TDIndustries
Encyclopedia
TDIndustries has consistently been recognized by Fortune magazine as one of the 100 Best Places to Work in America since the list was first published in 1998, and in 2005 was included in Fortune's "100 Best Hall of Fame," a list of only 22 companies across America who have appeared on this prestigious list every year.
Services
TDIndustries provides construction, service and operations for the systems serving new or existing commercial, industrial and institutional building:- Heating
- Ventilation
- Air Conditioning
- Electrical
- Life Safety
- Facilities Management
- Plumbing
- Process & High Purity Piping
- Building Automation Systems
- Refrigeration
- Commercial Food Equipment Services
Locations
Physical offices are located in Dallas, Fort Worth, Austin, Houston, San Antonio, and PhoenixPhoenix, Arizona
Phoenix is the capital, and largest city, of the U.S. state of Arizona, as well as the sixth most populated city in the United States. Phoenix is home to 1,445,632 people according to the official 2010 U.S. Census Bureau data...
; and the company has a project office in Denver.
Ownership
Over 900 of employees and recent retirees own 100% of the company. No single individual controls more than 3% of the company's stock. In fact, the entire senior management team controls less than 25% of the stock.Recognition
- One of the 100 Best Companies To Work For In America as published by FortuneFortune (magazine)Fortune is a global business magazine published by Time Inc. Founded by Henry Luce in 1930, the publishing business, consisting of Time, Life, Fortune, and Sports Illustrated, grew to become Time Warner. In turn, AOL grew as it acquired Time Warner in 2000 when Time Warner was the world's largest...
magazine. Not only has TDIndustries been on this list for the eleven straight years it's been published, TD is now a part of FORTUNE Magazine's "100 Best Companies to Work For" Hall of Fame -- a distinction that only 19 other companies hold. - Top 100 Training Organizations ‚ Training magazine‚ 2001, 2002, 2003 and 2004.
- National Construction Safety Excellence Award‚ Associated General Contractors‚ 2000.
- Award for Principle-Centered Leadership‚ Ernst & Young National Entrepreneur of the Year recognition of Jack Lowe‚ 2000.
- Top 25 Newsmakers‚ Engineering News-Record recognition of Ben Houston‚ 2000.
History
Originally founded as Texas Distributors, Inc., the name TDIndustries was coined in the early 1980s.Founding and Early Years
Mrs. Greer, who ran a successful auto parts business, co-signed the bank loan that provided twenty thousand dollars in start-up capital. She also lent the new company working space for a time in her building at 1820 Canton. The company charter was filed immediately with the Secretary of State’s office, enabling them to meet again at 2 pm the next day at Mrs. Greer’s building for the “first meeting of the incorporators and stockholders and subscribers.”
At that point ten thousand dollars cash was advanced to the corporation and the three stockholders elected themselves directors for a year; they held a board of directors’ meeting called for an hour later at which they adopted by-laws, approved a stock form and made themselves the company’s first officers. By a unanimous vote of three, Jack Lowe, Sr.
Jack Lowe, Sr.
John B. "Jack" Lowe, Sr. was a Dallas native who founded Texas Distributors Inc. in the back of an auto parts store owned by his aunt...
became both chairman of the board and president of the company. Mrs. Lowe was elected vice president and Mrs. Greer secretary-treasurer.
Texas Distributors concentrated on repair work early on—there was nothing to distribute at the time because Texas Distributors did not yet have a distribution agreement with a manufacturer and because none of the manufacturers had changed over from war production. Postwar conditions offered a pretty healthy repair market since any equipment that still functioned had been in operation since well before the war. TD’s first employees repaired or installed anything that even vaguely related to making things hotter or colder, including refrigerators, ice cream freezers, water fountains, and attic fans.
In the fall of 1946, the second half of the twenty thousand dollars arranged at its birth was advanced to the company, and construction was begun on an eight thousand-square-foot building at 3914 Live Oak. The new facility had a large display window and a tower of glass bricks that, when lighted, made the company’s name more noticeable at night. By spring, Texas Distributors had left Mrs. Greer’s automotive supply shop on Canton Street.
Forming a Relationship with Employees
Within ten months of its formation, the company took steps that began to establish the relationship between Texas Distributors and its employees—the seeds from which all current TD employee programs grew. On December 12, 1946, the board established the Texas Distributors Retire Plan which stipulated that the company would contribute to a retirement fund an amount equal to five percent of the employee’s monthly salary. In a second action, Jack, Fred Addison, Mrs. Greer, and Jim Pavelka were elected trustees of the Texas Distributors Profit Sharing Trust, which was based on six-months vesting, and the company promised to contribute annually an amount equal to twenty-five percent of its net pre-tax earnings. The money would be invested and credited to each employee based on the amount of his salary. One third of the annual trust contribution could be distributed at Christmas if requested. An employee could collect his accumulated funds after five years, but would forfeit them if he terminated before that time.Before 1947 ended Texas Distributors had signed an agreement with the Worthington Corporation, making TD a bona fide distributor of air conditioning equipment. The trouble was that there really wasn’t any wholesale business to distribute to. It brought new customers and a steady supply of equipment, but it also brought new challenges. TD had to overcome the thinking that Worthington was not well-suited for smaller jobs. A bigger challenge involved money: equipment has to be paid for when the distributor takes delivery of it. A company needs a healthy cash flow in order to stock enough equipment to make a good distributor, and cash was something TD did not have a lot of in 1948.
Jack took the problem to his employees and offered to sell them stock in the company which, at that point, only he, his officers, his aunt and his mother owned. He explained that the company was in need of additional working capital and that the company could perhaps get the money in other ways, essentially by going into debt, but this plan might keep the company out of debt and thereby benefit both it and its employees. A subsequent meeting of stockholders authorized issuance of an additional 217 shares of stock valued at one hundred dollars per share. The company agreed to loan its employees money to buy the stock with the understanding that they could repay the loans in installments subtracted from their paychecks. The stock would be nonvoting stock.
Fifteen employees subscribed to 187 shares of stock that day. In addition, friends of the company pledged to purchase the remaining thirty shares. The company’s capital value was more than doubled.
Early Struggles
Even in 1946, twenty thousand dollars was not much capital with which to jump into the air conditioning business, and capital shortages were a recurring problem for Texas Distributors for most of the 1950s. Expenses were kept at a rock bottom. Not until 1953 did TD buy its first new service truck. An arrangement to provide service for all new KelvinatorKelvinator
Kelvinator is an appliance brand. It takes its name from William Thomson, 1st Baron Kelvin, who developed the concept of absolute zero and for whom the Kelvin temperature scale is named...
equipment helped provide a meager, if steady, income. TD also leased and serviced drinking fountains, and a system of painting refrigerators inexpensively was developed. After that came opportunities to handle Philco
Philco
Philco, the Philadelphia Storage Battery Company , was a pioneer in early battery, radio, and television production as well as former employer of Philo Farnsworth, inventor of cathode ray tube television...
window air conditioning units and Worthington’s commercial air conditioning equipment.
With a steady source of equipment, TD began to move into contracting. In those days most prospects had to be sold on the need for air conditioning as well as on the desirability of Worthington equipment over that of better known companies. The availability of new equipment improved further in 1949, when General Electric
General Electric
General Electric Company , or GE, is an American multinational conglomerate corporation incorporated in Schenectady, New York and headquartered in Fairfield, Connecticut, United States...
offered TD its line of heating equipment. Now the company began to have dealers and a small wholesale business. Yet cash remained in short supply.
Becoming a distributor was an achievement that Jack and Texas Distributors had been reaching for since the company’s beginning. Becoming a GE distributor was not a specific goal, but it was understood that such a thing seemed likely once TD had established itself financially. The Worthington line had been a profitable arrangement, and in 1950 GE became increasingly dissatisfied with its North Texas distributor and offered its air conditioning line to Texas Distributors.
Worthington provided more income than GE would at the beginning, but the potential for growth with GE seemed much greater; the distributorship meant virtually unlimited access to equipment for TD’s own growing commercial business and potential profits from a wholesale market that, while not quite fully alive at the moment, was sure to grow. Perhaps more important than either of these was the fact that a connection with a major manufacturer meant TD was finally in position to take advantage of the residential air conditioning market that everyone felt sure was just about to take off. But the affiliation with GE strained Texas Distributors in new ways and increased some of the old pressures; the manufacturer expected its distributor to handle a certain volume of equipment, so doing business with GE meant doing more business than TD had ever done. To achieve those levels, it would have to create a sophisticated wholesale inventory operation and attract and organize a large dealer network across North Texas.
Dealers had to be either salesmen who could install and service equipment or servicemen who could sell. New ones especially needed lots of incentive and support. TD put thousands of dollars behind the new dealers and gave them thousands of hours of being taught everything from figuring loads and drawing layouts to bookkeeping and management skills.
In 1952, Texas Distributors and General Electric put together a store cooler and a dependable GE furnace and came up with a workable year-round air-conditioning system for the home. This unit went into 210 new three-bedroom homes in the East Ridge Park development and woke up a lot of people to the idea of affordable home air conditioning. At the time, GE didn’t actually have a product designed specifically for homes, and when other companies soon came out with one, the manufacturer and its distributors suffered. Then the resident product that finally arrived several years later proved unsuitable, and actual production units failed with great regularity.
The Crow Connection
A friendship between Trammell CrowTrammell Crow
F. Trammell Crow was an American real estate developer. Crow is credited for creating several famous real estate projects, including Dallas Market Center, Peachtree Center , and San Francisco's Embarcadero Center.-Biography:Crow was born in Dallas, Texas...
and Jack Lowe began in 1948, when Texas Distributors installed the air conditioning in several Crow buildings on Cole Avenue. In practice over the next two decades, Crow continued to bring in bigger and better projects, and TD furnished mechanical systems that worked, no matter what. The present and future employees of Texas Distributors owe a lot to the Homefurnishings Mart—or Furniture Mart—built in 1957. Few people thought the project would ever be built, and fewer thought a market building in Dallas would succeed. If it had failed, Trammell Crow would have gone broke, and Texas Distributors would have followed. But it didn’t, and all the grand designs that came later to Stemmons Freeway owe their very existence to the little Furniture Mart. And TD’s relationship with Crow was long and consistently profitable.
Equity Plan
Despite the drawbacks, TD’s wholesale business grew during the middle 1950s, but it grew more slowly than had been hoped. At the same time, other problems made themselves very clear; except for a few short-term bank loans, Texas Distributors had depended on profits to supply the capital necessary for growth. Revenues had increased, but net income had fallen. The company’s future looked increasingly limited. General Electric opened a new manufacturing plan in Tyler, and TD was expected to be the recipient of much of the equipment produced there—the company was under a lot of pressure to expand.Texas Distributors was able to get capital through a program called the General Electric Equity Finance Plan by which the manufacturer offered—in return for various considerations—to finance the growth of its distributors. Suddenly GE owned a piece of Texas Distributors. The manufacturer presented Texas Distributors with two hundred thousand dollars in working capital—half of that was a loan that TD would have to pay back, principal and interest. To cover the other half, TD issued GE one hundred thousand dollars in Texas Distributors preferred stock, and TD would pay the dividends on that stock until they could accumulate enough money to buy it back.
After terms had been agreed upon but before the papers were actually signed, Jack took the plan to his employees. Most of them owned stock, but only the company’s officers held voting stock, and they already had approved the equity plan. Jack explained the plan in every detail, reviewing the history of company financing, explaining why new money was needed, and why the GE plan seemed like the way to go.