Sam Parr  ⚪️

After dropping out of high school, Ken Hendricks started a roofing business in 1963 in Wisconsin. Simple business. After 7 years they had about 500 roofers on staff. To keep his employees busy during winters, he and his wife started buying, fixing, and flipping real estate

While running his roofing business, Ken noticed two things: 1. Most supplies who sold him his roofing material were shockingly wasteful with patchy supply chains 2. Because they were local (not national), their customer service wasn't great.

So, he had an idea: start a national supplier of roofing materials. His goal was to have local market expertise and service with centralized support and cost efficiencies. ABC launched in 1982 with one location. Today they have 700+.

Ken partnered with his wife Diane to build ABC after they gave their first roofing business to their employees. On his relationship with his wife: "I'm the one out front, getting things started," says Hendricks. "Diane is the finisher, taking things down to the last detail."

The pair expanded ABC by both buying up local roofing businesses as well as starting new ones in small cities. This is a very common strategy. Standard Oil did it, Waste Management did it, and many, many others. His goal was to keep the staff in place.

To finance the deals, the family borrowed from local banks. In fact, I'm pretty sure the family still owns 100% of the business.

Ken said ABC's ability to buy businesses is why they've succeeded so well: “I’ll walk in and look at a financial statement and I’ll spot fraud like that. It’s a sixth sense.” More ordinary, five-sensed entrepreneurs may need a little help dissecting the financials.

After getting a lead of a potential business to buy, he calls them himself. Delegating that initial contact suggests a lack of serious interest, Hendricks says. For each acquisition, Hendricks has a 5 person fact-finding team. Experts in accounting, human resources, and tech.