Tri County Equipment Sales
Building a New Market in an Unlikely Space
August 22, 2012
Sometimes, opportunity knocks. Other times, entrepreneurs have to create their own opportunities. For experienced entrepreneurs and business partners like Mike Slater and Chris Sanders, owners of Tri County Equipment Sales, seeing the potential for new markets is just a part of doing business.
Slater and Sanders are not newcomers to the construction equipment industry. Together, they have over 75 years of experience in helping people find solutions for their construction equipment needs. Their journey started together with working for construction equipment distributors in Michigan. Slater then decided to start his own business, Mid-Michigan Equipment Sales, that buys and sells used construction equipment. Then, about fifteen years ago, his good friend and business partner, Sanders, bought his own equipment repair business, Tri-County Equipment Repair. As a certified Al-Jon Repair Center,
Sanders dealt with a lot of Al-Jon landfill service compactors that were either inoperable or needed significant repair. But Al-Jon landfill purchasers are often subject to budget restrictions and schedules that make purchasing new compactors difficult when the average cost of a compactor is over $600,000.
Slater and Sanders realized that there was an opportunity to create a new business. They started Tri County Equipment Sales (TCES), a business that rebuilds and remarkets rebuilt landfill compactors to customers across the country. Using new and used parts, Tri County Equipment Repair remanufacturers the compactors and TCES resells them to budget-crunched landfills. This partnership allows them to sell the used equipment to customers for half the price of a new compactor.
“We found something very „niche.. We found a business that no one else was doing,” explained Slater. But does creating this second market take away from the Al-Jon new equipment sales? Surprisingly, this situation is just the opposite. “Al-Jon receives a lot of the trade-ins on used equipment from cities, but cannot repair them efficiently which means the equipment is often abandoned or scrapped. We can actually repair the equipment efficiently, so Al-Jon is on our side.”
However, when it came to starting the business and gathering the initial capital to invest in the equipment, TCES needed some assistance. Slater decided to contact the local Mid Michigan Regional office of the MI-SBTDC in early 2010. “I was looking for financial help. We had approached our bank about securing a loan, but they had trouble understanding the business. This business was in a new market and it had really never been done before, so it was difficult for us to forecast.” Slater contacted Tony Fox, the Regional Director of the Mid Michigan office and got him in touch with Small Business Consultant, Marie Elliott. Marie assisted Slater and Sanders with their business plan, providing some guidelines, looking at the financial projections and forecasting and identifying problems and possible solutions. Marie noted that "they were the ideal client to work with…coachable, interested in our services and our recommendations. They used the counseling time effectively, by being prepared and doing the homework assigned."Together, Slater and Sanders brought their new business plan to their bank that approved them for a line-of-credit.
“The SBTDC helped us all the way. When we had questions, they were very quick to get back to us with answers,” exclaimed Slater. “And as we have started growing, they have helped us keep the organization on track.” Slater also pointed out that he could turn to the SBTDC when he needed advice. “They were very honest and open with us. They helped us look at our weaknesses and address them as they arose.” "We are looking to grow the business to the next level, considering the retention of the quality employees they have on staff. It's great for job creation in the area and planning ahead for the "hand-off" to the next generation."
With the new line-of-credit, TCES secured the necessary funds to buy and repair additional machines. Because their market is relatively new, the company is actively seeking new customers who want to save money while maximizing their equipment life. In the future, Slater and Sanders are hoping to continue to grow the business as they buy and repair more machines, but they also have other goals. “We would like to pay down some of our debt as well as establish some financial security. But our customer is the first priority. We want to do everything we can for our customers.”
Having both run their own businesses before, Slater and Sanders have plenty of experience with starting a small business. Slater provides some valuable advice for other entrepreneurs, “Running a
small business is 24/7, 365 days a year. You have to be prepared to be available at all times. But be honest and fair to your customers, they should be your best friend.”
Find out more about Tri County Equipment Sales