Continual diversification in related fields helps prevent boom and bust periods for South Carolina’s Nature’s Calling
In sports, a deep bench always helps when injuries strike or a game plan changes, requiring players with different skills and abilities. It’s no different at Nature’s Calling Inc. in Charleston, S.C., where owner Russ Perkins relies on several diverse business segments — portable restroom rentals for construction sites and special events, roll-off containers/waste hauling and environmental services — to support each other.
“Without diversification, I wouldn’t be in business anymore,” says Perkins. “While the special-event market has remained good for restroom rentals, construction business has fallen dramatically since 2007 … the economic downturn has been pretty catastrophic for many businesses here.
“Our construction rentals in 2009 declined about 35 percent, and we’re about 5 percent down this year from last year,” he says. “Our roll-off business is way off, too, because it’s construction related. The special-event market is down some, but nothing like construction. Without special events, I’d be out of business — or at least scaled down an awful lot.”
Perkins cites four factors critical to successful diversification. First and foremost, develop good relationships with and listen closely to customers; their needs can lead to new business opportunities. Second, offer complementary services that fit in well with what you already do. Third, provide excellent customer service in your core business, which establishes a built-in customer base if you expand into other segments. And fourth, find non-competitive mentors in other geographic regions who can show you the ins and outs of whatever business you’re looking to get into.
Today, about half of Nature’s Calling business volume comes from portable restroom rentals and service, with a 60/40 split between construction and special events. Waste disposal accounts for another 45 percent, and grease trap and septic tank service represents the remaining five percent. Perkins also recently acquired Fenn-Vac LLC, an environmental and industrial cleaning service, which stands alone as a separate company from Nature’s Calling.
Containers got diversity rolling
Perkins’ entry into the roll-off container business offers a good example of how those factors work together. A few years after establishing Nature’s Calling, customers started asking Perkins why he didn’t offer waste-hauling service with roll-off containers.
“Certain customers were telling us they weren’t getting good service on roll-offs,” Perkins explains. “They said that since we provided good service on the portable restroom side, they’d give us their business if we ever decide to get into roll-offs.”
That prompted Perkins, who used to work for a waste-hauling company, to start doing market research. He checked out the service competitors provided and their rates, then contacted more of Nature’s Calling customers to see if more demand existed. Confident that enough demand existed to make a go of it, he ordered a truck and 10-yard containers. He opted for 10-yarders — as opposed to more common 20- and 30-yard containers — because Charleston is filled with narrow streets. “We had our restroom sales people ask remodelers if they would use 10-yarders, and got a positive response,” he says. “The 10-yard containers take up only one parking space, which is important because space is at a premium downtown. No one else had 10-yarders, either, so I carved out a niche for myself.”
The price is right
How did Perkins price his new service? Research told him what the market would bear and indicated demand would be strong.
“So from there, you figure out your expenses and what you need to make a profit,” he says. “Also, being in the waste business already, I had a general idea of where rates should be. It’s all about supply and demand. But the most important thing you need to know is your real costs.”
Perkins also drew on his experience in the portable restroom business. “Would you rather pump 500 restrooms at $80 dollars each or 800 restrooms at $50 each?” he asks rhetorically. “Golly, that’s a no-brainer. I’m a 500-at-$80 guy.”
To avoid heavy debt, Perkins bought containers as he needed them. “In my situation, my restroom business was strong enough to help me finance the roll-off business,” he explains. “I did only 10-yarders for two years before I bought 20- or 30-yard containers, and I paid off all the 10-yarders before I started to buy bigger ones.
At that point, Perkins says, he relied on customer service to carry the day. “You can’t control competitors’ prices, but you can control customer service,” he says. “You call us in the morning, we’ll get you in the afternoon; you call us in the afternoon, we’ll get you in the morning. We are Johnny-on-the-spot when it comes to service.”
Perkins also reduced his capital costs to a degree by configuring three of his five smaller roll-off trucks to double as restroom delivery and service vehicles. Those trucks carry 300-gallon waste/150-gallon freshwater tanks from Best Enterprises Inc., as well as a skid that holds four restrooms. “That turned those roll-off trucks into universal vehicles,” he notes.
Perkins learned first-hand about diversification while working as a sales representative for the Fennell Container Co., a waste-hauling firm, starting in 1982. In spring 1983, the company started a portable restroom business called Fenn-E-Let, so it could sell two services with one sales call. In 1983, Fennell opened yet another business arm, Fenn-Vac Inc., which provided industrial cleaning services.
Eventually, Perkins became the vice president of Fenn-Vac. But in 1995, he sold his interests in Fenn-Vac and Fennell, and bought Fenn-E-Let, changing its name to Nature’s Calling.
“To be perfectly honest, I thought it (Nature’s Calling) would be a source of income while I started another industrial environmental business,” Perkins says. “But after I took it over, we put over 100 restrooms and 20 holding tanks at a construction site for a local steel plant. We serviced the restrooms there five days a week and the tanks three times a week.”
Then the company received another huge job: seven-day-a-week servicing of 130 restrooms at a chemical plant expansion.
“Working two major construction sites was a challenge, to say the least — just keeping up with that level of service for five and seven days a week.” Perkins says. “It was like adding 1,400 services to our normal weekly service. We rotated (the weekend work) through our crews and they all got overtime, which helped them buy into it.”
A fit fleet
Over the years, the company’s equipment inventory has grown dramatically. Today, Nature’s Calling owns 750 roll-off containers, mostly from Bakers Waste Equipment Inc.; 19 roll-off waste-hauling trucks, mostly Macks with Galbreath Inc. roll-off hoists; nearly 3,300 portable restrooms from Satellite Industries Inc. and PolyPortables Inc., including 46 handicapped-accessible units and 35 with sinks; seven shower trailers made by Advanced Containment Systems Inc. (ACSI); 35 restroom trailers, made primarily by ACSI and a few by Comforts of Home Services Inc.; and two laundry trailers (used for emergency disaster relief efforts), also made by ACSI.
For restroom service vehicles, Nature’s Calling relies on a variety of trucks, all with aluminum tanks: seven International 4700s (1996 to 2001) six from Lely Manufacturing Inc. and one from Progress Tank (New Progress LLC), with dual waste/freshwater tanks ranging from 1,000 to 2,550 gallons; 2004 and 2007 International 4300s with 2,000-gallon two-compartment tanks from Progress Tank; a 2006 Ford F-750 with a 1,500-gallon waste/500-gallon freshwater tank from Progress; a 2007 Isuzu JW5R04 with a 1,350-gallon waste/250-gallon freshwater Progress tank; a 2007 Mack 700 CV built out by Amthor International with a 4,600-gallon waste/200-gallon freshwater; a 2010 Isuzu NRR built by Progress (1,100-gallon waste/400-gallon freshwater tank); and a 2009 International 4000S from Progress with a 1,500-gallon waste/500-gallon freshwater tank. Most of the trucks rely on pumps made by Masport Inc.
Perkins says restroom trailers have been profitable for Nature’s Calling. For example, in 1989, he purchased one trailer to handle emergency relief work stemming from Hurricane Hugo. “Then we brought it back to our yard and it basically did nothing,” he recalls. “So I repainted it, put the company name all over it and started putting it out at special events where I had restrooms out, to get some advertising. It kind of grew from there.”
Great disposal arrangement
In terms of waste disposal, Perkins substantially lowered his operating costs — and gave his company a large competitive advantage — by doing something unique: He paid to have a sewer line, a manhole with a trash filter and a lift station installed on site at his company, where he is allowed to dump septage and portable sanitation loads directly into the municipal system.
Perkins started by asking the local sewer district if it was possible, and was told it was. From there, he hired an engineer to draw up a plan and presented it to the state environmental agency, which approved it.
“It cost me about $100,000, which was a lot of money back in 1998,” he says. “At the time, the disposal rate (at a local treatment plant) was 7 cents per gallon. With monthly sewer fees, which are based on volume and measured by a flow meter, I pay only a half-cent per gallon. The line paid for itself in three years.”
The sewer line also was a substantial financial boon because it dramatically reduced the amount of time and fuel spent traveling to and from a disposal site. “My drivers dump every night,” Perkins says. “Then every morning, they leave with an empty tank. So I don’t have to purchase larger trucks, like I did at the start.”
More diversification in store
Perkins continued his diversification strategy in July by purchasing Fenn-Vac, the same company he partially owned 25 years ago. He heard through the grapevine that a company that bought Fenn-Vac in 1995 was looking to sell, and he decided to give it a go. Fenn-Vac now provides environmental services, such as hazardous-waste transportation and emergency response for hazardous and non-hazardous waste spills.
The acquisition was attractive because Perkins was already familiar with the industry. And he was able to reassemble the same work team that operated Fenn-Vac some 25 years ago — a valuable asset.
“While doing due diligence, I found out that a lot of plants and industries that had projects on hold (because of the economy) were starting to release funding, and environmental business was starting to pick up,” he says. “And in terms of diversification, we do a lot of disaster relief work, so we saw very beneficial synergies between the two companies.
“Plus, its services get us into industrial plants, which provides more opportunities to sell portable restroom rentals and solid-waste removal services,” he adds. “It puts us in a position where customers can make one phone call and solve any liquid- or solid-waste issue that arises.”
Just like in sports, it never hurts to have a deep bench.