Thompson Creek carves niche as Washington home town window-maker

In the late 1990s, Rick Wuest was a 30-something member of his family window-manufacturing company — forgettably named Mid-Lantic Corp. — when he decided the business his father built needed to change course.

Revenues were flat. Profits were reliably in the black. The Wuests did fine, living comfortably and poking along selling the vinyl windows they manufactured on Kent Island to building contractors.

“It was a lifestyle business,” said Wuest, referring to the window company his father, Fred, had started on West Street in Annapolis in 1980. But there was little reinvestment in the family firm.

Wuest’s ability to change that, building what became Thompson Creek Window Company, is all the more impressive given the difficulties many family-owned companies — big and small — face in navigating a path for succeeding generations.

Wuest, now 47, is a liberal arts graduate of Penn State who worked nearly every job in the company. He ached to take his family business to the next level.

“I knew there was an opportunity we hadn’t really yet fully realized,” he said recently. “I didn’t know what that was.”

He couldn’t help but notice that the window business, long a sleepy niche in the home improvement and building ecosystem, was exploding with the entrance of vinyl replacement windows. Replacement windows are often the more affordable alternative to ripping out an entire window frame.

“Some very well capitalized businesses came into the marketplace,” said Wuest, referring to big names like Andersen and Pella, which were aggressively pursuing the vinyl window market. Competition was growing. “The channels for windows in the marketplace were growing. Competition was coming and the prices were falling.”

Wuest knew that if the company were to survive, it needed to grow. And to grow, Mid-Lantic would have to begin reinvesting profits back into the company and expand sales.

“We weren’t very well capitalized,” Wuest said.

More importantly, he said the company needed to quit its reliable, simplified business-to-business sales model of selling only to contractors. Wuest thought the company should sell directly to consumers, a high-risk, difficult pivot requiring precise management that, without perfect execution, could tank the business.

That’s when he realized he needed to talk to his father about retiring and handing over the keys to a new generation.

“I went to Dad and said, ‘This business model isn’t the future of the company,’?” Wuest recalled. “As we transitioned out of 1997, 1998 and 1999, and I was moving toward the presidency, I said, ‘Dad, we have got to figure out how to get me to run the business and get you down to Florida to retire.’?”

It wasn’t easy. Fred Wuest, a former window salesman who traveled the country, had happened upon the idea to build energy-efficient windows after the oil crises of the 1970s. He was proud of the company he built.

Nevertheless, he relinquished day-to-day control. His son took over the presidency in 2000. The company had already moved to a new building on Kent Island east of Annapolis, where it had more space for manufacturing.

“Mid-Lantic” lacked the pizazz of a consumer brand, so Wuest adopted the new name from the company’s Kent Island address of Thompson Creek Road.

“It has a ring and feel to it.”

Next came a letter to the home improvement contractors, who were the middlemen who bought and picked up Wuest’s windows from his factory then marked them up for sale to consumers and installed them in homes.

Wuest’s letter ended all that. He informed the contractors that Thompson Creek would no longer sell to them. He would sell directly to the consumer.

If Thompson Creek controlled the windows from manufacture to installation, the company could control salaries, production and other costs along the way and keep all the profits for itself.

“We would have significant competitive advantages by going to the customer directly,” he said. “We could price our product better and maintain profitability.”

One of his first decisions was hiring one of his former customers, a contractor who had 20 years experience in selling and dealing with the public. Wuest would work on the manufacturing end and installation process, while the sales guy would build the customer base.

Wuest’s education began with attending every home improvement seminar he could find. He traveled the country, networking and visiting other home improvement entrepreneurs. He became a fixture at industry trade shows, picking the brains of consumer-facing companies on how to spread a brand.

As it slowly grew, Thompson Creek started advertising in the phone book and attending home-and-garden shows to get its name out. Wuest said he focused on two things to differentiate Thompson Creek from competitors: He would target the middle-income segment to capture the broadest consumer base, and he would stay in the Washington area to establish the company as a hometown favorite.

He became obsessed with creating an installation process that worked smoothly, not only for the company but for its customers. Just like at any company, his customers had to be happy with their purchase.

Returning to homes to fix poorly installed windows is not only bad for the company’s reputation, but it is expensive because it eats up man hours, fuel and materials that could be used elsewhere.

“I am the guy who is going to have to go around and fix it,” Wuest said.

The strategy has worked.

Thompson outgrew its Kent Island factory and in 2007 moved into an 80,000-square-foot facility in Landover with a new corporate headquarters down the road.

The company has expanded into five businesses, including closet manufacturing and multi-unit residential buildings. But replacement windows, manufactured at its sprawling factory, are still the company’s big driver.

Last year, Wuest said his firm grossed around $67 million, and this year he expects that number to hit $75 million while serving 10,000 customers. The average job runs about $8,700, he said.

“We put in 60,000 windows last year,” Wuest said. He earns a six-figure income that, in a good year, approaches $1 million.

The company, which has no debt, has a profit margin of about 10 percent, Wuest said. He oversees 413 employees, including 50 part-timers. The full-time staff receives a 401(k) match and health coverage. Factory workers earn an average of about $30,000 per year.

The company has 67 vehicles and limits its service range to within 60 miles of the Landover factory.

Wuest said he plans on stick around until he is an old man. His chances of that look good, as his 72-year-old father is hale and healthy in the Florida Keys, where he fishes in his spare time.

By the time he reaches his dad’s age, Thompson Creek may be a juggernaut.

The company and some investors last week purchased a tract of land near Joint Base Andrews, where they plan to build a 125,000-square-foot window factory that will triple production to nearly 200,000 windows a year and expand throughout the mid-Atlantic.

That is a family succession that succeeded.