Jul 01, 2019

Dealer of the Month: Natural Progression

Minnesota well-drilling business adapts to change & expands services

The business originally focused on well drilling. Sonic drill rigs commonly are used for exploratory purposes for mining clients.
The business originally focused on well drilling. Sonic drill rigs commonly are used for exploratory purposes for mining clients.

In 1959, twin brothers Marvin and Melvin Traut launched Traut Wells in Waite Park, Minn., but a tumultuous economy forced them to close the business in 1982. At that time, Marvin’s son, Mark Traut, and Mark’s cousin, Dave Traut, restarted the company as Mark J. Traut Wells Inc.—now known as Traut Companies. Mark had grown up working for the original company, and while Dave grew up on a dairy farm, he joined the original company in 1977.

Early Days 

“Natural progression is probably the best way to put it,” said Jim Gruenke, water treatment division manager with Traut Companies. “As the previous company closed, they were both out of a job and decided ‘Hey, why don’t we do our own thing?’”

The cousins purchased the previous company’s phone number, obtained a line of credit and began building the company up from 10 employees to 53 employees today. However, the early years of the new business faced many challenges. At one time in the early days of the business when the company only had 10 employees, the owners told the employees that they might not be able to meet an upcoming payroll, but the employees remained with the business. Additionally, a drought that hit Minnesota in 1988 created an additional demand for the business’ services and helped it grow, Gruenke said.

“They were very young—they were in their early 20s—and the joke is now that many competitors said ‘Those kids in St. Cloud, Minn., are never going to last,’” Gruenke said.

Thirty-seven years later, the company has weathered the years and expanded. In 1996, Gruenke joined Traut Companies to help expand the well driller’s water treatment division. Previously, Gruenke had worked for a competitor, but was approached by Mark and Dave to join their company after he briefly had left the industry, he said.

Traut Cos.’ fleet size varies from 80 to 100 units.
Traut Cos.’ fleet size varies from 80 to 100 units.

 

Changing Times

While well drilling is the origin of the company, it now has branched into different types of drilling as well as treatment. Traut handles residential, industrial and municipal drilling applications, in addition to water treatment and underground irrigation. The company also has a Minnesota State Department of Health certified lab that it uses for in-house water testing. 

“The biggest area now has grown into municipal and industrial type drilling,” Gruenke said. “We do a lot of government financed work through the Minnesota Department of Natural Resources and some Superfund work with environmental cleanups.”

The business has witnessed changes in the industry since its inception and has worked to adapt to those changes. Gruenke has noticed a transition from timeclock water softeners to metered water softeners in the industry. He also has noticed a renewed focus on treating arsenic in drinking water since the standard in Minnesota was lowered to 10 ppb.

“Other things that I have seen since I have been involved with the industry is drinking water is much more of a focus,” Gruenke said. “In years past, it was just water softeners, but now with concerns of water quality, drinking water treatment is much more of a percentage of the business than it used to be.”

Something that sets Traut Companies apart is that the business spends approximately 25% of its time catering to municipal and industrial applications. The business particularly is involved with environmental cleanups relating to emerging contaminants in the area. Gruenke’s advice to businesses looking to increase their involvement in municipal and industrial projects is to, “make yourself known to engineers.” Traut Companies’ owners worked to make their business known to engineers by getting involved in industry associations and building a reputation.

“When you are granted the work, pay every attention that you can to the details of customer service and quality work,” Gruenke said. “That will drive a lot of business to our door.”

Established in 1959, the business has expanded to provide water treatment services.
Established in 1959, the business has expanded to provide water treatment services.

Get Involved

Increasing involvement with associations and community organizations has helped drive business to Traut’s door. Improving community engagement was one of Gruenke’s goals when he started with the company, and actualizing that goal has proved well worth the effort. 

The business is active in the local Chamber of Commerce and Central Minnesota Builders Assn., as well as the Big Brother/Big Sisters program and Habitat for Humanity. The business also has its own line of privately labeled bottled water that it donates to community events. Gruenke, who is concluding a term on the Chamber of Commerce board, once tracked leads from that organization.

“I did track specifically leads that would come my way from that organization in particular, and I stopped counting when the client list exceeded 100 and our revenue was well into six figures,” he said. “Just diversifying in the way we get those leads is a way to grow the business.”

Beyond community organizations, Traut Companies is involved in several industry associations, including the Water Quality Assn. and the National Groundwater Assn. Belonging to industry associations helps strengthen the business and the industry, Gruenke said. 

Employee retention is a priority for the owners, who provide various incentives and benefits to employees, including healthcare and a company matched 401k. The owners offer performance based compensation incentives, which also impacts the business’ customers long-term through quality service. This goes hand-in-hand with Traut Companies’ marketing strategy, which highlights quality service.

“What I have personally found successful is just the history of quality work that we have done and willingness to provide the service when it is needed,” Gruenke said. “That creates a customer that is going to be with you for a long time.”

The business also incorporates other marketing strategies organized by a marketing firm, including billboards, radio and its website.

While Traut Companies always has remained a family-owned business, the water treatment industry continuously is evolving. Overall, dealers will need to continue to grow to keep up with changes in the industry.

“On the future of the industry, again we are going to have to keep coming up with more and more ways to be efficient as far as the ways we treat water because scrutiny of our methods will continue to become more and more prevalent as everybody is concerned with how we are affecting the planet as a whole,” Gruenke said. “In the future, the dealers that are going to thrive in this industry are going to be people that can be that specialty person that customers can go to.”

About the author

Lauren Estes is managing editor for WQP. Estes can be reached at [email protected]

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