Issue link: http://www.insightdigital.biz/i/125252
in focus { s m a l l b u s i n e s s } By S haron Ve rbete n Culture club New ownership structure fuels new direction at Amerequip courtesy of Amerequip Quality assurance is a key component in the processes employed by Amerequip, whose company's new ownership structure helped it to increase revenue by 50 percent in the first two years after the change. S ometimes being good enough just isn't good enough. At least that's how the management at Amerequip felt just two years ago when it made a significant change in ownership. That move has led to substantial growth and diversification for the New Holstein company, which designs, engineers and manufactures custom equipment for the lawn, landscape, agricultural and construction markets. "We set out with the strategic vision of wanting to diversify," says Mike Vanderzanden, Amerequip's president and CEO. "We were looking to be a $100 million company and have 500 employees by 2020. We wanted to create this vision that we wanted everyone to wrap their arms around." To implement that vision, however, in 2011, a group of 12 owners (comprised of senior managers and a director) bought out the corporate Employee Stock Ownership Plan (ESOP), which had been in place since 1998. After stockholders got 40 | Insight • M ay 2 013 over the first "24 hours of shock," says Vanderzanden, "from that point forward, it was extremely positive." "An ESOP has a time and a place," Vanderzanden adds. Because of the distribution pay-out that was forthcoming with the ESOP, he says, "We were either going to be bankrupt or forced to sell the company … with the ESOP, you're (also) trying to manage the risk based on all of the investors. We thought we could make the best decision to grow the company for everyone." And that they have. Instead of remaining comfortable and complacent, the new team was more interested with making investments and diversifying the company's reach, Vanderzanden says. "The new owners, guided by their board of directors and the executive leadership team, quickly began working on a strategic plan to grow the company's sales and customer base," he adds. The result? "In the first two years, we have increased revenue by 50 percent," says Vanderzanden. "We've also broadened our product line and customer base, expanding work with existing clients (like John Deere) in addition to redefining our strategic approach for revenue growth." Tim Dorn, Amerequip's vice president of sales and engineering, notes that working toward that goal meant focusing "on large OEMs (original equipment manufacturers) that have a global presence and a strong reputation in the market." It was also imperative, he felt, to build relationships with customers who share Amerequip's value. "We want to build a relationship, not just be a supplier," Dorn says. Clients new to Amerequip include the world's largest tractor manufacturer, Mahindra USA, locally based Oshkosh Corp. and construction machine powerhouse Caterpillar. The latter found Amerequip to be a fit based not only on the company's design and engineering skills, but on something much more important. "Amerequip's company values are very similar to Caterpillar's: integrity, excellence, teamwork and commitment," says Paul Lam, business manager, BCP Work Tools, Caterpillar. "The Amerequip team ran the project with professionalism and was able to deliver the product on time despite unexpected challenges that surfaced." On the road to 2020 To achieve the company's aforementioned strategic goals for 2020, Vanderzanden says, "We needed to grow at 17 percent a year in order to achieve that … 2013 may fall a little short, but right now, 2014 is already shoring up to be a huge growth year." Growth hasn't been limited to revenue, however. In just under two years, Amerequip has grown its employment base by more than 35 w w w. i n s i g h t o n b u s i n e s s . c o m