Bruce Morelan Acquisition Of Power City Electric Gave Rod’s Electric Owner Everything He Needed

Bruce Morelan thinks his company is a lock to make the list of the state’s fastest-growing private companies next year.

Rod’s Electric is the only Spokane-area company to make the 1997 list, which is compiled by the Puget Sound Business Journal. The list was based on revenue growth of companies between 1994 and 1996.

Rod’s Electric grew by 55 percent during that time frame. But the company doubled its size in fiscal 1998.

“What we’ve done is quadruple our sales over the past five years,” Morelan says. “We’ve gone from $7 million in sales to approximately $28 million during that time period.”

This year’s dramatic leap is largely the product of a major acquisition. Earlier this year, Morelan bought Power City Electric, another of Spokane’s big electrical contractors.

But it was the steady growth of Rod’s that forced Morelan’s hand in the Power City deal.

The growing demand for Rod’s Electric services left the company short of estimators, field leaders, equipment and vehicles. Morelan could have bought more equipment and trucks, but when it came to the people, he says, “anybody that’s good is already working for somebody.”

But in the Power City deal, Morelan said, he found everything in one neat package. The two companies, now subsidiaries held by Spokane Electrical Services Company, make Morelan the largest employer of electricians in Eastern Washington.

One of his Spokane-based competitors has a larger overall operation, Morelan concedes, but many of their electricians work in Portland and Seattle.

Morelan didn’t start out in life with the ambition to run an electrical contracting company. He was a nuclear engineer in the U.S. Navy, and when he left the service after a five-year tour in 1989, he went to work at the Hanford Nuclear Reservation in the Tri-Cities.

“But I hated working for Westinghouse,” he says, “so I decided to quit and buy my own restaurant.”

The experience, he says, taught him a lot about cash flow and the necessity of having good employees.

In 1994, he and his wife moved to Spokane and began negotiating to acquire Rod’s Electric.

“I wanted to get back into something a little more technical,” he says, “and I knew that even if the Rod’s deal fell through, Spokane was a much better place for someone of my ambition to get into a larger business. I chose Rod’s simply because I could tell it was an extremely good company,” he says. “We just wanted to run a good company, and make it a good place to work.”

Rod’s Electric was founded by Rod Anderson in 1946. He sold the company to an employee in 1973. That employee took in two partners, Dick Kay and Don Barth, from whom Morelan acquired the company.

Power City Electric was founded in 1936.

Morelan says the acquisition was a particularly good fit because Rod’s historically has concentrated on the Spokane market, while Power City has specialized in a broader Eastern Washington market.

In acquiring Power City, Morelan got a Tri-Cities office and a major customer contract in Wenatchee.

“After we concentrate on serving Eastern Washington from these three points,” he says, “I anticipate expansion to Western Washington, northern Oregon and southern Idaho.

“I’d like to be a regionally-based contractor, but I don’t want to grow so fast that we lose our emphasis on quality and customer service.”

Morelan believes that growth requires distinguishing yourself as the leader in one of three areas: providing the lowest price; providing the highest quality and customer service; or being on the cutting edge of innovation.

“You have to be adequate at the other two, but if you are the best at one, you can grow,” he says.

“Well, we are not the cheapest contractor around, and we never will be. But we provide excellent value because our customers don’t have to worry whether the job is going to be done right.”

Morelan says excellent customer service and reliability is what drove Rod’s growth before the Power City acquisition. He doesn’t plan for that to change.

The company doesn’t limit itself to any specific project areas. It ranges from home service calls to new home construction, to commercial service and construction, to industrial service and construction.

“We have experience with nuclear plants and aluminum plants,” he says.

Recent jobs include the Fairchild Air Force Base hospital remodeling; the new production facility at Kaiser Aluminum’s Mead smelter; and Itron’s new manufacturing facility. The company is currently doing the new paging and information systems at Spokane International Airport.

Morelan says he will look for more acquisition targets, and thinks sales will hit $50 million within five years. The company’s 200-person work force will likely grow to 300 during that time, he adds.

“But,” he adds, “my goal is not to be the largest volume contractor in the region. My goal is to be the quality and customer service contractor of choice.”

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