Luce, Schwab & Kase Inc.
After nearly six decades, Luce, Schwab & Kase (LSK) Inc. has cultivated a loyal client base. In fact, 90 percent of the company’s business is for repeat customers, President Jim Luce says.
“We’ve been doing business with most of our customers for 30 years,” he says, noting that LSK often works with family businesses. “We’re always seeking the long-term relationships that will enable us to do business with our customers for a lifetime.”
Fairfield, N.J.-based LSK provides HVAC and refrigeration products. Luce’s father, George Luce, co-founded the company with Frank Schwab and Bill Kase as a refrigeration house in 1957.
George Luce started as LSK’s president and remained with the company until 2005. “I’ve been president since then,” Jim Luce says, noting that he bought out Schwab and Kase’s shares. “I’m sole owner of the business today.”
LSK’s customer base consists primarily of contractors. “We service both mechanical contractors and [residential] contractors with a 50/50 mixture of [both],” Luce describes.
The company has four branches and a stocking warehouse in New Jersey. “It’s a fairly dense market,” Luce says. “It allows us to ship around the state and gives us access to New York and metro Philadelphia.”
Ability to Evolve
Luce joined LSK full-time in 1982. Over the years, “I worked every job in the company,” he recalls, explaining that he started at the company’s counters and worked in its warehouse. “I evolved into purchasing/sales and eventually became purchasing manager, vice president and my role today.
“I’m still involved in most aspects of the company,” he continues, noting that he is proud of implementing the company’s first computer system in 1984. “We were still working on the old Cardex system at the time. Wholesaling has come a long way.”
LSK’s success is due to that willingness to evolve and change with the times, Luce says. “We originally started out as a refrigeration supply house,” he says. “Today, it is an equipment supply house that [provides what] the market is asking for.”
The company’s market has “seen a shift from conventional products to demand for ductless split systems and variant refrigerant flow [VRF] technology, which has been highly embraced by the engineering community,” he says.
“[VRF] allows for much higher energy efficiency than conventional approaches,” he continues. “The engineering community appreciates this because they know they can reduce the operating costs for the owners they’re looking out for.”
Bringing the Best
LSK strives to bring the best products to its customer base, Luce says. “[We sell] the products that we feel have the greatest impact in terms of selling potential with respect to energy efficiencies and where the market is growing,” he says.
“Because of this, we’re calling on engineers today more than we did 30 years ago,” Luce continues. “Making alliances with engineering firms has been critical to getting out our messages out about high-efficiency equipment and getting it specified.”
Business is strong for LSK, but coping with it can be challenging with only four selling locations, Luce admits. “But we have many, many delivery vehicles,” he states, noting that the company benefited from the recent drop in gas costs.
“[It] has reduced our transportation costs quite significantly in the past few months,” he explains. “That may be short term, but it’s welcome at this point.”
LSK’s customers “are looking for frictionless service,” he continues. “The ability to get product where it needs to be is more important than ever before in terms of the distributor and contractor relationship.”
To meet this need, LSK puts more emphasis on starting on deliveries earlier to make it as easy as possible for contractors to do business with the company. “[We even do] weekend deliveries,” he says. “We want to be known as the distributor that’s been the easiest to do business with and provides frictionless service.”
On the Cutting-Edge
Technology has dramatically impacted LSK’s business, Luce says. “We’ve tried to be on the cutting-edge and make sure that our salesmen have the latest technology and so forth,” he says.
For instance, “We all have iPhones today and our sales force has laptops,” he says. “We’ve encouraged all of our dealers to use iPads.”
The company also invested in three training rooms in its locations to keep its employees aware of new technology.
“The whole idea is to maintain our edge in sharing the technological changes in our equipment,” he says.
LSK also trains its customers on the latest Mitsubishi and CITY MULTI products. “We’ve seen tremendous growth in both of these product lines,” Luce says. “We recognize the need to constantly [train on them]. We run classes in three of our locations quarterly, so we’re continually signing people up to learn about VRF technology.”
Luce remains proud of LSK after all these years. As a family owned firm, “I have a personal relationship with virtually everybody in the company,” he says.
“The personal aspect of a family business is a beautiful thing,” Luce continues. “My son is in the business and I’m hoping to have more children involved someday.”
It also enables LSK to operate in a decentralized way. “We can respond [and make decisions] very quickly,” he says.
Luce sees a strong future for LSK. “In the next several years, there’s a wonderful opportunity to grow the business,” he says, citing its air conditioning work as an area for potential growth. “[It] has expanded over the years,” he says, noting that the company was one of the very first portable air conditioning distributors. “We were selling and moving [them] before anyone knew what portable air conditioning was.
“We’re anticipating that we’ll see some strong growth in the commercial market over the next several years,” he says. “Multifamily housing also has been very strong for us, along with commercial, VRF opportunities and complexes, too.”