Being Agile, Staying True

Ragan Grading & Septic adapts to the economy and keeps going strong by changing its business mix and sticking to core principles
Being Agile, Staying True
The Ragan team includes, from left, Ismar Lopez, Steve Holloway, Ken Ragan, Logan Ragan and Monty Sims.

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Done right the first time: For Ken Ragan, that’s his motto and the heart of his business. He believes his integrity keeps him ahead in the onsite industry, and he doesn’t understand how anyone could stay in business without it.

“Think about the quality of the job you’re doing, and do it right,” he says. “I see people cutting their prices to bring in business. If you’re going to cut quality too, then it isn’t worth it. We haven’t raised any prices, and we have stayed about middle of the road. We don’t cut corners. We do it right, and if you do it right the first time, there’s no need to go back.”

In business for 26 years, Ragan Grading & Septic Tanks, LaGrange, Ga., handles anything related to septic systems and does land clearing and excavating for new homes. “I’ve been doing septic tanks the longest,” Ragan says. “We do all kinds of jobs, from new systems to repair to cleaning, and I have a portable restroom rental business, too.” He specializes in conventional systems because of the regulatory requirements in Georgia and because those systems work well in the red clays of the state.

Before the recession, the business was about evenly split between excavation and septic systems. Since the housing bubble burst, septic system repair and pumping have made up about 75 percent of the work. “I do get about six or seven new installation jobs a year, but new systems usually go along with new construction, and there isn’t much of that happening,” Ragan says.

“I used to keep eight employees in overtime work every week. Then, all of a sudden, there wasn’t enough work to keep them part time. Most of them left to find other work. But I had a few stick with me.”

Ragan now has three employees: Steve Holloway, Monty Sims and Ismar Lopez. “These guys have been with me for almost eight years,” he says. His son Logan Ragan also helps after school and during the summer.

 

Building solid relationships

In the current economic climate, it’s hard to retain employees. So when Ragan finds people he wants to stay on the job, he looks for ways to keep them coming to work. “I pay as well or better than anyone else around here,” he says. But he believes it’s the way he treats his employees that makes the real difference: “We feel like family here. My employees have been with me through a lot, and I’ve been with them through a lot, too.”

He has tried to give his employees as many work hours per week as possible, while still being able to pay his own bills. “Even in the worst of it, I try to keep the guys in at least 30 hours a week,” he says.

Finding work for them also opens up possibilities in his other businesses. “If I don’t have anything for them to do in the septic business, I have some rental properties where they can do maintenance work for me,” Ragan says. They also do brush hog work – clearing fields around a local pond and other land-clearing jobs when they come up.

He pays for continuing education opportunities for them so they can keep up their state requirements in septic systems and erosion control. Besides the on-the-job benefits, Ragan allows his employees to use his excavation equipment for projects they do on their own property. “I think they’ve all taken advantage of that,” he says.

Keeping his employees happy frees him to worry about other things, like keeping the health department satisfied.

 

Working with regulators

In Georgia, county health departments are the first stop for anyone who wants a new system or a repair. “The health department dictates how the systems go in, how big the drainfield will be, and pretty much everything,” Ragan says.

Few alternative systems are installed in Georgia. Typically, the health department recommends conventional systems, and Ragan is comfortable with them. He has little concern about the health department’s involvement in the decision-making.

“I think it’s good that the health department tells the customer what kind of system they can put in – so if it doesn’t work, it’s the health department who has to figure out why,” he jokes. “But in reality, I do like that they make the site evaluation, and they know whether the site can handle a septic system.

“Sometimes, they tell the customer they have to hire a soil scientist to figure out if the soil will handle a septic system. That’s a $200 fee. But if it’s what you have to do, you do it.” Usually, soil tests don’t come with any surprises. “Most everything around here is red clay,” he says. “We have some rocky places, but not many at all.”

 

Thriving repairs

With few new installations on the horizon, beefing up the pumping and repair side of his business was Ragan’s means to survival – and it has brought in a lot of work. While that work is profitable, his heart sinks when in the course of doing it he finds problems that could have been avoided.

“A lot starts from when I go to clean a tank that’s having problems,” he says. “That’s where you can see ponding around the tank or in the drainfield. Sometimes the problem doesn’t stand out and you have to dig up the tank. That’s where I find problems caused by poorly installed systems. People try to cut corners, and you can’t do that.

“About one month or so ago, I cleaned a tank that was backing up. When I looked into the tank, I noticed it was full of water. When we dug it up, we found that the water wasn’t getting into the drainfield because the person who installed the system didn’t put a coupling on the pipe where it goes into the chamber system.

“The pipe just went all the way down into the dirt. The water had no way of getting out of the tank other than what little could drain through the soil. The pipe was pretty well clogged, too. I don’t know if these guys don’t know any better. Sometimes I think it is just negligence.”

Problems also happen from lack of maintenance. Too often, Ragan says, people don’t have their systems pumped on a regular schedule, and most don’t know that they should have done any kind of maintenance on the system at all.

“People don’t think about it,” he says. “They will say, ‘I’ve had my tank for 25 years and never had it cleaned.’ Fortunately, most of the newer tanks have a filter that gets stopped up before the rest of the system goes bad.

“But when we do find a system that’s in serious need of repair, we just explain to the homeowner what it will take to fix it. They have to contact the health department first, if they want to go that route – you can’t make them fix it.”

 

Keeping a flourishing business

To provide high-quality service, having the right equipment is important. When the construction market was at its peak, many people were willing to take out loans and buy on credit. Ragan bought some new equipment, including two Hyundai excavators. His fleet also includes:

Two Cat rubber-tired backhoes

Two Cat dozers

Four Cat front-end loader track loaders

One Cat skid-steer

Two tagalong trailers

Three dump trucks

A vacuum truck on a Ford F-650 chassis

A Ford F-350 pickup truck

With business prospering, Ragan figured he could pay off the new excavators within a few years, and he looked forward to operating them without the downtime common to older machines. When the recession hit, he was stunned, but not broken.

“We learned to cut back and that’s about all you can do,” he says. “I’m a good budgeter of money. I can get by with the bare necessities.

“I’ve always heard that you should keep enough money back for about six months’ worth of bills. I think I had enough for three years. You have to stay prepared for anything in business. When you see those big checks coming in, don’t get excited and run out and spend all of it in one shot. Save for the days when there’s no work.”

Besides keeping a rainy-day account, Ragan looks for the best prices on pipe, rock, sand, and whatever he needs. That takes some comparison-shopping, but it’s worth the effort. He has also found other ways to save money, like doing most of the office work himself and keeping utility bills under control.

He keeps a close eye on his credit, too. Despite the lack of excavating work, he still has a monthly bill for the equipment he bought, so he refinanced it at a lower interest rate to keep the payments affordable. “That has helped a lot,” he says.

He also does some advertising, although he doesn’t rely on it. “I advertise in the Yellow Pages, and I recently took out some ads on the paper placemats in local restaurants – table toppers,” he says. “That’s the first time I tried that. Otherwise, our business is word of mouth. We get a lot of business because of our reputation and the fact that I’ve lived here all my life.”

Fortunately, things have eased a little this year. “Construction still hasn’t picked up much, but it’s been better this year,” Ragan says. “I had a lot of business last spring. I think people used their tax refunds to get work done that they had been putting off. We were putting in about 55 hours a week.”

 

Getting into the business

Even though things have been tough over the past few years, Ragan hasn’t allowed it to dampen his spirit. He still loves his business. He recalls that when he got into this business, he did it because he didn’t want to go to college. “It was supposed to be just a summer job, but I decided I liked working outside,” he says. “I didn’t want to be cooped up inside some office.”

That was 31 years ago. He’s still glad he made the decision to stay on at a summer job: “I guess you could say that after I bought my first bulldozer, I never looked back.”



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