by Mark Hengel
Posted 6/22/2009 12:00 am
Updated 1 year ago
In college, Ryan Heringer of Jonesboro fed his electronics habit by installing electronics systems for his friends.
More than seven years after graduating from the University of Arkansas at Fayetteville, Heringer's livelihood stems from the skill he once spent odd hours practicing.
The 30-year-old opened Sound Concepts Inc. of Jonesboro shortly after graduation and is now one of the go-to guys in the region for the installation of home and commercial electronics systems. The systems range in price from $20,000 to well into six figures and can be as small as a home theater setup to a system that controls almost all electronics in a client's home - air conditioning, lights, home theater, stereo, even window blinds.
The systems even allow an owner to control everything from his cell phone.
And despite the economic slowdown, business has remained busy for Heringer, he said, with his 13 employees and three contractors working on more than 60 projects currently. For those considering Sound Concept's assistance in installing an electronic system, cost is usually not a sticking point, he said.
The industry as a whole has not weathered the economy as well as Sound Concepts has. In its annual list of the nation's top 100 installation companies, CE Pro, a trade magazine, found 2008 revenue fell about 12 percent. Sound Concepts' 2008 revenue grew by about 25 percent year over year.
Making (Sound) Waves
Heringer has earned national recognition for services he provides. CE Pro ranked Sound Concepts among the nation's top 100 "integrators," an industry term for those selling and installing home electronics.
The company ranked No. 54 in the nation, with $4.3 million in 2008 revenue, according to CE Pro's list. The company worked on 156 installations in 2008, with the average revenue from an installation topping out at about $28,000. Heringer expects 2009 revenue of about $4.5 million. Sound Concepts is the only Arkansas company on the list.
Heringer is one of the lucky people who has turned his passion into his livelihood. "When I was up in school, that was kind of my passion," he said. "I would go buy all the latest and greatest electronics."
During Heringer's final years at the UA, installing electronics for others helped pay for his own habit, he said. Heringer's skill also landed him work for northwest Arkansas residents like Don Tyson, the former chairman of Tyson Foods of Springdale.
It didn't become clear that installing electronics might become Heringer's trade until he returned to Jonesboro and began working for his family's petroleum distribution business, Star Cos. Inc. While working for his father, Al, young Ryan continued installing on the side.
"I realized that no one else was doing this, and I realized I made more money on the side than working for my dad," Heringer said.
Al Heringer took the news well. Ryan said his father told him to "go out and make it on your own." (But he also asked his son to return the company car he'd used while on the family's payroll.)
The decision has led to annual revenue growth of greater than 10 percent, Heringer said.
The company has carved out a niche installing electronic setups in homes that any celebrity would proudly show off on MTV's celebrity home show "Cribs." While the average job in 2008 cost about $28,000, it's not uncommon for projects to cost much more. Heringer recently completed a northeast Arkansas home's $900,000-plus system, and a condo in Little Rock's 300 Third Tower (see story, Page 17) has more than $500,000 in electronic goodies packed into just over 2,500 SF, Heringer said.
Heringer would not disclose the names of those clients.
For the most part, business has remained stable despite the economy's woes, Heringer said. Sound Concepts provides a luxury item, and most of the company's clients are not wanting for cash.
"For a lot of clients, it's not 'What can I afford?'" Heringer said. "They ask, "What can it do and can I justify spending that amount of money on it?'"
A project can entail anything from a customer buying a television at the Jonesboro showroom to Heringer & Co. installing everything needed so that a touch screen remotely controls almost all things electrical in the house.
Sound Concepts doesn't outfit only homes. The operation completes installs for several businesses. A steady client for Sound Concepts has been Liberty Bank of Arkansas, from which Heringer received his initial startup loan.
"Wallace Fowler, he's probably the No. 1 reason I got started," Heringer said of Liberty Bank's chairman and CEO.
The original small-business loan was an easy one to make, Fowler said. Fowler has known Heringer and his father for a good while, and Al Heringer sits on the bank's board of directors, Fowler said.
"We gave him an opportunity, and he has absolutely done well with it," Fowler said. "If there is anything fun about banking these days, that is it."
Fowler and Liberty Bank have also employed Heringer. Fowler hired Sound Concepts to outfit his house on Eden Isle at Greers Ferry Lake, and Heringer installed the components that allow Liberty Bank's headquarters to hold weekly meetings with its several locations across Arkansas.
Having connections to Don Tyson and Fowler has helped Heringer in other ways, he said. About 85 percent of Sound Concepts' business comes from referrals, he said. The number of people with enough disposable income to buy such high-tech toys is not large, but they often know each another.
"If you do a good job for them, that's all you need," Heringer said. "It's a snowball effect. They'll send me five other people."
Sound Concepts has another method for drumming up business, though. The company has invested upwards of $2.5 million to outfit its Jonesboro showroom. The intention is to include everything a potential customer might want to play with before buying.
The showroom's 10,000-SF area includes two theaters, a corporate conference room, a custom kitchen, bedrooms, outdoor theater, a soundproof room, wine cellar and his-and-her luxury bathrooms.
All can be controlled from Heringer's iPhone.
More customers are asking for the ability to control their installations from a phone, Heringer said. The ability to remotely turn on air conditioners and other amenities can be a real convenience to anyone traveling to a weekend house, Heringer said.
Traveling is something Heringer has become familiar with since starting the company. Because only a select number of people in northeast Arkansas can afford such high-end systems, Heringer often travels the state and neighboring states for work. Last week, he spent three days in Bentonville outfitting the house of a Wal-Mart Stores Inc. executive, he said. Other jobs have taken him to Tulsa and other cities in neighboring states, he said.
Dr. George Roberson of Pine Bluff said he hired Sound Concepts to outfit his family's Hot Springs lake house after several builders and contractors recommended the company. Roberson and his wife, Sara, are investing about $50,000 in a system that will allow them to centralize almost all electronics in the house, including security cameras, locks, lighting and entertainment.
"It is a smart home and it also has the advantages of being able turn off all lights with one switch," said Roberson, medical director of Jefferson Regional Medical Center in Pine Bluff. "We also have had the wiring installed for cameras, and we will be able to look at the boat dock over the Internet."He added that "it'll be fun to play with."