As a business owner, can you imagine overcoming fires, floods, hurricanes, the loss of the company’s founding fathers, off the chart interest rates and cash flow challenges? Just ask Jack Aden of Rawles Aden Lumber Company about his history, and he will quickly convince you that given persistence and a winning attitude, challenges can be overcome. Jack Aden, current owner of Rawles-Aden, and the son and close friend of the original owners, has seen the company through major crises. Rawles Aden Lumber Company, with the help of the Crater SBDC of Longwood University, experienced a positive turning point in 2000 and has since posted an average 12% gain in revenues over the past five years. To understand what Jack and Rawles-Aden have overcome, it is necessary to revisit their past. Jack himself states: “There is nothing I haven’t seen in my 30 years with this company.”
Rawles-Aden Lumber Company began operations in Petersburg, Virginia, in 1960. From humble beginnings, the company has grown into a multi-million dollar corporation servicing the Mid Atlantic region as a distributor of specialty building and remodeling products, both imported and domestic. Jack explains the company’s competitive advantages as “the coordinated product mix and the superior product knowledge of our professional staff.” Jack himself has a long history with the company, having demonstrated an early interest in the forestry and lumber business.
Jack earned his Bachelor of Science degree with a major in Forest Management and a minor in business at Virginia Tech in Blacksburg, Virginia. Upon graduation in 1973, he served in the United States Army, completing his tour of duty as a Captain in the Army Reserve. Jack did not immediately begin working for his father’s company, but worked for a German engineering firm that had an emphasis in forestry products. This experience provided Jack with an exposure and education in international business and travel which has proven invaluable to his business today.
In 1975, Jack was living the good life, traveling the world. Atlanta was his home-base. It was during this period that Mr. Rawles, co-owner of Rawles-Aden Lumber, flew to Atlanta to recruit Jack back to his hometown of Petersburg to begin management grooming. Jack agreed to do so, married his college sweetheart, Nancy, and returned home. He worked as a territory sales representative for Rawles-Aden and thoroughly enjoyed meeting and working with clients and being “out in the field” from 1975 – 1988.
As both principals were aging, it was necessary for Jack to focus his energies in the corporate office. As Jack says, “There was a rude awakening with my OJT (on the job training) in management and administration. It’s been bitter sweet because of the many challenging transitions.” In 1992, Mr. Rawles died which was the loss not only of a founding principal but also the loss of the company CFO, hence another new role for Jack. During this period he also learned that his father had Parkinson’s disease. Then in 1995, Jack lost his father, the business location had an $800,000 fire, and the financial institution for the business gave the company six weeks to find another bank.
The company was wasting away because of the difficulty of finding a bank that would work with them. The business was too small for the big banks and too large for the smaller community banks. To complicate matters, the financial community frowned upon using inventory as collateral.
In 2000, Mr. Aden was very concerned about the lack of cash flow, the tight margins and keeping his nineteen person work force in place. He did not know where to turn and even entertained the thought of selling or merging the business. Jack was looking into refinancing as an option because of extreme finance service charges and the need for a working capital line of credit. He met with Diane Howerton and Ken Copeland of the Longwood SBDC to analyze and prepare financial projections. The internal analysis with the assistance of student interns revealed that restructuring the debt would result in a 20% increase in cash flow. A proposal was prepared, with assistance of staff and students of the SBDC, and reviewed by several financial institutions. Longwood SBDC’s relationship with lenders generated a lead with First International Capital. With an SBA loan guarantee by First International Financial, known today as UPS Capital, Rawles-Aden Lumber was able to operate on a positive cash flow. This positive change made it possible for the company to hire a professional warehouse manager; upgrade the computer system, replace aging equipment, add new product lines and expand into new markets. Jack states:
“I can’t say enough for what the SBDC did for us. It (their services) kept us in business. The SBDC assistance and analysis was presented in such a wonderfully professional manner. This is the essence of what business assistance programs should be doing.”
The company experienced a major turnaround and expanded their workforce to 23 people. Even with these accomplishments, Jack has found time to volunteer his time and financial resources in some interesting areas. He participates in a partnership that is working towards privatizing individual forest product facilities in the former Yugoslavia. He has participated in two mission trips to Haiti and was scheduled to return this year; however, the political unrest has prevented him from doing so. He is a founding and active member of the Brandermill Church. His newest role is as President of Learn to Earn which is a committee of professional business people, educators and community leaders working with the Crater Workforce Initiative Board.
On asking Jack about his vision for the future of the company and industry, he said, “We are blessed to be living in this part of the world. With the great advances in technology and the vast opportunities for an expanded global reach, the growth potential opportunities are limitless.” Jack continued in this interview to praise the assistance from Longwood University through the SBDC program…
“The primary reason we are so grateful for SBDC is that we were so discouraged during that time…. not only did the SBDC throw us a lifeline, they got us enthused about what our business could do.”
Thank you Jack, from all of us at the Longwood SBDC! We’ll be watching your success and we’ll be there if you need us!