• Contractingbusiness 2349 0112 Acquisition Mike Martin

    CONTRACTOR INSIGHTS: Acquisition a Leap Forward

    Jan. 1, 2012
    Carlson & Stewart Refrigeration has a busy new year ahead, as it capitalizes on its purchase of Central Minnesota Refrigeration.

    In the "smart moves" department, chalk up the recent acquisition of Central Minnesota Refrigeration (CMR), of Sauk Rapids, MN, by Carlson & Stewart Refrigeration (CSR), based in Marshall, MN, announced in December of 2011.

    The purchase gives CSR — a 73-year-old leader in industrial and commercial refrigeration —a jumping-off point, and easier outreach to refrigeration customers in a previously untapped, 100 square-mile region.

    CSR president, Mike Martin, knew of CMR's own solid reputation, as established by the late John Ballard, who passed away in June of 2011 after a long illness. There was never any need to question the quality of CMR’s expertise and leadership.

    "We're very alike in what we do. They have a good reputation, and their field technicians are very good. We've always had a good relationship. We're also dealers of some of the same refrigeration products. It was almost a hand in glove fit," Martin says. He credits the help of Gail Lancour, CMR office manager, who was instrumental in keeping CMR running during Mr. Ballard's illness, and who helped ensure a smooth transition of ownership.

    The integration of the two businesses includes capitalizing on the strength of Carlson & Stewart's system engineering and design leadership, and industry experience, to better meet the needs of clients operating in central Minnesota. Current and new customers in that region can now easily take advantage of Carlson & Stewart's industry best practices and leading edge, energy-efficient systems that can provide cost savings and positive return on investment in a short period of time.

    Martin knows how to take stock of a competitor. He started at Carlson & Stewart part-time in 1972, then became a full-time employee in 1975, after earning a degree in mechanical engineering technology from Southwest Minnesota State University. His field service experience is second-to-none, and includes project installation supervision for commercial and industrial refrigeration systems.

    Carlson & Stewart was founded in 1938 as Carlson Sales & Service, by Roy Carlson. In 1948, Bud Stewart joined his Uncle Roy in the business. It was incorporated in 1958.

    Today, Carlson & Stewart Refrigeration, Inc. is a Design/Build contractor specializing in commercial and industrial refrigeration systems. It provides system design, equipment sales, complete installation, and service for industrial and commercial customers in Minnesota, the Dakotas, Iowa, and Wisconsin. Carlson & Stewart has enjoyed double-digit growth through the last five years in its commercial and industrial segments. Its commercial/industrial project ratio usually tracks at 50-50. Commercial clients include Hy-Vee, Nash Finch, Super Valu, many independent grocery stores, and those in the Affiliated Foods store chain. At the top of its industrial client list is the frozen-food giant, Schwan Foods Co., and a major baking company, Baker Boy.

    CSR's Marshall, MN headquarters services customers within a 300-mile circle. Its Sioux Falls office manages accounts within a 90-mile radius. The Central Minnesota Refrigeration acquisition enables them to reach customers within a 100-mile radius of Sauk Rapids, MN, which is located in the center of the state. The CSR/CMR workforce now stands at 52 employees.

    Peer Group Support
    Martin took on the new venture as part of a grander vision for company expansion, one which has gained the support of his colleagues in a CEO peer group he recently joined, known as Vistage (vistage.com). The group meets monthly to share ideas related to their companies’ growth and development.

    "One of the topics we had discussed was, how a company can continue to grow and improve itself. One of the ways to do that is by establishing a branch office, or by acquiring a complementary company. I was challenged to get out of my comfort zone. Vistage has spurred me to do more with the company than I ever thought I would," Martin says. Among the business theories he’s latched onto is "traction" — which is an Entrepreneurial Operating System (EOS). The EOS identifies six key components to help a leader get everybody in the organization pulling in the same direction. Martin says the Vistage peer group has also helped him improve his own management style, which he doesn't mind saying used to involve a "seat of the pants," approach. "Since I began participating in the Vistage peer group, I'm working more on managing the business rather than letting it run me. I'm focusing more on our core philosophies, value for the customer, and taking care of our employees. Then, hopefully everything else will take care of itself," he says.

    CSR is yet another of those excellent private companies that does very little advertising, yet benefits from many positive, word-of-mouth referrals from satisfied customers.

    "We've provided customers with products and services they require, and they tell someone else," Martin says. "Or, someone at a facility moves on, and their new company has similar issues we've handled, and we get more calls into that new company. Our engineering, service, and design have helped us develop many happy customers.."”

    Quality is a "core value" at CSR. Emblazoned on the back of employee business cards is this message:

    The Quality Product
    The value of the systems and service we provide to our customers will exceed expectations.
    Our competition will admire our work

    To ensure employees carry out that mandate, Martin says they first have to "get the right people on the bus. We hire and evaluate employees based on the extent to which they live up to our four core values: safety first, a quality product, quality people, and ethical behavior. We follow up with customers to ensure they're satisfied with our work and are getting maximum value from our service."

    Looking forward, Martin says that growth is a top priority, as the refrigeration industry itself serves as a prime motivator. Change is coming from all directions, and CSR wants to be ready at every juncture.

    "The region is filled with good competitors. And, we're constantly competing against ourselves, to increase our value to our customers, to help them grow and prosper. What's more, the refrigeration industry is forcing us to grow and change with it," he adds.

    "We'’re finding ourselves getting more involved with microprocessors and electro-mechanical valves. We'’re trying to be more energy efficient, and provide systems that help customers save more money. We recently replaced a customer's refrigerated cases with new, high efficiency cases, LED lights, and ECM motors, and he's already seeing huge paybacks."


    Single Phase Motor Terminal ID
    Many air conditioning systems incoprate a hermetic (welded body) compressor as the standard. It’s extremely important for the HVAC technician to identify the correct electrical termials. If the electrical terminals aren’t wired correctly, severe compressor or system damage will result.

    A standard has been developed for single phase welded compressors. The standard terminal designation is read like a book, from left to right and from top to bottom. The order of these terminals is: Common (C) —Start (S)—Run (R).

    While protectors are very reliable, and do a good job of protecting a compressor motor against normal overload situations, they can’t protect motors against miswiring and defective external components. Miswiring a compressor can cause a motor to burn in as little as 25 seconds. Any motor miswired or used with defective components will ultimately fail.

    Be sure to check and replace any electrical components including but not limited to the contactor, run capacitor, relay, and start capacitor. Any of these components could also cause compressor failure.

    Copyright 2005 Emerson Climate Technologies, Inc.

    All rights reserved. Used by permission.