By Allison Gorman
TN Business Magazine
May 2007
An athletic facilities builder hits its stride
Competition Athletic Surfaces attracted national attention in 2005 for its role in changing the color scheme of the tennis courts at the U.S. Open from standard green to blue and green.
The alteration garnered critical acclaim not just for helping fans follow the on-court action but also for giving America’s top professional tennis event a signature new look. But Competition is about more than just U.S. Open acclaim.
Paving industry veterans Lee Murray, Steve Clift and Mike Gregory founded the company in 2000, resurfacing tracks and tennis courts and reaching $400,000 in first-year sales. Even then, they saw untapped potential in ground-up construction of outdoor athletic facilities, including peripheral structures like sidewalks, fencing and infield turf.
With the 2002 launch of Competition Athletic Construction, the men began securing contracts to build state-of-the-art facilities like those at Bayside Academy in Nashville and a unique rooftop walking track at Unum in downtown Chattanooga. Construction sales now are a step ahead of those from surfacing, and total annual revenues have leveled off at some $4 million.
That’s a comfortable pace, says Murray, who has watched other small businesses collapse sprinting toward the elusive finish line of sustained prosperity.
Murray’s new strategy is to grow his profit margins, which often fall victim to fluctuating materials prices (asphalt for track beds, steel for chain-link fencing, etc.). And with an established record, Competition can bid to better reflect the cost of handling long-distance jobs—a market he says the partners initially underestimated.
Throughout the Southeast, Competition has few rivals in its most lucrative niche, athletic facilities for middle and high schools. The company’s biggest hurdle may instead be the state line. Tennessee trails its neighbors in school spending, Clift says, and athletic amenities are often cut from construction budgets. Where Tennessee spends $16 to $23 million per school, he says, Georgia may spend up to $50 million—and the Atlanta metro area alone anticipates needing 80 new middle and high schools in the next 15 years. It’s not just Georgia, with its generous funding, that has outpaced Tennessee. Competition has traveled to the coasts of Alabama and North Carolina to secure handsomely funded state projects. The company’s biggest moneymaker, Clift says, has been a $600,000 project at a high school in the humblest of places: Louisa, Ky., a coal-mining town on the West Virginia border.
"We didn’t realize it, but these states work differently and fund differently," Murray says. "Five years from now, it may turn around and Tennessee may be spending. We don’t know, and we can’t control it."
Until then, Competition will go where there’s traction.
Link to this article: http://www.recmanagement.com/200305fe00.php