Case Studies

Erickson Framing LLC

Western Pioneers in Residential Home Construction

Family-owned Erickson Framing LLC (Erickson) first opened its doors in 1975. Specializing in turnkey framing, as well as pre-fabricated building products for residential construction, Erickson has become the premier framer for many major homebuilders in the western United States.

“We build prefabricated walls and trusses for residential and some light commercial builders,” Rich Gallagher, CFO of Erickson, elaborates. “We also offer pre-hung doors, trim, molding and a lot of the turnkey elements our customers desire in a new-build residential home.”

Bob Quinonez, vice president and COO of Erickson, has worked with the company for more than 30 years, starting back in 1980. “We are self-contained,” Quinonez says of the company. “First, we have a truss operation, second we have a lumber yard, third we have a wall-paneling plant and fourth we have a door shop. We are fortunate to be big enough to be able to buy direct on materials; we do sometimes buy local, but the bulk of our material comes from the mills.”

Erickson’s key geographic markets include northern California, Arizona and the greater Reno, Nev., area. The company also owns and operates its own lumber and panelization yards in Chandler, Ariz., as well as Roseville, Calif. The two yards enable Erickson to pre-fabricate wall trusses and panels before bringing the product to the site, cutting costs and saving time in the process.

“We are unique in that we operate our own lumber yard,” Gallagher explains. “This means we’ve got a competitive advantage through buying our materials direct from mills, whereas other framers have to pay a marked-up retail price.”

In-house lumberyards also facilitate quality control, as well as speed. “Operating our own yards adds insurances to quality, because everything’s built in a controlled environment, and it’s always consistent, with a certain safety element in place,” Gallagher explains. “We build the walls and the trusses in our yard and then ship them to the job sites, so by the time they get there, our crews are ready to install and piece it together, which cuts down on the cycle time and build time. Prefabricating is huge for us in that we are able to leverage cost-effective labor within the construction cycle. This translates into advantages that our competitors can’t meet, lower costs and efficient labor, which is going to continue to be key for us in a tightening labor market.”

However, that is not all Erickson provides. “More often than not, we provide the trucks and drivers, too, because delivery is sequenced so everything is in the most organized position when it gets to the jobsite,” Gallagher continues. “There’s a very specific strategy and technique in the constructing, loading, unloading, delivery and installation, to take advantage of every last efficiency we can get.” In fact, Erickson’s streamlined system allows the company to guarantee 40 percent shorter construction times than other conventional framing.

Hosting the President

After 38 years in business, Erickson crews have framed more than 80,000 homes and pioneered the production and delivery of panelized framing systems along the way. Even United States President Barack Obama has taken notice of Erickson’s impressive track record, singling out the company as exemplary for its high performance through the recession.

When President Obama made a trip to Arizona in August 2013 to speak about housing and the middle class, he selected Erickson to tour due to its outstanding credentials. “Having your operation accommodate that type of visit is an incredible honor,” Gallagher says. “They selected our company to tour, meet people, understand what it is we do, get to know the team and talk through some of our concerns in the housing industry and related labor challenges.”

After touring the facility, the President made a speech praising Erickson. “One of the cornerstones of a middle-class life in America is the chance to own your own home,” Obama said. “Thanks to the steps we’ve taken over the past four years, companies like Erickson Construction are bringing on new workers to build more new homes.” In fact, rebounding demand has pushed Erickson to grow its team.

Ups, Downs and Ultimate Growth

“Obviously last year snuck up on a lot of us in how quickly the market started to rebound,” admits Gallagher. “Northern California and Arizona were two of the harder hit areas during the recession, so the resulting recovery has seemed to be even more dramatic from what we’re seeing across the U.S.” Though Erickson was certainly affected by the recession, the successful turnaround presents a promising future.

The 1980s and 1990s were a prosperous period for Erickson. A later series of acquisitions resulted in Masco Corp., a Fortune 500 company in the construction sector, buying out the company. Not unlike many other companies in the housing industry, Erickson was hit hard by the recession and in 2012, Atlas Holdings LLC (Atlas), a private-equity firm specializing in the rehabilitation of industrial businesses, acquired Erickson.

The latest acquisition has turned the company around with great success. “With Atlas, our theme has been back to the future,” Quinonez explains. “So we’ve basically started the business all over again, and in one year we had made a dramatic turnaround.”

At the depth of the housing crash, the company had approximately 100 employees; currently, its full-time employees number 600, and Erickson continues to expand.

“We’re growing and we continue to hire every day,” Gallagher reports. “We take tremendous pride in how we evaluate, hire and put forth a comprehensive safety and training program prior to putting our folks on the line, and it’s working really well for us.”

A built-in-house manufacturing sector gives Erickson an edge over the competition, as well. “The fixed manufacturing element here in the yard allows for us to more immediately respond to fluctuations in market demand,” reveals Gallagher. “The nature of this industry is more reactionary than others because of all the outside economic and customer influences, but our structure and operational efficiencies will continue to play in our favor in the coming years. Indeed, in the years ahead, all prospects seem bright.”

“We’ve got our fingers crossed that this is a sustainable incline,” Gallagher says. “It seems to be, since it’s not growing at disproportionate means.” No matter what the future may hold, Erickson Framing LLC will continue to play a crucial role in the re-growth of the nation’s housing sector – just ask the President.

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Spring 2018



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