Victory Sweepers, Inc

Description

The founder of Victory Sweepers is Mark R. Schwarze, son of the founder of Schwarze Industries, Incorporated, Bob Schwarze. Before he was old enough to drive, Mark accompanied his father as a helper on his contract sweeping routes in Huntsville and Birmingham, Alabama. Then, once Mark was old enough to get a driver’s license, he became a weekend sweeper operator in the family’s parking lot sweeping business. In 1973, Bob Schwarze decided to make his own parking lot sweeper, primarily because he couldn’t buy a commercially-built sweeper that worked well in a parking lot sweeping application. Once others in the industry discovered how well his new air sweepers worked, Bob soon had to quit sweeping so he could build parking lot sweepers full time. Mark went to work for his dad’s sweeping manufacturing company, Schwarze Industries, Incorporated, right out of high school, even though his dad would have preferred he go to college instead. So, Bob had the good sense to start his son at the bottom of the company ladder — washing sweepers! Then, over time, Bob worked Mark up through the ranks. Seven years later, when Mark took over the company’s day-to-day operations as vice-president, he’d had first-hand experience in virtually every hands-on job in the organization, from welding to fab to paint to sales. Over the next 15 years, driven by the ‘keep it simple and make it work great,' product design and customer-oriented support philosophy of his father, Mark catapulted the company to the leading position in the parking lot sweeping industry. At one point, the Schwarze family firm had in excess of 60% market share in that industry segment, a number that was arrived at from a competitor’s survey. Then, as company president, Mark also expanded the family firm to include making regenerative air and mechanical broom street sweeping machines, and developed an almost worldwide sales network. By 1999, Schwarze Industries, Incorporated had become a company with over $35 million in annual sales and was one of the top three sweeper manufacturers in the U.S. marketplace. A direct result of this tremendous reception by customers was, oddly enough, that by 1999 it became apparent the company business would have to be sold. That’s because the primary stockholder was the now ailing founder, Bob Schwarze. The company had grown so large under Mark’s direction that there was, under American tax laws, no practical way for it to pass down from father to son. In addition, the Schwarze family’s historical strategy of continual growth would soon require a large financial outlay in order to finance the necessary expansion. Finally, when Bob received a short-term terminal diagnosis, the answer became inescapable. With no choice but to sell prior to Bob’s passing, a public company, Alamo Group, Incorporated (NYSE: ALG), became the eventual purchaser. Schwarze Industries, Incorporated was a family business no more. Although as part of the arrangement Mark initially stayed on as president, it wasn’t long before the differences in the public company’s methodology, direction and customer support philosophy became glaring.

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