JANUARY 25, 2011
Business Spotlight: Shiny to the Finish
By Chris Wrinkle
Springfield Business Journal Reporter
A father’s fishing excursion to the Missouri Ozarks in 1975 led to his sons forming a multimillion-dollar business in tiny Forsyth.
Attracted by Lake Taneycomo, the cost of living and a slower pace, Ray Donat moved his family the next year to Forsyth from Chicago, and a decade later, his three sons – Dale, Dean and Don – formed Mid America Metals at 14886 U.S. Highway 160.
The company refinishes architectural wood, stone and metal surfaces and has enjoyed a 25-year run leading up to $8 million in 2010 revenue.
“Basically, we go into the skyscrapers of the world and refinish the metal, stone and wood in those buildings,” says owner Dale Donat.
Dale and Dean were co-owners until Dale bought Dean’s half of the business Jan. 5 for an undisclosed amount. The third brother, Don Donat, left the business after two years, according to Dale Donat.
Mid America operates 10 offices from its Forsyth headquarters with plans for an 11th office to open in Miami this year.
The company has a nationwide client list including St. Louis Art Museum; Jefferson Memorial in Washington, D.C.; Rangers Ballpark in Arlington; Kansas City’s Crown Center and Kauffman Stadium; Daytona International Speedway; and UPS World Headquarters in Atlanta.
Services range from removing a scratch on an elevator door to recoating an entire stone surface.
A profitable venture
For 23 of its 25 years, Mid America revenue has grown from the prior year.
In fiscal 2010, company revenue was $8 million, up 14 percent compared to fiscal 2009, Donat says.
Company executives have scaled back its fiscal 2011 revenue projections to the 6 percent growth range.
“When we started into the recession, in late 2008 (and) 2009, we talked with employees and tightened our belts,” Donat says. “We worked with employees and customers alike to try not to lay anyone off.”
Mid America has been able to maintain its record of no layoffs of its 85 employees by maintaining its growth plan even during the recession. The key was listening to customers, Donat notes.
“With customers, we got more aggressive, tightened up on pricing, redid contracts and just tried to work with customers,” he says.
During 2010, Mid America grew its maintenance base, adding 66 long-term contracts that amounted to $36,000 a month. The company now has more than 400 long-term maintenance contracts, which produce about 65 percent of the company’s revenue. The remaining 35 percent is new business.
“We had a record year in sales and profit,” Donat says, adding that profits increased by 65 percent last year.
Builders and developers are requiring their projects to be certified in Leadership in Energy & Environmental Design, which Donat admits presents challenges to his business.
Most refinishing products don’t meet LEED standards, he says.
“The products we use are not green-certified,” Donat says. “Janitorial companies haven’t made it a priority. It’s a huge challenge for us that’s being driven by our customers.”
To achieve LEED-certification for existing buildings, several actions must be implemented, according to the U.S. Green Building Council, which governs the certification. Some of the points are attainable by cleaning departments.
According to www.usgbc.org
, there are four levels of LEED for existing buildings: certified, silver, gold and platinum.
There are eight points specifically targeting cleaning, including use of sustainable cleaning products and materials; isolation of janitorial closets; implementation of a low environmental impact cleaning policy; implementation of a low environmental impact pest management policy; implementation of a low environmental impact cleaning equipment policy; water-use reduction; occupant recycling; and entryway systems.
Although refinishing products that are LEED acceptable may be more expensive, Donat says Mid America has tried to keep costs level and has established a green team of three employees.
The global market for metal finishing chemicals is expected to reach $8 billion by 2015 due to increased demand from the electronics and electrical, motor vehicle equipment and aerospace industries, according to a Jan. 7 report by Global Industry Analysts Inc.
Donat says the trade is highly specialized, and Mid America’s turnover rate has been low, 5 percent during the last two years. Still, company officials have set improving worker retention as a goal.
They’ve also set a succession plan in place, and it has a familiar ring.
Donat is hopeful that his son, Brandon Donat, a company vice president, will follow in his footsteps and run the company.
“I’m hoping to turn it over to my son, eventually, who will be the second generation,” Donat says. “I’ve worked very hard at it. I’ve read a lot about how difficult it is to have a second-generation and a third-generation company.”
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