Hendricks believes almost anything can be salvaged. I ask him for reasons not to buy a company and he swats away the question.
Above one credenza hangs a steel model of an iconic photo of construction workers lunching on a beam suspended over New York City. The image commemorates both Hendricks's passion and his past. Like the men in the photo, he is a veteran of hard physical labor and meal breaks taken in high places.
The ABC Supply story is so American dreamy it sounds made for the inspirational-speaker circuit. Hendricks grew up hauling and laying shingles alongside his roofer father, leaving school in 11th grade to work two 40-hour-a-week jobs: one in a factory and one at an electric utility. In 1963 he launched a roofing business that seven years later would employ more than 500 workers. To keep those employees busy during harsh midwestern winters, he and his wife started hoovering up real estate, much of which they rehabilitated and sold. (Readers are invited to mentally add "and Diane" to half the sentences in this article. Hendricks compares the couple's business partnership to that of Home Depot (NYSE:HD) co-founders Bernie Marcus and Arthur Blank. "I'm the one out front, getting things started," says Hendricks. "Diane is the finisher, taking things down to the last detail.")
As a roofer doing business at military bases and Kmarts (NASDAQ:SHLD) across the country, Hendricks felt frustrated by the industry's patchy, wasteful supply chain. He also bridled at the disrespect distributors showed their customers. "It got me deep in my gut that hard-working, honest roofers like my father were treated like lowlifes," he says. "I wanted to change that image."
To Hendricks the solution was implicit in the problem: He would build the first national chain of roofing and siding distributors. So in 1982 Hendricks launched American Builders and Contractors Supply, marrying local market expertise and service with centralized support and cost efficiencies. Two years later, the company began its dizzying ascent of the Inc. 500, reaching No. 3 in 1984 and No. 2 in 1985, and planting its flag on the summit in 1986. Today the company has $3.1 billion in sales, more than 6,000 employees, and 345 stores.
About half of ABC's growth derives from the acquisition of struggling independent distributors; the rest is split between buying and improving successful distributors and starting new ones. Bankers, lawyers, suppliers, and friends convey news of companies whose owners have died or that are succumbing to high labor costs or poor management. Sometimes it's the owner who makes the call.
Hendricks believes almost anything can be salvaged. I ask him for reasons not to buy a business, and he swats away the question. "Wrong location? Move it," he says. "Wrong people? Replace 'em. Wrong industry? I don't believe it. I've got a company in the machine tools industry, and we're doing great. I'd happily go into the coal business. It's how you look at something and how it's managed that make the difference."
Hendricks is applying a similar philosophy to Beloit, which he treats like a 16-square-mile fixer-upper. We are touring the town in his Jeep, with its Bush/Cheney sticker on the bumper and an Ann Coulter book on the back seat. Hendricks owns five million square feet in the area and is constantly gobbling more. (He manages real estate through Hendricks Development Group, a company not affiliated with ABC.) We pass property after property that he has bought and refurbished: an abandoned pump station turned visitor's center, an old Catholic high school that now houses the local Head Start program. Every so often he indicates a point in the distance. "From here to there I own everything," he will say.
He's in fine eat-the-rich fettle. "To hell with the executives. The workers are the ones who built this community."
Hendricks's history in Beloit is more complicated than one might think, given his love of restoring things and the town's obvious need for restoration. ABC's rise roughly coincides with the decline of this racially mixed city of 35,000. Once a thriving industrial center, Beloit began to leak manufacturing jobs in the late 1980s. A couple of nasty crimes tarnished its image; physical and social infrastructures frayed.
Despite the city's troubles, Hendricks's early forays into local development met with some hostility. His real estate buys in minority neighborhoods--at one point in the '70s he and Diane owned about 100 houses in such areas--earned him the epithet slumlord. Those charges have dissipated, but innuendo occasionally comes back like reflux. At a recent United Way event, Hendricks says, a woman "came up to me and shook her finger in my face and said, 'I know how you made your money. You're not such a hotshot.' But the people around us immediately attacked her. They said, 'How can you say that? Don't you know what he's done for us?"
Hendricks still attracts ire today--not surprising; he's an unelected private citizen with strong opinions and the resources to get his way. Some people take angry issue with his projects--most notably a plan to move the police station, library, and other city services from the business district to a largely vacant mall he owns half a mile away. A number of business owners, in particular, worry that the exodus will sap vitality from downtown. "It's a very small sliver," says William Barth, editor in chief of the Beloit Daily News. "But you do hear the occasional comment, 'Why don't we just rename it Hendricksville?"
