Dauphin: Industry trends sway results
Some of the largest private companies in Dauphin County are experiencing many of the same issues as their smaller competitors.
Staffing in a tight labor market is chief among them, though larger firms generally have an advantage: New recruits may see more opportunities to advance in a bigger company.
For Swatara Township-based Traffic Control Services LLC, which does business as Flagger Force, the workforce typically grows more during the warmer construction months. Flagger Force supplies road crews to support projects for a variety of companies, including utility companies working on gas and water pipelines or construction crews overseeing road and bridge repairs.
The biggest thing that stood out about 2016 to co-founder Mike Doner, the company’s executive vice president and COO, was the Verizon strike, which saw about 40,000 workers walk off the job for the better part of two months.
Verizon is one of the company’s biggest clients, so the spring strike cost the Dauphin County company significant revenue.
However, Flagger Force still posted 14 percent growth and revenue of $68.3 million last year.
Doner credits growth in other markets, including work for other energy companies, for offsetting the temporary Verizon loss.
“We were able to take those resources and allocate to other companies who were continuing to grow,” he said.
Flagger Force is now up to more than 1,600 employees in the Mid-Atlantic and could be pushing 1,900 by the fall, Doner said. The company has been adding offices in new areas, including Virginia and western Pennsylvania.
Doner expects steady revenue growth over the next few years, likely 15 to 20 percent per year, based on nationwide demand for infrastructure work, which is prevalent along major highways.
Replacing aging gas and water pipelines also is a high priority.
Perennial listmaker Sutiff Auto Group, based in Harrisburg, saw its revenue dip slightly in 2016, finishing at about $127 million.
President Jonathan Casey said service, parts and used car sales continue to drive revenue for the company.
Last year, Sutliff saw more customers buying SUVs and trucks, a trend driven primarily by lower fuel prices and driver preference. Casey said the company continues to see that trend in 2017, especially in the certified pre-owned segment.
Top private companies in Dauphin County
Ranked by total revenue
- D&H Distributing Co. Inc.
- Quandel Enterprises Inc.
- Schaedler Yesco Distribution Inc.
- Sutliff Auto Group
- Stephenson Equipment Inc.
- H.B. McClure Co.
- Traffic Control Services LLC DBA Flagger Force
- Edwin L. Heim Co.
- Phillips Office Products Inc. DBA Phillips Office Solutions
- NRA Group LLC
That said, he also expects long-range electric vehicles, such as the Chevrolet Bolt, will become a more frequent sight on midstate roadways in the next decade. Low maintenance costs and fewer parts make these vehicles more attractive to buyers today.
Sutliff also has a Volkswagen dealership, which Casey said is on the upswing again after the manufacturer went through an emissions scandal related to performance of its diesel engines.
“Often times it takes a big failure to change such a large company like Volkswagen for the better,” he said.
VW is currently expanding its lineup in the SUV and electric-car segments.
With dealer consolidation occurring in the industry, Casey said Sutliff is proud to be one of the few dealer groups left in the Harrisburg area that is also based in the midstate.
Swatara Township-based Herbert Rowland & Grubic Inc., or HRG, consistently ranks near No. 100 on the Top 100 list.
The civil engineering firm posted a modest 5 percent revenue gain with nearly $28 million in sales last year.
Regional vice president Andrew Kenworthy credits a portfolio balanced between public-sector clients and private-sector development work as the biggest reason for the company’s continued growth.
“It’s a nice balance that helps take out the highs and lows,” he said.
HRG has experienced more demand from local governments in recent years, especially on infrastructure projects, though there is a growing push by the private sector to run more public systems tied to water and wastewater. Warehouse growth also continues to be a strong market for the firm.
The company is looking to expand its government work across the commonwealth. It’s about 18 months into the opening of a Shippensburg office.
HRG has seven offices and is up to about 300 employees. The labor market conditions have forced the firm to look at “developing the farm league” more, Kenworthy said. The company has seen growth in internships and is trying to hire more college graduates that it can train.