“Risk is part of being in business,” he says. “There can be significant technical challenges, but we’ve always been able to come through it.
“Some have come down to the wire, but there hasn’t been a case where there’s been something we couldn’t do. We never let a client down, even if it means sometimes failing financially to do that.”
Electrosonic has dipped its toes into the merger and acquisition waters on occasion over its 50 years and Bowie remains philosophical about those, without too many specifics.
“Some have been incredibly good. Others haven’t panned out,” he says.
There are many reasons why acquisitions do or don’t work, but Bowie points to geography as one of the keys in making a smooth transition. “If a company is close to where you are, it makes integration easier,” he says. “It’s harder when it’s farther away to make it part of you. No matter what you think you see, you don’t know for sure until you bought it.”
One decision that all sides agree has worked out is when Electrosonic spun off its manufacturing division to Extron in 2010. Although that move eliminated one longstanding piece of Electrosonic’s history, it helped the company focus more on its systems integration business, says Bowie.
For that sale, Electrosonic worked through a consultant, which contacted all potential buyers and brought the information back to Bowie and the rest of the leadership team. “You have to make the right decision for Electrosonic,” he says.
“As long as I do that, that’s all anyone can ask. We worked hard to make sure it found a good home.”
Addressing Market Corrections
Bowie looks back with some level of surprise that the Great Recession of 2008 “never came for us.” Some of that, he says, is probably a result of working on mostly new-build projects that were already funded so there was no reason to stop them despite economic travails.
Electrosonic boasts a two- to three-year backlog, says Bowie, “a luxury not a lot of companies have.”
“We felt it more with bidding and competition than with the projects themselves,” he says. “A lot of clients continued to spend money and we moved around geographically. We didn’t grow but we didn’t shrink either and we had to juggle a lot of things.”
Electrosonic “took a big revenue dip” when it decided to back out of corporate multi-room projects, says Bowie, but it’s not a decision he regrets. With increased bidders trying to undercut each other on price in that market, the jobs became less appealing, he says.
“The price was a real giveaway, so the quality was bad,” says Bowie. “Many customers don’t always understand the difference between the quality of the project and accepting the low bid, so they frequently choose the low bid.”
Most of Electrosonic’s projects, says Bowie, fall into the category of “mission-critical,” whether that means they’re actually in a control room or in another space that has a specific deadline date for its opening.