For decades, Leedo Mfg. in East Bernard, Texas, was known primarily for manufacturing cabinets for multi-family homes. And while the multi-family industry still provides a significant amount of the company's income, more recently it has branched out or increased business in some related areas: new single-family homes, high-rise buildings, condominiums and military bases.

Clearly diversification has paid off. Between 2005 and 2006 Leedo logged a 14 percent increase in revenues. And according to owner Victor Samuels, there are big plans on the horizon.

Adding business

Capturing some new business in the single-family market was not a quick process, according to Samuels. "We started slowly. We spent a year selling to three builders in south Texas to develop our capabilities of anticipating what our customer wants. We want our work to be somewhere between right and perfect the first time," Samuels says, adding, "Now we're out pitching that we can do this; so that's a new source of income for us."

High-rise buildings have always been in Leedo's portfolio, but Samuels says that of late it has been called upon to do even more high-rise work, which has also added to the company's revenue stream."We've also moved up in quality of cabinets and number of high-end units that we sell to multi-family builders," Samuels says. "However these are different because they're going to sell the units at the conclusion of the construction process to condo converters."

Work for the military

Leedo has done work for the military for years; however, most recently it has become the top supplier of cabinetry to military project builders. Samuels explains that a number of military bases are either refurbishing or remodeling housing units and military bases that were built in the 1940s. As a result, work for the military has become a larger piece of Leedo's income.

Military business is a large volume business, according to Samuels. Job contracts may last anywhere from 18 months to five years, and he likens it to an apartment project. "It just goes for a lot longer time," he says.

Samuels himself was given the regional Ernst & Young Entrepreneur of the Year 2007 award. He recently learned that he has been nominated to be the national winner, an award previously given to such well-known entrepreneurs such as Michael Dell of Dell Computers.

Outsourcing

Leedo does some outsourcing, but only in the area of countertops. "We don't lay up our countertops; we buy our countertops, although we cut them," he says. Leedo also outsources marble, though that is brought in pre-cut according to architectural specifications.

However, Samuels notes that Leedo is doing much less outsourcing in other areas. "We used to buy a lot of (wood) board that was printed or had some sort of a foil on it. We do a lot of that ourselves now." Nonetheless, he notes that there is an eye on potential overseas importing. "We've been to China six or seven times in the last four months," Samuels says. "We are contemplating doing some sourcing in China."

Looking ahead, Leedo is considering some efficiency initiatives within its plant, as well as working out some different approaches to the installation of its product. "The part of the process that we as manufacturers control is what goes on in our own facility," Samuels says. "And I include getting it to the customer, which means how you pack it and ship it. However, installing it means that every time you get a job in a new place you start from scratch. You get a different superintendent who has different expectations than somebody else or his predecessor did. Sometimes we have different installers; now we have field supervisors who go to every job. That's the hard part. What we control at our facility and getting it to the customer, we're darn good at. The part that is difficult to control is installation."

A different company

"We think the outlook for us is terrific," Samuels says. "In the last 18 months we have hired a group of senior managers who are great thinkers, and we believe we are going to continue growing. We have a very large growth goal."

"We think that these people whom we've hired are going to lead us to be a new company, a different company. I think that's probably our biggest and best thing that we've done in the past 12 months."

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