With huge deal in hand, don't let others get away
Pittsburgh Business Times - by Dan Reynolds
David Perry might have learned his most valuable business lesson when the windfall he felt sure of landing started to look like a mirage.
The owner of Murrysville-based American Geosciences Inc. founded his environmental consulting company in 1990 and has seen growth since then that has averaged 25 percent per year.
But 2006, which by all appearances should have been his biggest year ever, turned out to be the only one he's had where his company experienced no revenue growth.
Perry blames himself and says he won't let it happen again.
Like many owners of engineering firms, Perry has to proceed cautiously when lining up big contracts. In a field where finding the appropriate staff members for the job can be a challenge, Perry said he can't bite off too much work because he won't be able to service his customers.
"Our biggest problem is finding qualified staff," Perry said.
So when his company lined up a site remediation contract worth $3.2 million -- a number greater than his highest yearly revenue -- Perry backed off on finding other work, thinking he'd have plenty.
The job was scheduled to begin early in 2006, and Perry said the legal minds that were vetting it kept telling him the project would be approved any day.
"It always had the appearance that it was imminent," he said.
But days turned into weeks, and weeks turned into months; and still the project didn't get the green light. Perry started having second thoughts about other jobs he had turned down because he didn't want to choke on too much work.
"That was really my fault," he said. "I wasn't aggressive as I could have been on a couple of projects because I was really afraid to take the project."
The job eventually started in late 2006, but once his company got into it, Perry found that the deal was much smaller -- it ended up being worth just one third the size of his client's original estimate.
Perry said that's the last time he'll let other projects go at the expense of the big deal.
"We are much more aggressive now about pursuing work until the project actually comes in," he said.
An officer with another local service company said that's a sound strategy.
Pat Branch, the COO of architecture and engineering for Downtown-based Astorino, said his company recruits talent and new contracts with equal fervor and lets quality draw quality.
"If you've got quality personnel, you will find work to keep them busy, and if you have quality work then you will find quality personnel to do that work," Branch said. "It is absolutely impossible to know in a service business exactly what you're going to be doing three months from now."
Perry estimates growth for his firm in 2007 will again be close to 25 percent. He's taking jobs as they come and learning to live with the fact that projects are sometimes bigger, more complicated and more expensive than they appear -- and sometimes much less so.
Perry says he's learned his lesson.
"We'll deal with it when it comes through the door," Perry said.
dreynolds@bizjournals.com | (412) 208-3827
