What is this female, white-collar executive doing running an electrical contracting business in Omaha? Putting a valuable reputation built from 38 years of hard work serving neighbors, architects and builders in the area together with cutting-edge ideas in efficiency swiped from the button-down corporate world, that’s what.
And the result for D&J Electric?
“We punch above our weight class when it comes to large jobs,” agreed owner and operator Lori Buchanan.
'Does it feel right in our heads and our hearts?'
When Lori and her husband Jay searched a year ago for a small business to purchase, they discovered this small company tucked in a neighborhood southwest of 60th and L. Didn’t matter that they were a little out of the way; continual referrals from contractors and business owners familiar with the work of their skilled electricians filled D&J Electric’s schedule with remodel and restoration jobs, from multi-story office buildings, warehouses and restaurants to retail space and apartments.
Quite a bit to step into for Lori, a corporate human relations specialist, who left a leadership position with Mutual of Omaha in employee engagement and talent management for the challenge of running a small business. Jay left his job as director of global supply chain and logistics for Nebraska Furniture Mart to join her.
“Jay and I always have enjoyed talking about businesses, thinking about business and reading about business,” Buchanan said. “As we looked around for a business to buy, we sought one with a sustainable pipeline of work, asking ourselves, ‘are they in a good place, are they making money?’”
When the couple checked out D&J Electric, they found the company fit another of their personal criteria: “Does it feel right in our heads and our hearts? Does it feel like the business would be interesting and fun? You have to go a little bit on your gut instinct. And D&J had a healthy company culture, one certainly built by the owners but also by their long-term employees, too. This company has deep talent with tremendous capabilities.
Turning to the SBA to guarantee the deal
With D&J Electric’s owners ready to sell, Lori and Jay met with Omaha State Bank to lay the groundwork for a deal involving the purchase of the business’ three buildings, equipment, lift truck–and the considerable worth of the future cash flow the business could expect to generate. Then the deal hit a snag.
While the two were attracted to Omaha State Bank’s strong reputation and focus on investment in the local community’s small businesses, they were disappointed to learn the purchase would be held up temporarily as Omaha State Bank completed its merger with Centennial Bank, another locally-focused institution and the SBA’s Nebraska Small Lender of the Year for 2010, to form Core Bank. With the entire management team at Core Bank backing the purchase, all the way up to the bank’s CEO and president, they did suggest restructuring the deal under an SBA guarantee to manage around the banks’ merger activities.
Jay attended an SBA loan presentation seminar in Elkhorn to learn about the application process, and “put things in perspective.”
“We’re not a wholesaler, retailer or manufacturer, we’re in the service industry, so we didn’t have a lot of asset collateral,” he said.
“We negotiated hard on the property price,” Lori added.
Patience paid off, as the couple was approved for a 7(a) loan in August 2013 to purchase the business.
Common name at sites all over downtown Omaha
“We’re looking to be the “go-to” mid-tier contractor in the area,” Lori said. And the immediate future looks bright; in 2013, D&J Electric will report its biggest annual revenue in company history this year and recently brought five new employees on board, bringing the staff up to 40.
The company also specializes in upgrading electrical service for new equipment, often requiring advanced tech skills to improve the electrical service capacity for an entire building or that serve a single piece of equipment. They also do the brainy stuff for their clients, including job cost analysis and turning out detailed electrical drawings for design and build services.
D&J Electric is a common name at construction sites all over downtown Omaha; the biggest job for the company is found at the former Northwestern Bell Building, a multi-million job at 19th and Dodge converting the long-vacant 12-story, 380,000 square foot structure into modern, must-have apartments. Plans for the project, dubbed “The Wire,” for the 60-year old building’s history as a regional telephone headquarters, also call for commercial retail outlets on its first floor.
Then there’s similar electrical renovation work the company is doing for the four-story Fairbanks Building, the former Antiquarium, on Jackson right next to the Old Market, and a million-plus job on a renovation for a new apartment complex at 13th and Jones nearby. Add up work the company does with retail, office and large-scale apartment complexes, fast food and strip mall developers; like the “four retail stores” at the new Nebraska Crossing mall in Gretna. These are examples of our team’s deep “sense of purpose, intense focus, and performance that our customers have come to expect from D & J Electric” Jay said.
Message to their team: 'we have your back'
For D&J Electric, according to Lori, it’s the relationship the new owners have with their employees and clients which matters most of all.
“We don’t have the experience that our employees have in performing this specialized work,” Lori said, “so we do everything we can to support them so they are successful, which, in turn, will pay dividends for our client.”
Jay agreed: “Our message to our team is that “we have your back, and we support them.”
Upon taking over, they kept on the former owner as a key employee, depending on his years of experience deciding which contracts to take and which to take a pass; moreover, he provides much-needed and trusted continuity on current and future electrical contract jobs.
Then the couple met with each employee to discuss the core values and direction of the company. “Most businesses struggle without real buy-in from the employees,” Jay explained.
“We wanted to understand our employees’ capabilities and matching them with the jobs that fit,” Lori said. “There’s a real value in cross training and rounding out this talented team, because our future growth is based on the knowledge, skills and experience of our employees.”
That’s not a commitment they take lightly.
Take those five new employees. Three of them are first-year apprentices who are required to begin the educational process to become licensed electricians, and as long as those new hires keep their attendance and grades on track, the company will support these tuition expenses. Wellness and employee assistance plans are next.
There’s also a plan to put the seasoned employees in leadership positions on jobs to mentor the apprentices, giving the journeymen “ownership on a project, and real sense of challenge and responsibility,” Lori added. But there can be a problem with relying on a few key people.
“When it comes to putting people on a job, we often get ‘oh, put so-and-so on that job, he’s great at it,” she said. “That’s great, because that shows a lot of pride in the work to be the go-to expert. But we need those guys to be mentors, to bring along the whole team to learn that work, too, because we’ll need the depth. People can’t be all places at all times. If we are stronger all around, we’ll deepen our bench strength, improve our capabilities and performance. We believe the work at cross training will drive the sense of teamwork. We expect this to prove itself through the eyes of our clients and partners.”
Lori and Jay figure if they build a sense of teamwork, a culture of cross training, and bring their industry experience to guide more efficient ways of performing the company’s already strong reputation for quality work, D&J Electric will become not only a preferred employer for talented electricians in the area, but continue to improve its reputation as a high performance, quality driven organization.
After all, that reputation was a big part of the value of the business in the first place.
“At the end of the day our biggest concern is our reputation,” Jay explained. “If we’re going to have sustainable business model, you can’t live off it, you have to improve it while building that deep trust.”