There are three key parts to every business transaction: you need to have top-notch employees, you need to satisfy customers, and you have to know where to find work. Lee Franciscus has made a science of excelling at all three.
Franciscus is the CEO of Franciscus Inc., the residential roofing firm he founded in 1991. The company services all of northeast Ohio including Cleveland, Akron and Canton.
When he started the company, it was strictly new construction. “We were the largest new construction contractor in Ohio,” he said. “A few years ago we realized that this wasn’t going to last forever, so we reached out to homeowners, focused on tear-offs, and started adding a sales force.”
Now less than 5 percent of the company’s business is in new construction, and the company has diversified to succeed in a changing economy. “We do it all — slate, wood shake, flat roofs, shingles, metal. We pretty much can handle everything that is thrown at us here,” Franciscus said. “We’ve become multifaceted at this point. We don’t know when new construction will come back, but when it does we will be ready. It will be the icing on the cake.”
Crafting a Business Model
Franciscus got into the industry by chance after serving in the military. “After I got out of the Army I was working three jobs,” he recalled. “I was approached by a friend who asked me to help out at his father’s roofing company. I never thought that it would become a career, but I liked the work, I loved learning about roofing. Three years later I started my own company.”
He knew that quality craftsmanship was crucial in the roofing industry, so he developed a business model that hinged on finding the best help available and paying the price for top-quality work. “I looked at the industry, at what everyone complained about — that they can’t find good help. I thought, you can find good crews — people just don’t want to pay them.”
Franciscus sought out installation experts who were struggling to run their own business and let them concentrate on what they do best — installation. “There are a lot of very good crews out there, but they can’t be on an effective crew and run the business at the same time,” he said. “We take on the business end and focus on marketing and sales, so we have jobs for them to install.”
Soon the construction boom was in full swing and business took off. In 1997, he did a little over $200,000 in business. By 1997 he had topped $1 million. “That’s when I stole my wife from the Cleveland Clinic because I couldn’t keep up with the office staff,” he said. Angela Franciscus is the company’s CFO. When he switched his focus to re-roofing, he brought on Tom Schlund, to be the company’s “sales manager and marketing guru.” Last year the company topped $13 million in revenue and did 26,000 squares.
A Rewarding Work Environment
Franciscus attributes the company’s success to the top-quality work with his crews. The company’s commitment to its employees begins with safety. “We’re proactive,” said Franciscus. “We care about our employees. We want them to be safe and feel safe in the work environment. We ensure access to proper safety equipment. And we have a phenomenal track record. We’ve always been about the guy on the roof — making sure he’s safe.”
“We’re always conducting ongoing training and certification,” Schlund said. “All crews are dedicated to following OSHA standards. Quality control is in place, and we are following up with crews to make sure no shortcuts are taken. And we compensate them fairly. We pay them enough to care.”
A term Franciscus likes to use is “life balance” — a rewarding working relationship that allows you to spend time with your family. “No one’s doing a good job if they aren’t making a living,” Franciscus said. “If you’re going to make it a career — and let’s face it, roofing isn’t easy work; it takes a toll — you have to be well compensated.”
Schlund agrees. “We feel the best work environment is one that makes sure they have time for their families,” he said. “As long as the job gets done, we don’t care if they take an hour off to attend their son or daughter’s tee-ball game. We don’t micromanage, and that goes a long way.”
Next Franciscus focused on the customer. He summed up his thinking this way: “I asked myself, ‘What are homeowners afraid of when getting a new roof? What are they anxious about? There are two basic things. Number one: Is he is going to take the money and run? Number 2: Am I going to get a quality roof put on at a fair price?”
He vowed never to engage in high-pressure sales techniques. “We have never charged a down payment,” he said. “We don’t pressure sell them. We don’t say the offer is only good for two days or a week. We let them make the decision.”
Schlund emphasized the importance of educating the homeowner. “We have a full PowerPoint presentation that helps homeowners understand what the company is about, what the roofing process is all about, and what to expect once the roofing process begins,” he said. “By the end of the 10 minutes of watching this, they have a very good idea of what to expect.”
Salesmen also offer tips on how to the homeowners can get ready for the re-roofing job and offer the “impeccable cleanup guarantee.” Franciscus noted, “Tom often says getting a roof is like open-heart surgery on your home, and we try to keep the scarring to a minimum.”
“We’ve become the best at the most difficult part of our industry — the cleanup,” said Schlund. “We take our time. We do a walkaround. Our contractors care. And homeowners know what to expect. We notify them 48 hours before the start of the job. And we let them know that if they get their lawns cut before the job, our magnet sweep for nails will be more effective. It’s the little details like that that make all the difference.”
It’s that type of precision that marks every phase of the process, right down to the choice of sealant. For example, the company uses NovaFlex sealant because they know it will perform well in a variety of applications. It’s used on chimneys, metal, gutters, bay windows, pipe stacks, and brick counterflashing. “It’s all about the details,” said Schlund. “In Cleveland, a lot of the chimneys have a brushed-brick surface. Other caulks pull out of the brushed brick, but this one gets in and stays there.”
“One of the great performance aspects we’ve found is that other caulks don’t fare well at temperatures below 50 degrees, but NovaFlex does,” Franciscus said. “In a climate where the weather can change frequently, we know we can count on it.”
The commitment to customers carries over to the cities and towns they live and work in. “We’re not just a contractor in the community — we’re part of the community,” said Schlund. “We give away three roofs a year to families in need. Homeowners appreciate and prefer to work with a company that gives back to the community.”
The first community outreach project went to a customer, a teacher who had lined up a new roof to be put on in June. But when her husband passed away suddenly, the teacher called to cancel the job. “When I told Lee, he said, ‘Call her back and tell her we will put that roof on for free,’” said Schlund. “That’s when I knew this was the company I wanted to retire at. We’re here to make money, but we acknowledge we are part of the community as well.”
The company now accepts essays nominating families in need for the roof replacement. They receive hundreds of nominations. “Reading them is a humbling experience,” said Franciscus.
The company helps the community in other ways as well. “We also launched a fundraising program to organizations who can give free gift certificates to members,” said Schlund. “When the person gets a new roof, Franciscus donates $100 to the organization.”
It’s all part of the company’s plan to invest in the community through these projects and others, like sponsoring youth baseball and soccer. “Our project managers live in 11 different cities,” said Franciscus. “We want to be a presence in all of them.”
You can’t take care of employees and customers if you aren’t taking care of business, and Franciscus has proved adept at adjusting to a changing economy and remaining profitable. The company has diversified, expanding its offerings to include siding, windows and insulation. In the last few years, the company has gotten into insurance remediation work as well.
“Something that makes roofing unique is that we are cyclical,” he said. “If you get a roof, 15 or 20 years later you’re going to need another one. I’m young enough and our company is young enough that we want to replace the roofs we put on. And we’re beginning to replace those roofs.”
Now the company is targeting houses built in the late 80s and early 90s.
“Roofing is a need, not a want,” said Franciscus. “When the question is, do we get a new car or fix the roof that is leaking water into the kitchen, the roof wins that battle every time.”
When it’s time for a new roof to go on that house, Franciscus wants his company to be the one to put it on. “We see by the results that we’re doing the right things out there,” he said. “The roofing industry as a whole has a bright future ahead of it right now. I’m envisioning our company reaching the $20 million mark in the next three years.”