Construction Company Hits 10-Year Milestone

The Springdale headquarters of Milestone Construction Co. LLC features numerous mounted trophy animals.

Most of the big game mountings — including a grandiose lobby display of a mountain lion and a ram entangled in a scrap — are holdovers from the building’s previous tenant. Nite Lite Outdoors, a retail hunting supply business, shuttered the doors of the 8,000-SF building on South 48th Street in February 2001, less than three years after opening.

“Those [mounted animals] were in the building so we made that part of our offer when we bought it,” explained Travis Ruff, one of the firm’s co-founders, along with president Sam Hollis. “Sam and I both love to hunt and it creates a lot of conversations when people come in. We’ve added to the collection over the years.”

Some of the other animals throughout the building are the result of successful hunting trips by Hollis and Ruff.

But it is not the big game that has supported Milestone, a full-service construction management/general construction firm that will celebrate its 10th anniversary this fall.

 In construction jargon, elephant hunting refers to a contractor only interested in pursuing projects that are huge.

Despite the furnishings at Milestone headquarters, Hollis and Ruff haven’t built their business by hunting the big game. It’s been built, they said, by a smart growth plan and a dependable reputation.

“Quality has always been a very strong goal for me,” Hollis said. “I don’t have the desire to be the biggest contractor. I have the desire to be the best. It is cliché, but I am very proud of the projects we’ve built.”

 

No Small Feat

Starting any business has its risks, but research shows that construction is more challenging than most.

According to the U.S. Department of Commerce, seven out of 10 new employer firms in the United States survive at least two years, but just half survive at least 10 years.

But when broken down by business sectors, only 36 percent of construction companies survive beyond five years.

That is the lowest survival rate of all business sectors.

In that context, the risk has paid off for Hollis and Ruff.

Since opening in 2004, Milestone has increased revenues by nearly 600 percent through 2012, when it reported a little more than $27 million in income, growth achieved without any outside debt.

The company, which has about 25 employees, remains financially healthy, but the two owners declined to disclose the company’s revenue for 2013. Milestone provided revenue figures in the past for the Northwest Arkansas Business Journal’s annual list of Largest Contractors (See list on page 12), but as is the prerogative of any private company owner, Ruff said he and Hollis decided not to discuss revenue “moving forward.”

In terms of activity, Milestone completed 22 projects last year and started 12 projects in 2013 that will be completed in 2014.

 

Forming a Partnership

Hollis, 47, was a construction laborer during high school and worked his way through college that way while earning a construction management degree from Oklahoma State University.

“I’ve always enjoyed seeing something being built from the ground up,” he said.

In 2004, Hollis was 10 years into his job managing the Northwest Arkansas office of Tulsa, Oklahoma-based Oakridge Builders Inc., a subsidiary of The Flintco Cos., the largest Native American-owned construction company in the United States.

“I had a great experience with [Oakridge] and they are a great company, but owning my own company is something I had always wanted to do,” he recalled.

Hollis said he had contemplated starting the company on his own when he met Ruff, who had just completed course work for his MBA at the University of Arkansas.

Ruff, 39, grew up in the trucking business — his family owned American Freightways Inc. of Harrison — but a chance to do something different professionally spurred his return to the UA for graduate school.

After graduating in the spring of 2004, he kept running into a guy who lived in the same neighborhood — Hollis.

“He was looking to start his own company and I was looking for a good business to sink my teeth into,” Ruff said.

The mixture of Hollis’ day-to-day industry experience as a tradesman and Ruff’s acumen for structuring and running a business was a good match, both men agreed.

“I decided in September [2004] to do this, resigned from Oakridge in October, and we started first of November,” Hollis said.

 

Getting Started

The first paying job for Milestone was a competitive bid project for the Rogers School District — two classroom additions at Bonnie Grimes Elementary School and Westside Elementary School.

“We were awarded the projects in early spring and had to have them open by August,” Hollis explained. “Those projects went off really well.”

Since that initial work, the company has grown to handle commercial construction projects, varying in size from renovations and interior tenant finish projects to multi-million dollar developments throughout the four-state area, and Hollis estimates Milestone has been awarded between 12 and 15 projects for the Rogers School District.

One of the latest was the Rogers New Tech High School, a project that involved retrofitting an existing building in two phases. The school, completed in time for the 2013-14 school year, had a price tag of $4 million.

Milestone was also the construction manager for the $12 million Elkins High School. It, too, opened prior to the 2013-14 school year.

Another of the firm’s notable projects was the Hobbs State Park-Conservation Area visitor center, a 17,000-SF center that opened east of Rogers in 2009.

The University of Arkansas Board of Trustees has also selected Milestone for a variety of projects on the UA campus in recent years, including a renovation and addition to the Phi Gamma Delta fraternity house, assorted roofing projects and elevator renovations, and the expansion of the Jean Tyson Child Development Center.

Hollis said he has always tried to take a methodical approach with the company’s workload.

“I think we’re only as good as our last project, so to speak,” he said. “We’ve tried not to expand too quickly and have [customers] who are not happy with what we’re doing for them. It’s a balancing act.”

Hollis added the company typically has seven or eight projects going at once. Currently, some of them include a medical facility in Bentonville for a national client, a retail strip center for Hunt Ventures near Pauline Whitaker Parkway in Rogers and a medical clinic for Northwest Health System just off Wedington Drive in Fayetteville.

 

Future Growth

Like any business, Milestone’s growth moving forward is contingent on the economy.

Hollis said medical construction, as well as education, will continue to be a key sector for providing the company with revenue opportunities.

He also said jobs for manufacturing clients will likely be increasing in the next five to 10 years, too, an assumption strongly tied to a sourcing initiative of Wal-Mart Stores Inc. In 2013, the retailer announced it would commit to spending an additional $50 billion over 10 years on sourcing goods in the United States, which may lead suppliers to expand or construct new facilities.

Wherever the path leads, getting bigger as a company will not mean becoming further and further removed from the client.

And the decision-making will be guided by business owners who’ve demonstrated a philosophy of being responsible about growth.

The proof is in a 10-year Milestone.

“My dad used to say you can create a big fire-breathing dragon but you have to keep feeding it,” Ruff said. “You have to have controlled growth and we’ve been able to do that. You can get too much work and not have the working capital or the people to support it, but we’ve tried to control that the best we can.”