Construction supplier sees growth in urban development

A focus on being a one-stop shop for contractors has positioned a supplier of architectural products for growth in West Michigan.

Byron Center-based Double O Craftsmen Inc. serves both the commercial and residential construction industries, supplying and installing windows and doors, as well other interior items such as cabinets. Established in 1997, the company has found that by carving a few key niches for itself and sticking to its own guiding principles, it can grow its business even in tough economic conditions.

President Michael Otis told MiBiz that he aims to have the company serve as somewhat of a one-stop shop for contractors in the window and door space, particularly for commercial customers.

Lately, Double O has found itself with considerable work in both residential and commercial segments. The opportunity for Double O lies in its ability to both distribute and install products, which allows contractors to outsource that part of the job exclusively to one company rather than going through additional suppliers. That convenience factor, in turn, leads to repeat business for the company, particularly from larger contractors.

The strategy of becoming a one-stop provider for contractors allowed the company to maintain growth even during the downturn years, Otis said.

“An awful lot of competitors went out of business or left the state (during that time period),” Otis said. “We had every reason to believe we could be the last man standing.”

The company more actively seeks commercial work, despite becoming a favored contractor with developers doing downtown residential work in Grand Rapids, he said. Double O has completed several projects with developer Karl Chew from Midland-based Brookstone Capital LLC and with Grand Rapids-based 616 Development LLC.

Double O distributes primarily Jeld-Wen products, but also sells other brands.

By working with developers who are redeveloping older buildings, Double O has also made a name for itself by being skilled in “historic renovation,” Otis said. As an example, he pointed to work the company did for a project on Prospect Avenue in Grand Rapids’ Heritage Hill neighborhood that involved removing, preserving and restoring historic stained glass windows.

 “Amazing craftsmanship went into those windows 100 years ago, and we wanted to preserve that,” Otis said.

Despite having a relatively steady pipeline of work at present, Double O often gets hampered by seasonal slowdowns like many companies in the construction industry, Otis said. Last summer and fall, the company had upwards of 60 employees (including temporary workers), but the headcount has dropped to 25 people currently. The seasonality of the business is bothersome for Otis as it means “bringing on people we know we can’t keep.”

Even after a fairly slow first quarter, Otis is optimistic for the remainder of 2014 and foresees a ramp up of business coming into the summer and fall months, just like last year.

The experience Double O had over the last couple of quarters is in line with current trends in the real estate and construction segments, according to local reports.

“Overall activity in the first quarter of 2014 was softer compared to the previous quarter due to the vacation season and poor winter conditions keeping many consumers and prospective tenants frozen, waiting until spring to make decisions,” wrote Colliers International in a recent report on the West Michigan retail segment. Similar conclusions were found in reports on both office and industrial segments. “In Kent County, the decrease in both sale (14) and lease (29) transactions from the previous quarter’s count (29, 34) offers proof that activity has slumped.”

Despite some periodic slumps, Otis is forecasting growth for the coming years. The company had sales of $5.2 million in 2013 and Otis said he foresees roughly the same for 2014, or possibly a small increase.

However, Double O has grown enough in recent years that the company is now in the market for a new facility. The firm is looking to move into an area that could specifically benefit from urban redevelopment and an influx of employment, he said. The company is currently looking at buildings around Grand Rapids’ southeast and southwest industrial areas.

“Our thinking is that we want to bring jobs to an area that needs (them),” Otis said. “I don’t want to build a new building. I’m bothered by the fact that we leave beautiful buildings and move to the suburbs.”

https://mibiz.com/item/21583-construction-supplier-sees-growth-in-urban-development