Foodservice veteran Gary Allen returned to the service agent business through the purchase of Vanco.
Slightly more than a year ago, Gary Allen, a former owner of Commercial Parts and Service, received an invitation to attend a gathering of former CFESA presidents in Chicago. Wanting to reconnect with the industry prior to departing for this event, Allen called a few service agents near his Indiana home and talked with them about how business was going and discussed some of the key issues they faced. What Allen found out in these conversations is that the service segment of the foodservice industry still sparkled in his eyes.
Simultaneously, Allen's son Jeremy had approached him about following through on previous discussions between the pair about going into business together. And not that long after, Allen approached one of those companies he had spoken with prior to the CFESA event about a potential acquisition. This past February the deal got done and Gary and Jeremy Allen acquired Vanco, an Indianapolis-based service agency that works on both hot and cold equipment in a 75-mile radius of its headquarters.
FE&S talks with Gary Allen about his decision to come back to the service segment, some changes he's noticed, what it's like running a family business and more.
FE&S: What about the service industry brought you back?
GA: To begin with, about 15 months ago I made the decision to acquire a business in partnership with my oldest son. We considered other opportunities, from our hobbies to franchises. I'd had a taste of retail in my years away, and those businesses have hours that are just not family friendly. It seemed to me we'd have less risk doing something that was a good fit with our past experience. Jeremy has been in the electrical contracting field since 2004 but did work part time for us at Commercial Parts & Service back in the day. And although I had been away for nine years, the basics of the service industry are still the same.
Another big reason is the people in the equipment side of our industry are good folks to deal with. I call it a quality of work life issue. If, by and large, I enjoy the people I deal with in my daily work, then that's a nice little perk.
FE&S: Still, during the past 10 years, the industry has changed dramatically — from the emergence of parts houses to warranty issues. Some would argue that these changes have created an even more competitive and challenging operating environment for service agencies. So, I have to ask, why get back into the service business now?
GA: There are still niche opportunities in the market. We are on the front lines with foodservice operators, who have three main areas of daily operations to deal with: personnel, customers and facility issues. If we can be their go-to guys that they can count on to take care of one of their top three then we should always have a valid position in the marketplace.
FE&S: You were working in real estate and other industries for the past 10 years. Now that you are back working as a service agent again, what changes in this industry have you noticed for the better?
GA: Service companies like ours have invested in data management allowing technical and parts information to be readily available at the fingertips of anyone. This is better for everyone because it keeps too much information from being confined only in the heads of experienced people. So by giving more people access to more information our ability to serve multiplies and we are able to do so with a higher level of competence.
One example of how this can benefit everyone involved is that we can provide repair history information to the customer, providing them with decision-making information on vital pieces of their kitchen equipment. As a result, we are seen more as a partner or value-added resource that helps them better manage their foodservice operations.
FE&S: Any other changes you have noticed?
GA: There are a whole lot more estimates being requested these days. It seems that foodservice managers must have tighter reins on their spending authority, so we are experiencing a lot more direction from them to give a price estimate before finishing a repair. The outcomes of this are:
- More office administrative time on our end, driving up the service agents' overhead
- Slows down the turnaround time to get the equipment back up and going for the customer, which lengthens their downtime, and ties up the service agents' capital in many more jobs that have been begun but can't be finished
- Requires the service agent to become more knowledgeable about the cost and availability of new equipment to compare with the repair estimate
The basics of what we do — being on the frontline taking care of the customer — has not changed. So that part is still comfortable. But now I am educating myself on the trends that we need to be aware of to make sure our field technicians are ready to serve customers. For example, do they need smart phones or a small computer to better serve their customers?
FE&S: What about the industry today has surprised you the most?
GA: The general industry acceptance of large parts houses; however I realize that this is the normal course of any industry as it matures. That is, the more competent and aggressive players establish and execute successful growth plans that lead them to a higher growth rates thus increased market share. Another surprise is how little technology has infiltrated the management and repair of foodservice equipment. There have been so many technological advances in other areas of our lives that I was curious what may have been implemented in foodservice equipment. So far, we don't have technicians sitting in our office at keyboards diagnosing and repairing coolers, ovens and dishwashers through the internet.
FE&S: What's it like having your son in the business?
GA: It's great – he has already exceeded my expectations. I get to experience him in a whole new role, using his God-given talents on the technical side, along with his natural instincts when dealing with all the stakeholders in a business; the customers, vendors, fellow employees and owners.
Working with my son allows me to pass along things I learned from my father and CFESA peers, as well my own experiences. It gives him an opportunity to use his abilities, positively affect the lives of customers and staff, grow something that he can point to and if successful, reap some rewards.
FE&S: Any concerns about combining family and business?
GA: When you are a business owner you never turn it off. When you have technicians out in the field working on a roof and weather is coming in you worry about them. Not every family should take that on, so I talked with Jeremy and his wife at length. If a truck is coming early one morning you have to be there. It is part of owning the business. And both my son and his wife were, in my assessment, up for it.