A utility locating contract drives the need for air excavation, which opens the door for a whole new business.
While working for another company, Mike Arme saw a need for a safer and more efficient way of locating utilities, and wanted to be the leader in bringing that technology to central and southern California.
That technology Arme was looking for, air excavation, proved to be a smart decision. After being founded more than a decade ago, Underground Solutions Inc. (USI) quickly established itself as a player in the industry.
“We were one of the first — if not the first — full-service potholing companies in our area,” says Mike Arme, owner of the Escondido-based company. “We were also the first potholing company to use the VACMASTERS 4000 vacuum excavators in our area. This technology, along with our out-of-the-box approach to solving customers’ problems, allowed us to become the leader in our area for air-vacuum potholing and excavating.
“Our business model is simple,” he adds. “We aren’t looking to be the biggest, just the best.”
So far, so good. When Arme established the company in 2003, he had two field employees and one VACMASTERS 4000 truck. Today, the company owns eight VACMASTERS units, employs 27 people and offers additional services, such as ground-penetrating radar scanning and electromagnetic locating. Furthermore, USI’s client base has grown from six in 2003 to more than 550.
As it turned out, selling customers on air-excavation technology, which was relatively new in the early 2000s, was not difficult because it offers compelling advantages compared to other excavation methods such as hydroexcavation.
For starters, air excavators don’t use water. This not only conserves a valuable resource, it also eliminates the expense of securing work sites to prevent water runoff into storm drains. Moreover, air excavation eliminates the costs associated with disposing of hydroexcavated mud/sludge and trucking in fresh backfill material. The overall result: A competitive edge in bidding on projects, Arme says.
In addition, air excavation is considered safer than using highly pressurized water. “High-pressure air will flow around an inanimate object, not through it,” Arme says. “It may give you a bruise, but it will not sever a limb. So it’s safer all around for the utilities, the environment and our employees.”
USI’s success underscores the importance of keeping up with technological advancements. Arme says he’s always on the lookout for the next big thing in technology that can take his company to the next level and stay ahead of its competitors. “If you don’t do that, you run the risk of getting passed by,” he points out. “If you aren’t open to different ideas, you start fading back.”
Arme founded USI after his previous employer — a company that specialized in trenchless technology and utility line installations — won a contract to install new water and sewer lines in San Diego. At the time, Arme was a vice president in the company.
The city required the company to locate utility lines 500 feet ahead of the new line installations to ensure that the proposed pipeline routes on the construction drawings were viable. To do this, the company used backhoes to expose and locate other utility lines. But for every 10 lines crews located, the backhoe broke about two. “We were responsible for making the repairs,” Arme recalls. “I figured there had to be a better way.”
After some extensive research, Arme found that better way: vacuum excavation. “So I started USI as a separate company to facilitate the potholing,” he explains. “My business associates didn’t want to get into air excavation, so they were OK with me branching off into this new market.”
Arme bought a VACMASTERS 4000 and then invested in two more units within eight months. “People saw the truck and it soon became its own animal,” Arme says. “It morphed into its own business — people were clamoring to use it. Somehow I knew that requiring potholing to locate utility lines in advance of new line installations wasn’t something that was going to go away.”
USI’s first large project came up in a roundabout way. As employees were driving one of the VACMASTERS units home from a construction show where it was on display, they noticed a man driving alongside them, writing down the USI phone number shown on the side of the unit.
“They thought they’d hit a rock and broke someone’s window,” Arme recalls. “But it was a guy from a large engineering firm who’d been looking for a company with air-excavation technology. That chance encounter turned into more than $1 million worth of work during the next 1 1/2 years. This occurred early on and it put us on the map. Our trucks were getting seen everywhere.”
That exposure led to even larger jobs, like the construction of a 10-mile-long pipeline that connects a desalinization plant in Carlsbad (about 35 miles north of San Diego) to existing water distribution systems in neighboring municipalities. “In 2013, we were asked to do potholing in one of the sections,” Arme says. “After we finished, they were so enthralled with our work and our custom utility location reports that they asked us to do everything. It went from 150 to more than 1,400 potholes in four cities, all within a six-month window.
“It took three to four dedicated crews a day, which made it very challenging to keep all of our other customers going,” he continues. “But we were able to do it.” The fact that utility line strikes drastically diminished after USI started performing the potholing only further burnished the company’s reputation, he notes.
MORE WORK, MORE EQUIPMENT
As the company grew, so did its fleet of equipment. The workhorses are the eight VACMASTERS 4000s, built on either Ford or International chassis. Each one features an 800-gallon debris tank, an 85-gallon water tank (there are times when hydroexcavating is required), a Sullair compressor (300 cfm at 220 psi), a John Deere 155 hp engine that powers the vacuum system, and a water pump that generates pressure of 3,000 psi and flow up to 3 gpm.
The company also relies on three RIDGID SeeSnake pipeline inspection camera systems; four LMX100 ground-penetrating radar machines, made by Sensors & Software Inc; electromagnetic locators made by RIDGID, Pipehorn Utility Tool and Vivax-Metrotech; two Caterpillar skid-steers; compacting machines made by American Pneumatic Tools; and almost two dozen jackhammers made by American Pneumatic Tools.
Air excavation isn’t always the best method of excavating. Hydroexcavating is better for, say, digging a 3-foot-wide trench that’s 8 feet deep and 200 feet long. “But for potholing, vacuum excavation is more efficient,” Arme notes. “We can average one 8-foot-deep pothole an hour, including excavating, backfilling, compacting and patching/repaving.”
The company also relies on a less visible but equally important tool: proprietary software developed to produce detailed utility location reports for customers. The reports provide a compelling selling point and differentiate USI from its competitors, Arme says.
The company’s approach to projects also sets it apart. Arme says that because of his background, which includes more than 30 years as a pipeline contractor, USI views projects from a contractor’s perspective instead of an engineer’s vantage point. What’s the difference? An engineering approach is often more black and white, and doesn’t always jibe with the reality of on-site conditions. “On paper, they believe a pipeline will fit the way they design it,” he explains. “But when you actually start digging, it’s often a different story.
“That’s why we named the company Underground Solutions,” he adds. “We’re going to use all of our knowledge and all the tools in our toolbox to find out-of-the-box solutions.”
KEYS TO SUCCESS
Arme says that aside from embracing new technology, several other factors have contributed to USI’s success. He sums up the most important one in three words: Never say no. “We never turn work down,” he says. “We basically figure out a way to do whatever the customer needs. We have a can-do attitude that stems from not only our knowledge of the industry, but our employees’ skills and abilities. We’re very service-oriented and take a lot of pride in what we do.”
Then there’s the company’s unique marketing tool — vinyl wraps on the eight VACMASTERS 4000s. While vinyl wraps in and of themselves aren’t that unusual in the industry, the graphics on the USI wraps definitely provide another point of differentiation for USI. Arme calls it a storyboard wrap: It shows a cross section of layers of dirt and a vacuum hose, along with the words, “We can dig a six-foot pothole in a matter of minutes using nothing but air; and we can do it all day long.” The wrap also prominently displays the company’s website and phone number.
“My team and I spent countless hours in designing the graphics to ensure that the trucks were not only eye-catching, but also explained the function of the units,” he says. Why? Arme felt that aside from industry insiders, it’s difficult for people to figure out what an air-excavation truck is when they see one driving down the road. As he puts it, “If you don’t know what they are, you don’t know what they are.”
Although the wraps are expensive, Arme says they’re well worth the investment. He came up with the idea shortly after USI won its first big contract. “It’s the best form of advertising out there,” he says. “After we wrapped the trucks, we started getting calls left and right. We went from working mostly in San Diego to working all over Orange County. Those wraps are one of the main reasons we grew so fast.”
MEASURED GROWTH AHEAD
Looking ahead, Arme expects the company to keep growing, but in a strategic, structured manner. In short, he’s not interested in exponential growth that could jeopardize quality and customer service. “I won’t sacrifice what we’ve built just to get higher (revenue) numbers,” he says.
Arme anticipates a strong market for potholing/utility location services during the next three to five years as federal funds are released to pay for upgrading Southern California’s aging water and sewer infrastructure. In addition, he expects to find more markets for air excavation than just utility line locating.
“We’re always evolving,” he says. “Right now we have most of our eggs in the utility locating basket. But there are so many other things air excavation can do outside of utility locating. We just have to keep thinking outside the box.”
Project reports give customers valuable location data
As Underground Solutions Inc. won more and more contracts to locate underground utility lines for everyone from engineering contractors to design-engineering firms to municipalities, it became apparent early on to owner Mike Arme that customers required more from the company than just exposed utilities. They also needed utility location data in an easy-to-understand format that would make planning future infrastructure projects easier and more cost-effective.
So Arme hired a company to develop data-collection software that could generate detailed reports showing the location of every pothole excavated during a project. “There was a lot of mapping technology out there at the time, but there was nothing on the market for data collection,” he recalls. “So we had to create our own software.”
The reports provide customers with a wealth of data, including a photo of each pothole showing the utility line that was exposed, the kind of utility line (gas, sewer, water and so forth), the depth of the line from the ground surface to the top and to the bottom of each line, the diameter of the line, the distance from the curb to the line, and the direction the line runs.
“After we dig the hole and photograph the pothole so you can see the line that was exposed, we put a survey nail at the center of the line’s location for future locating,” Arme explains.
“Every pothole we dig has its own photos and measurements, and the report is organized chronologically by pothole. The photos basically verify all the data we’ve gathered.”
The reports are especially valuable because they’re generated daily as USI does potholing ahead of utility line installation crews. “Doing that kind of due diligence ahead of time reduces the need for change orders tremendously,” he points out. “It limits the kinds of surprises that installation crews might otherwise encounter during the normal construction process.”
Arme says USI is currently designing a fourth generation of the software, which keeps evolving based on customer input, among other things. “Software development is not cheap,” Arme says, noting that USI charges customers extra for the reports. “Every time we revise the software, it costs us $30,000 to $40,000. But the more we can give customers user-friendly information that’s really easy to understand, the better off we are.”