The Meter's Running

The Meter's Running

Fred Munn Sr. built a thriving business out of measuring

water, air and electricity levels for others. The going has been so good that he's now guarding against growing too fast.

by Mark Gordon | Managing Editor

Fred Munn's career-transforming business idea, hatched in the mid-1990s while he was working construction jobs in Clearwater, is the epitome of seeing opportunity in the previously unseen.

In fact the idea, which has since turned into a thriving $3 million-plus business, has its roots in selling things as simple as air, water and electricity.

But Munn didn't build a bottling plant or create oxygen chambers. Instead, he built a business that could capitalize on the needs of real estate executives and landlords to rein in their costs providing utilities for an entire building.

The company, Sarasota-based American Metering Services, Inc., is a submetering company, which means it installs meters for individual apartments, condos, mobile homes and, lately, businesses. The company then bills the individual tenants for their specific usage. "We are just like the utility company," says Munn.

Of course, the big difference between Munn's company and say, TECO Energy or FPL, is that American Metering Services is simply the middleman. It doesn't actually provide the water or the electricity for customers.

That simplicity has proven to be a successful way into entrepreneurship for Munn, who owns American Metering Services along with five partners. The 20-employee company, after taking a few years to find its footing, has grown its sales each of the last four years. In 2007, it reported $3.5 million in revenues, an increase of 75% from its $2 million in 2006 revenues.

Munn is projecting even more growth in 2008 and 2009, as the apartment rental market grows in proportion to the sinking housing market. Landlords can only raise rents so much, Munn reasons, so he hopes his services will be in more demand. The company also recently opened a commercial division, setting up meters for stores in strip malls and businesses in office parks.

The projected growth also represents Munn's biggest looming challenge: to keep up with technological advances in the submetering industry, from the actual devices to the software programs that control the billing process.

The software program aspect has always been a priority for Munn. When he started the business in 1997 in what was then a tiny machine repair shop near the Sarasota-Bradenton International Airport, Munn went through four or five computer programmers before he settled on one. "We wanted to have our own programmers," says Munn, "so we could tailor it to what we need."

Munn also likes to keep repair work of the meters completely in-house, somewhat unusual for a small business with clients in almost 10 states, including Florida, Indiana, Texas and North Carolina. Keeping up with that work will only become more cumbersome as the company grows its customer base.

One of the company's two repair technicians, for example, has spent all but three days of 2008 on the road, maintaining and updating meters for the company nationwide. "We really service our accounts," Munn says. "We want them to know there is a difference between us and our competitors."

And that market has grown competitive over the last decade. When Munn founded American Metering Services the submetering industry was relatively tiny. Now there are some 200 companies across the country that provide a similar service, including about 15 in Florida.

Munn is also facing another growth-based challenge, that of maintaining a customer friendly persona when automation might make more business sense.

For example, the company has consistently used real human beings to answer the phones, a task bound to become trickier as its client list grows. "You want to automate," says Munn, "but you always want to be friendly to the customers you serve."

SUMMARY

Business. American Metering Services, Sarasota

Industry. Real estate, utilities

Key. Company has found a niche in installing and maintaining water and electric meters for apartments and condos nationwide.