Raise the Roof

Raise the Roof

Construction by Mark Gordon | Managing Editor

A willingness to do work others won't has been a catalyst for consistent and stellar growth for a century-old family run roofing company.

When Sutter Roofing executives agreed to take on a project for the Bay Pines VA Hospital near St. Petersburg in 1996, they thought it was going to be a relatively standard job: not necessarily easy, but one where their crews could continue to cement the firm's reputation for doing the gritty work others won't do.

Things didn't go as planned. Federal government red tape strangled the project. Work crews were denied access to parts of the building, the work exceeded costs and, probably most significantly, the project tied up a trio of work crews for a year. Executives learned a valuable lesson about job selectivity and when to say "no" to a project, despite the financial opportunity.

"It was horrible," says Doug Sutter. "It was a huge lesson for us and one that would have killed a smaller company."

Killing off Sutter Roofing would be a tough endeavor, though, no matter the project. The 104-year-old-company, which was founded in West Virginia, is employing its fourth generation of Sutters. Doug, 41, and Brad, 37, great-grandsons of the founder, serve as vice president and manager of the repair and maintenance divisions, respectively. The brothers' father, Stephen Sutter, 60, has been with the company for 36 years and is currently the president.

Beyond sheer longevity, the company is in the midst of one of its biggest-ever growth spurts. Revenues have more than tripled since 2000 and have grown 96% the last three years, from $18.1 million in 2003 to $35.4 million in 2005; the firm is projecting around $45 million in 2006 sales. Staffing levels have nearly doubled the past three years as well, from 180 employees in 2003 to 330 employees this year. Finally, growth has been driven by new office openings in Tampa, Fort Myers and Naples during the last eight years, the latter location debuting earlier in 2006.

The Sutters concede it's not simply their crews' roofing expertise that has fostered the company's growth. Internally, recognizing the importance of retaining employees has been essential, as was a decision to invest heavily in technology in 2004. Externally, the commercial and residential building boom in Florida has played a significant role in the growth, plus "it's impossible not to say that hurricanes haven't had a big say in our growth," Brad Sutter says.

Tough work

Stephen Sutter had been running the family roofing and metal business in Clarksburg, W. Va., for 10 years in 1979 when he decided the company - as did the Sutter clan - needed a change of pace. The previous decade had been a trying one for Stephen Sutter, as he took over the business suddenly in 1973 after his father, C.W. Sutter, unexpectedly died. Sutter's brother remained in West Virginia, where Sutter Roofing & Metal Co. still operates today.

When Stephen Sutter arrived in the Sunshine state, he started from the bottom. He had no local contacts and little knowledge of the business community. He was met with an abundance of closed doors and rejections in the first few months.

In Orlando, Stephen Sutter teamed up with a roofer and contractor and they began working on small projects. The fledging company hit its first jackpot in 1980 when it was hired by Tropicana to do a major re-roofing project for the company's headquarters, then in Bradenton. Tropicana remains a top Sutter client today - the firm estimates it has worked on roughly 3 million square feet of roofing for the juice company over the last 25 years, including working on some time-consuming cold storage facility projects.

In 1986, Stephen Sutter bought out his partner and moved the company to Sarasota. Sutter Roofing was getting steady business from Tropicana and wanted to be closer to the company's Gulf Coast plants and factories.

The company began building up a portfolio of clients in addition to Tropicana. It was a list that would develop into a who's who of Gulf Coast builders and construction firms, with names including Halfacre, Mike Carter and W.G. Mills. In the late '90s, the firm launched a repair division to capitalize on that growing segment of the market - it currently has 29 two-man crews who go from Tampa to Naples on jobs. It's taken on projects outside of Florida, too, including ones in Dallas, Pittsburgh, even Guatalema.

Overall, Sutter Roofing's niche has become doing difficult and complicated jobs, such as cold-storage and freezer facilities, which require strict compliance with food and safety regulations; high rise condo projects, which take a lot of preparation and insurance backing; and schools, which require precise work in limited time. Doug Sutter says about 80% of Sutter's clients are repeat customers. "We aren't known as the cheapest roofing contractor out there," Doug Sutter says, "but we want to be known as the best performing."

Growth uncertainty

Two methods the company has utilized to reach that goal and continue its growth have little to do with laying down tile for roofs.

First, in 2004, the company invested heavily in technology, spending $300,000 on software and servers that connect all four offices. The system gives the company a way to search for new opportunities, track orders and completed jobs and go through a significant amount of sophisticated historical data. In addition, field managers have laptops and portable printers so they can create orders at job sites.

The technology investment stemmed from a deluge in post Hurricane Katrina work orders, Brad Sutter says. Most of the jobs focused on repairing damaged roofs, but there were also some new construction projects. And to keep track of it all, the company needed to spend on top-shelf technology, something cost-conscious construction firms aren't always quick to do.

The Sutter Roofing software breaks down the work into five categories, of projects. "It helps us recognize what were really good at," says Brad Sutter, and what the company can improve on.

The second factor has been a commitment to employee retention. Through experience, the Sutters have learned that some jobs take longer and need more workers than anticipated. So they take care to make sure employees who go through the extensive training programs stay with the company.

In addition to standard company benefits, the Sutters have some extra perks. On the job, for example, the company recently hired a full-time safety director, a big plus when considering the hazards of the work. "We are trying to reinforce it every day," Brad Sutter says, "instead of once a month." Off the job, the company took all employees and their families - 623 people - to Busch Gardens for a day in June.

Technology and employee relations are factors in the Sutters' control. But other hurdles and challenges to maintaining growth, such as the price of materials and the slumping housing market, create unpredictability. It's enough uncertainty where the elder Sutter is projecting slower growth over the next year, with a possible greater pullback in the first few months of 2007.

Asphalt has tripled in price the last few months, and there have been substantial increases in the costs of aluminum and stainless copper, too. Stephen Sutter says the price increases are factored in when bidding on projects, forcing the company to pass up some projects. Says Sutter: "You have to weigh the competitiveness of the bidding process with what the reality of the what the costs will be."

AT A GLANCE

Year Revenues Increase

2003 $18.1 million -

2004 $28.5 million 57%

2005 $35.4 million 24%

Average annual growth: 41%

Source: Sutter Roofing Inc.

SUTTER TOUGH

Doug Sutter, vice president of Sutter Roofing Co., says the company has defined itself by doing jobs other companies shy away from. The jobs are tough and complicated, not just because the work is dangerous - like putting a roof on the top of a high-rise condo building - but because they take several work crews sometimes working 24 hours a day, top-end equipment and sound insurance bonding.

Some projects bring specific challenges, such as freezer warehouse and cold storage facilities, which have to meet federal FDA guidelines for preserving food. Those projects require a watertight seal around the edge while work is being done, for example. Other projects, such as the University of South Florida Sarasota-Manatee's Crosley Hall, are difficult due to the way the building is designed, with sharp corners and unusual angles.

A partial list of Sutter Roofing's recent tough jobs - along with the payoffs - includes:

•A Publix freezer and distribution center in Lakeland for $3.6 million;

•A Publix freezer in Atlanta for $1.6 million;

•A Sweetbay Florida distribution center in Plant City for $1.7 million;

•The Idlewild Baptist Church in Tampa for $1.58 million;

•The University of South Florida's Crosley Hall in Sarasota for $715,000.