Texas contractor takes unique approach to training crews while also adapting to marketplace to survive oil industry downturn.
In just four years, Ken Sugawara and his partners have seen their company grow from a startup operation to one that bought its 15th hydroexcavator last year and earned $6 million in gross revenue.
Landshark Hydro-Excavation, based in Pearland, Texas, has undergone some changes in its service mix over those years. Some items haven’t changed though, like treating the work as a craft instead of just a job, making sure workers are as safe as possible, and catering to customers.
The company focuses on hydroexcavation, but has added services such as utility pole installation and emergency-response spill recovery. With its growth, the company has satellite offices in Odessa and San Antonio.
FINDING A NEW PATH
Sugawara wasn’t a newcomer to the industry when he and his two partners started Landshark in 2013. He has been in the industry for 23 years. One partner, Dave Davis, was working for a customer when they started talking about creating their own operation.
“Dave and I spoke about putting together this company, and he bugged me enough to where I finally decided to go for it,” Sugawara says. A silent partner later joined them.
The three started by offering hydroexcavation services and added services that complement it, like industrial vacuuming. As they picked up work, the company relied more and more on third-party rental for vacuum boxes and waste hauling.
“We started to rely on so many other people to handle these services that the customers didn’t give us enough attention as we would get if we had our own,” Sugawara says. “It caused issues because we had to rely on the third-parties’ training, and wonder whether their training was as stringent as training with our own people.”
If something happened at the fault of the third-party contractor, it would also affect Landshark’s reputation. “We quickly realized the issue there and started doing a lot of the work ourselves,” Sugawara adds. “Our main focus though is still hydroexcavation and industrial vacuuming.”
A lot of work came right away from companies Sugawara and Davis had previously served. Having diverse offerings only helped. “Most of our clients wanted a 100 percent turnaround and one-stop-shop type of deal,” Sugawara says.
The company went from a revenue of $1.2 million its first year to $6 million last year.
A DIFFERENT WAY OF TRAINING
Landshark takes a unique approach to its employees. “It is not unlike how refineries take their millwrights and machinists, and train them and treat it as a craft,” says Kenny Sharpless, business development manager. “They have a true training program that takes them from beginner to journeyman. Our guys are treated as apprentices and move up to journeymen in both training in the yard and on the truck.”
The continuing education was designed with input from field supervisors and started as a craft-certification test. It has since developed into three phases. The first phase is knowing every component of the truck, its capabilities and what functions it can do.
The second phase is troubleshooting. The third phase is using different techniques to do the cutting, defining soil types, and knowing how to adjust to the soils.
“I believe this program has helped us quite a bit because of our confidence in how the truck works, how to adjust for the different job requirements, and basically speaking intelligently to the clients,” Sugawara says.
Training this way also helps the workers feel like they are all on a level playing field. That includes Sugawara, who started in the industry as a swamper (assistant to the operator) and worked his way up.
“I’m passing that philosophy down to the office management, field management and down to the operators and swampers,” Sugawara says. “Being able to relate to them in all aspects has been a great help. It goes along with understanding what these guys do in the field. We’ve really created a family here. It truly is a family.”
TRUSTING THE BUILDERS
Landshark operates 15 hydroexcavators capable of performing dry and wet vacuuming and three 70-barrel vacuum trucks (Global Vacuum Systems). Of its 15 hydrovacs, four are Vacall – Gradall Industries and the other 11 are GapVax. All are 2014 or newer models.
Each is custom-built with specifications from Landshark. “We like having manufacturers that work with us on development,” Sugawara says.
Landshark’s GapVax trucks all operate with a 23 gpm pump, while the Vacalls operate with 25 gpm pumps, both larger than the pumps on typical hydroexcavators.
The larger pumps prepare crews for any soil conditions. “If you have heavy soils, you’ll need the gpm, which is your workhorse, as opposed to your psi, which is your cutters,” Sugawara says. “If you have to go dump and get water from a distance away, then it’s better to conserve water using a smaller pump and a smaller nozzle and you can work longer.”
The larger pumps allow crews to increase production if they run into tough soils.
The trucks are also fitted with rubber-booted vacuum tubes instead of the traditional steel. “We’ll never go out without that,” Sugawara says. “The reason for that is to avoid the bumps and nicks to the pipe or whatever utility it is you are uncovering.”
To go along with the rubber-booted tubes, Landshark uses primarily turbo (rotating) nozzles with neoprene heads to minimize damage to utilities.
CATERING TO PIPELINE SPILLS
When not working with utilities, Landshark often works on spill cleanups throughout Texas and Wyoming. “Those are the jobs that are always challenging and problem-solving is needed,” Sugawara says.
The first task on arrival at a pipeline leak is to locate it, then uncover and inspect it. However, the company doesn’t handle just the location and cleanup, it handles all aspects of the job.
“We handle all the boxes, the profiling, the light towers, hand-wash and eye-wash stations and the portable restrooms,” Sugawara says. “That’s been the demand of one of our biggest clients and it seems to be going the way of other companies too.”
The process makes life easier for customers: Instead of four companies submitting bills for the same job, they get only one. Leak cleanups can last anywhere from a couple of hours to weeks.
“Some of these leaks that we go on, we can show up on the job site, chase the first part of it and keep chasing it for the client as they direct us around a facility or down a pipe,” Sharpless says.
The family mentality and the craft approach to training have helped the company stand out from competitors. “When you put our guys and our vacs out there next to the competitor’s vacs, our people make a difference,” Sharpless says.
Landshark also takes pride in a superior safety record. The company has a total recordable incident rate (TRIR) score of zero. TRIR is a mathematical computation that takes into account how many OSHA recordable incidents a company has per number of hours worked. “We’re not only working very efficiently, but also very safely,” Sharpless says. “We do acknowledge safety when we see our guys out in the field. We do some spur of the moment rewarding for good behavior.”
To help keep its employees happy, the company keeps crew members service-specific. “We don’t want to have someone who hates hooking up hoses to a vacuum truck doing that when he would rather be doing hydroexcavation,” Sugawara says. “We’ve noticed a behavioral-based issue having cross-trained guys and we didn’t realize it existed until we sat back and watched. The only way we can stand out is if guys enjoy what they’re doing, and if they’re not enjoying what they are doing, it’ll show.”
The company is still growing, and Sugawara looks forward to the future. “Our biggest thing right now is our industrial vacuum side,” he says. “It’s growing by leaps and bounds with the contracts we’ve received recently.”
However, the company has to be cautious about growing too fast and sacrificing quality for quantity.
“The industry may want us to go fast, but we’re not going to go that fast,” Sugawara says. “We’re going to develop smart, well-informed, well-trained individuals.”
A changing landscape
Being in the heart of the oil industry in Texas, Landshark Hydro-Excavation co-owner Ken Sugawara has seen his company’s market change as the oil industry has declined.
“Last year was tough,” Sugawara says. “We saw many people fold and shut doors.”
Sugawara wanted to make sure that didn’t happen to his company. The first change for Landshark was focusing less heavily on oil and gas pipeline work.
“We had to adjust to other services in 2016 that we didn’t highlight as much when oil and gas was strong,” Sugawara says. “Those additional services were a lot of municipality work and utilities and road projects.”
That’s when the company branched off into doing utility pole installation.
“In about a year and a half we’ve taken the utility pole installation service industry by storm,” Sugawara says. “The competitors that we’ve taken it from, we now out-perform them on a daily basis 60 to 70 percent as far as the amount of production they can expect. That is a direct result of what our guys can do with the same equipment because of our knowledge and training.”
Now, with the oil industry making a comeback, Sugawara says his company will be stronger in the long run. “The diversification gives us multiple revenue streams,” he says.