Diversification is hallmark of personal and corporate growth

April 22, 2012
| By Pete Daly |
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If there was a slogan that reflects Jeff VanderLaan’s strategy, it would be: Diversify for strength and growth. It has worked for Kent Companies and it has worked in VanderLaan’s personal career.

VanderLaan joined Kent Companies in 2006, and now is CEO of the Grand Rapids-based concrete construction contractor, which has offices in several states, including Texas. His grandfather founded the company in 1957, and VanderLaan took over from his father, Al, in December 2008 at age 31.

He probably could have gone to work for the family business right out of college, but he did not take that route. Instead, he succeeded in getting admitted to law school — where he excelled — and then practiced law at two major law firms in West Michigan: Smith Haughey Rice & Roegge and later, Dykema.

Kent Companies began as Kent Concrete, a direct result of the 1950’s post-war boom. Everybody knows how the returning WWII vets wanted a house with a picket fence, but they also wanted a new car and a garage to keep it in. Many houses in the 1950s were not built with a garage, so VanderLaan’s grandfather, John VanderLaan, started a full-time business mixing concrete and pouring slabs for many new garages and new homes. Soon, sidewalks and other forms of concrete flatwork followed.

In the late 1970s, John's sons, Al and Roger, took over and diversified the company, adding other concrete-related specialties such as concrete pumping, floor underlayments, concrete polishing and staining, facility services, mudjacking, foundation restoration, excavation and masonry.

By the late 1990s, Kent Concrete became Kent Companies with locations across the Lower Peninsula and in northern Indiana. In 2000, the business acquired another concrete company in Dallas, serving the southern tier of states including Louisiana, Arkansas, Oklahoma and Missouri. In 2007 and 2008, Kent Companies expanded its geographic capabilities with the addition of offices in Bentonville, Ark., and Charlotte, N.C.

Jeff VanderLaan
Organization:
Kent Companies
Title: CEO
Age:  34
Birthplace: Grand Rapids
Residence: Byron Center
Family: Wife, Jennifer; daughters Molly, 3, and Maggie, 8 months.
Business/Community Organizations: Vice president, American Subcontractors Association of Michigan; board of directors, Dégagé Ministries.
Biggest Career Break: “During the summer of 2006, deciding with my dad that the time was right for me to come back to work for the family business here.”

In 2009, Al's son, Jeff, and Roger's son, Chris, took ownership of the business.

Jeff had started working for the firm when he was 12, sweeping floors in the back shop after school and during the summers.

“I had always thought in the back of my head that I was going to go to work for the family business,” he said.

After graduating from East Kentwood High School, VanderLaan attended Hope College in Holland, where he earned degrees in political science and business administration. By that time, he had decided it would be better to do something else for a living rather than going straight into the family business. So he attended the Michigan State University College of Law.

“The hardest thing about law school was getting in,” he joked, but then quickly clarified that comment. He said that, actually, he worked very hard in law school — so much so that he was named a managing editor of the school’s Law Review and graduated in the top of his class as a Dean Charles H. King Fellow.

He then spent two years each at Smith Haughey and at Dykema, where he worked in a variety of legal areas, including construction litigation, acquisitions, corporate finance and real estate. When he rejoined Kent Companies in 2006, it was as project manager and corporate counsel.

“I felt I had gotten a well-founded legal background and experience under some very good senior attorneys at those firms,” he said.

Kent Companies is well known in the construction business in Greater Grand Rapids, having worked on the Helen DeVos Children’s Hospital, DeVos Place, Kent County Courthouse, the Farmers Insurance expansion, Cherry Commerce Parking Ramp, the River House condominium building and many more.

The River House building in downtown Grand Rapids, owned by Robert Grooters, is the second tallest concrete structure in the state, noted VanderLaan.

“We’re involved right now in the Urban Market” project, he added.

Kent Companies has about 350 employees throughout the country. Its revenues in West Michigan alone were $34.5 million in 2009, dropping to $27.1 million in 2010. It began growing again in 2011, with West Michigan revenue at $31 million and total revenue nationwide at $62 million.

When VanderLaan’s father and uncle took over the family business in the late 1970s, it “really started to grow beyond just residential flatwork or light commercial concrete work,” he said. Soon the company had diversified into concrete construction for retail, commercial and industrial buildings. The two brothers “really expanded the company,” VanderLaan said.

“One of the hallmarks of our company is the diversity beyond just pouring concrete,” he said.

The company specializes in all aspects of concrete construction, including heavy foundations, cast-in-place elevated and post-tension structures and “super-flat” concrete floor technology.

Super-flat floors — “microscopically flat and level floors,” in VanderLaan’s words — have been growing in demand over the last 20 years as industrial processes increasingly involve ultra-sensitive electronic technology. The development of lasers for use in construction has made possible an ever-finer degree of super-flat concrete floors.

Old buildings that have been renovated into high-end condominiums require another specialized technology Kent is expert at: lightweight, poured gypsum floors over sound-proofing material so residents don’t hear neighbors above and below them.

The Great Recession was particularly hard on the U.S. construction industry, and while it was “painful, difficult, stressful” for Kent Companies, VanderLaan said it also “made us better.”

He said that when forced to “really take a hard look at the fiber of your business and what really makes your company move forward, it helps you identify areas for improvement — things that you can change to make yourself more profitable, more lean, more attractive to your customers. It really forced us to take a very hard look at every way we do business, and made us better for it.”

In his opinion, the local construction industry had been insulated from the extreme ups and downs of the national economy for quite a few years, due to the persistent investment in new health care and medical research facilities, as typified by the Medical Mile on Michigan Street in downtown Grand Rapids.

“That really kept a lot of people busy,” he said, but also made many companies complacent and less competitive for projects outside the city. As the medical construction projects began reaching completion and the nation sank into recession, he said, “It’s almost been a race to the bottom in terms of construction pricing” in West Michigan. That made it more difficult for many contractors to maintain high quality and customer service.

“Anybody can pour concrete who has practiced enough,” he said, adding that it is the diversity of services that have set Kent Companies apart.

He also noted that its strong financial footing helped the company weather the recession. Its peak year was 2007, according to VanderLaan, with its level of activity down through 2009 and 2010. Last year was “up slightly,” he said, and he anticipates another increase in 2012.

“It has been slowed down for quite a while, but I think the good companies found ways to adapt and find other areas for work. But there is still less work to do today than there was four or five years ago, that is for sure,” he said.

One service Kent Companies is expanding in West Michigan is Kent Home Services, which offers basement waterproofing and foundation and concrete repair services to home and property owners, a market that is “growing significantly,” he said.

In terms of the economy, here as well as across the country, VanderLaan said there is definitely an upward trend.

“We’re seeing signs of optimism return to the industry. My hope is it is not false,” he said, noting that last year the winter ended with an optimistic “false start” that “tailed off very quickly by the middle of spring. That doesn’t appear to be happening this year.”

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