With an azure-blue sky serving as the backdrop, Ricky Baker stands at a window in his third-floor office and looks down at Big Tex Trailers' property in Mount Pleasant, Texas, recounting the dramatic changes in the landscape that paved the way for this transcendent November day.
“This entrance right over here that you see — that was Titus County Road 3035 that circled in,” he says. “On the property where this building is sitting, there was a cabinet shop and a house.”
Baker talks about how the company cleared out trees, filled in a pond, acquired homes and moved them, successfully appealed to the county to have the road closed, and moved massive amounts of dirt.
“I'll bet you don't even recognize this, do you?” he asks, referring to the dramatic changes since Trailer/Body Builders' last visit in 2001, months after he was named Ernst & Young's Southwest Entrepreneur of the Year in the manufacturing sector.
In a few minutes, Baker will leave his office, take the elevator down to the first floor and walk outside with several hundred of his closest friends — dealers, vendors, contractors, and others who played a direct role in the company's success — to celebrate the opening of Big Tex's new 51,500-square-foot corporate headquarters and the raising of the flags.
He will stand with his wife, Kelly, as marketing director Tammy Foster greets the gathering.
He will listen as Foster talks about how Baker got into the trailer business in 1976 while still in high school, acquired his own company in 1978, sold it in 1982, and that same year started Big Tex in Mount Pleasant and then officially founded it in March 1983 in Odessa. She will talk about how it grew into “the most diverse and largest utility trailer manufacturing company in America,” with manufacturing facilities in Odessa and Mount Pleasant and a trailer manufacturing plant and truck bed plant in Madill, Oklahoma; a network of over 500 trailer dealers in the US, Canada, and Mexico; trailer parts distribution centers in Mount Pleasant, Odessa, Madill, and Ocala, Florida; and 13 company-owned sales and service locations in California, Arizona, Texas, Louisiana, and Arkansas.
He will watch as the flags are raised — first, the American flag by Staff Sergeant Rick Carlson and Private First Class Laney McDowell of the United States Army; then the Texas flag by Charlie McLemore of Magnum Trailers, which has multiple locations in Austin and San Antonio and is a long-time dealer for Big Tex.
Lynn Beal, representing Tex Trail Trailer Parts, Jerry Murrack of S&H Trailer, Urian Weaver of CM Truck Bed, and Ronald Jackson, founder of CM Trailers, will walk to the poles representing the company flags. Finally, Baker will walk to the Big Tex flag. They will raise them in unison.
“We have built a new infrastructure that is going to carry us well into the future and the next levels we're going to,” Baker says.
A story of growth
Between 1983 and 1987, Big Tex grew rapidly and developed a dealer base from west Texas to the West Coast.
Between 1988 and 1990, Big Tex acquired a 100,000-sqare-foot building on Interstate 20 between Odessa and Midland, which became the new manufacturing facility, and then entered the trailer parts distribution business by acquiring Tex Trail from Beal, who remains as executive vice president for Big Tex Trailers.
Big Tex also purchased a second 40,000-square-foot manufacturing facility on Business I-20, only blocks away from the main facility, to allow expansion into the heavy- duty equipment trailer market.
To meet a growing demand for its products and for repair services to the Permian Basin consumer and commercial market, Big Tex in 1993 acquired an adjacent facility and created Big Tex Sales and Service. Also, in that same year, Big Tex became the first utility trailer manufacturer to join the National Association of Trailer Manufacturers (NATM).
In 1994, land was purchased in Mount Pleasant and the current manufacturing facility was constructed, producing its first trailer in March 1995.
Between 1997 and 1999, Rheas Trailer Sales of Mount Pleasant was acquired — it was located on the original Big Tex site on the northeast corner of the current property — and Tex Trail Trailer Parts expanded to Mount Pleasant.
In 2001, a new 15,000-square-foot Tex Trail Trailer Parts building was constructed in Odessa. A few years later, Big Tex purchased a local fabrication company, renamed Big Tex Fabrication.
In 2007, Big Tex acquired CM Trailer Mfg and its subsidiaries, CM Truck Beds and S&H Trailers, from Ronald and Kay Jackson, Baker's long-time friends.
All of that growth led Baker to the obvious conclusion: Big Tex had outgrown its infrastructure.
“The synergies between the management teams were not as good as we wanted them to be,” Baker says. “We had no ability to stick our heads around the corner and ask a question. While cell phones and e-mails are good, nothing takes the place of sticking your head around the corner and being able to communicate with everybody on the same wavelength.
“Our main management team was split up. All of our major corporate administrative functions were in Odessa. Our executive VP was in Odessa. Our HR department was in Odessa. Our VP of sales was in Mount Pleasant. Our VP of manufacturing was in Mount Pleasant. I was in Mount Pleasant.
“While we had a nice administrative office in Odessa, to consolidate it to Odessa would mean expansion there. So we either had to expand our offices there or build new offices here. The decision was made to do it here. Though the oil patch and the West Texas economy were strong, for us it had become increasingly difficult to hire and retain good-quality people. We felt it would be easier to recruit and hire and retain those people here.
“We also had some very aggressive expansion and growth plans in our five- and 10-year plans. So it was time to slow down and take a breath and rebuild and reinvest in our infrastructure.”
Baker acquired 30 acres adjacent to the Big Tex property, taking the total to 93. Then, midway through 2007, Baker started relocating the Odessa staff to the Big Tex offices while the new corporate headquarters were being built.
Once that new building was completed, they tore out all the old offices — which were scattered over that building — and relocated those people to the front section. That includes everyone who deals with the daily operation of the plant — production managers, production supervisors, production scheduling, purchasing, and receiving.
The new building came in three phases: loading and shipping, with drive-through bays that triple the shipping capacity; operational offices (dealer sales, order entry, invoicing); and front-section corporate and administrative offices.
“On one hand, we're really proud of the things we've been able to accomplish in this office, and what it represents,” Chief Operating Officer Randy Homer says. “We're also very humbled and thankful and blessed we're in this position to have such a nice facility.”
“The corporate office brings all of our companies together,” senior vice president Jim Kelly says. “Everything is centralized. With the acquisition of CM, along with our other subsidiaries, it is truly a headquarters building and gives us tremendous expansion possibilities for future growth. Our executive management team, as well administrative support, is now in-house. We think that makes us more responsive. Everybody's close enough that if you have a question, you get an answer. It will be a real asset.”
Kelly's overseeing of the construction project makes him understandably proud of the outcome, but the most outstanding addition may be along the frontage road, where visitors are greeted by a 200-pound sculpture of a Texas Longhorn steer — the result of a three-month search by Kelly that finally culminated in the purchase of the gentle giant from an El Paso company.
“I love this thing,” Kelly says.
Surviving the recession
Of course, the whole process of relocating and building coincided with an economic downturn that actually, according to the National Bureau of Economic Research, was a recession that started in December 2007.
Baker admits that it is a bit unsettling, but Big Tex has withstood the malaise with great strength, compared to the rest of the industry.
Through the first three quarters of 2008, total consolidated revenue was down just 3.5%. Through the first fiscal quarter of 2008, which was completed in September, total consolidated revenue was down 5.6%.
“Normally, we're not happy with that,” Homer says. “We're used to double-digit growth. But we feel like we're fortunate to not be down by more than 5.6%. Compared to the rest of industry, that's pretty good.
“But who knows what second-quarter totals will be? November through February is historically the slowest time of year. It looks like it's going to be considerably slower. We'll see. We used to be able to predict with a reasonable degree of certainty. Today, it's not as certain. What I can talk about is more of what we don't know than what we do know.”
Says Baker, “I figure we're about to really start feeling the downturn. Industry-wide, we see companies running 40% and 50% down. It's a scary deal. When finance companies start tightening up, everybody's affected down the line.”
Part of Big Tex's strength is diversity in products and service, and a considerable part of that now is due to Tex Trail. VP Dennis Webster prefers not to release sales figures, but says they were up in 2008.
“Everybody's running for cover now, but we're running full-speed ahead,” Webster says. “Our sales and market share are up, because of the service and experience we are providing. The tendency for companies in our industry right now is to climb in a foxhole and pull a lid over themselves. We're just going to keep doing what we're doing, and that is being aggressive in the segments of the parts market in which we excel.
“We have the widest variety of trailer parts of any wholesale distributor I've ever been involved in. We know that knowledgeable, experienced personnel are the key to providing good service. Several of those individuals in the industry have come to us and expressed a desire to be a part of an aggressive, service-drive organization. We are happy about that and feel that their contributions will help ensure our growth.”
Beal says one of the advantages of a trailer manufacturer owning its own trailer parts distribution company is that it is not just a parts department.
“Trailer manufacturer parts departments are different — they are greatly limited in their capabilities,” he says. “Others don't do what we do. Tex Trail was literally a stand-alone trailer parts distribution company when it was acquired by Big Tex, and it still is. The advantage is that a dealer anywhere in the US who is buying loads of trailers from Big Tex can order from people who are really in the parts business — repair or replacement parts, towing accessories — from Tex Trail. It's not a trailer salesman trying to take an order for a tail light. It's true parts people.”
Says Webster, “We pride ourselves in great relationships with customers. We're talking to them all the time. When we say we're going to get a part, we do. We don't care if we have to find it overseas or locally. If it's something they can use, we don't have any fear of putting it in stock and marketing it. Some of our growth comes from an expanded offering as well as being aggressive in the marketplace. We combine the best of all worlds in things other distributors can't do.
“One of the surprising advantages I've found about the fact that Tex Trail is owned by a trailer manufacturer is that its close proximity to manufacturing experts and repair facilities allows Tex Trail staff to learn about trailers. They come to understand the applications of the parts in manufacturing, as well as in the repair and retail environment. I have learned that it's frustrating for a parts customer, especially a trailer manufacturer, to buy parts from people who don't understand trailers.”
In October, Tex Trail opened its third location in Ocala, Florida, and on January 1, it will open its fourth location in Madill, Oklahoma.
Also, Big Tex is in the final stages of purchasing a 175,000-square-foot facility and 55 acres on Interstate 75 in Cordele, Georgia, to manufacture and distribute to dealers in the eastern US. The never-occupied, like-new facility includes two buildings, one of which will be dedicated to manufacturing trailers and the other will become the fifth Tex Trail distribution facility.
“We may never be the biggest one out there in the parts business — and we are not trying to be,” Beal says. “Our goal is to be the best. We know that the final judge of that will be the customer, so we will continue to try to offer the best value in the business.”n