Irby expected to be the state’s newest $1 billion private company
by Ted Carter
Published: June 10,2012
Mississippi can expect to soon set a new place at the table reserved for The Magnolia State’s privately held billion-dollar companies.
Jackson electrical products distributor Irby plans to join Ergon and Yates Construction at the $1 billion table by the end of next year, Irby president Michael Wigton said just days before the 86-year-old company christened a $6 million sales center and corporate headquarters built behind the current Irby building at 815 S. State St.
“I’ve already set my mind that that is where we’re going,” Wigton said of Irby’s target of $1 billion in annual sales by the close of 2013.
Irby is enticingly close at slightly more than $900 million this year, he said.
Irby, whose four market segments are industrial, contractor, commercial and utility, would be just one of 10 distributors “that have ever achieved a billion dollars in sales in our industry,” Wigton added. “We’re going to hit that mark by the end of next year. We’ve got a great group of people. They all want the same thing I do.”
The vast majority of Irby’s wholesale distribution business is concentrated in the South, where many of its 50-plus branch operations are located. Its utilities division does business nationally and accounted for about $600 million in sales last year, as utilities throughout the country began spending more money on infrastructure upgrades and expansions.
But hitting the $1 billion mark will gain Irby recognition nationally beyond its utilities division, making it the third largest privately owned wholesale electrical distributor in the country, according to Wigton. The other two companies are national, he said.
The privately held French global distributor Sonepar Group bought Irby from Stuart and Charles Irby in 2005. Since then, the Jackson company has doubled in size. “As a stand-alone-company we would be the 14th or 13th largest in the United States,” Wigton said.
The $18 billion Sonepar, whose U.S. operations are headquartered in Philadelphia, has electrical distribution operations in 35 counties.
Irby has 800 employees in 22 states from Maine to Florida and as far west as Denver and Albuquerque, N.M. Its workforce includes about 160 people in Jackson, and branches in Meridian, McComb, Columbus, Tupelo, Vicksburg and Gulfport.
Irby has acquired more than a half-dozen regional competitors in places such as Minneapolis, Chattanooga and Texas. It ended 2011 with the acquisition of Treadway Electric of Little Rock, Ark.’s oldest electrical distributor and employer of more than 100 workers in four locations across the state.
Off the Ropes
Irby’s rapid increase in business since the middle of the last decade caused it to begin outgrowing the circa 1926 building on South State Street it acquired with the purchase of the company from the Irby family. Then the recession came and “our business went into the toilet,” Wigton said. “Our industry was hit like most of the others.”
But unlike the others, Irby kept its workforce intact and stayed the course on its market expansion plans. For that strategy to work, a new sales and distribution center would be imperative, Wigton decided.
Sales growth the past couple years has erased any second thoughts Wigton had about going ahead with spending $6 million on the 85,000 square-foot center. The confidence level “is very high” today, he said.
“We’re climbing back out. We had a very good last year. And this year we’re in double digits” in percentage revenue growth, he added.
Sales this year will be “$130 million more than we’ve ever done before,” said Wigton, a former GE executive who has been president of the electrical wholesale distributor for slightly more than seven years.
The utilities market segment has been the strongest for Irby, while the industrial business “remains very, very strong” as well, he said.
“It had a very big year last year and is up by double digits this year,” Wigton added, attributing the industrial increase to manufacturing sectors such as pulp and paper moving ahead with upgrades put off during the recession.
Sales to automakers such as Nissan in Canton and plants in Alabama are also climbing, as are purchases by oil and gas businesses in the region, according to Wigton.
The construction side is up slightly in sales to commercial projects such as retail centers and office buildings, he said.
That growth should continue, at least some, according to the IBIS World’s Electricians report which projects the electricians industry will have revenue growth of 8.3 percent this year as activity picks up in the residential, industrial, commercial and municipal building markets.
Likewise, the Association of Electrical Equipment and Medical Imagining Manufacturers in Arlington, Va., reports that prospects have brightened for the electrical equipment intensive commercial construction category, which includes offices and retail space. “A solid recovery is expected by 2013,” the association says.
A New Home
About 2,000 guests, including executives from parent Sonepar, its branch operations and customer companies across the country, turned out for last Thursday’s grand opening of the ultra-modern sales and distribution center situated on three and a half acres just off South State Street near Silas Brown Street.
Built by Barnes Construction of Mississippi, the warehouse-office complex is a showcase for electrical efficiency, from its rooftop solar panels to lighting monitors on the roof that measure lighting coming into the building from specific angles and adjust room lighting accordingly, Wigton said.
“Everything in there is energy efficient,” he said.
As the work got underway, Wigton frequently asked Irby facilities director Dale McMurry and contractor Moses Electric for changes he thinks will help the building become a showcase for cutting-edge electrical efficiency.
In the end, the building still came in close to budget, according to Wigton.
The center includes 3,000 square feet of product area as well as a training area that can accommodate up to 125 people. “It’s got absolutely incredible electronics,” he said of the training space.
In the weeks ahead, Irby will move its entire headquarters staff to the new building. The center’s 30-foot ceilings are much better suited for office use, he said.
No decision has been made on the future of the 95,000 square-foot building in which the Irby family started the business in 1926. “The building will be empty for a while,” he said, and added Irby may decide to lease it.
“It doesn’t look like much on the outside but on the inside we have had a bunch of remodels,” Wigton noted. “A year and a half ago we put in all new tile flooring.”
He said in a June 2011 interview just after construction started that he is confident time will show he made the right call with the multi-million-dollar expenditure on the new center. That confidence has only grown since then, he said.
Meanwhile, Irby is preparing to slide its chair up to the $1 billion table.
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