From surviving to thriving

May 1st, 2015 / By: / Business, Feature, Management, Perspective

Dan Hooks propels his organization to new heights by maximizing regional opportunities and building a management team.

“Surviving the latest recession taught us several lessons about the financial health of our company and what we needed to change in order to go from surviving to thriving,” says Dan Hooks, CEO of Party Reflections Inc., Charlotte, N.C. “After taking a 20 percent revenue hit, we formulated a strategy in the middle of 2009 that would continue the growth we had started in earnest in 2008.”

Hooks’ father had launched the party rental store in 1958, a business that rented primarily tables and chairs, and where Dan Hooks worked summers and weekends as a teenager. As soon as he graduated from college in 1989, Hooks came on full time. He took over as president in the early ’90s and has continued to expand the business in terms of offerings and size. (The company had 25 employees in 1989 and now has more than 200, as well as three locations from which it provides a full range of tent and event needs for its clients.)

Photography by Betsey Hansen
Photography by Betsy Hansen

Playing offense
The growth strategy Hooks and his management team began discussing in ’08 consisted of expanding the business into Raleigh or Greensboro, N.C., or Charleston, S.C., by working a two-to-three year plan. But the plan got fast-tracked when the economic downturn began to affect the company’s revenue. “When the recession hit us in ’09—a year later than it hit a lot of people—we had a ton of equipment sitting around here; we had employees that wanted to work; and we had trucks,” Hooks says. “So instead of playing defense we decided to play offense.”

Dan is a respected member of the tent and event industry. His integrity, commitment to excellence and drive to grow his business inspire others in the industry. ~Sigrid Tornquist

Hooks decided to acquire a small event rental company that was going out of business in Burlington, N.C. He moved the newly purchased equipment to Raleigh, added some equipment of his own and opened Party Reflections’ second store. Opening the new site ahead of the original plan created some challenges. “We wanted to have a manager here at our Charlotte site for a while before moving him to Raleigh, so he would be familiar with our company culture and business philosophies before moving up there,” Hooks says. “We didn’t have time for that, so for a while we had a general manager up there but made the majority of decisions from here. As time progressed the site became more autonomous.”

Understanding the differences in the local market was also a challenge. Despite the proximity to Charlotte, Raleigh had different pricing standards, and not knowing the customer base was problematic. Hooks was able to hire some seasoned employees who had worked for another tent and event rental company in the area. “Hiring people with local industry knowledge helped us grow considerably,” he says. “As for the pricing issues, we built trust and trained the market to help clients understand why we needed to charge more than the area was used to. We know that we can only provide the best possible equipment and service if we make the profit necessary to maintain that equipment and pay for the services provided.”

0515_Dan_Hooks2
Photography by Betsy Hansen

A matter of opportunity
The company’s second acquisition in Columbia, S.C., was finalized in December 2013 and was the result of opportunity more than it was necessity. The company had grown to a point where the former owner would have needed to make a huge reinvestment in management and equipment to accommodate the growth, so he chose to sell rather than make those investments. “This was more of a takeover of a business that was in a market leading position, and it came with challenges that were considerably different than the first acquisition we did,” Hooks says. “While the first was more about the market, this was more about internal culture—trying to get everybody realigned to a common goal.”

Hooks and his team reorganized the management structure from a hub-and-spoke model to cross-functional management teams. “Growth affects every department and can hurt the way it functions if it’s not managed properly,” Hooks says. “One person can’t handle all the touch points as a company grows,
so you have to appoint leaders in the various departments.”

Bridging the gap
The company’s latest merger happened in September 2014 and was motivated by the desire to stabilize cash flow and employee workloads throughout the year, and the desire to add an experienced industry veteran, Christian Eastman, to the leadership and ownership team of Party Reflections. The rental business is somewhat seasonal and lags from January to March. Hooks purchased Displays Unlimited, a convention services company that experiences its busiest season during those months, to fill that gap. “Although this company is fabric-related (pipe and drape), it’s almost a completely different market,” Hooks says. “But what we had in common was the need for temporary staff and extra trucks during the busiest months. Now employees can work between the two companies, eliminating the need for temporary employees at either. The same goes for trucks. This merger really helps bridge the gap in the slow rental season.”

Photography by Betsy Hansen
Photography by Betsy Hansen

Outside advice
Hooks looks for opportunities for growth outside the rental industry, gaining support from a business advisory group he belongs to. He meets once a month with business owners from non-competing industries that assist one another with common business issues. “From advice given to me by this group, we hired a CFO to better control our finances and give us the information we needed to succeed following the last recession,” Hooks says.

He also seeks advice from within the industry, meeting twice a year to discuss best practices and compare financials with an industry-related group of non-competing rental owners. “These groups have largely impacted our business over the years because we have been willing to admit that we make better decisions when we seek more information about a subject from outside of our walls as well as within them,” Hooks says.

“While I do not share the philosophy that consolidation can be tackled on a national scale, I firmly believe that a regional company can surely operate in several neighboring cities provided there is an opportunity to share resources. We have taken advantage of a few opportunities that have allowed us to build a regional presence, and our strategy is to further develop this approach as other opportunities present themselves.”

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