Diversity pays off

The slowdown in construction of housing and other projects has thinned the payrolls of countless construction companies in northern Nevada, but Chris Turner, president of Northern Nevada Excavating, says 2008 will be his busiest on record for the five-year-old Sparks-based company.

With three big projects starting in the Lake Tahoe basin and Truckee area this summer, Turner says Northern Nevada Excavating is even looking to hire more operators. Roughly 90 percent of the company's jobs come from previously satisfied customers.

"We have built a reputation in town and with our clients," Turner says. "We are out on the open market bidding, especially with how tight things are right now, but we have a hard time competing on the open market. You could have 10 or 15 dirt guys bidding, and it's hard to compete. Most of the times, the guys who end up getting the bid made a mistake, or at least it seems that way to me."

Although Turner says successful contracting is half dumb luck, his success in an economic downturn has more to do with smart positioning. Five years ago when he launched the company, Turner shied away from grading for new subdivisions easy money and steady work for several years and instead pursued contracts in commercial and industrial construction and apartment projects.

"I worked for two big contractors in town, and all we did was subdivisions," he says. "When I started my company I did not want to get in that racket, and we established a niche right away.

"I wanted to stay in commercial, industrial and multi-tenant because there was really no one in that market," Turner adds. "It helped in the long run because a lot of guys are coming in my market, but I already have a foothold."

Turner says the company has seen roughly 12 percent growth each year, although 2007 saw a dip in revenues. Controlled growth during the construction boom also helped the company stay solvent.

"I didn't create this big monster overhead," Turner says. "I had chances, but I kept overhead low. When the subdivision game was going hot and heavy, I had plenty of chances to bid that work. But we would have had to tool up, and then you create an animal. A lot of companies bought a lot of equipment and created a huge appetite. We bought some used (machinery) and some new to be diversified and keep monthly expenses low."

As a result of the construction slowdown, Turner has purchased several pieces of heavy equipment formerly owned by other area companies.

Currently Northern Nevada Excavating is grading for multi-tenant apartments at the top of Sutro Drive in Reno, as well as for new townhomes on Holcomb Lane.

Another factor responsible for the company's early growth: contracting out of town. Northern Nevada Excavating did the site prep work for Wal-Mart stores in Sacramento and Winnemucca, and has also worked as far out as Kirkwood Ski Resort and Wendover.

"We were diversified," Turner says. "If there was a project out of town, and everyone was (bidding) here, I would go out of town. I put our eggs in different baskets the last five years, and it is paying off now."

At age 18 Turner started in the field as a laborer, then moved to operator and eventually was made a foreman. After working for years for several of the top companies in town, he bought a backhoe and a 10-wheeled dump truck. With just one employee Turner struck out to dig out his share of the excavating industry.

Northern Nevada Excavating currently carries 40 full-time employees on its payroll, including several women who work as operators, and has about 40 pieces of heavy equipment, including dump trucks, bulldozers, backhoes, and excavators. Turner admits it's not always the easiest line of work.

"There are some sleepless nights, but that is part of the game," he says. "I have taken some risks, but I also

pay attention to the world economy. I watch fuel prices, pipe, aggregate, cement; I watch everything and am looking six months to a year from now. I am building my company based on that (information).

"During the slow times you have to buckle down and make good choices," he adds. "This business is kind of like a chess game to me. You have to strategize the economy."