Gambling on Growth

Father-son company maximizes growth by anticipating demand and staying a step ahead

Gambling on Growth

JG Environmental in Lancaster, Pennsylvania, has grown steadily, at times exponentially, since it’s founding in 2008. Vice President of operations Jim Guerin II (left) joined his father, President Jim Guerin, in the business after finishing college

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Not many people were starting new businesses at the peak of the 2008 recession, but Jim Guerin took that leap.

Defying popular wisdom, Guerin resigned from his longtime, well-paying job to start his own operation and achieved remarkable success with a single guiding principle: Take chances at the right time.

Using skills he cultivated as a business development strategist for a large wastewater management company, the owner and president of JG Environmental in Lancaster, Pennsylvania, started his own outfit purely as a brokering operation — bidding, planning, and coordinating jobs without actually owning or operating any of his own equipment. He made a run of it that way before taking the plunge into full-fledged environmental waste operations.

“It was a big personal financial risk for me, but the timing was good because the poor economy was prompting potential clients to reevaluate the cost of their current environmental service contracts,” Guerin says.

The decision reveals a knack for planning ahead that has helped him find success running his own company.

“I wanted full responsibility and the ability to make decisions regarding the direction of the business,” Guerin says. “I saw room in the market, and since the timing was right, I decided to take a leap and start my own business.”

Roundabout beginning

Guerin’s first dive into entrepreneurship was a car wash. The venture wasn’t exactly a success, but it led to a conversation with an operator who was pumping the car wash basin. He discovered that the wastewater management company had no sales department, prompting a bold decision.

“I became their first sales guy and worked my way up to sales manager and then business development,” Guerin says.

After 11 years, he took his leave in 2007, citing growing discontent with his level of control in the company, and founded JG Environmental. “I started off thinking I was going to be a broker,” he says. “I told my wife, ‘We don’t need employees. We don’t need equipment. I know what I’m doing.’”

Guerin would go out and find jobs, then plan and bid them, subcontracting all the hands-on work to various environmental companies. It worked for about a year. Eventually, clients started asking why they needed a middleman for jobs when they could go straight to the contractors. He realized it wasn’t a sustainable business model, and in 2009 he bought his first truck.

“I had the experience, but mainly at sales, not hands-on as far as the truck. I had seen it done so many times, and I’ve always been a hard worker,” Guerin says, citing early work as a farm and moving company laborer. “Now I have that experience doing the work myself.”

Guerin’s son, Jim Guerin II, helped during breaks while attending the University of Delaware, starting as a laborer while the company was still brokering and eventually running a truck as they transitioned. After graduating, he joined the company full time, eventually becoming part owner and operations manager.

An unexpected addition

“I never thought it would be a father-son operation — never in my wildest days — I really didn’t,” the elder Guerin says. “I thought: He’s smart, smarter than me. I thought he would come out of college and do something else.”

Growing up around cars gave the younger Guerin an interest in machines and a proclivity for mechanical things, making him a perfect fit for the operational side of JG Environmental.

“He was significantly helping grow the business, through a lot of dedicated, hard work,” the elder Guerin says. “He became integral to the business, so I asked him to stay.”

While the elder Guerin focuses on managing the business end — bidding jobs and managing growth — his son quickly took on more responsibility and became the operations specialist. He spent only two years as a driver before transitioning into a leadership role.

“He’s vice president of operations, and it has become so easy. I just throw everything on him,” Guerin says with a laugh. “My job is basically to go out, bring the work in, and his job is to get it done.”

With Guerin’s talent for management and operations, the growth has been so explosive — with services now running the gamut of nonhazardous environmental waste removal — that the company is looking to restructure yet again, adding on to its processing facility.

“It was easy for (Jim II), three, four, five years ago, but now he has nine drivers, there are five field service people underneath him, and we also have a full-time mechanic. He’s responsible for all the equipment, and then we get a treatment facility, so what do I do? ‘Jim, you’re responsible for that.’” Guerin says. “We need more help, absolutely we need more help, which is part of the plan once we build the addition. We’re going to hire more people to take the processing off his hands.”

Guerin says working with family can be challenging because both personal and business relationships are involved.

“I’m very fortunate — blessed — to be able to work with my son,” Guerin says. “I didn’t set out for it to happen, didn’t plan on it, but there’s a trust factor with your own blood that you never can quite get if you hire somebody. It’s really a pleasure for me to work with him.”

Gaining steam

The company started off leveraging the elder Guerin’s previous expertise in wastewater management, but eventually became a one-stop shop for any environmental waste needs, including bulk hauling and waste processing.

There were several large jobs that helped get the operational side of the company up and running. First was work in the Marcellus Shale, which became a hot spot in the early 2010s. There was an abundance of work cleaning everything from frac and vacuum tanks to drilling pads, in addition to bulk-hauling drilling spoils.

Next came Hurricane Sandy in 2012, providing JG Environmental with six months’ steady work during the early recovery efforts. For at least four months, a large contractor in New Jersey essentially sublet one of JG Environmental’s trucks.

“They needed our help, so we ended up sending one truck out there full time,” Guerin says. “At the time, we only owned three trucks, so sending one every day that we could bill for four months was a big shot in the arm.

“If you don’t have these trucks out every single day, you won’t be able to pay for them. Starting off, somebody would say, ‘Can you … ’ and I’d say yes, then I’d figure out how to do it. I mean honestly, that’s true,” Guerin says. “You do what you can to keep the truck moving, keep the truck running.”

The growth mentality is reflected in the evolution of the facilities. Today, the company is planning to expand the processing facility and will build new office and garage headquarters on an adjacent lot next spring.

“Business really took off when we purchased and moved onto the new property. Combining administration and operations really helped us with synergy and helped us get focused,” Guerin says.

At one time, they were renting a small office where Guerin worked back to back with an administrative assistant — Joyce Hanner, now the company’s vice president of finance and administration — 3 miles away from the shop. Operators would fax information back and forth.

“Now that we’re all under one roof, it’s much more efficient, and we continue to grow,” Guerin says.

Taking risks

It might seem like luck has pushed the company on its rapid growth trajectory, but careful consideration and foresight are the real reasons for its success.

There have been plenty of challenges, like dealing with last-minute job requests, but these jobs have provided opportunity.

“If there’s a sinkhole or somebody lost power, we’re small enough to tweak our schedule and jump at the opportunity,” Guerin says. “There are a lot of companies out there that they called first that can’t do it so quickly, so taking the chance and ordering the trucks before you actually need them, that’s important — seeing that you’re going to need it in six months — because these trucks take six to eight months from once you order them until you receive them.”

That strategy has worked out well for JG Environmental, which has maintained steady growth of between 30 and 40 percent per year over the past seven years. Since the company bought its first truck in 2010, it has grown to 17 employees (including both Guerins) and 12 trucks.

“We’re busy, and then all of a sudden somebody has this need, so we end up subbing it out, or we sub out the scheduled work because it’s an easier job and we pull our truck off and we juggle another thing,” Guerin says. “That’s what drives the need to get another truck, so once that happens more and more often, that’s when you say, ‘We need another truck.’”

They recently added a brand-new 2019 GapVax to their existing fleet of two GapVax wet-dry units with Hotsy Cleaning Systems, a PresVac wet-vac unit, Galbreath roll-off truck, three Acro Trailer tank tractor-trailers, an ITI Trailers & Truck Bodies pump truck, as well as an additional PresVac pump truck and four support vehicles.

With the new unit, their plan is to begin keeping growth to a more controlled rate.

“We’ve been averaging two to three trucks added for the past four or five years. So we’re just trying to manage the growth now,” Guerin says. “As any business owner knows, it’s the net that matters, not the gross sales. So as soon as the net starts not keeping up with the gross, that’s when we’ll home it in a little bit. And we don’t expect to continue 30 to 40 percent again for another six or seven years.”

A strong legacy

Looking back on the long road that got him to this point, Guerin’s only regret is that he didn’t start his company sooner.

“I was in the industry for over 11 years with one company,” he says. “After eight or nine years, we started not agreeing. I was frustrated for two years. So it was very risky and not a good time personally to start a business, but the work was out there, becoming more available to people seeking work. Everybody was thinking that they could save money by reevaluating contracts and seeking bids from new contractors.”

By taking a series of calculated risks, Guerin was one of the few who made the recession work for him, carving out a sizable cleaning kingdom that he can now pass on to his son.

Mob legacy makes haulers’ lives difficult

An abundance of challenges comes with starting a business, let alone one in a saturated market in the middle of a major recession. For Jim Guerin, owner and president of JG Environmental, in Lancaster, Pennsylvania, one of his biggest challenges wasn’t the competition, but instead the red tape that accompanies environmental waste services.

“Getting our permit to be able to transport the spoils of hydroexcavation is important because each state requires different permits to haul on its streets and roads,” Guerin says.

JG Environmental has permits for Pennsylvania, New Jersey, Delaware and Maryland. Not all permits and certifications are created equal — case in point, New Jersey’s waste hauling permit.

“When I say it’s a challenge: It takes anywhere from two to three years to get a permit to operate in New Jersey,” Guerin says.

Part of the reason for the difficulty in that area dates back to the days of the mob, which used garbage hauling operations as fronts for money laundering, using intimidation and violence to win lucrative bids, and often using falsified paperwork to appear legitimate.

“We get fingerprinted by the FBI; my son and I got fingerprinted. A full background check from the state police of New Jersey is dropped on you; so it took us a month to fill it out, then it takes eight months for them to evaluate it, and then questions start. It’s a very big process,” Guerin says.

After the initial process, to maintain the permit requires continuous reports, paperwork, and quarterly spot inspections.

“It’s difficult to get, and once you get it, then to keep it is not a picnic either,” Guerin says. “So that was a challenge, as well as getting the processing facility permits from the Department of Environmental Protection. That took 2 1/2 to three years. They inspect your facility and you build based on the regulation, implementing it into your process and facilities.”


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