T&O Tackles Atlanta's Busy Refrigeration Market

Aug. 1, 2011
For this edition of RST Contractor Insights, Contracting spoke with Steve Tibbetts, President, T&O Refrigeration, Fayetteville, GA.

T&O Refrigeration was built on a solid educational foundation, quality service, and a little bit of luck. And the persistence of founder Steve Tibbetts has helped a bit, too. T&O Refrigeration is one of the largest independently owned refrigeration contracting companies in the Southeast. Tibbetts, 55, has more than 35 years of commercial refrigeration experience.The firm is based in Fayetteville, GA, a suburb of Atlanta. A second location was established in Nashville, TN, in 2002.

T&O's commercial refrigeration service/installation customers include Publix, Kroger, SuperValu, Save-A-Lot, The Fresh Market, Costco, and Food Lion. The company holds licensing that qualifies it to serve customers across Georgia, Tennessee, Alabama, and South Carolina. Steve Tibbetts founded T&O Refrigeration in 1987. He started his refrigeration career in the late 1970s. He worked at his uncle’s ice-making plant by day, and attended RSES night school. Once licensed, he obtained a job with the in-house service department of Kroger’s Atlanta division. Towards the end of his 10 years with Kroger, Kroger’s management thought he was the ideal choice to orchestrate the start of an in-house construction department. After successfully managing this department, he decided it was time to go out on his own.

Once he was on his own, Tibbetts was selected as the refrigeration contractor for some Kroger installation projects, which helped jump-start the new venture, and propelled the company through an unexpected economic slowdown in the latter part of the 80s.

Learning the Business
Business continued to lag through 1991, but Tibbetts committed much of his time to business education.

"That slow time gave me time to figure out how to run a business, instead of just handling the technical part of it," he recalls. "I attended every seminar that came to town. Then, I attended a seminar by Frank Blau (who introduced flat rate pricing into the service trades, and founded plumbing’s first contractor alliance.) Frank taught me everything I know about the numbers, overhead, and job costing. The most important thing he taught me was how to price for profitability."

Armed with an improved understanding of the realities of running the business, Tibbetts was prepared when more work came along, as the Publix store chain expanded from Florida into Georgia and other southern states in the early 1990’s. T&O installed the refrigeration systems for Publix’ second Atlanta store, and have done about 100 installations since then. From the installation department evolved T&O's service department and today, T&O Refrigeration services about 175 supermarkets in multiple states.

"I believed that, if we could install and service refrigeration systems correctly, and put quality above everything else, we’d be successful," he explains, "and, it's worked. I've probably turned down more work in the last 25 years than we've taken on. We take on only what we can handle, and we do it right. But the main reason for our success is our people. We have a great group of men and women that work extremely hard every day to keep our customers satisfied."

Experienced in Secondary Systems
T&O has installed secondary glycol systems in approximately 20 supermarkets. "We did the first secondary system for low temp and medium temp in the Southeast about 10 years ago. It's still running, but it has a lot of challenges because its very complicated. Its hard to find technicians with the skills to service these types of systems, especially in outlying areas."

T&O teams have also installed a variety of rack and single system refrigeration units, but Tibbetts is most impressed by the size and economy of distributed systems. His favorites include those made by Hill PHOENIX, Kysor/Warren, and Hussmann.

"If I were building a store for myself, I'd use distributed systems —on the roof, or inside, near the systems they feed. You save refrigerant with distributed systems, and the technology isn’t complicated," he says. "You have shorter runs, and it's easier to find leaks. Refrigerant loss is our biggest expense, and EPA compliance is a goal, along with energy savings."

T&O employs 60 people. Twenty-six service technicians and five construction crews operate out of 41 trucks. And, they're loyal: 12 have been with the company for more than 10 years. Ten employees have been with T&O for more than 15 years, and two are in their third decade on the T&O team.

New Technicians Learn from the Veterans
Tibbetts' training method is to take a technician with trade school experience and groom them in the field the T&O way. He hires new technicians directly out of trade schools, as helpers or maintenance apprentices, or as apprentices in the construction division. Each apprentice is teamed up with two technicians as they begin a steady progression up the ladder.

"Being that we have stores under contract, we do a lot of system cleaning and maintenance," Tibbetts says. "There's a good amount of self-contained equipment in our stores, and once we feel comfortable with an apprentice, we'll dispatch him on calls for that self-contained equipment. If the technicians he's working with feel he's ready, then we'll give him a territory, which includes about eight stores.

"We give a service apprentice one year to prove himself," Tibbetts explains. "Our experienced technicians and managers evaluate their progress. If we don't feel someone is making progress, we'll move on to another. Our liability is so great, if we make a mistake on a rack system, we're liable for product loss. Our guys must be capable of fixing it. If they're not, it shows up pretty quickly," Tibbetts says.

He believes T&O's competitive advantage is found in its level of service and installation quality, and the empathy it has for customer concerns. "We offer a level of trust, and a partnership with our customers. We build relationships, and it seems to work. I tell all of my vendors the same thing: I’m not going to change suppliers for a 2% price difference, but if it's 5 or 6%, I might. I feel our customers will do the same. If our prices are a little bit higher, we'll get the work. If we're a lot higher, we won't. I also think they like having access to me, as the owner. They can call and 'beat me up' a bit if they have to. With 60 employees, we're going to make some mistakes. But when we make one, we admit it, take care of it, move on from there, and try not to make the same mistake twice."

T&O has enjoyed a sales increase every year, except two years ago, when sales were flat. Sales increased by 10% in 2010, and the same increase is expected for 2011, with 2011 sales estimated at $12 million, despite having added just one new customer this year. That's what comes from a good reputation.

"We don’t have any salespeople," Tibbetts says matter-of-factly. "Most of our new customers come through referrals. Today, there are supermarkets on every corner, and they’ve got to keep things looking good, clean, and fresh. We have more business now than we’ve ever had and I believe this is because we show up every day and do what we say we’re going to do."

About the Author

Terry McIver | Content Director - CB

A career publishing professional, Terence 'Terry' McIver has served three diverse industry publications in varying degrees of responsibility since 1987, and worked in marketing communications for a major U.S. corporation.He joined the staff of Contracting Business magazine in April 2005.

As director of content for Contracting Business, he produces daily content and feature articles for CB's 38,000 print subscribers and many more Internet visitors. He has written hundreds, if not two or three, pieces of news, features and contractor profile articles for CB's audience of quality HVACR contractors. He can also be found covering HVACR industry events or visiting with manufacturers and contractors. He also has significant experience in trade show planning.