Transforming business Transforming business Advocate staff photo by PATRICK DENNIS -- Mike Saint, left and Bob Dosser, co-owners of Corporate Services LLC of Baton Rouge, talk with Timmy Lajaunie, development lead. The two men created software to help companies manage rental equipment. Corporate Services’ software tracks rental equipment BY TED GRIGGS| Advocate business writer Dec. 31, 2012 Comments After 20 years in business, Baton Rouge-based Corporate Services LLC boasts a client list of about 400 companies in the United States and 14 foreign countries. Corporate Services’ customers, who include Chesapeake Energy and the city of Vancouver, use the software to manage their equipment and rentals, tracking everything from revenue and costs to locations and maintenance. Ask co-founders Bob Dosser and Michael Saint about the keys to their success, and they’ll tell you stupidity, dumb luck and more stupidity — a process that ultimately proved them to be smart businessmen. First they were too stupid to realize all the obstacles they would have to overcome in starting a business. Then they lucked into the software business for oilfield service companies. And finally they were too stupid to quit when the bottom fell out of the oilfield in 1998. “We didn’t envision being a software company,” Saint said. “It was an accident,” Dosser said. The partners were working at an office automation company in Houma in 1993 when they realized the owner would never sell to them, and staying there was “a zero-sum ballgame,” Dosser said. So they started an office automation consulting company. They named the company Corporate Services because large companies had corporate services departments, but small companies couldn’t afford one, Saint said. The idea was to provide small businesses with advice on an as-needed basis, on everything from buying fax machines and telephone systems to copiers and other hardware. “So we kicked that off and immediately began to starve to death,” Dosser said. About six to eight months in, the owner of an oilfield services company with offices in Houma and New Iberia called. He had bought software to network his offices and hired local developers but his offices still weren’t networked. “He asked us in and said, ‘You guys are consultants?’” Dosser said. “What he didn’t know was if he’d needed someone to chip rust off his pipes and paint them we would have done that.” After examining the problems, Dosser and Saint realized their client couldn’t afford the hardware and software solutions then available. At the time, the minimum their guy needed would have been a mini-mainframe and maybe millions for programming. So Saint wrote the initial software, and he and Dosser went back to starving. Not long afterward, a friend of the first client called and said he’d heard they wrote software and asked if they could do the same for him. “It was a bit of a revelation,” Dosser said. By 1997 things were going well. Corporate Services had 20 clients in the oilfield, and revenue had grown to more than $1 million. Things were going so well that in November Saint actually took a vacation with his wife. “We were sitting out on the beach, and I said, ‘You know the business is five years old, and I think we can kind of rest easy a little bit. We don’t have to worry about it tanking,’” Saint said. “And she said, ‘You better be damn careful thinking like that.’” Five months later, oil was about half what it had been in November 1997. By the end of 1998, the spot price of oil was around $8 a barrel. “Every client we had turned the lights out and went home,” Dosser said. “Overnight it went away.” Dosser said the company survived somehow until late 1999, when Canada’s oil and gas business started to recover. By then, Saint and Dosser were poised to diversify their customer base. They had begun working on a second product in 1997 called TrakQuip that could be used by any company with rental assets. Despite the R&D limitations caused by the oilfield crash, in late 1998 Corporate managed to install a very rough version of the software for a client. “We called it a beta, but it was probably an alpha,” Saint said. But the program wasn’t commercially ready until 1999. Demand grew. In 2004, Corporate Services relocated to Baton Rouge because it was easier to recruit tech workers here than in Houma. These days, the company sells far more TrakQuip licenses than RTMS, which is used exclusively by oilfield service companies. TrakQuip is used by small and large construction companies and the companies that rent equipment to them; suppliers of durable medical equipment, such as beds, IV stands and heart monitoring devices; oilfield service companies; and even the utility department for the city of Vancouver, British Columbia, Canada. Using TrakQuip, the utility department set itself up like a rental equipment company. The software allows the department to itemize its assets and issue purchase orders for additional equipment, such as vehicles, cherrypickers or what have you. “They know what they’re paying for it. They know what kind of condition it’s in,” Dosser said. “They can follow that piece of equipment.” The software keeps a history of the equipment so the department knows if a specific device has broken down, Dosser said. The next time the department needs similar equipment, it can tell the rental firm not to send that particular machine. Avoiding downtime or delays can cut costs significantly, whether you’re a drilling company or a construction firm, Dosser said. One of the software’s biggest advantages is it gives the customer a more detailed picture of its assets, Dosser said. The customers know, among other things, what they have, where it is, who has it, how it’s being used, if it’s being used, and who’s breaking it. Some clients even use the software to track their workers, which allows them to more accurately bill their time, Dosser said. “They have access to a ton more information that they can then utilize to make management decisions,” Dosser said. One large construction company, with offices throughout the country, cut its tool department costs by $11 million a year with the software, Saint said. Before the company began tracking assets, each piece of equipment was assigned a cost as a percentage of overhead. For example, a job superintendent might need a backhoe for one day, Saint said. But he kept it around for six months because he’d already been charged as much as he was going to be, and he might need the backhoe again later. So job superintendents hoarded equipment, which meant the company had to buy more of it, driving up costs, Saint said. Once the company could track everything and began charging a daily rental rate, supervisors began returning equipment promptly to avoid additional charges. Saint said Corporate Services’ software differs from typical business management, or Enterprise Resource Planning, software. “Every one of our clients has found a way to make themself unique in the marketplace,” Saint said. “As a result, they can’t go buy a shrink-wrapped package that will do what it is they do.” Corporate Services fills the gap between the traditional products and what its clients need, he said. The company builds tons of features into its software, and customers can turn those features on or off according to their needs. Tom Hubbell, the American Rental Association’s vice president of marketing and communications, said Corporate Services is among dozens of niche software providers targeting the rapidly growing rental industry. Last year, the U.S. Gross Domestic Product — the total value of goods and services produced — grew by 1.7 percent, Hubbell said. The rental industry grew at four times that rate. In 2013, estimated revenue for the rental market for the United States and Canada is $38.1 billion, Hubbell said. There are a number of reasons for the rental industry’s success, Hubbell said. When the economy crashed, banks were reluctant to lend for new equipment purchases so construction firms thatneeded to finish projects turned to rentals. By renting, a company gets exactly what it needs when it needs it without having to worry about the costs associated with storing, maintaining and managing the equipment, Hubbell said. And rental fleets have to be up to date, so customers know they’re getting the most current devices. Dosser and Saint declined to discuss current revenue figures. But Corporate Services now has 2,500 active licenses for its software, and the company’s goal is 4,000 licenses by 2015, Dosser said. Dosser, 69, said he has no plans to retire. He jokes that he owes too much money to do that. “As long as it’s fun, I don’t see any reason to retire,” Dosser said. Saint said his job is not just fun but exciting. Just about every month the company works with somebody who’s probably bought a software package that fell short and probably paid programmers to try to modify it, Saint said. “They may despise computer geeks and software because of the frustrating experience they’ve had,” Saint said. “And when you solve their problems in life, they’re initially shocked … and a year later, they say things to you like, ‘I don’t know how we ever ran this business without you.’” Saint, 61, had a stroke earlier this year and considered retirement but decided that’s not what he wanted to do. “I don’t think either one of us will quit until they stuff us into the ground,” Saint said.