Business advising helps builders grow amid Great Recession

Elite Construction

Trini Garibay Owner of Elite Construction in Tri-Cities

KENNEWICK, Wash.–Every business has a story and the story of Elite Construction and Development is an unlikely one.

In 2007 J. Trinidad “Trini” Garibay was making a good living selling cars–he’d been in sales three years and had been named “Salesman of the Year” all three years. Business at the Ford dealership where he worked was humming along, but real estate was booming.

People were making big money flipping houses and Garibay saw an opportunity to create something collaboratively with people he knew and liked, instead of constantly competing.

So he talked with his best friend, David Magana, who was a plasterer, and another good friend who had experience in general construction, and the three decided to form a partnership. Garibay would be the front man and handle most administrative tasks, and the other two would manage the job sites.

Just about then the housing boom went bust. No matter what they had seen on TV, they weren’t going to be able to flip houses in the Tri-Cities in 2008. Rather than give up, they decided to pivot and do renovations.

Their first job was a $500 repair and they used that money to get their general contractor’s license. They didn’t have money for tools. Every dollar they made went back into the company. After the first year they were $45,000 in debt. Mid-way through the second year the partner with general contracting experience resigned for personal reasons.

Elite Construction could have gone the way of so many other small construction firms during the Great Recession, which was out of business. But it didn’t.

Instead, the company found its footing and started to grow—in multiple ways. In just six years they have more than 30 employees, they’ve expanded from central Washington to Northern Oregon and Idaho and they are now bidding, and winning, multi-million dollar jobs.

Although they do some subcontracting, more than 70 percent of jobs are handled in-house. In 2013 Elite Construction was named the Southeast Washington Minority Small Business of the Year.

An online gallery of their commercial and residential work and client testimonials peppered with words like “honest,” “dependable,” “professional” are two clues to their success, but Garibay says there is a third factor: business advising from the Washington Small Business Development Center (SBDC).

In the early days of Elite Construction, Garibay heard about the SBDC from a friend and decided to give them a call. He reached Bruce Davis, the SBDC advisor in Kennewick, and he’s glad he did.

“Trini got started at Columbia Basin College and graduated in auto mechanics,” Davis said, “and then he was so good with people that he got recruited into auto sales. When he and his partners decided to open a new business, it’s great that the SBDC program–with local support from Columbia Basin College–was there to help them take the next step.”

“Bruce is a big reason why we are still in business,” Garibay said.

Starting a construction firm in 2008 was counter-intuitive, to say the least, Davis said, but he credits Garibay with figuring out Elite Construction’s target market and going after it.

“He has good instincts, and he’s smart,” Davis said, “and he’s not afraid to learn.”

The immediate challenge was securing funds for working capital and equipment. At a time when credit was particularly tight, Davis helped Elite Construction get a loan for $150,000. It seemed like a huge sum of money, Garibay said, and at first he didn’t want to touch it.

“But cash flow is very important; it’s the lifeblood of the business,” he said, and without the loan they couldn’t grow.

In 2012 Garibay participated in a Profit Mastery class sponsored by the SBDC and facilitated by Davis. The Profit Mastery curriculum, which is offered by SBDC advisors across the state, helps business owners gain a better understanding of financial statements and how they can be used to make strategic, proactive decisions.

“Bar none, that was probably the most eye-opening experience I’ve had,” Garibay said. “As a business owner, if you don’t understand your financials, you’re in trouble.”

Especially when your company is growing as fast as Elite Construction is.

While the construction industry as a whole continues to slog along at employment rates far below 2007, Elite Construction grew 670 percent in 2009, (the first year was admittedly bleak) and has seen multiple years of 100 percent growth in revenue and employees. In 2012, Elite brought in about $2.5 million in revenue, Garibay said, and then doubled it in 2013. This year the company is on pace to increase revenue yet again.

After starting small, on residential or commercial renovations, the company is now going after large government contracts. Their portfolio already includes multifamily housing, several schools and libraries.

What Elite Construction didn’t have in experience they made up for in customer service. No job was too small and no phone call was left unanswered. They built their reputation one job at a time, Garibay said, by only promising what they could deliver and always delivering what they had promised.

That commitment to customer service is mirrored in Magana and Garibay’s commitment to their employees.

That means continual coaching for improved skills and increased responsibility, public acknowledgement of outstanding effort or performance, paid time off or gift cards for excellent work, occasional one-on-one lunches with the boss, company barbecues and pizza nights and other team-building activities.

Instead of a culture of suspicion and jealousy, Garibay said, he and Magana are working to lead by example and create a culture of respect and appreciation.

“Everybody watches out for each other,” Garibay said, “and for the company, too, because without the company, there is no work.”

Looking out for each other is a value that extends beyond their customers and employees to the larger community. Elite Construction contributes to a growing list of community non-profit groups and also intentionally works with women-owned and minority-owned businesses when possible.

Though they’ve climbed a mountain in their first six years, Garibay said he sees more challenges ahead, including the possibility of international work.

“I’ve got a big vision and large goals,” Garibay said, “but I think they are attainable.” Fortunately, his SBDC advisor is just a phone call away.