A Conversation With Patrick M. Gililland – President & Owner, SPF Depot Inc.
By Juan Sagarbarria
A local distributor that became an international presence in the spray foam market, SPF Depot’s Patrick (Pat) M. Gililland speaks to Spray Foam Magazine about the shape of the market and how perseverance has resulted in his growing empire.
Spray Foam Magazine: You’ve come a long way in this industry. How did you start off in the spray foam industry and what prompted you to go into this type of business?
Pat Gililland: I was working in the fluid power/factory automation business, working extensively with General Motors and plastic injection molding businesses developing new tooling and parts with longer service life. Hurricane Katrina knocked out my sales region, so I found myself unemployed a few weeks later. I saw “Holmes on Homes” TV show and they were spraying foam and four weeks later, I was in the business. I started with the E-10 spraying homes and storage sheds. The mix chamber is very much like a plastic injection nozzle, so I heat-treated it like I did before. My original equipment manufacturer (OEM) chamber lasted four months with no scoring, so we started selling the resurfacing service on eBay.
SFM: From your years as a distributor, what can be said about the demand of spray foam equipment?
PG: The US/Canada markets are very stable with Canadians being more educated in the SPF field due to their contractor regulations from the Government and the amount of money required to enter the business there. Our distribution in Poland and Russia is growing and I see far more polyurea applications there that building owners would not consider in this market, but in the EU region, buildings are 100 to 400+ years old, so it’s a true long-term investment for them. In the U.S., we are a “throw away society”, so consumers here think in terms of one or two decades, not one or two centuries. OEMs are smart to produce a quality product that will give years of stress-free service from the equipment, as well as their people. We still have requests for Gusmer products that have been in the field for 20+ years. Gusmer, from my perspective, had a firm grasp on quality equipment. I don’t see anyone else with equipment 20+ years old still running.
SFM: To what do you attribute SPF Depot’s success?
PG: Timing was good, but I think its more about stocking parts: Same day shipping and helping the customer with problems and technical help they aren’t getting from the large companies. We only sell the PMC proportioners, but we get calls for technical support and technical help from all over the world on brands we have never sold. Consumers are grateful for the help they can’t get from their former supplier.
SFM: It seems SPF Depot is constantly expanding its presence in the international market. How broad exactly is your international customer base?
PG: We ship to 43 countries and we stock parts in Russia, Poland, Germany, Ireland, and we just accepted a distributor in China. We package/label some products in different languages and we provide technical help and on-site service in various locations in Europe. Approximately 30 percent of our business is export. We don’t limit ourselves to just the foam insulation and roof coatings market. We have a broad spectrum of customers we sell to; that is how we managed to acquire over 5,000 customers worldwide. We participate in several trade shows in the EU region. U.S. shows tend to be just a moneymaker for the organizer, so I visit those shows and hand out free hats, free parts samples, and enjoy meeting our customers.
“We do what others won’t want to do… to get the customer the parts they need to keep spraying.”
SFM: What makes SPF Depot such a reliable force for potential customers to partner with?
PG: We do what others don’t want to do. We can take orders and ship till 4 p.m. CST and we have even taken orders later than that and drop them off at UPS or USPS to get the customer the parts they need to keep spraying. “Keep ‘Em Spraying” is our motto. Nobody wins when a contractor is down and the large company employees don’t want to cut into their personal time and really could not care less – they get the same check at the end of the week. We can customize machine parts in our shop and very easily try new products. Larger corporations have too many hoops to jump through to get a new product released, so they take two years, while I can introduce a new product in as little as two days. Most employees just want to get their time in and collect. Our distributors like our products, as well as how fast we handle any warranty issue. We are the only ones that offer Certified DuPont Viton™ O-rings made to mil specifications and that gives our customers assurance
that its a quality product of true Viton™ blend.
SFM: We understand there are some big things happening for SPF Depot on the horizon, including the addition of a new facility you mentioned. Could you weigh in on that? How has that been going and how will this change affect your sales and overall company growth?
PG: We just purchased a 2.5-acre lot and will start construction this year. Our new facility will have a large meeting room to conduct in-house training with a video conference system to hold training sessions with distributors in our global market. Our warehouse and store space will be fully air conditioned to ease the hot summer days in Louisiana. We will still have our daycare center and we’re adding a classroom for home schooling employees children. A large bay area will provide the space for custom building spray rigs and provide in-house training on startup/shut down procedures. A separate building will house part of the new CNC lathe and milling machines that will automatically machine our smaller parts after hours.
Our growth rate is holding steady at 15 percent annually now. With a new distribution center in Ireland and two new distributors interested in Russia, we hope to see our export capabilities grow as we start to provide packaging of our solvents out of Belgium and manufacturing some gun parts out of Germany.
SFM: What will these future training programs entail?
PG: We plan to hold video conferences on gun cleaning and typical problems people have while spraying. We will also showcase some large polyurea jobs being done in Europe. Early next year we will fly our distributors in for some in-house training and new product announcements. We have helped at CertainTeed with their in-house training where they have me run the section on gun maintenance and typical issues everyone has. I enjoy that part of the business. I always tell people there is nothing stupid you can do that I haven’t done before and learned from – well most of the time.
SFM: In terms of distribution, are there any new products that SPF Depot has recently made available?
PG: We just added several parts to support the GAP guns and the old Gusmer GX series. We have a distributor in China that sells a lot of GX-8 parts. On top of that, we just started making numerous parts for the GAMA guns, pumps, and proportioners made in Spain to help us acquire more of the EU region. We now have our own complete replacement for the GAP gun with 100 percent interchangeable parts, so we can sell parts of a complete gun at 50 percent less than others. We have also started making our own pumps to support U.S. customers. We have toyed with the idea, but didn’t see the demand. When large OEMs have $100 million in equipment in the field and decide they don’t care to support it anymore, we find a huge void we can fill, and we fill it fast.
SFM: What is your industry outlook overall in the next 10 years?
PG: The industry will grow as people realize utility rates will not go down and many choose to remodel their current home rather than accumulate more debt on a new one. I see the U.S. market at a slower pace than what we see overseas due to attitudes on investing in a building envelope for the long haul. The price for equipment continues to rise and that is going to hold the growth down in the U.S. market. Its hard to start a business with $60,000 in debt, make the loan payment, make payroll, pay taxes, be competitive, and have a dollar left to pay yourself at the end of the month. We hold our prices low by contracting to local shops to make parts for us in high volume and we do all packaging and assembly in-house.
SFM: What does the future hold for SPF Depot?
PG: We are starting to look at acquisition of other companies with complementary products we can offer/support. We don’t care to be in the contractor business doing the jobs. That makes us a competitor to our customers and that doesn’t seem right. I think in the future you will see what I envisioned with SPF Depot being a single-stop source with quality product and low prices that caters to several types of industries doing SPF applications. •