from being late to adopting fax machine technology to its current invoicing system, which is primarily email-based. Customers are also able to pay via direct deposit and PayPal. He also talks about why Ross Industries’ trucks no longer have GPS installed and how and why that has occurred. If you are a sweeping contractor, we encourage you to listen to the audio version of this article in addition to reading the above. You will then be better able to understand the success and longevity of this 42-year-old company, Ross Industries, Inc.