Atypical Business Approach Bolsters Oregon Contractor’s Growth

Oregon’s Lovett Services builds a sterling reputation by taking an alternative approach to doing business

Atypical Business Approach Bolsters Oregon Contractor’s Growth

Lovett Services is 125 employees strong, including (left to right) Aaron Sawyer, corporate communications manager; Donovan Manchego, directional drilling operator; Ivan Memmer, field safety coordinator; Stephen Dahlstrom, directional drilling operator; Tylo Hartford, directional drilling foreman; and Brandon Myrick, directional drilling operator.

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Lovett Services is not a typical construction-services company.

From performance reviews for field workers and reading assignments for all employees to guerilla marketing tactics and an on-site bookstore to a corporate culture that emphasizes continuous learning and improvement, the Portland, Oregon-based company aims to take a different approach from the norm.

Established by co-owner Dale Lovett, the company also differentiates itself through diverse service offerings that include hydroexcavation, directional drilling, conventional excavation, plumbing, drain cleaning and vacuum truck and mitigation services, says Aaron Sawyer, corporate communications manager. 

“We don’t do much at Lovett that’s the usual,” Sawyer says. “I know we operate differently than other companies because sometimes employees leave and then come back to us because they find those other companies don’t focus on the same things we do.”

Just because Lovett Services’ employees work in the construction world doesn’t mean they don’t need the same kind of corporate culture other professionals enjoy, Sawyer notes.

“We see such a high need for it,” he says. “In the construction field, there’s usually a grab-your-shovel-and-go-to-work mentality — and don’t ask any questions. But we do things differently because that’s a recipe for disaster. All you do is create stepping stones for people to go elsewhere.”

In the end, it’s hard to argue with the results. The company generates more than $25 million in annual revenue, employs about 100 workers, owns a large fleet of equipment and caters to a wide range of customers, primarily commercial facilities, municipalities, schools and restaurants.

On any given day, Lovett Services’ crews might be exposing utility lines with hydroexcavators at hospitals and large companies; using vac trucks to clean debris from catch basins and remove fats, oils and grease from drainlines; deploying directional drills to bore pathways for new water, gas or electric lines; fixing water main breaks at plants and other facilities and performing mold prevention or water/fire mediation work.

“We’re busy,” Sawyer says. “And it’s something different every day.”

Humble beginnings

Lovett started the company in 1997 with only an excavator, focusing primarily on residential sewer repairs. He slowly branched out into horizontal directional drilling in the early 2000s and then into drain cleaning.

A continual need for subcontractors, who often weren’t available when needed and didn’t always share the same values and standards for quality, drove Lovett’s diversification efforts. Plus it just made sense to keep adding bolt-on services that meshed well, Sawyer says.

“The beauty of our business is that all the services complement each other,” he says. “If you need a plumber, you might also need a drain cleaner. Or an excavation job or plumbing call might reveal a need to have a new service line drilled. All of our services flow together and produce a seamless one-stop shop for customers.”

Most of the jobs that crews perform tend to be smaller in nature. But as Sawyer notes, they add up in a hurry.

“There’s something to be said for drilling thousands of feet of lines at a time, but smaller projects tend to be more consistently available,” he says.

The company’s growth was kickstarted around 2018 by the arrival of a new co-owner, Gary Cosmer (now the firm’s chief executive officer), who came from the private-equity industry and worked on many merger-and-acquisition projects. He also brought with him a focus on operating efficiency, based on a Japanese philosophy called kata that emphasizes continuous learning and improvement.

Aided by Cosmer’s fresh business approach, Lovett Services also expanded its market offerings as well as its geographic footprint by acquiring Synergy Restoration & Construction in Portland in 2020 and Kruse Plumbing in Vancouver, Washington, in 2021.

“Those acquisitions fit into our strategy of buying companies that mesh well with services we already provide,” Sawyer says, noting that Kruse does new-construction plumbing, a service Lovett didn’t provide before. “We knew we couldn’t grow as much with just Lovett Services. We had to grow our portfolio of services.”

Equipment investments

As the company’s services expanded, so did its fleet of machines and equipment, primarily purchased from Papé Machinery. For industrial and municipal work, including hydroexcavation, the company relies on four Vacall combination sewer vacuum trucks that feature Kenworth and Freightliner chassis, 30,000-gallon debris tanks, 1,500-gallon water tanks and Vacall blowers.

The company also owns five horizontal directional drills manufactured by Ditch Witch (a brand owned by The Toro Company), ranging from JT5s (4,100 pounds of thrust force, 5,000 pounds of pullback force and up to 550 foot pounds of spindle torque) to JT20s (17,000 pounds of thrust force, 20,000 pounds of pullback force and up to 2,200 foot pounds of spindle torque).

In addition, the company has invested in a CCTV camera truck outfitted with an inspection camera system manufactured by CUES; eight Yanmar and John Deere excavators; and four custom jetter trucks outfitted with jetters made by US Jetting and Harben (a subsidiary of Flowplant Group Ltd.) The units feature 100-gallon water tanks and water pumps that generate pressure of 4,000 psi and flow up to 25 gpm.

The company also depends heavily on ServiceTitan, a business management software platform designed specifically for the trades. It offers a wide range of capabilities, from dispatching and scheduling to handling invoicing, customer payments, payroll, job costing, financial reporting and more. 

“It’s one of the best investments Lovett ever made,” Sawyer says. “It’s a very robust business management platform.”

Mastering processes

The Japanese concept of kata, which has its roots in martial arts and means “way of doing,” informs all aspects of the company’s operations. In simplest terms, kata is a structured way of mastering processes by doing things deliberately and repetitively, with an ultimate goal of continuous improvement and innovation.

On a job site, for example, that might mean ensuring that everything needed for a job is ready to go and in the same spot every time, Sawyer says.

“It’s been a real game-changer,” he says, noting that Toyota Motor Corp. is one of the more well-known adopters of the concept. “Our whole way of doing things changed by embracing the Toyota system. Once you get into it, things start working differently at your company.”

One central plank of a kata mindset is educating and empowering individual employees to suggest improvements that can improve efficiency.

“It’s about managing people for improvement — empowering them to pull a red flag and stop work when they see something wrong or that can be done better,” Sawyer says.

The company’s emphasis on self-improvements meshes well with the Toyota principles. For example, all employees are required to read a book titled The 13 Behaviors of High Trust published by FranklinCovey, a leadership-training company. Another book recommended for employees is How Full Is Your Bucket? by Tom Rath and Don Clifton, Sawyer says.

Striving for improvement

To bolster the self-improvement efforts, the company offers a bookstore that focuses on self-improvement books that employees can take home to read. Or they can buy books the bookstore doesn’t have and get reimbursed for the cost. There’s also a fully equipped gym for employees to use because physical well-being is important, too, Sawyer says.

“We also pay for professional development training,” he adds. “For instance, our salespeople often receive blueprints for projects to develop estimates but don’t know how to read them. So we’re sending them out to learn how to read blueprints. It’s these kinds of things that keep us ahead of the game.”

Sawyer concedes the company’s zen-like culture isn’t for everyone. But that’s OK, he notes.

“You either grow in it or find it’s too much and leave,” Sawyer says. “We let those employees go with grace and rehire them with grace if they come back. But developing this kind of culture pays dividends for us. If employees are happy with themselves and at home, they’re going to perform better at work.

“When I was first hired, it was pretty obvious to me that adopting Toyota’s kata philosophy was not going to be easy. I had to forget a lot of what I learned in the industry and understand there are better ways to do things.”

Job reviews for all

All employees also receive annual performance reviews as well as peer-to-peer reviews, another nod to the company’s emphasis on continuous improvement.

Effective performance reviews are especially important right now with the tight labor market. Why? Because it’s much easier to give employees feedback that can improve their performance than to eventually fire them and then have to look for new employees and invest considerable time in training them, Sawyer says.

“Sometimes someone’s job performance just needs a little bit of tweaking, so we want to help them understand what they need to do their job better and more efficiently,” he says.

In other instances, managers may determine that an employee needs a job change in order to keep improving, Sawyer says.

“Not everyone wants to do the same thing all the time,” he says. “Sometimes you want to hit a different key on the keyboard. We’re always looking to move people toward what’s best for them to grow, which in turn helps Lovett grow.”

Ambitious revenue goal

Looking ahead, the company has set an ambitious revenue goal: $100 million in sales within the next 10 years. To achieve that, the company expects to acquire more companies that can expand the company’s geographic footprint as well as bolster existing services or add complementary new services, Sawyer says.

The only growth inhibitor on the horizon is the tight labor market, because the company’s existing workforce can’t take on much more work. If it tries to do more work than it can handle, it would jeopardize work quality and customer service, Sawyer notes.

“When you no longer finish projects on time, for example, you’re doing C-grade work and start getting two- or three-star online reviews,” he says. “And we’re not a two- or three-star service company.

“If you grow a company the wrong way, you can ruin everything you’ve been trying to do from the start,” Sawyer continues. “Growing by always putting customers first is the only way to do it.”

Is $100 million in revenue a doable goal?

“We’re very confident that we’ll hit it,” Sawyer says. “We have the right team in place to achieve that kind of growth. Yes, there are challenges down the road, but we have a system in place to handle those challenges and turn them into opportunities.”


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