There has been an inordinate amount of speculation surrounding this Article ranging from the fact that it may be a paid product to Foreclosurepedia is on the payroll. The reality is that Milan Thompson, Chief Executive Officer (CEO) of ASONS was contacted by myself while researching an Article about the excesses in the Property Preservation Industry. This Article, as many in my Series will address, revolve around the presentation of Corporate Dossiers. While many Contractors are primarily concerned with whom pays what, many of us are actually more concerned as to whether or not a Company has both the fortitude and integrity to become part of our Portfolio. So, before the emails roll in about how the pay is low or you have an ax to grind, this Article deals with whom the Company is.
In 1999 Carolyn Beeson and her son Jeff started up a small construction company to buy and flip houses. It was named A-Son’s Construction after her son Jeff. At the time, Milan Thompson was a silent partner in their business, providing some coaching and funding to buy the homes. The first property ASONS bought was a US Department of Housing and Urban Development (HUD) property that had grass knee high and had not been trashed out. “Frankly, it was a mess,” Thompson said. Jeff complained to the selling company who apologized and stated that they recently had taken over the HUD (Marketing and Maintenance (M&M)) contract due to another company “…failing miserably…” and were in the process of hiring field sub-contractors. “Jeff got this wild idea that we could make more money cleaning maggots out of refrigerators than flipping houses,” Thompson said so he signed a waiver prohibiting us from ever buying another HUD house after our first one!
HUD requires their M&M Contractors to use small companies such as ASONS. This gave Jeff and ASONS a chance to grow the business because of these rules. As Thompson put it,
About a month later the three of us were discussing what an opportunity we were seeing and it was decided that I would quit my job and come on board as the first employee to help them get this organized. This was in 1999. It was never meant to be a long term job for me. For the next 5 years we kept getting more and more work not only from HUD but from Nationals, agents, and local banks as well. There were many a week we didn’t get a paycheck while we made sure our contractors and employees did. Our family kept putting our profits back into the business so we could grow.
Thompson on how ASONS hit the mainline: “Around 2005 we bid on a HUD M&M 2.0 contract and was a finalist. We did not win but we did gain confidence in our abilities to compete. In 2010 we bid 5 of the 10 FSM [M&M Field Service Manager] 3.0 regions that were available and we won 2 of them! A-Son’s is the poster child for what HUD stands for – giving small companies an opportunity. We attempt in every way to partner with our subs in the field. Yes, pricing in the field is going down and if ASONS does not keep pace with cost reductions we will go the way of the dinosaur.” Reflecting upon this and the current Industry landscape Foreclosurepedia notes,
Since the days of the HUD M&M 3.0 there has been a steady decline in the pricing paid to Contractors. One of the biggest concerns Foreclosurepedia has is that HUD knows, at the end of the day, that virtually no Contractor is currently able to be in Compliance with the Provisions of the Service Contract Act (SCA). Foreclosurepedia actually did an expose on this issue and broke down some of the money required to be paid in accordance with SCA. It is our opinion that the HUD 3.8 Timeline was accelerated in an attempt to sidestep the SCA Issues which would, quite possibly, force HUD to accept higher bids in order for Prime Vendors to be able to pay Contractors so that all would be in Compliance with SCA.
Thompson on how ASONS pays: “In the beginning, ASONS used to pay Contractors weekly and carry the money themselves.” As most Contractors know this, in and of itself is unheard of. Thompson continues, “Well, we [ASONS] don’t do it that way anymore as we now pay all contractors daily! After any work is completed by our contractors and qc’d [Quality Control Checked] in the office we direct deposit the money into all contractor’s accounts that day. Money is the lifeblood of any small business and I will never forget from where we came.”
Thompson further stated with respect to SCA issues, “As for our employees…with our HUD contracts we were able to offer all employees [of ASONS] full health insurance with ASONS’ paying 90% of their monthly premiums.” Not bad for the employees in my opinion.
Thompson on himself: “As for me in this business…not only was I the first employee but I have sat in every position within the company over the past 14 years and may be the only CEO in this industry who has worked in every position both in and out of the office. I have come a long way from the day I started with only paper and pencil in hand; and my family has supported me at every turn.”
I am proud of what my family has accomplished; we are living the American dream and have many contractors, employees, and clients to thank for our success.
Thompson on the Corporate Model: “ASONS is a National Property Preservation company that is structured to be managed as a flat organization. We use 6-Sigma techniques to continually improve our processes. Our employees are trained property preservation procedures for two weeks prior to working with contractors in the field. [Contractors in the field] then teach them what you don’t learn in the books.” Thompson elaborates further,
As a flat organization our employees are allowed to make any financial decision when confronted with an issue in the field. There is no price level where they have to go to their supervisor for permission. But what does happen is when they are uncomfortable with a decision they consult with their co-workers and/or their trainer and/or their supervisor. This way we make decisions with the contractor at the property the first time (when we can as sometimes our client makes us put in bids). We have trainers who sit among the REO Asset Specialist (RAS) for each client group and work with them on a daily basis. The invoicing person for that client also sits among the group they invoice for. The supervisors for training, vendor relations, IT, accounting, construction, floor, etc… all sit in a room together. When there are issues they all hear it and work on it together. No fiefdoms allowed.
Thompson on the ASONS’ Employee Setting: “We have popcorn Tuesdays at 2:30pm every week where we pop corn and take a break. We have donut Thursdays every week where the employees are treated to either a donut or fruit when they come to work. We give free soda pop every day.”
Thompson on Contracts: “We just completed [a specific time was not mentioned] a Vendor Pricing Proposal for several states where we did not choose the lowest price [referencing Lowest Price Technical Value] but rather the ones with the most value and were fairly bid. Some of the prices for some of the services we perform actually went up. We will now use this pricing to go out and attempt to grow ASONS with competitive, fair pricing as established by our vendor network. To be fair there are some vendors who after bidding lower prices seem to want to renege on what they put down. Frustrating.”
Thompson on the Interpersonal Level with respect to Contractors,
Let me tell you about some of my contractors. Back in 2000 when we had a whopping total of 4 sub-contractors we were approached by a person from Bosnia who had to leave to save himself and family from certain death. I really didn’t want to get involved with a non-English speaking foreigner but I agreed to meet with him. Through his son who spoke broken English at best he told me that he had been in America for 6 months and wanted a chance. He told me that he and his whole family would work for free for one week and show me how good they were. Broke my heart. My great grandfather had come to America from Germany many, many years ago alone and at the age of 17. Someone helped him, it was my turn to repay. I hired him, our family helped teach him English and Mohamed now works for several Nationals and last year made over $500,000 and has his own crews!
About 7 years ago a contractor came up from Indianapolis and met with me. He was dyslexic and did odd jobs for agents but wanted an opportunity. So we gave him some work but it was a disaster. Then we began reading to him when he was at the job site what he was supposed to do and the pictures we needed. Success! Today Daniel has a girlfriend who reads him his work and last year he made almost $100,000! When the Gulf war started we had a contractor who was called to be an instructor. His wife stayed in the business and we reduced her workload to ensure she was successful. When he came back, we gave him the work and the contractor who was going to be replaced wanted to move to Dayton to be closer to his adult children, we allowed for him to go there and gave him all the work we could to help support him.
To ensure transparency, Foreclosurepedia is releasing an email exchange which has been the center of several media outlet’s questions of us with respect to the offering of transportation to and from Foreclosurepedia’s General Headquarters (GHQ) in Blaine, Tennessee, and the ASONS GHQ Muncie, Indiana.
Thompson: I will make one last offer to have you see a property preservation company by offering to pick you up and take you back home in the same day…by that same jet you first wrote to me about. You see the jet is a tool to be used as needed not a status symbol as it is for some. And I will pick you up at the airport myself as that is how I do business. I have [redacted by Editor] hours left for the year on my jet card and will share/give you 3 hours of that time.
Williams: While I appreciate the offer to fly [it] would be conflict of interest albeit tempting.
Overall, I believe Thompson has been both sincere and forthcoming. Being a veteran of the US Armed Forces like myself, Thompson strikes me as quintessential small business executive; an Old World Man attempting to navigate the New World landscape. We were granted a snapshot of ASONS’ financials for this Article. This, alone, is unheard of let alone wise if a Company is attempting to skew the data or their true intentions. That information and how it impacts Contractors; the boots on the ground, will be discussed in our next Article.
Before anyone; Competitor or otherwise asks, we WILL NOT release any numbers with specificity! The balancing act is a delicate balance of trust; trust between Thompson, Foreclosurepedia and the Industry at large. The data has been substantiated and paints a picture not of obscene profit margins and largess, but rather one of prudence and due diligence.
So, bearing in mind that this Article and its Companion to be released later this week does not have the typical Smoking Guns many of our Readers are accustomed to, it marks a New Frontier upon which Foreclosurepedia is entering. Any Publication has the ability to churn out, day after day, negativity. What is difficult for reputable Publications to do is the presentation of honest and unbiased Reporting when it flies in the face of its Readership. We hope that both our Supporters and otherwise will appreciate the fact that we want to fairly present all facets of the Industry. We feel that this Series is a good step in that direction!
Are you a Company whom would like to be Profiled in our Corporate Series on Foreclosurepedia? Feel free to reach out! Are you a Contractor whom wishes to opine? Likewise, reach out to us today!