NEARLY THREE DECADES in event rental have taught Tom Brown a thing or two about how to sustain success. First off, when a good opportunity presents itself to you, take it.
That's what the president of Frederick, Md.-based Signature Special Event Services did in 1998 when he rolled revenue from the sale of his former company, Rental Tools, back into its new owner, Greenwich, Conn.-based United Rentals, and stayed on in a management position. “We went from a $50 million company to a $3 billion company,” Brown recounts. “We had a group of employees who were worried about what would happen with the change, but I was able to keep the group together, and I promised we'd make something of it.”
And make something of it he did — although not exactly in the way he'd planned. Which brings us to another of Brown's well-learned lessons: Adapt to change.
After a late-1990s “acquisition frenzy” during which United Rentals, a longtime specialist in construction equipment rental, beefed up its event division, “They came to me and said, ‘You know what?’” Brown recounts. “‘We really want to go back and concentrate on our core business — general rental.’” With the help of investment group River Associates, he put together a buyout of United Rentals' special event business, and in March 2003, Signature was born.
Fast-forward one year, and Brown again found himself with an opportunity that, though promising, “came along probably a little sooner than we would have wanted.” Still, the presence of former tent giant Academy Tent & Canvas' tent rental assets on the auction block offered too much potential to pass up. “We jumped on it,” Brown says. Getting Los Angeles-based Academy's tent lode has meant getting a foothold in the lucrative California market.
Positive feedback from repeat clients such as the PGA, which Brown says likes Signature's newly acquired peaked and curved tents for its events, is nice, but it's money that really talks. And in the case of the newly expanded Signature, which claimed $23 million in rental volume in 2003, it's saying great things: “Revenue has gone up over last year more than 35 percent with the Academy acquisition,” Brown says, adding that he expects another increase of 25 percent to 30 percent next year.
And as higher revenues come in, Brown says he'll continue to put out the most comprehensive event rental offerings he can: “I don't know that there is any other company that can offer the tents, heating and cooling, kitchen and catering, flooring, lighting, generators and broadcast power we have. Our product line is truly diverse, and I don't think there's anyone who can touch it.”
Signature Special Event Services 285 Bucheimer Road, Frederick, MD 21701; 888/314-6848, 301/698-5840; www.eventservices.com
“We do job costing on every job we do, and I personally review those for a number of reasons. We want to see if our pre-bid matches up with what our actual costs are, so we know if we're really making money on a job, which helps us when we're bidding in the future.”
“One of the things we might introduce is a cost-plus [system]. For instance, I could go out to one of the large golf groups and say, ‘We can control your cost. We will charge you exactly what it costs us, plus 20 percent,’ say, or whatever margin we want to set. We haven't done that yet, but the industry might be ready for it. We want to show them we're not trying to get rich, but we do want to make money here.”
HITTING THE ROAD
“We're doing events every single day all over the place, and I try to get to as many as I can to see what kind of event we're doing. To do this job right, and meet all the people — the head of the USGA, the Super Bowl committee — it's hard. I don't love traveling because I miss my family, but I do enjoy meeting the clients.”