APEX Maintenance has Found its Niche

Dan Earl entered the sweeping industry in 2008, after selling his prior business and taking a few years off to a retirement he found to be boring. Earl had founded what became a very successful business that had only one thing in common with power sweeping: it was in another industry no one much thinks about, that of providing scale calibration services to the railroad industry. “You know those signs on the highway that say ‘All trucks must enter scales’ ” Earl asked? “All trains have to go through scales also. And lots of organizations have those scales: The coal company has one because they want to know how much coal they’re selling and how heavy it is. The electric company purchaser has a scale, too, because they don’t trust the coal company and want to know for sure how much coal they’re buying. The railroad also has a scale because they want to know how much coal they’re pulling.” The buyer, seller and transporter scales all have to be calibrated in order to be used for revenue-generating reasons. Historically, those scales have been tested with rail-bound test units. However, Earl found a way to reconfigure those testing units so they could be put onto semi-trucks, a much cheaper alternative. His ‘better mousetrap’ was soon providing scale calibration services from Montreal to Miami, and ultimately expanded to offer the same service from California to New York. “We ran semis all over the country testing railroad scales,” said Earl. “It was a good business and right up my alley; blue collar, working around diesel trucks. What I didn’t like was the travel, so I found some people who were interested and sold the company to them and retired at 35. After a few years, though, I found retirement to be very boring.” When Earl decided to get involved in a new business, one of his criteria was that the work be local, so he could be home to watch his kids grow up. He also wanted to be able to be home during the day, rather than at night. The top three requirements on his list, he says, were that whatever enterprise he chose be blue collar, involve working with diesel trucks and primarily involve nighttime work. “Who goes out to work at night? Sweeping trucks,” said Earl. “It was a blue collar occupation that was right up my alley.” Around 2008 he found a power sweeping company, Bill’s Lawn Care and Maintenance, that was for sale in the Jacksonville, Florida, area. The firm included a couple of sweepers, with routes, as well as the lawn care side of the business. He renamed the firm APEX Maintenance Services, LLC. When Earl bought the company it came with two sweepers, one a nearly new Victory Mark II, which he sold because it was almost new and he decided he didn’t want or need a new sweeper due to its relatively high rate of depreciation. To replace it he bought a much older Nite-Hawk, since he thought the cost of ownership would be less with a single-engine sweeper. His thinking was also that it would be quieter than a twin-engine machine and do fine with the paper and other light debris that his clients needed swept. Then, when APEX had the chance to get into some parking garages, which they didn’t have a machine to handle, Earl got creative. He tried to find an old Toyota-mounted Schwarze 222 to buy but couldn’t locate one. So, he bought a 1989 Toyota-mounted motorhome from the same era, took the motorhome portion off, shortened the frame and driveline and bought a Schwarze PolyVac to mount onto it. He also moved the sweeping head from the back, like it is in the PolyVac, to between the front and rear wheels. In essence, Earl says, he built his own quasi Schwarze 222. “I put a hydraulic dump system onto it so I could offload into dumpsters,” said Earl. “It has 14″ tires that cost me $68 apiece for new ones. I get about 33 miles to the gallon and the motorhome only had 32,000 miles on its V6 engine when I got it. Cost of ownership for that sweeper is about 1/5th of my Victory and about 1/4th of my Nite-Hawk.” Because of how well the machine worked out for him, says Earl, they moved toward sweeping even more parking garages and today his homemade Toyota sweeper runs about 20 hours a week in those structures. The company uses it for other types of lots, as well, except its parked during leaf season since it has such a small hopper capacity. “What I’ve found to perhaps be unique to our area is not the type of debris; there’s not a high level of sand, for example,” said Earl. “We mostly pick up light litter except for one factor: leaves. There have been an enormous number of trees planted in the Jacksonville area. The oaks are prevalent and they drop leaves from about November through May. During the leaf season our manpower about doubles. Because we have a mostly industrial base of customers, many of our customers go from perhaps 10 hours of sweeping per month to 10 hours per week. We have to gear up for that during those months. That makes the winter season a challenging time for us. Then, relatively speaking, we get summers off.” However, Earl stresses that he wants to keep his employees working all year in his firm, which he renamed APEX Maintenance. That can be a challenge in that Earl has another goal in mind, one that many contractors reading this might find foreign: He doesn’t want to grow the company past its current four-sweeper, four-employee, size. “I really don’t want to get any bigger than that, even though we have had numerous opportunities to do so,” said Earl. “We run at about 97% capacity. If I get bigger I know it will make more headaches. I don’t want to get to the size where I need to add a middle manager, for one. However, with the increasing amount of paperwork that’s being required these days, I may have to hire someone to start assisting with that.” In the winter months, the company does almost all parking lot sweeping and day porter services, running around the clock on weekends and at essentially full capacity during the week. During the summer months, Earl has added pressure washing of sidewalks, mostly for current customers who want to utilize his company’s work ethic for that and are willing to wait until the summer months to get the job done. “We also have started picking up floor scrubbing of interiors of warehouses,” said Earl. “Probably 60-70% of our business consists of warehouse properties, not retail. I’ve learned that the profit margins in retail centers aren’t worth my time and are a hassle. When I bought the company the client list included nine Walmarts. Within six months I’d given them all up since they weren’t profitable. “The previous owners were also sweeping multiple shopping centers and I gave them up, as well, for the same reason. Within the first year, I’d estimate that I gave up 60% of the total contracts I’d gotten with the purchase because they just weren’t profitable. The warehouses have a reasonable profit margin and, although they’re twice-a-month instead of seven nights a week, the overall profit is about the same. It’s a great market niche and we don’t lose customers or employees; our customers appreciate the value we provide and they stay with us for a long time. Our employees are happy to be here, as well. APEX now does quite a bit of inside floor scrubbing during the summer months. This, combined with the pressure washing, keeps his current employees busy in the summer. “As far as I’ve found, sweeping the inside of the warehouses is basically just like sweeping the outside,” said Earl. “We purchased a walk-behind Tennant floor scrubber and use an inexpensive chemical we can buy at Home Depot that gets good results. The scrubber is a 36” electric unit that we plug in and then get about eight hours of service life per charge. Most of our accounts have interiors of from 20,000 to 50,000 square feet, so it will take several days to clean each one. “Although we could do the job quicker with a ride-on machine, because of the relative cost of that to a walk-behind, the cost to the client is basically the same. However, by using the smaller scrubber my employees get more hours for doing the job and my goal is to keep my employees working.” In the accompanying audio podcast, Earl stresses the importance of developing a detailed, comprehensive business plan and then sticking with it. For example, he says APEX went into janitorial for about six months, and also gave a try at window washing, but he decided those services were counter to his business plan. “I want to keep my business small and concise,” said Earl. “We do the inside floors because it offsets my wintertime high volume season. The original plan was to put the employees to work in the summer in the lawn care business that existed when I bought the firm. What I found was that business model involved me having to work at night in the sweeping portion and then during the day at the lawn care side. I just wasn’t interested in working that many hours and do not want to get so big that I have to have a layer of middle management. So, I sold the lawn care portion of the company.” Earl makes it clear that experience has taught him that bigger isn’t necessarily better, and that it also doesn’t mean you’ll be more profitable with increased expenses and a middle management layer. APEX Maintenance concentrates on its core areas of business and they decline to branch out into all sorts of services. They do evaluate other customer requests and will assist if they can. Earl says that he’s made it a point to know all of his customers personally and that allows for a strong level of communication between all parties. From the conversation with Dan Earl, it’s clear that he has found a profitable niche for his company, one that provides for his family and his employees. His is also a business model that works without having to be involved in the low bid ‘race to the bottom’ where so many contractors in the retail sector have found themselves in recent times. He also promotes his company well while on the job, as may be seen by the closeup of the graphic on the hopper of one of his sweepers, shown to the right. As Dan Earl expounds in the podcast, “You don’t want accounts where you’re not making money. You also don’t want a few accounts where you’re making boatloads of money to make up for your zero profit accounts because that’s not right either. What you want is a business where every account makes you a decent profit and you have good communication with all.” You may reach Dan Earl via the APEX Maintenance website, which is located at www.jacksonvilleparkinglotsweeper.com.