Contractor Focuses on Lateral Lining

Co-workers take experience and customer service focus and turn it into a profitable business.
Contractor Focuses on Lateral Lining
Steve Stefanidis (left) and Mike Rodger formed Liner Guys in 2012 in London, Ontario, focusing on lateral cleaning, inspection and lining.

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Judging by the lateral lining company’s growth — about a 30 percent increase in gross revenue in each of the last two years — the no-nonsense approach is paying dividends in a competitive lateral lining market in and around London, Ontario.

“We’re a customer first kind of business,” says Stefanidis, who handles sales and marketing for the company, while Rodger supervises field operations. “Good customer service is rare in today’s society. But we believe that customer service requires exactly what it says it is: You bend over backward to do whatever you can for every customer.

“You know you’re doing something right when a customer gives you the keys to their home and says, ‘I trust you,’” he adds, noting that customers periodically do just that. “That’s a major responsibility. I don’t always feel comfortable when they do that, but so far it’s worked out well.”

Customer service informs virtually every aspect of the company, from embracing advanced technology that minimizes disruption for homeowners and helps employees finish jobs faster to setting high hiring standards for employees who can interact properly with customers. It also includes educating customers about the advantages of no-dig technology, which is still relatively unknown in the regional market the company serves, Stefanidis says.

Even the company name (Rodger’s idea) is intended to make things easier for customers. “We threw a thousand ideas out there and Liner Guys just stuck,” Stefanidis recalls. “It was just the two of us back then and it defined the basis of our business. We wanted to convey that we are the guys for lateral lining. It’s just that simple.”

Getting started

Rodger and Stefanidis met while they were working for another lining company. After Stefanidis left the firm in 2012, he told Rodger to call him if he ever wanted to form a company on their own. “He called me a week later and asked me if I was serious,” Stefanidis says. “We then held a meeting with our families and that was the birth of our lovely business.”

The duo was excited about business prospects because market research showed that 70 percent of the city’s homes are more than 30 years old — a total of approximately 30,000 homes in all. “We figured it could be profitable for us even if we worked on just 30 percent of those homes,” Stefanidis says. “And there are lots of townships around us with homes that are even older than that … so the business looked very lucrative. The infrastructure here is getting old, and the technology is incredible. It’s still amazing to me how we can inject a liner into a pipe and three hours or so later, we have a perfectly formed plastic pipe inside the old one.”

To enhance customer service, the duo invested in a CIPP lining system from LMK Technologies. The company also relies on a 34-foot-long wet-out trailer (where the pipe liner gets impregnated with resins prior to installation) made by Atlas Specialty Trailers, and a Hitachi generator.

“We like the LMK system because the inversion tank has a camera port where we can insert our SeeSnake camera and watch the liner inflate,” Stefanidis says. “It’s much better to be able to see that the liner is open at both ends, rather than guessing.”

The company also owns four RIDGID SeeSnake inspection cameras with CS10 color monitors; two RIDGID Scout locators; four RIDGID cutting heads, used for scouring pipelines; a milling machine, made by Picote Solutions, for reinstating laterals; and two Ford F-150 pickup trucks.

Employee preferences

Stefanidis says he and Rodger are very particular about who they hire to use all this equipment. Employees must be able to not only grasp the intricacies of lining, but also respect and interact well with customers. That includes refraining from smoking, littering and swearing on job sites.

“It’s not difficult to find employees,” he explains. “It’s just difficult to find employees who take pride in their work — who work the way we want them to work. We’re pretty fussy about how our employees interact with customers. We want employees who treat our business like it’s their own.”

There’s a reward for employees who make the grade: no boss/employee hierarchy. “There’s no boss or supervisor in our company,” he says. “We work hand in hand with each other. We don’t want our employees to look at us as bosses, but we also don’t want them to take advantage of that kind of mentality. Our philosophy is let’s all work hard for a good day’s pay and everyone goes home happy.”

When it comes to training, Stefanidis doesn’t think pipe lining is difficult to learn, but he says there’s definitely an art to it, and employees are lucky to have Rodger as a teacher.

“Mike is definitely an artist at lining — he’s a natural. He lives and breathes this stuff. He’s cool, calm and collected and believes that no matter what he comes across, we’ll dive in and fix it.

“He wants things perfect and pristine,” Stefanidis adds. “We take a lot of pride in our work — it truly matters to us that customers are happy.”

Education is critical

Getting people to understand that they don’t have to dig up failing laterals — and deal with the resulting inconveniences created by excavation — remains an uphill battle. Even though trenchless technology has been around for decades, Stefanidis says he still encounters people every day who don’t know the technology exists. “That’s our biggest challenge ­— changing that dig-it-up mentality.”

The company employs several strategies to educate customers and make them feel comfortable with the technology. The company’s website is its primary education tool, which features nearly a dozen videos — some of their own and some from LMK — that explain various aspects of no-dig technology. “You can explain it all day long, but when someone sees what a finished pipe looks like, there’s an ‘aha’ moment,” Stefanidis says, explaining the value of videos.

Stefanidis also shows customers samples of lined pipes, including one where they can slide a liner out of a section of pipe to see what it looks like. He also shows samples of cracked pipes so customers can see how the resin in the liner fills in cracks in the pipe. “Visuals are always key,” he says. “It’s the best way to show off your product.”

In addition, Stefanidis provides customers with testimonials from satisfied clients as well as a list of references they can call. “We give them about 10 references and tell them to call three of them randomly,” he explains. “That way they know they’re not calling my mother or an uncle. … They’ll get an objective opinion of our performance.”

Education is important because trenchless lateral rehabilitation is not always the cheapest route for customers to take. But if properly educated, customers more often than not are willing to pay a premium for pipe lining because it’s so much more convenient and less intrusive. “Otherwise you have to dig a hole, fill the hole, let it settle for several months, then put more soil on and so forth,” Stefanidis says. Moreover, digging up and replacing a line might require removing a tree or taking out part of a sidewalk, patio or driveway that later must be replaced. “So if you calculate the other benefits, then it’s essentially cheaper to do it this way.”

Advertising pays dividends

To get the word out on a larger scale, the company runs ads on a local radio station and pays for signage on the rear of city buses. The radio ads cost anywhere from $750 to $1,500 a month for seven 30-second spots in various time slots. The bus signs cost another $800 to $1,500 a month. The ads are a bit quirky and humorous, which helps brand the company in a friendly yet memorable way, Stefanidis explains.

“Advertising is not cheap, but it’s something a business has to do,” he points out. “We’re the only ones in our market who do it. People tend to put more legitimacy on things mentioned on the radio or in print, so it made sense to use these mediums to get more exposure.”

When customers call for service, they’re asked where they heard about the company; that enables Stefanidis to monitor the ads’ effectiveness. So far, so good; he estimates that the bus ads generate about 30 percent of the company’s job leads while the radio ads trigger another 20 percent. The rest come from word-of-mouth referrals,
he says.

Looking ahead, Stefanidis envisions more steady growth for  Liner Guys, but he and Rodger are cautious about growing too fast — jeopardizing quality control and customer satisfaction.

“It’s easy to ruin your name that way,” he says. “That’s why we don’t have 10 or 20 crews. We don’t lack for work and we’re going to keep growing, but in a controlled way.”

While the company does provide other services, such as lateral cleaning, pipeline inspections and line location, lateral lining generates the bulk of its revenue. But Stefanidis is not concerned about overdependence on pipe lining. He believes that as long as the company continues to provide top-notch customer service, there’s enough work available to negate the need to diversify.

“We also pride ourselves on our ability to source things out for customers,” he says. “I have contacts for electricians and carpenters, for example. I can supply almost anything they need.” But doesn’t that give other contractors revenue that Liner Guys could keep in-house? Sure it does, he agrees. “But that’s how partnerships are formed. In the future, you never know — we might amalgamate into Liner Guys Heating and Air Conditioning, or maybe add an electrical division, or a home-renovation division, or even get into project management.

“On the other hand, if you carry too many torches, you might lose one,” he adds. “So for now, we plan to just focus on what we do best and do it right.”


Free lateral inspections generate new business

An old adage says there’s no such thing as a free lunch, but in London, Ontario, there is such a thing as a free lateral inspection, courtesy of Liner Guys Inc.

The free inspections serve two purposes: They generate job leads and differentiate the company from its competitors, says Steve Stefanidis, who co-owns the company with Mike Rodger.

“It gets our foot in the door,” Stefanidis says. “Sure, it’s an expense for us, but getting the lead is worth the expense.”

There is one caveat involved: The inspection is free only if a customer has a problem with a lateral, as opposed to people who, for example, are selling a home and want a free inspection so they can tell prospective buyers the lateral is in good condition. “We charge a fee for those kinds of inspections,”
he says.

What if a legitimate customer gets an inspection that reveals a problem, but doesn’t choose Liner Guys to fix it? “We shake their hand, leave a business card with our phone number and tell them to call us if they need us,” he says. “We don’t pressure anyone. And if the lateral is in good condition, we tell them. If there’s a problem, we tell them. If they want a quote, we provide one. There are never any strings attached.

“If no repair is required, the customer is usually happy with the news and they’re going to tell five or six other people how honest we are. … And then they’re also more likely to call you back when a problem does occur,” he adds.

Stefanidis estimates that in eight out of every 10 inspections, Liner Guys gets the job to reline or clean a lateral. A key factor in that success rate: Customers can watch the inspection on a monitor and see any problems firsthand. If the customer wants a copy of the inspection on a thumb drive or a DVD, the company charges a modest fee.

The company also performs inspections for local plumbers upon request, but they’re not free. So what stops a plumber from circumventing the fee by telling a customer to call Liner Guys and ask for a free inspection? Absolutely nothing, Stefanidis concedes. “There are always companies out there with less integrity than ours,” he says. “It’s a cost of doing business. When you own a company, those are the hills you climb.”



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