Kansas City Business Journal - by Aly Van Dyke
Date: Thursday, November 4, 2010, 3:34pm CDT
They had 90 days.
Three months to test and inspect 4,000 smoke detectors in a busy children's hospital in downtown Kansas City. Using existing dust and containment systems, it would have taken 60 days just to test the 400 duct detectors.
Shawnee-based TED Systems needed something new, so the fire system installation and servicing company went about creating a system.
Made of angle iron and plywood, TED Systems built the first of what would become several hundred HEPACART™ systems. The carts connect to walls or ceilings and allow a worker to test smoke detectors, electrical structure and other systems without contaminating the surrounding air with dust, smoke or debris.
Thanks to the cart nicknamed "Woody" testing those ducts at Children's Mercy Hospital took about half the time it would have otherwise.
That was seven years ago. Since then, HEPACART Inc. has gone from an idea born of necessity to a company that sells six models of an aluminum containment system to hospitals and contractors in 30 states. This year, HEPACART™ is on track to have $900,000 in revenue, a 160 percent increase from $350,000 in 2009.
And it will only go up from there, founder Herb Farnsworth said.
"I would hope we grow at least 50 percent a year for the next two to three years," he said, pointing to increasing enforcement on debris containment.
The need for dust and particle containment systems in hospitals came about in 2003, when The Joint Commission passed a new hospital regulation requiring better control of contaminants released during indoor construction.
Farnsworth knew containment systems would become a growing market, but the timing had to be just right. So he got input from customers and relied on his knowledge of how long it took for a regulation to be enforced. Going on instinct and an educated guess, Farnsworth sat on his idea for three years. He incorporated HEPACART™ in December 2006.
The company sold its first cart in July 2007. That year, it sold about 30 carts to companies in four states, raking in about $150,000 in revenue. But breaking into the manufacturing business from servicing fire systems required skills and materials Farnsworth never used before.
Lesson one: financing.
HEPACART™ was completely self-financed Farnsworth didn't want to be publicly traded and starting it took more resources than he expected.
"All good ideas require more time and more capital than you think," he said.
Then came the challenges of logistics and marketing.
He had to buy manufacturing space, aluminum, welders and saws. He had to go from selling a service to selling a product. And he had to break out of the 100-mile sales radius he used with TED Systems to a nationwide network.
"It's more difficult to stay in touch with 5,000 hospitals across the country than it is 300 customers locally," he said.
To do that, he's picked up a few tricks. He now understands the importance of a Web presence, e-mail blasts and national trade shows. He's learned lessons from trial and error. And Farnsworth has consulted his son, who works in marketing.
But the real growth strategy for HEPACART™ has and always will be something a lot less complicated than developing a national marketing strategy.
"The simple thing that we've done right is that we've listened to our customers," he said. "When you're any size company, particularly when you're a small company, you better listen and listen carefully because your customers will tell you what they want."
When a customer said he needed a device to help feed wire through a hospital ceiling, Farnsworth listened. Now, HEPACART™ has a new product with long-term visibility at a low cost to the company and to interested customers.
"It allows us to be in lots of places with our name and our brand for $225," he said.
When a contractor told Farnsworth he needed a system to reach ductwork through a wall rather than a ceiling, Farnsworth listened. Now, HEPACART™ has two wall models.
Listening to customers' needs has expanded HEPACART's™ product line from a single ceiling system to five models, with 20 options. Farnsworth said the company has a few more ideas in the works.
Rick Singers, sales and customer support representative with HEPACART™, said that flexibility has helped attract and retain customers.
"Our ability to turn on a dime is what separates us from our competitors," he said.
David Becerra, registered communications distribution designer with Shaw Electric Co., said high-quality and convenience products led to his purchase of four carts in the past three years.
"HEPACARTs, to me, were the best method," he said.
Farnsworth said HEPACART's™ success has come from its ability to "protect patients and productivity" the company's marketing slogan and the factor that sets its products apart.