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Portland Business Owner Names SBA's Oregon Small Business Person of the Year
Paresh Patel, President, Courtesy Vending, LLC, has been named as the U.S. Small Business Administration’s (SBA’s) Oregon Small Business Person of the Year. Courtesy Vending, LLC a 13-yr old business founded by Patel at age 17 in 1992 with one pop machine, has grown to become the largest independent snack and drink machine vending operator in Portland.
From very humble beginnings in a very competitive industry, the company posted sales of $1.6 million in 2003 and projects sales of $2.5 million in 2004, operating over 1000 vending machines, employing 17 full time route drivers, warehouse personnel, operations and administrative staff. Patel’s passion for knowledge and his drive to succeed have been evident from an early age. Patel gained his business experience at age 12 with the remodeling of his family owned motel; he led the renovation and created systems that continue to provide efficiency for the business today. Through his teenage years, he managed the financial aspects of the family business to successfully create profitability and stability for his family.
Patel has employed a very sensible and methodic approach to growing his vending business to reach the success the company enjoys today, and continues to do so. Like many self-made small business owners, he, his wife and his daughter live a relatively frugal and conservative lifestyle in order to devote resources to the growth of the business. In 2000, he used a $200,000 SBA 7a loan from Wells Fargo for a significant equipment investment, tripling his capacity and revenue thereafter.
In 2003, his company won an important coup by being awarded the vending machine contract for the City of Portland Public School District. Early in 2004, Patel again made significant expansion strides with the acquisition of a competitor's equipment and routes, almost doubling his capacity and revenue potential. This has led to the need for a larger distribution warehouse/corporate headquarters building in the Portland Airport area. Groundbreaking for this facility took place in December 2004, with the project being financed with a Wells Fargo/SBA 504 loan and with support from the Portland Development Commission.
Based on Patel’s strategic vision and leadership, Courtesy Vending, LLC is well known in the industry as a leader in technology and innovation. Courtesy Vending, LLC uses handheld computers and electronic locks as well as the leading industry software to stay on the cutting edge. Success has brought many benefits, but with no time to rest. His story is even more unique in that, during this same period of Courtesy Vending, LLC's growth, Patel provided on-going administrative and operational support to his father, who suffered a 1996 accident that left him quadriplegic, in helping to run the family's modest motel business.
In what spare time exists beyond those commitments, Mr. Patel provides numerous hours of service as Chairman of the Board of Directors of Pacific Northwest Federal Credit Union, as well as supporting and serving on committees to further the goals and objectives of the Indian Cultural Community in Portland. Add to that his commitment to education; he earned an undergraduate degree and an MBA while initiating the business. Now at age 30, Mr. Patel is nearing the completion of his Ph.D in Business Administration with an emphasis in E-Business from Capella University.
Pacific Tech Construction, Inc. Winner of SBA’s 2005 Regional and Portland District Minority Enterprise Development Awards
It’s a pretty good bet that Kelso natives Cal Miller and Joe Lane would have been successful businessmen out on their own. But put them together, and you have a partnership that’s turned Pacific Tech Construction from a regional commercial contracting business into a national building services company.
Theirs is an example of a business partnership that works, says Don Jones, president and CEO of Twin City Bank. Miller and Lane share a similar work ethic that gets the job done, says Jones, who knows Pacific Tech Construction well. They share the same vision and goals, and they are innovative businessmen who take good care of their employees, Jones says.
"I think it’s trust," Jones says of the duo’s secret to the success. "I think it’s a belief in the other’s ability and a desire to have a good company."
Last month, Miller and Lane marked their 10th anniversary as owners of Pacific Tech Construction in Longview. A flourishing business built on aggressiveness and the ability to find the night niche in a competitive industry, the company has been nominated by the Small Business Administration’s Portland District Office for a national award recognizing its business leadership.
The pair, 1987 graduates of Kelso High School, have known each other since the third grade. The 36-year-olds lived next door to one another until recently.
They contrast each other nicely, Miller says. He’s the numbers guy, overseeing operations, while Lane is the people person, concentrating on business development and marketing and doing much of the traveling.
The boyhood pals were fresh out of college and working for local companies when they started talking about opening a business together. They started Pacific Tech Construction in the garage of Lane’s former mother- in-law. The garage is the size of their conference room today, Lane recalls. But the company grew quickly. They were hiring employees within a couple of months. They soon moved to a building in Kelso and later to their current location on Industrial Way, where they’ve been since 1998.
Pacific Tech Construction was built on two divisions, general contracting and roofing. They’ve seen their success fluctuate over the years with the Longview economy. For the first three or four years, the company grew at a rate of 50 percent a year. However, the middle years were hard as the local economy saw a downturn. "But we recovered and buckled down," Miller says. "What we learned from that was invaluable," Lane adds. "We are now selective about who we do work for." Today, Pacific Tech Construction is enjoying a steady period of growth, once again growing at about 50 percent a year. The last two years especially have seen significant growth, Lane adds. "They have faced adversity with the economy," Jones says. "But they’ve managed through good business practices to weather that and come out on top."
Pacific Tech Construction also has offices in Honolulu, Lady Lake, Fla., and Mesa, Ariz. The company employs about 100 people, 80 percent of who are from this area.
About 75 percent of Pacific Tech's work comes from the federal government. The U. S. Navy is the company’s biggest customer.
When asked why they are successful, Miller and Lane point to their management team and employees. It’s a tight, cohesive group, Lane says.If they stepped away from their business, it would run itself, Miller says. "If we wanted to, we could walk out right now, our people are that good," he says. "It’s people probably more than anything," agrees Lee Sykes, a project manager and also a Kelso native. "And two very aggressive owners." With the company seven years, Sykes says Pacific Tech Construction has managed to be diverse while still carving out a niche in the construction industry. Being aggressive in seeking our work has been a key , he says.
"It’s a great place to work and we could use some more people," he says. "We are definitely on the upward trend of all companies and we hope to stay that way."
Jones adds that the company approaches each job with the same attitude. "They have that hometown feeling that every job is important and it seems to pass down through the ranks," he says.
Miller jokes that if the job is hard, his company will take it on. "We just focus on the hard ones -- the nastier the better," he says. "That’s our specialty."
One of those nasty projects was when the company was hired to rebuild the structure housing Boise Cascade’s H-4 paper machine in St. Helens, a $2.5 million, 3-year project. It was a tough job, to say the least. Crews, wearing ice vests to keep them cool in the stifling hot, humid building, worked on a rolling scaffold that was built over the running paper machine. No one was injured and the machine was never shut down once while the crew worked.
It's a tough business, where you have to prove yourself every day, Sally Spalding, purchasing agent with Boise Cascade, says of Pacific Tech Construction. But the Longview company has done just that, Spalding says.
When Boise Cascade hires a contractor, the company has three priorities: safety, cost control and staying on schedule, Spalding says. Pacific Tech Construction excels in all those areas, she says. "They are an excellent contractor and that’s why we’ve been doing business with them for so many years," Spalding says.
While Pacific Tech Construction has work for numerous local businesses, most of its work now takes employees out of the area. So why stay in the Lower Columbia? It’s simple, say Miller and Lane. This is home to them and the majority of their employees. "We are committed to this area. We grew up here and we are proud to be here," Lane says. "I am concerned about this community and what’s going to happen here." The men are heavily involved in their community. Lane serves on several boards, including the Cowlitz Economic Development Council and Twin City Bank. And Miller is involved in youth sports. The company sponsors at least 20 youth sports teams.
Plus, you can’t get better employees than those from this area, the men say.
"We have a great labor pool to draw from up here," Miller says. "Trust us. We work all over the country. The labor pool here is a lot deeper."
Miller and Lane admit they are a bit taken aback by their success. The company has exceeded any expectations he had 10 years ago, Miller says.
"I never thought we’d be this size, honestly," Lane says.
The businessmen want to keep their company small for at least another five years to take advantage of their existing market under federal guidelines. After that, they’re game for anything.
"We believe if an opportunity comes along, we hop along for the ride," Miller says.
What’s More Organic Than Granola?
Debi Sommars knows all about organic growth.
Her business, Portland-based Sommars Ovens, has literally grown one customer at a time. Her product, organic granola, is gaining popularity as the organic-food movement becomes more mainstream.
What began as a hobby in her kitchen has become a multistate business in only five years -- a far cry from the late nineties, when she was living in Southern California and baking 2-pound batches of organic granola for friends and family.
Then she moved to Portland with her husband, Mark Rosenbaum, a financial adviser who recently served as Mayor Tom Potter's campaign chair.
While grocery shopping one day, she noticed entire aisles devoted to organic products. "It was mind-boggling to me," she said. "It wasn't like that in Southern California."
A business idea was born.
She visited the Small Business Administration's SCORE office for business advice. She researched the organic- foods market, discovering annual double-digit growth. She rented test kitchens and tinkered with her recipe.
Her company now bakes about 25,000 pounds annually and is on a trajectory to double production every year.
The former investment adviser's products now are in stores and company and college cafeterias from Northern California to Seattle. It also has a private label product which accounts for 10 percent of sales. Though she won't reveal revenue, she says her self-financed, 4-person company is expanding and profitable."She's taken this further than I thought she could," said Eric Davis, store director at Lamb's at Stroheckers in Portland, which carries her products.
Sommars is quick to point out that she doesn't merely sell granola. She sells "organic" granola. Organic generally implies foods with no pesticides, hormones or genetically modified organisms. A fall 2003 survey by Whole Foods Market found that more than half of all Americans had tried organic food. Almost a third said they had increased their consumption of organic food and beverages in the previous 12 months.
Sales of natural food products in Oregon and Washington reached $887 million in 2003, an increase of 18 percent from the previous year, according to the trade group Natural Food Merchandiser.
Sommars, who has become somewhat of an organic evangelist, knew none of this when she began making her own granola 10 years ago. She is wheat-intolerant, so she began baking organic, wheat-free granola for friends, who started asking for packages to take home.
After moving to the Northwest and deciding to go into business, Sommars was forced to alter her recipe. Larger batches required different ingredients. "I had to modify it a lot," she said. "What works in 2-pound throws doesn't work in 200-, 500- or 2,000-pound throws."
Despite her company's rapid growth, she still self-distributes her products -- Some Nut Granola (with almonds), No-Nut Granola and granola with flax seed.
In Oregon, Sommars Ovens products are in Lamb's at Stroheckers, City Market, People's Co-op, Wizer's Markets, Market of Choice and Palisades Thriftway. She visited each store to pitch her product. She also did in-store demos herself, handing out samples to customers. "I got a lot of feedback that way. I wanted to know what people were thinking," she said.
The region's emphasis on healthy eating, combined with her passion and local address, helped sell her product. Lots of companies make granola, but few produce the organic variety.
Retail sales account for half of company revenue. The college market comprises 40 percent. Sommars calls the growth of her business "serendipitous." Those in the grocery industry, however, are much more generous. "She's sharp. I've been doing this a long time and I've seen so many products, but the difference with her is, she really believes in what she's selling," said Davis. "Her next step now is to find a distributor."
Sommars Ovens granola is also sold in several cafeterias on college campuses, including Willamette University in Salem and Reed College in Portland. Dan Sprauer, director of operations at Bon Appetit cafeteria at Reed, said Sommars' granola "is as good as I've ever eaten." He buys about 200 pounds of granola every month at $1.78 per pound, about 35 cents less per pound than competitors.
Sommars, who calls herself a "social entrepreneur," recently signed a contract with a distributor in the lucrative and largely untapped Southern California market. Other lines of potential business include school vending machines, and she's preparing a marketing campaign based around the healthy attributes of organic granola.
She is also open to the possibility of outside financing.
"First of all, [growth] needs to be very thoughtful," she said. She pauses.
"Do I have to have a limitation?"
