B.E. 100s Neighborhood Improvement.

Hot, new additions are transforming the B.E. 100s

FOR MOST OF US, WHEN WE HEAR THAT THE NEIGHBORHOOD is changing, it's time to pack up and go. For these four trailblazers, a changing landscape meant significant gains to their bottom lines.

One new tenant is a seasoned veteran of the BE 100S who sold his original enterprise only to start another. And while the other three may be new to the block, none are devoid of business experience and entrepreneurial savvy. Combined, they represent more than $700 million in sales in just one year! The sheer diversity of their businesses stands as a testament to the breadth of black-owned enterprises and the strength of the BE 100s.

ANOTHER HOME RUN

During his days as a member of the Atlanta Braves, Henry L. "Hank" Aaron made a stellar career hitting home runs out of the ballpark. His record--755 home runs--still stands today, almost 125 years after he hung up his cleats. Now it looks like Hammerin' Hank has hit another homer, this time as an auto dealer for Bavarian Motor Works (BMW).

Hank Aaron BMW set new records by posting a profit just 90 days after opening its doors in southwest Atlanta in late December 1999. A letter from the general manager for the BMW Southern Region attests to the dealership's performance for fiscal year 2000: 507 new cars and SUVs sold, 27% more than projected; and 152 certified pre-owned Beamers sold.

The new buzzword in the automotive industry is customer satisfaction, an area BMW takes seriously enough to pay its dealers cash bonuses when they surpass goal. For Hank Aaron BMW that translated into a cool $786,000 added to its bottom line. Last year--its first year in business--the dealership had $32.9 million in sales, making it one of the hot new companies to join the BE AUTO DEALER 100 list at No. 87 this year.

Being one of the first African Americans to acquire a BMW franchise was not without controversy. For years, the National Association of Minority Automobile Dealers (NAMAD) had been pressing luxury import auto manufacturers to add African American-owned dealerships to their groups. In February 1998, BMW announced its intention to appoint at least 10 black-owned dealerships by 2000. Hank Aaron BMW was among them. The significance is not lost on Aaron.

"Why was I chosen?" retorts Aaron when asked. "Just because I had been a baseball player didn't mean I didn't know how to run a business," he says. "I have 17 successful fast-food restaurants with Church's, Popeye's, and Arby's. They knew I had some experience running a franchise operation. I accepted the challenge that I could put minorities in charge and run a dealership."

To assist him, Aaron tapped Sidney Barron, an African American sales veteran with 12 years' BMW experience from another Atlanta franchise, to become his dealer-operator and general manager. Barron had been consistently ranked among the top three salesmen in Atlanta for a decade. "I knew I could do this job with some support," says Barron.

About a month before opening, Barron developed a marketing campaign announcing Aaron's new dealership. He spliced together old baseball clips of Hammerin' Hank with Aaron introducing his new lineup of all-star veteran sales and services staff; the ad ran on local cable TV.

As a new kid in the neighborhood, Hank Aaron BMW is taking advantage of its proximity to Atlanta's Hartsfield International Airport to help market its services. Its prime feature--a parking and ticket service whereby BMW owners can drop off their car in pre-designated parking spaces to have it serviced while they are gone. The $1,200 per month fee (that Aaron BMW pays) for six spaces more than pays for itself, says Barron. Customers--and potential customers--can log on to Aaron's Website, www.hankaaronbmw.com, to schedule service for their car or airport drop off, order parts, shop for a car, or get a loan preapproval.

As the fourth BMW dealership in Atlanta, Aaron has set his sights on being the largest dealership in the city. "I'm used to batting in the fourth spot and being No. 1. The growth is here and we've done much better starting out than anyone has expected. We'll be one of the most successful dealerships in Atlanta," proclaims the home run king.

ALERT TO NEW OPPORTUNITIES

When the temporary staffing industry was created more than 50 years ago, an African American woman would have been a rare find among employees sent out to fill a position. While it is now de rigueur to find African Americans among the temp pool, it is still rare to find them in the CEO's seat. But that's exactly where you'll find 39-year-old Victoria Lowe, founder, president, and CEO of Alert Staffing, a $204.2 million staffing services firm, the first such company owned by a woman to join the BE 100s. Alert is No. 13 on the BE INDUSTRIAL/ SERVICE 100 list.

Based in the Los Angeles area, Alert Staffing has grown from a fledgling start-up with four employees and $600,000 in sales in 1995 to 135 full-time employees and 5,400 associates on assignment in 35 states in just five years.

While on early maternity leave from her position as a regional vice president for Remedy Temps, Lowe got the idea to start her own firm.

The St. Louis native developed a business plan and came up with a company name, Alternative Staffing Group (ASG). She then contacted a former co-worker and friend, Carin Goldberg-Maher, who agreed to help. The two raised $20,000 in angel investor loans from family and friends and Lowe tapped another $8,000 from her credit cards to get started. Armed with a two-year contract from Electronic Data Systems (EDS) estimated at $250,000, Lowe hung out her shingle in a small Century City, California, office in May 1995. The contract called for Lowe's company to provide temporary staffing services for EDS' Los Angeles area locations.

Lowe characterizes those startup days this way: "Carin's job was to recruit people and fill the job offers. I had to recruit the businesses. In other words, I had to catch 'em, and she had to clean 'em and cook 'em."

A year later, Lowe says she decided the company had a "bigger calling" to become a national firm. She developed a business proposal to partner with a large, national staffing company, Adecco, whose client, Southwestern Bell, was looking for a minority-owned staffing firm. Allure Staffing was born from that partnership, eventually becoming Alert Staffing. Lowe signed a five-year contract with SBC Communications, estimated at $12 million, to provide clerical and technical support to their facilities in five states.

The company counts among its largest clients AT&T, SBC Communications, Sprint, Motorola, and Procter & Gamble. When SBC purchased Pacific Bell, the merger more than quadrupled the size and revenue of Alert, skyrocketing revenues from $36 million in 1998 to $163 million in 1999.

Equally important to growing a business is managing it. "Growing this quickly and raising the capital fast enough to manage the growth has been the greatest challenge," says Lowe, who has set her sights on becoming a $1 billion national, if not international, company with"in the next five years. "I'm a person of vision and faith, and I believe that you call it into being everyday. And that is how we work."

BUILDING ECONOMIC BRIDGES

As the former president and CEO of the Michigan Minority Business Development Council (MMBDC), Ronald Hall understood the value of the network his organization provided to bring minority and disadvantaged business owners together with large, majority-owned corporations. His board of directors read like a who's who of the auto industry, including Harold R. Kutner, group vice president of worldwide purchasing for General Motors (GM), and John M. Barth, president and COO of Johnson Controls Inc. (JCI), a $12.7 billion supplier of auto interiors and systems to the Big Three car manufacturers.

In bidding on a contract to supply auto seats to GM, JCI promised it would form a joint venture with a minority-owned firm to build a plant in a Detroit empowerment zone. The company would get the largest single contract ever awarded to a minority by GM and employ residents from the local community. Barth, also vice chair of MMBDC, approached Hall about doing the deal.

"A lot of these deals are made based upon relationships," explains Hall. The contract, to be the exclusive provider of seats for the Cadillac DeVille, was estimated at $900 million over five years. "I firmly believe that for minority companies to have an opportunity to be a major player in the industry, you have to have a joint venture. Besides, it's much easier to do a joint venture with someone who has experience in that industry if you don't have any," he adds.

While Hall may not have had experience building car seats, he'd worked as a systems analyst for Ford Motor Co. for 15 years and had been an owner of two Bonanza Steakhouses. He later served as assistant vice president of New Detroit, an urban coalition of major corporations with a mission to provide a voice and support to minority and disadvantaged Detroiters. That position led Hall to assume the helm of the MMBDC.

"JCI won the contract based upon having a minority partner," says Hall. "And thus the start of Bridgewater Interiors L.L.C., a joint venture between my company-Epsilon Technologies L.L.C.--and JCI." Hall serves as president and CEO of Bridgewater Interiors L.L.C. He formed Epsilon with two partners--William F. Pickard, CEO of Global Automotive Alliance, No. 9 on the BE INDUSTRIAL/SERVICE 100 list with $260 sales, and former Green Bay Packer and entrepreneur Willie Davis, who also sits on the boards of several multinational companies, including JCI.

The group broke ground in March 1998 in a city- and state-designated empowerment zone. Epsilon and JCI collateralized an initial $2 million of the $33 million cost of the plant. The balance is financed through a bank and will be paid off within five years. "The biggest challenge was getting and training a workforce to build good, quality seats in a timely fashion with customer service in mind," Hall remembers.

Two master seat builders were hired from JCI and made supervisors. "I bought seat components so that we could practice building them, break them down, and then start the process all over again." In manufacturing, efficiency is essential. "GM sent in engineers to see if we could build seats fast enough to meet their timetable. It takes exactly 28 minutes to complete one set of seats--driver's side, front passenger, and a rear set," recounts Hall.

However, the challenge, says Hall, is in managing his supplier base. The company uses 52 suppliers providing more than 250 parts. Despite the pressure, business has been good. Bridgewater had $52 million in sales from July 1999 to December 1999, making enough seats for 26,000 vehicles. Last year, the company made seats for 119,000 DeVilles, which translated into more than $218.4 million in sales and a No. 11 spot on the BE INDUSTRIAL/SERVICE 100 list.

"The JCI partnership is a relationship I want to renew and grow," explains Hall. "We mutually agree on what makes sense for Bridgewater to go after and that's what we do."

MOVING BACK IN

When Emmit J. McHenry sold his former BE 100s company, Network Solutions (see "Where Are They Now?" August 2000), many thought he would move on, lending an ear and his expertise when needed. But that's what other people thought. This African American computer networking pioneer and founder of the Internet-domain-names registry had other plans.

"I had not fulfilled my business dream," says McHenry. "I had three partners at Network Solutions who wanted out. No one knew the Internet would be as big as it is now. We needed $15 million to $20 million to expand [on the Internet], but we couldn't get the capital." So McHenry did what any savvy entrepreneur does; he sold his old business and started a new one. This time, the focus was on being a total network solution provider in a new communications environment, hence the new name, NetCom Solutions.

Not a man lacking vision, McHenry started NetCom in 1995 and sold Network Solutions that same year. In its first year of operation NetCom had $7 million in sales. With last year's earnings, NetCom put McHenry back on the BE INDUSTRIAL/SERVICE 100 list at No. 8 with $262 million in sales and 215 employees.

"We put the building blocks in place, whether voice, video, or data. We are ISO9001 [the industry standard] and TL9000 [a higher level] certified. We are a process-driven organization that can support customers nationally and internationally and are committed to understanding the technology, including that which will be used in the future," explains McHenry's son, Kurt, vice president of marketing.

Both father and son say their competitive edge is that they don't just install systems; they understand the customer's business model so they can offer true value to a company. Adds Kurt: "We allow our customer to focus on their core competencies. They don't have to manage us and what we do."

Until the end of last year, Emmit McHenry was responsible for the day-to-day operations of his company. He's since brought in Samuel D. Wyman III, former president of Harris Corp.'s Microwave Communications division, a network-solutions provider and manufacturer of commercial microwave radios, as NetCom's president and COO. This, says McHenry, allows him to "focus on a strategic level and plan for the company's future. To date, we've grown through internal growth. Now, we're looking for strategic acquisitions." That business model may also include taking NetCom public as a means to access more capital.

"The need [for services] is in the mind of the people. Demand drives innovation. The challenge is delivering quality service at a competitive price," says McHenry.

Meet the Next Generation

As a testament to the bullishness of last year's economy, there are 13 new companies joining the elite ranks of the BE 100s for 2001. Along with Alert Staffing, Bridgewater Interiors, and NetCom Solutions International Inc., 10 additional newcomers make it onto the list and span the breadth of business trends today, from auto manufacturing and IT services to environmental cleanup and heavy trucking. Here's a brief introduction to the other companies on this year's BE INDUSTRIAL/SERVICE 100 list and where they rank.

Millennium Digital Media Holdings L.L.C. No. 27

A broadband service provider of cable and Internet services including high-speed DSL, the St Louis-based company offers traditional Internet access along with Web design and hosting, among other related services. Started in 1997, the company grossed $120 million in sales last year and employed 500 under the leadership of CEO Kelvin R. Westbrook.

GlobalView Technologies L.L.C. No. 31

Network integration, installation, and professional services are the hallmark of this Detroit-based company breaking onto the list with $103.5 million in gross sales. Lead by CEO Hiram E. Jackson, the 1999 start-up employed 375 people last year.

MPS Group Inc. No. 49

Started in 1994, this diversified Detroit-based company offers an array of products and services including interior flooring, industrial and environmental cleanup, demolition and decommissioning, along with commodities brokering and transportation. Under the helm of CEO Roderick K. Rickman, the $71.5 million company employs 250 and has been selected the Michigan Minority Business Development Council Supplier of the Year for 2000 and 20001.

Medical Care Management No. 58 (tied)

Established in 1996, this Nashville, Tennessee, concern develops and manages health maintenance organizations and related managed-care organizations in Tennessee. Anthony J. Cebrun is chairman and president of the $60 million company, which employs 350.

Sun State International Trucks Inc. No. 70

This Tampa, Florida-based company is heavily into trucking--heavy trucking, that is, including sales, lease, rental, parts, and service. Started in 1985, the company came under majority-black ownership in 2000, under the leadership of Oscar J. Harton, its president, and employs 140 with gross sales of $46 million.

ITS Services Inc. No. 78

In the midst of the I-95 technology beltway sits Springfield, Virginia-based ITS Services Inc., which provides information technology and telecommunications support services. Started in 1991, the company, led by President Angela M. Mason, had sales of $41.28 million last year and employed 300.

Triad Management Systems Inc. No. 92 (tied)

This Rockville, Maryland-based company provides information technology, technical engineering, and human resource contract services. Started in 1988, the company grossed $32 million in sales and employed 450 under the tutelage of its president, LeRoy E. Wildy.

American Product Distributors Inc. No. 94 (tied)

This Charlotte, North Carolina-based company provides all manner of business and janitorial supplies to the likes of Office Depot, Bank of America, Bank One, and State Farm Insurance. Established in 1992, and led by Chairman and CEO C. Ray Kennedy, the 18-employee firm grossed $30 million in sales last year.

Metropolitan Facility Resources No. 94 (tied)

Specializing in the sales and installation of commercial furniture and carpenting, the Detroit-based company grossed $30 million in sales last year. Its president, Darrell W. Francis, started the 11-person firm in 1997.

JIL Information Systems Inc. No. 98

Started in 1991, the Vienna, Virginia-based IT firm provides systems engineering, integration, installation, database design, and development, among other services, to a host of companies in the 275-employee company had sales of $29.8 million last year.