Hard Work, Determination Help Company Show Importance of Hydroexcavation

Amid ongoing challenges, small Puerto Rican company charts a course for growth.

Hard Work, Determination Help Company Show Importance of Hydroexcavation

Alfredo Hernandez (right) uses the lance to break up the ground at a job site, while HydroEx President and General Manager Miguel Rivera Villamil works the remote control for the hydroexcavator.

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In a way, HydroEx — a hydroexcavation company in Puerto Rico — is a lot like the island country it calls home: Despite challenges and setbacks, it just keeps rolling with the punches and striving for further growth.

Owners Miguel Rivera Villamil and Cecilia Lloréns and established the company in 2003 in Guaynabo, near the capital of San Juan on the northern side of the island. Since that time, they’ve endured more than their fair share of turmoil and upheaval: A deep economic downturn that started in 2008. Devastating Hurricane Maria in September 2017. A 6.4-magnitude earthquake that rocked the country in January 2020. And the ongoing COVID-19 pandemic, not to mention a labor shortage.

Yet through it all, the husband-and-wife team remains buoyed by the potential market for hydroexcavation services on this island country, with its population of 2.8 million people.

“Our belief in what we call our three P’s — patience, perseverance and persistence — is what keeps us going,” says Lloréns. “We’re patient during downturns, we persevere in educating customers and developing business and persist in following up with customers.”

“We also keep our overhead small,” adds Rivera Villamil, noting that during the 2008 economic downturn, the company sold one of its two trucks and had to dismiss several of its full-time employees. Today the company operates with a lean mentality; it’s only employees are only Rivera Villamil, Lloréns and truck operator Alfredo Hernandez, who’s been with the company since 2014.

The company operates one truck: A MAXVAX 700 designed by Amerivac Group and built by Sewer Equipment on a 2008 International 7400 chassis. It features a 6-cubic-yard debris tank, a 650-gallon water tank, a UDOR water pump (10 gpm at 2,500 psi) and a 3,000 cfm blower made by Roots (a brand owned by the Howden Group).

“This truck is a perfect size for us here on the island, where we have a lot of narrow streets,” Rivera Villamil says, noting the truck is used primarily for exposing/locating utility lines, trenching and digging foundations. “It combines the benefits of a small and a large truck.”

BUSINESS, CONSTRUCTION BACKGROUNDS

Rivera Villamil and Lloréns were born in Puerto Rico. Rivera Villamil served in the United States Army and then earned a mechanical engineering and technology degree at Purdue University and a master’s degree in administrative science from Johns Hopkins University.

His first job was with Chrysler Corp. (now Stellantis) as a tool and process engineer at an assembly plant in Delaware. After five years there, he returned to Puerto Rico to work for a family-owned, heavy-equipment distributor, Casco Sales.

Lloréns earned a business and accounting degree at Notre Dame of Maryland University and a master’s degree in finance at the University of Loyola Maryland. She worked as a loan and credit administrator in the international division of a large Baltimore bank before returning to Puerto Rico to work for Casco, which was the exclusive distributor for John Deere agricultural and construction equipment and other heavy-equipment company products.

The couple faced a career crossroads after Casco was sold in 2000.

“I really wanted to do something different — something that didn’t involve working for a large company with many employees,” Rivera Villamil says. “I wanted more of a niche market, where I could be an entrepreneur.”

OPPORTUNITY KNOCKS

The seeds for that business opportunity were planted earlier when Rivera Villamil saw a demonstration of a hydroexcavation truck. He was intrigued by how safely a hydrovac truck could do excavations.

“What I saw was a great business opportunity in a niche market,” he recalls. “Sure, there was some risk involved. But there were a lot of problems here in Puerto Rico with excavation accidents.”

“The drawings for utility lines usually aren’t that accurate,” adds Lloréns. “So even the best excavation contractors can have problems if they don’t know where utility lines are located.”

So in 2003, the couple took a leap of faith by establishing HydroEx and buying a hydrovac truck.

Getting potential customers to understand the advantages of hydroexcavation proved to be the company’s biggest challenge.

“The most difficult part was educating customers — showing them that we could minimize their excavation risks,” Rivera Villamil notes.

In addition, the company also had to fight an uphill battle in terms of pricing because hydroexcavation is more expensive than traditional excavation methods. Rivera Villamil countered that concern by explaining that the higher cost of hydroexcavating was small compared to the potential enormous costs and liabilities posed by, say, a backhoe rupturing a natural gas line.

A LUCKY BREAK

The fledgling company got a big break in 2006 while working on its first big project: the construction of a new taxiway at Luis Muñoz Marín International Airport in the city of Carolina. HydroEx was hired to expose a utility line, Lloréns says.

“After we finished locating the utility, they said they didn’t need us anymore,” she says. “But then a contractor broke an electrical line. So they called us back and we worked there on several additional projects.

“That was a big opportunity for us to show the benefits of hydroexcavation,” she continues. “Like they say, you can’t buy that kind of advertising.”

The company established itself even more firmly when a pharmaceutical company hired it to locate utility lines before starting an expansion project. HydroEx exposed several utility lines not shown on drawings, which impressed its risk-assessment team.

“We worked on that project for two years, from 2009 to 2011, and to this day, the company specifies hydroexcavation in its job bids,” she says.

A TURNING POINT

That project proved to be another critical juncture for the company by giving it a foothold in the country’s thriving pharmaceutical industry. Puerto Rico is a global hub for pharmaceutical and medical-device manufacturing.

In fact, the country is the largest exporter of biopharmaceuticals in the United States and the industry generates 30% of the country’s gross domestic product and half of its manufacturing activity, not to mention employs more than 94,000 people, according to Invest Puerto Rico, a business development group.

“In one case, an insurance company told one of our pharmaceutical customers to call us,” Rivera Villamil says. “Pharmaceutical companies now are our core customer base.

“We mostly do line locating and clearance work,” he continues. “And if they’re building an extension of a building, we will hydroexcavate the perimeter of the project to whatever depth is required to see if there are any utilities in the construction area.”

On other jobs, HydroEx also excavates the foundations for plant expansions because the vibrations caused by conventional excavation machines could compromise the extremely sensitive calibration of equipment used in manufacturing. In other cases, the companies need hydroexcavation because project areas aren’t accessible for large pieces of conventional excavation equipment, he adds.

MORE GROWTH FACTORS

Another factor in the company’s growth: certifications as a veteran-owned business, a disadvantaged business enterprise and a minority-business enterprise, which made it attractive to companies that are required to hire disadvantaged minority-owned companies to fulfill government quotas, she says.

In addition, HydroEx is the only company in Puerto Rico that focuses on hydroexcavating, which underscores the importance of being first to market and establishing a dominant position, Rivera Villamil notes.

To market the company’s services, Rivera Villamil did hydroexcavation demonstrations for potential customers so they could see firsthand how the process works as well as the safety/risk-reduction benefits.

Furthermore, Lloréns joined numerous professional groups and organizations in order to network with potential customers. Such groups include the Puerto Rico Association of General Contractors, the Puerto Rico Manufacturers Association and its Industrial Women Committee and the Puerto Rico Minority Supplier Development Council, which certifies and supports minority-business enterprises, she say.

“You never know who you’re going to run into at one of these meetings,” she says. “Plus you have to keep reminding people that you’re here and available.”

Clear and effective branding also plays a key role in marketing, as reflected by the company’s name.

“The company name makes it very clear what we do,” Lloréns says. “It’s very gratifying when I tell people we offer hydroexcavating services and they say, ‘Oh, you must be from HydroEx.’ I know we must be doing something right in terms of marketing.”

GROWTH ON THE HORIZON

And after years of educating customers about the safety benefits of hydroexcavation, Rivera Villamil says the company has gained significant traction in that regard. With hydroexcavation now a more commonly accepted excavating technique and an expected flurry of infrastructure-improvement projects on the horizon, he believes the company is poised for growth in the coming years.

“We’re now seeing a lot of bids going out for infrastructure projects, such as airport and water-utility improvements, funded by money from FEMA (the U.S. Federal Emergency Management Agency) for hurricane and earthquake assistance,” Rivera Villamil says. “So hopefully by the end of this year or early in 2020, there’ll be a lot more projects.”

As Rivera Villamil looks back, he says making the challenging switch to an entirely different career has been well worth the risks involved with starting a business from scratch.

“When you find a utility line that customer didn’t know was there and that would’ve caused a lot of headaches if someone hit it, it’s very gratifying,” he says.

“Educating people about hydroexcavation has been a very steep road to travel,” Lloréns notes. “But it’s also been quite an interesting journey. We just persevere and keep on going.” 



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