Glass Inc. - Reflections 1999-2019

The East Mississippi Business Development Committee Smith had been appointed to the executive committee of the East Mississippi Business Development Committee. E.M. “Hoot” Gipson was chairman of the board. Other members of the committee in- cluded Tommy Du- laney, Manny Mitchell, and Jimmy Alexander. The EMBDC was the chief agency for economic develop- ment in Meridian and Lauderdale County. The group worked to strengthen the busi- ness base of the re- gion, retain jobs, and create a talented workforce. Now, one of the executive board members was unemployed. “I went straight to see Hoot.” After Smith explained that he’d been fired, he assumed Gipson and the others members might not want someone on the execu- tive committee who didn’t have a job. “Awww,” Gipson said, “that’ll work itself out.” Then Gipson rubbed his chin. “You got plenty of time on your hands. Now, you can help me.” Gipson immediately assigned economic devel- opment tasks to Smith. “He kept me busy working, got me out of feeling sorry for myself,” Smith said. “I was working with other entrepreneurs and business owners. I heard their stories. They sort of mentored me.” During the course of the development work, several people suggested that Smith start his own company. “You’re good at what you do,” Gipson said. “Start your own company. Start small, if you have to.” “I have a noncompete agreement,” Smith told Gipson. “Don’t worry about that,” Gipson said. “Take a little time off; get a business plan together; get some financing. It will all work out in the end.” Then Gipson added, “The community will sup- port you. You’re the one out in public; you’re the one serving on boards; you’re the one involved in the community.” “But the noncompete—” Gipson interrupted. “When he fired you, that non-compete went out the window. Yeah, he’s going to sue you, and you’re going to sue him right back for the money you’re owed. That’s how it will get worked out.” A Plan, a Banker, a Building, and a Logo Smith took time to develop a detailed business plan, including plans for the cash-flow-heavy business. With over 20 years in the glass business, Smith understood the nature of subcontracting. “Subcontractors work for a general contractor from the first of the month to about the 25th,” Smith explained, “then we turn in our pay requests. We front the costs for labor and overhead for that period, and by the time the 25th of the following month comes around, sometimes we still aren’t paid.” The turnaround on payment ranges from 30-75 days. “In addi- tion,” Smith said, “10% retainage is typically held from the check until the job is complete. So, in order to handle a job, financially, you’ve got to leave a lot of money in the company — and pay yourself last.” About the time Smith was starting his new venture, Community Bank opened its doors in Meridian. Community Bank had locations in Forest, Jackson, and Hattiesburg, and they were expanding into Meridian. Chuck Nicholson had been hired to oversee the expansion. One of Nicholson’s first official business tasks was to visit Smith. “We’ve been friends for a long time,” Nicholson said. “We’re opening a Community Bank here, and I want to be your banker. You’re starting a new business, and you’re going to need some money,” he told Smith. “And I want to help you.” “Well, I’m about to buy some computers,” Smith said, “if you want to finance those.” “How much do you need?” Nicholson asked. “I need $2,500.” “I’ll have you a check this afternoon,” Nicholson told him. Then Nicholson asked about the big picture. “How are you going to operate, Robert?” “Well,” Smith thought, “Once we start work on larger jobs, I’m going to need a line of credit.” Smith outlined the cash-flow challenges a subcontractor faces. He told Nicholson that, al- though he didn’t need the money immediately, as the company grew, the cash-flow demands would grow as well. “How much do you think you’ll need?” Nicholson asked. “To start,” Smith said, “I’m probably going to need about a quarter of a million dollars.” • • • Fate handed Smith another opportunity in mid-1999. A&B Electric, a staple of the Meridian business community, had just completed a new building for its headquarters. “The ‘A’ in A&B was Jimmy Alexander; the ‘B’ was Henry Burns.” Alexander was the electrician; Burns was the money man. And Smith was friends with Henry Burns’s son David. Smith paid his friend a visit. Smith asked David Burns what plans they had for the old A&B Electric Building. Smith thought the building might be a good lo- cation for his new business. The building had offices in the front, warehouse space in the back, and a fenced-in yard behind the struc- ture. Burns told Smith he wasn’t aware of any plans for the empty building. “Do you think your father would rent it to me?” Smith asked. “He might,” Burns said, “for the right person.” “What do you think he’d charge?” “Probably $400 per month.” “That sounds perfect,” Smith said. “But,” said Burns, “you’ve got to make Daddy happy. It’s his building.” Smith made an appointment with the elder Burns. The two were acquainted through David, of course, and Smith had been to dinner at the Burns home on several ocassions. But Smith was also aware of Henry Burns’s business acumen. Burns had been successful in the oil business, in the convenience store business, as operator of a chain of hotels, and in A&B Electric. The entrepreneural Burns listened to Smith’s plans for his new company. Then he added, “David said I needed to come in here and make you happy. He said you’d probably want somewhere around $400 per month for rent.” “Well, Robert,” Burns said, “I wouldn’t lease it to just anybody. Since I know you, and you’re just getting started, I want to try to help.” Then Burns rubbed his chin and smiled, “But if you’re going to make me happy, I’m going to have to get $500 a month.” “That’s a deal,” Smith said. The two men laughed. Then, they shook hands to seal the agreement. Chuck Nicholson E.M. “Hoot” Gipson, Chairman of EMBDC Henry Burns 20 21