A recession-inspired career change
Avia Collinder, Business Reporter
Kevin Richards is a name familiar in finance and investment circles, but he has chosen to leave the comfort of his desk as an employee, and the profession at which he has excelled, to launch his own business as home-improvement specialist.
The former investment manager with First Global Financial Services Limited, his last job, and previously, National Insurance Fund, among others, now spends his time transforming mildewed and rusty bathrooms into sparkling interiors that add value for property owners.
"I spent a number of years in finance and found out that most Jamaicans have their wealth in real estate,
"That said to me that real estate was the industry to be in."
So in May 2009, Richards, the sole shareholder of Gordon Capital Management Limited and Re-Bath Jamaica (RBJ), spent about $5 million acquiring the franchise to be the local agents for international bathroom fixer-upper, Re-Bath, and set up shop at Manning's Hill Road, St Andrew.
RBJ carries the Re-Bath range of bathtubs, liners and wall systems, as well as other bathroom amenities such as sinks, toilets, vanities, glass shower enclosures and faucets.
"I started to look at home improvement, which is a stepping stone to getting into development, which is where I am really headed," Richards told Sunday Business.
"It was not necessarily the greatest time, but the recession was also affecting the finance industry."
According to Richards, in 2009, he "just took the risk" , joining the ranks of entrepreneurs who, either by circumstance or choice, are putting their creativity to the test in order to triumph over the recession or leverage the economic opportunities that it creates.
"I just felt more comfortable moving into real estate."
For someone who previously worked in finance and investments, he had the head start of an ability to objectively and professionally assess the risks involved in the bold new move.
What was the experience of starting up during a recession like?
Richards admitted that it has been "really tough", not only from usual start-up teething pains, but also because he is operating in an environment where job security concerns have rendered consumers persons ultra cautious about spending money.
The certified bath installer has found, too, that the local market
"We are selling a new concept to Jamaica so we have to do more work than the others like explaining the importance of having a warranty on the products so there is recourse for if something goes bad," he pointed out.
"We also have to let customers know that spending on home improvement is an investment and is not frivolous spending. Your home is an appreciating asset and not a depreciating one like a car or items of clothing."
The new business currently employs three persons on a full-time basis and four on contract.
But business is growing steadily and Richards plans to add two more employees on contract over the next two months.
Re-Bath currently rents
"We don't expect to turn a profit until 2011, when, hopefully, we would have had more market penetration," the RBJ chief executive said.
Apart from the cost of goods, other main cost centres are salaries, transportation and office-related expenses, such as utilities.
Funding has been entirely from Richards' personal savings.
The bathroom company is active both in the residential and commercial markets. In the latter segment, business comes from hotels and residential developments. His business' ability to offer warranty on its products and services is proving a distinct advantage.
Re-Bath's products are said to be an improvement on fibre glass and enamel tubs, which Richards identifies as being prone to cracks, leaks, discolouration, rusting, chipping and peeling.
Re-Bath makes liners that fit existing tubs and are mar-keted as being resistant to cracks, chips, scratches and dents.
The products are being promoted over spraying, which has been knocked as a temporary fix that comes with health concern from chemicals in spray.
"Our products have been found to have the highest resistance to mould and mildew compared to regular tile walls and bathtubs and shower bases," Richards has claimed.
The company offers lifetime warranty on its products and workmanship.
"Installations are completed quickly, effectively, leaving rooms available for occupancy with zero downtime. Our wall surrounds cut bathroom-cleaning time dramatically and reduces the need to purchase expensive cleaning solutions," said the RBJ salesman.
The US-based Re-Bath LLC has over 200 franchises world-wide, including five in the Caribbean, specialising in the distribution and installation of bathroom fixtures.
The company, formed in 1979, created the acrylic tub-liner and wall-surround system and subsequently developed a patented material, Dura-Bath SSP (solid surface polymer) with which is makes its products.
According to Richards, the franchise fee he paid to be the Jamaican agent,
Richards said he received "verbal confirmation" from the Bureau of Standards that there were no restrictions on the importation of the products.
He has also listed a raft of international bodies, he said, which have approved or endorsed Re-Bath's products. These entities include the International Association of Plumbing and Mechanical Officials,
Re-Bath has been offering discounts to accelerate its market penetration.
Richards is intent on transforming the home-improvement business with his Re-Bath products.
For 2010, the company is targeting the hotel and lodging sectors, "especially as our products have been proven to reduce operating costs and is the preferred bath installer for major hotel chains such as Marriott, Hilton, Holiday Inn and Hyatt," he said.
By the second quarter of 2010, Richard is planning to branch out into installations for kitchens and other areas of the home.
"Our objective is to bring professionalism to an unstructured industry and establish a company that people can trust to deliver on the promise," said Richards.