What better place to conclude an issue about money than in Las Vegas, a city where the term "busted flush" applies as much to its housing market as to its poker tables? Few companies felt Las Vegas' housing collapse more acutely than A.C. Houston Lumber Co. and president Ron Mason. Today, more than ever, he stresses the importance of knowing your limits. His game plan: Focus on the here and now.
Been There, Done That
We have a yard down in Indio, Calif., and that's where I started. In the summer it gets damn hot. I can relate to the yard workers and say "Hey, I've worked out here in the summer too, so I know what it's like."
After the Bubble Burst
Property values are well less than 50% of what they were back then and so people are bailing on mortgages. You're talking housing starts going from 30,000 to 5,000. We downsized our facility here and we got into a much cheaper facility and we've just hunkered down and tried to operate as efficiently as we can. We don't view this as going to end anytime soon, so we have to survive in the market as it is. That's how we've designed our business. If it does at some point pick up again, it will be all for the better.
CNBC on My Office TV
Obviously there's no direct correlation [with the big corporate news reported on CNBC] to our business, or there rarely is, but I think having a basic understanding of what's going on in the world of business internationally gives you ideas. You learn about ideas that worked for other companies and you ask, will this work for ours? That's the good I get out of it.
All the Same
The construction trades here in Las Vegas I don't believe are really different than they are in the other states [Idaho and California] we do business in. Most of us that live in Las Vegas and make it our home really aren't involved [in the scene on the Strip], unless you work in the tourist trade. Even if you do get involved, you learn to live your own life away from that. The construction trades are definitely outside the arena of the Strip.
I think one of the real fallacies of thought that you get into during management–or business in general–when you've had a slowdown is to want to think of it as just a temporary situation and to base your business planning on the comeback. We like to look at our business planning based on what it is doing right now. If things do get better, you can always build to that.
That has had to change with the times. Right now, the yardstick is: Are we creating enough gross profit dollars, given our economic needs?