The Story of Roger Thompson (G&S Heating)

Apr 27, 2023

American Dream Achieved

IBA, as an approximately fifty-year old business brokerage firm serving the entrepreneurial community of the Pacific Northwest, has been uniquely positioned since before the American Bicentennial celebration of 1976 to witness and hear the stories of thousands of people who have lived the American dream through entrepreneurship creating beloved businesses by employees, customers, and communities while finding personal fulfillment and financial prosperity through execution of their ideas, hard work, perseverance, and ability.  In an effort to share these stories heard throughout the years by our team of business brokers, who are commonly regarded as the “best listeners” in the M&A industry, IBA has retained highly regarded writer, Nesha Ruther, to tell their stories.  It is our goal to share one story a month. It is our hope that you will find the stories as inspirational and motivational as they are to us and the buyers who bought the businesses in IBA facilitated transactions in Washington, Oregon, and Alaska.

The Story of Roger Thompson (G&S Heating)

By Nesha Ruther

Roger Thompson began his career in heating, cooling, and electric when he was only 16. At the time, he was following in the footsteps of his older brother, who upon graduating high school, had taken a job working for a local heating and air conditioning company. “He got me a job working after school sweeping floors and just doing what kids do,” Roger says.

Over time, Roger’s responsibilities grew. He learned how to fabricate heating and air conditioning ducts and spent his summers installing cooling systems in people’s homes with the journeymen.

In 1979, Roger graduated high school. He asked his boss for a raise but was turned down. Roger left that company and went to work for Todd Shipyards, now owned by Vigor Shipyards. At the time, Todd had a government contract building naval frigates. Roger spent the next three years working there doing ventilation ductwork on board the ships.

Roger’s time aboard ships led him to realize however that heating and cooling were where his interests truly lay. In Snohomish County, an acquaintance of Roger’s owned a small sheet metal shop. “I kept hitting him up for work and he’s like, ‘I don’t know, I hardly have enough work for myself.’ I said, ‘Well I can help you with that. I’ve got a lot of experience working with new builders and contractors, I can go get a list of building permits and start looking for work,’” Roger says.

The owner agreed, impressed by Roger’s tenacity. “I basically made a job for myself and started helping him build the business,” Roger recalls. That little sheet metal shop went on to become G&S Heating.

At the time, the business was mainly working on new residential construction. They had 30 employees, but the construction market was volatile, and it was difficult to find regular business. Roger got to work securing a consistent stream of revenue. From when he joined in 1985 onward, he poured his heart and soul into the success of the company. So much so, that he never charged the owner overtime for all the extra work he did.

In return, the owner gifted him 25% of the company. “I just really wanted to build the business,” Roger says. “We talked about it for years and it finally came to fruition.” Over time, that 25% became a buy-out agreement, and in 2006 Roger became the sole owner of G&S Heating.

Roger began to shift the business towards more commercial work. He also went ahead and pursued his electrical administrator’s license, spending a full year studying the material before taking the exam. When he passed, he continued to scale the business by bringing on a few electricians. “That was a real challenge for me,” he says. “[Electrical] was a whole different business. The cost of goods is totally different, there’s a lot of labor, not a whole lot of equipment; it’s very, very competitive.”

Where the majority of air conditioning installations are done by teams working for a company, electricians tend to be individuals. This meant that even if Roger’s pricing was consistent with the competition, his profit margin would be smaller because he had to pay his employees.

In 2007, an already difficult industry took a turn for the worse with the onset of the Great Recession. “I had one good year,” Roger recalls, “We had 41 people, and then it went down to 12.”

During that time, Roger was forced to make some incredibly difficult decisions regarding staffing. “I just looked at who really drank the Kool-Aid, who was in it to win it, who really wanted to help people. I kept all the team players,” he says.

Roger knew that if the company was going to have any chance of surviving, he couldn’t rely solely on his own outlook; he needed an outside perspective. He decided to hire a consultant to help guide the business. “I found this one consultant in the Seattle area that was referred to me by another friend in the trade. They had been very successful and knew about me, my [company] culture, and what I stood for. I learned a lot about the business, I learned about departmentalizing as far as trying to figure out where your profits are and what is going to make you money,” Roger says.

This insight led Roger to focus the business on residential replacement. He also increased the marketing budget from 1% to 6% and built a website for G&S Heating. This attention to marketing reinvigorated the company, and soon it began to stabilize and bring in more revenue. “At that point, we had gotten back to about 35 people and were making $5 or $6 million [a year],” Roger says.

At the time, G&S was located in the small town of Monroe, Washington. Roger decided to move the company to Everett, which was much closer to the I-5 corridor and was likely to bring in more customers.

Roger’s hunch was right, and business began to take off. Moving to Everett also gave the business access to a broader pool of talent. “I had good employees all along, but running a business in a small shop, in a small town, somebody might drive by and say ‘Yeah, I’m not working there. They probably don’t have a whole lot to offer me.’ But when we were on the I-5 corridor and our shop was huge, we became really visible. I had people knocking on my door asking [for work],” Roger says.

G&S began to attract attention from more than just potential employees, Roger’s business had caught the eye of Lennox International. Lennox accepted G&S into a program they had with both Costco and Lowe’s, giving the business the benefit of being associated with large brand names. Roger also made sure all his company trucks were branded so people could see they were active. “I focused on the term ‘owning your neighborhood’,” he says. “That means spending less time in the truck running between jobs and more time in your own neighborhood improving the product line.”

Whereas before Roger might take an installation job that required his employees to travel as far as two-and-a-half hours away, he now limited jobs to within a 35-minute radius. By focusing on local work, Roger was able to save more time and money on travel and build up a stronger presence in his community. “We looked at ZIP codes, we looked at area demographics, we sent out fliers in the mail,” Roger says of his strategy.

The ‘own your neighborhood’ approach paid off, and G&S Heating grew to be a $10 million company with a team of 50 people.

Their work was divided between 60% residential replacement, 20% service work, and 20% electrical and light commercial work. Roger’s pursuit of his electrical license eventually yielded large returns, because, unlike similar installation companies, he did not have to hire outside electricians to do that work.

While this success did not come without challenges, by taking the time to establish systems and processes, Roger was able to get to a point where he could focus on scaling the company rather than the day-to-day activities of running the business. “Getting to the point where I could work on my business rather than in my business meant actually having job descriptions, task lists, and managers to manage those job descriptions and tasks lists. That way I could just manage my managers. It made [running the business] a lot easier.” Roger says.

This meant maintaining the right balance of work and employees, but also ensuring those employees were high-quality team members that could be relied upon to get the job done well. “It got to the point where I could come in in the morning and I wasn’t putting out fires. I wasn’t getting phone calls from customers saying, ‘Your guy came in here and forgot to put the door on the outdoor unit before he left.’ Everyone was doing their jobs,” Roger says.

Despite his changing responsibilities, Roger continued to be highly involved in the hiring process. While direct managers might conduct the first interview with a potential hire, Roger always did the final interview himself. “I would sit down and tell the person, ‘This is the kind of person we’re looking for. We need a good fit, and this place isn’t a good fit for everybody.’ We’re not here to do mediocre work or provide mediocre service, and I made sure my employees knew that.”

Another factor in the business running smoothly was the establishment of a centralized information database so that employees could easily find the information they needed without taking up the valuable time of their managers and colleagues. This process also ensured there was a clear, streamlined strategy for meeting the customer’s needs. “Any time a customer called, it went into the database, so you could have the history of that customer right there. Having processes in place for customers so that they could be taken care of was really important,” Roger adds.

While any business involves a certain amount of multitasking, the nature of Roger’s industry meant constant moving parts that needed to be monitored. “I’m not sitting in an office watching 50 people that are all under one roof,” he says. “I’ve got 50 people that are on 50 different job sites, and some of those people see five or six jobs a day. So, we have 60 or 70 different potential exposures or liabilities. It’s all about accountability, clear and concise job descriptions with clear and decisive task lists and procedures. It’s painstaking to do all that. It’s hard and it takes so much time. But it makes your job easier all the way around.”

Roger deeply enjoyed the customer-focused aspect of the business, so even in the later years of running the business, when he was not interacting with them directly, he made sure his employees knew how customers should be treated. He also enjoyed being able to take on a mentorship role with his employees. “I like working with the people that work for me,” Roger says. “I liked helping the customers, so sales training was fun. I liked dealing with my people as long as they liked me, as long as we had a good relationship. The majority of the time, I had really good people.”

Roger attributes one element of G&S Heating’s success to something that doesn’t actually have anything to do with the industry—core values. “I thought it was a bunch of hooey the first couple of years I was with my business consultant. But having core values, having a mission statement and a vision, it helps you share the direction you want to go with the people that work for you,” Roger says.

By creating a common language of values, company mission, and vision, and giving his employees a stake in those principles, Roger not only allowed them to feel more connected to the company but created a standard by which employees knew they had to perform. “We had our core values posted all over the office, outside, and in the shop. Any time somebody would clearly do something that wasn’t very smart or wasn’t very kind to the customer, I would ask the manager to sit down with them, go over the core values, and ask them ‘Where do you think you are falling short?’ Roger says.

“Maybe there are some people that just want to fly by the seat of their pants and don’t really care, but there are also those who want to work for the guy who’s the best, that treats his people the best, and treats his customer the best. They want to go out to a job site and have customers say, ‘You guys are awesome. You did my cousin’s house, my mom’s house, and the first house we built. We’ve been dealing with Roger for 25 years.”

For those employees, the core values gave them clear and measurable principles to aspire to, and they could have confidence in knowing their colleagues were doing the same. Roger’s core values were Honesty, Integrity, and Empathy. Their tagline was “A service company you can depend on,” and their mission statement was to provide the customer with 100% satisfaction.

“That means we want to customer to be happy 100% of the time. We’re not going to walk away, ignore them, or call them only to say, ‘I’m sorry we can’t do that,’ or ‘I’m sorry that’s just the way it is.’ Every single job had a follow-up call where we would find out if the customer was happy and how their system was running,” Roger says.

By ensuring that core values were not simply words on the wall, but principles to live by, they informed and impacted the work that Roger and his team did every day.

In navigating the nuances of entrepreneurship, Roger found having a community of like-minded entrepreneurs to be invaluable. He developed strong relationships in the industry through the Air Conditioning Contractors of America. ACCA provided a space in which business owners could gather in a non-competitive environment and discuss their marketing plans, financials, challenges, and victories.

“We were all on the same page,” Roger says of the experience. “We interviewed [a business owner] for half the day and we discussed what his issues were, the things he needed help with, the things we saw that were holding him back. And then we sat him down and went one by one [giving feedback].”

A key element of Roger’s career has been learning what he can do to be a better leader. From hiring a consultant to joining the ACCA, he was constantly looking for ways in which he could improve himself and his business.

Part of Roger’s approach to leadership was holding himself accountable for everything that happened in his company. “I used to tell people, it’s not the [employee’s] fault that a mistake is made. It’s our fault that he made that mistake. It’s our fault he was allowed to make that mistake. Either he didn’t have the training he needed, or he was rushed and for some reason felt he didn’t have time to do it correctly. The problem almost always goes back to management,” he says.

This approach not only allowed Roger to connect more strongly with his employees through empathizing with them but helps him to see the bigger picture behind mundane problems. When a mistake happens, rather than blame an individual employee, he can correct the systems that allowed the mistake to be made.

“If a guy is doing poor work and you’re allowing that to happen, then it’s your problem, and if it’s your problem and you’re not doing your job in managing him, then it’s my problem. The problem comes back to my desk, and I took it on the shoulders every time,” Roger says.

“It takes a lot of work, more than a lot of people understand. A lot of people think, ‘I just want to be my own boss.’ Well, you can be a boss, and you can run your business any way you want, but in order to grow, to have people to refer you to their friends and neighbors, it’s a lot of hard work.”

Eventually, that work began to take a toll. Roger had built a small scrappy business into a large, organized, and streamlined operation. “I didn’t want to do it any longer because it was just too much. I think I was good at it, but it took a lot out of me,” he says. Ever the planner, in 2012, Roger began developing a five-year plan for transitioning the company to new ownership.

In 2018, Roger was connected with Gregory Kovksy and IBA through the same company, Business Development Resources, that had helped him acquire the business 12 years earlier. “Greg is just a super nice guy. When I came to him and told him what I wanted to do, I actually had tears in my eyes because it was such a big step for me. He listened and he shook my hand and said, ‘I can tell that you’ve been thinking about this for a long time, and I can tell that you’re ready.’ He just made me feel comfortable,” Roger says of that powerful moment.

For business owners looking for a broker, Roger recommends selecting someone they are on the same page with and who makes them feel at ease. “If the guy makes you comfortable with his method of going to market with the business, and if he agrees on the valuation, that’s all you can ask for,” Roger says.

Since retiring, Roger has spent his time remodeling his home in Eastern Washington and traveling. In March and April of this year, Roger and his wife traveled over 8,000 miles across the Southern United States, and in August they went to Paris. His favorite city he has traveled to is Prague.

For Roger, the American Dream is knowing that all his long hours and hard work have amounted to something meaningful. “It can be brutal,” he says. “I spent a lot of weekends sitting in my office figuring stuff out.” Despite the obstacles, Roger Thompson built an incredibly successful business that he, along with his customers and employees, could be proud of.


Nesha Ruther

Nesha Ruther is a writer and editor from Takoma Park, Maryland. She received her BA in English Creative Writing from the University of Wisconsin Madison, where she received a full tuition scholarship through the First Wave program based on academic and creative merits. She was a 2016 Young Arts winner in spoken word, a 2016 winner of the DC Commission of the Arts Larry Neal Writing Award, a 2017 winner of the Mochila Review Writing Award, which was judged by Nikki Giovanni, a 2020 winner of the University of Wisconsin’s Eudora Welty Fiction Thesis Award, and a 2022 Tin House Winter Workshop Participant. She has been commissioned to write and perform for the National Education Association, and has had work published in NarrativeNortheast, Angles Literary Magazine, Beltway Quarterly and more. She currently lives in Cincinnati Ohio and is the Lead Manuscript Developer at Holon Publishing and Collective Press.