Nevadan at Work: Exec works to make sure locals don’t sweat staying cool

Very few, if any, of the 2 million people living in Las Vegas could bear one summer without air conditioning. That's what makes Ken Goodrich's business somewhat recession-proof.

Goodrich, a graduate of Clark High School and the University of Nevada, Las Vegas, founded Yes Air Conditioning and Plumbing, a company specializing in air conditioner repair and service.

When the weather heats up, so does his business.

"We generate most all of our profit from April 15 to September 15 and the whole goal is to hold on to it for the rest of the year," Goodrich said at his new 20,000-square-foot office and warehouse in the Buffalo-215 Business Park.

Goodrich has built a small empire in the heating, ventilation and air conditioning, or HVAC, industry in Las Vegas. He started Racee Air Conditioning in 1986, then purchased Lang Refrigeration and Economy Air Conditioning, turning the faltering businesses around and selling them for $3.5 million to competitor American Residential Services in 1997.

During a noncompete period with ARS, Goodrich developed several commercial projects in Las Vegas, and bought and restored more than 100 foreclosed homes.

He founded Yes Air Conditioning in 2000, acquired two other HVAC businesses in Las Vegas and Phoenix, and again sold them to ARS in 2008 for roughly $35 million. Goodrich was retained as Western zone president for ARS.

Even in the Great Recession, Goodrich has been able to increase his business; he reported a 30 percent jump in revenue for 2009. In June, he bought his headquarters building and an acre of land for parking and dispatch operations. The company has a fleet of more than 100 service vehicles.

The Las Vegas native also established the J. Duncan Goodrich Air Conditioning Technology Endowment at the College of Southern Nevada in memory of his father, who started the family-owned air conditioning repair business. To date, the endowment has provided more than $150,000 in scholarships and equipment to the college.

Question: How did you get interested in the HVAC business?

Answer: My father came here and worked at the Nevada Test Site as an engineer in 1957. When air conditioning came into vogue in the late 1950s and early '60s, not many people knew how to work on them. My dad would moonlight and I was the official flashlight holder at 10 years old and then my dad made a business out of it. He retired from the test site in 1977 and started Racee Industries. I learned the trade and got to where by the time I was 16, I'd go to high school and come home and run service calls.

Question: When you sold to ARS, did it want a noncompete clause? How long was it?

Answer: Yeah, I had a noncompete until June 2000. I started acquiring old air conditioning companies in Las Vegas and Phoenix like M&S, Pahor and DNH. I bought them all and put them together as Yes for the brand name. My niche was buying old established brands, so when guys went to retire or their kids wanted to sell, I was the guy who would go buy them.

Question: How much did you pay for them?

Answer: As low as $5,000 and up to $1 million. Generally, I'm buying the business phone, the customer database and the trade name. Most people wondered why I buy these things that are shutting down or at the end of their life. My philosophy is if the phone rings and somebody is requesting service, it's up to you to make it a good business.

Question: What's the hardest part of the HVAC business?

Answer: It's a highly technical business. You've got to understand this high-tech trade and then you couple that with people management. The seasonality of the business is hard to manage.

Question: What about the plumbing part of the business?

Answer: That takes some of the seasonality out of it, but we're predominantly air conditioning. The HVAC industry is predominantly led by technicians. They focus on the trade, rather than the customer. We set our mantra to be bigger, better, faster, smarter, legal, ethical and moral.

Question: How much was the purchase of the company's new building and land?

Answer: It's going to be a $2.5 million facility when we're finished with the parking lot.

Question: Previously, you were leasing your facility. Did you feel as if this was a good real estate investment in light of current property value in Las Vegas?

Answer: It's rent versus buying depending on what kind of discount we can buy at. We had offers on similar buildings in 2006 at $200 a square foot and we bought this for $74 a foot.

Question: How many employees do you have in Las Vegas now compared with past years?

Answer: We had about 80 employees in 2008 before the sale. Now we've got 116 at Yes and 80 at ARS. We've continued to grow during these challenging times.

Question: How have you been able to not only survive, but thrive during this recession?

Answer: A big portion is we stayed focused on our service and replacement business and did no new construction, so people who stayed in their homes or businesses need to repair (air conditioners). When I travel and people ask me what I do in Las Vegas, I say I'm in the best business you can be in in Las Vegas and they say, "Casinos?" No, air conditioning. People continue to repair them. We bought six failing competitors and their phone numbers in the last three years. It's a blessing because you see how many of my construction brethren are struggling.

Question: What do you see as your biggest challenge this year?

Answer: We've hit major market share. We're the market leaders now in Las Vegas. Where do you go from here? The growth rates we experienced in the past are probably not as realistic. Our challenge is going to be to grow as market leaders, so we offered a new service line, which is reinsulating and adding insulation to the attic and ventilation to increase energy efficiency.

Question: What's your plans going forward?

Answer: We're going to continue to do what we've always done, which is to provide exemplary service to our customers seven days a week, 24 hours a day at our call center and crews on call. We're in the service business and I believe (that) in these challenging times, the guy who gives the best service wins and that's how they grow.

Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.