Hitt Contracting isn’t for the quiche-and-cabernet crowd.
Company T-shirts read “Hitt ’Em Hard.”
“True Grit. True Hitt,” was the slogan of a recent marketing campaign, which marked the company’s emergence from a recession that hammered revenue.
The three co-owners — Russell Hitt, 76, son Brett, 50, and Russell’s son-in-law Jim Millar, 54 — are polite and brutally direct.
When I was eating lunch at a Washington steakhouse a few months back with Russell and Jim, they bluntly (and rightly) gave the wait staff a comeuppance for slow service.
Hitt sets high standards for itself and expect the same of others.
“We don’t accept mediocrity,” Millar said.
They foster a driven culture that put this 75-year-old family-run enterprise on the verge of becoming a billion-dollar company, with 720 employees, revenue of $920 million, and profits I estimate to be between $30 million and $40 million for the fiscal year 2011 that ended in September.
Not bad for an enterprise in an industry that is supposed to be flat on its back.
The company has offices up and down the East Coast, and plans to open a Denver office any day, and another in Silicon Valley after that. Hitt builds just about anything — from restaurants to roads. But its specialty is commercial interiors, especially those understated wood-and-chrome offices that ooze power.
Hilton, Washington Gas, W Hotels, Northrop Grumman, the Hay Adams Hotel are all clients. Hitt does about 4,000 jobs a year, which range in size from a few thousand dollars to $200 million. The average job is $200,000.
The all-business Brett studied construction at Georgia Tech University, and sprinkles his conversation with words like “logarithmic” and “prescriptive.” His voice ratchets up a notch when discussing the company’s training school, Hitt Institute, where new employees learn everything from Spanish or English to Excel, the computer spreadsheet program.
Brett said the Hitt discipline, hard-wired into the company over three-quarters of a century, was the trick to weathering the financial crisis, which saw revenue drop from $913 million in 2008 to $707 million in 2010, a 22 percent decline.
Family-owned Hitt attacked the decline head-on, freezing salaries for two years, canceling the 401(k) match, cutting bonuses and making sure everyone felt the pain equally. About 50 positions went unfilled. Ten employees were laid off.
“I didn’t sleep much,” Brett said of those days.
The owners took a haircut, too, giving up 20 percent of their bonuses for a couple of years. Overall, payroll costs declined around 8 percent, squeezing margins.
Hitt said its diverse lines of business is what helped it manage the downturn. The big drivers are new construction and work for law firms at $150 million in revenue each; interiors at $200 million; building data centers, $125 to $175 million; and special projects, $100 million.
When the bottom fell out of the building construction sector, Hitt shifted managers to healthier sectors such as health care and data centers, where they just finished a sprawling $100 million data center in Denver for the State Department.
They hired four new salesmen and sent them to the far corners of the continent in search of business. The company now has projects in 30 states.
They expanded into more services, offering to team with architecture firms to design new offices as well as build them.
They also stayed lean. First of all, the company has zero debt. Virtually everything at Hitt is paperless. Every employee has a laptop or desktop, and operations staff have smartphones.
“I see this company as a vessel for everybody’s safekeeping,” said Brett, who began helping out on job sites at age 11 (He worked on Chez Francois, the french country restaurant in Great Falls). “It’s incumbent that everybody share a little of the burden.”
The Hitts are entrepreneurial. They own a restaurant group called MHG, which owns and operates three local restaurants, called Circa; two in the District and one in Clarendon. MHG also owns Greenberries Coffee in McLean. They own a funky little startup called Tin Cup, which creates stencils that allow golfers to imprint custom-made designs on their golf balls. Tin Cup is going to gross more $1 million this year. Hitt also owns its headquarters and some other properties.
One of the family’s few concessions to success is a “log cabin” compound in rural Virginia. And Russell — known as the soul of the enterprise — has a spread in South Carolina.
Though Hitt is unsentimental when it comes to business, it views itself as a family company at its core. It fires people, but those who can perform are given runway and a long career.
Hitt has 14 employees over the age of 65, and six fully-retired who still routinely come to the office to help out. One employee has been there nearly 50 years.
“We create these roles for them,” Brett said. “They wanted to stay active. Dad very much cares about the employees. He believes in make sure they have the ability to excel.”
The tightfisted, no-nonsense culture started back during the Great Depression.
Warren Albert Hitt of Amissville, Va., started the company in 1937. After leaving the family farm at age 17, Hitt worked several jobs, including as a service station attendant, an electrician, a popcorn and candy seller at a theater in downtown D.C., and as an accountant, which he learned at Strayer University.
Warren had picked up some trade work in carpentry and painting, and started doing odd jobs at nights and on weekends.
“My father was self-made and self-taught,” said Russell, who has been working at the company since he was 18, and who still interviews job candidates.
Warren’s wife, Myrtle Lee, who hailed from a South Carolina cotton farm, kept the books with a ball-point pen, tracking every job on a 7-by-10-inch card. The company’s offices were the family dining room table on 18th Street in Arlington.
When Warren died in 1976, Hitt was grossing around $4 million a year.
Then two things happened: the demand for Washington area office space rocketed, and Brett and Jim joined the company.
Jim — “Mr. Outside” — handled business development and customer relations. Brett —“Mr. Inside” — concentrated on strategy and operations. Their first $1 million job came along around 1990. Annual growth started to reach 25 percent.
Revenue skyrocketed after Sept. 11, 2001, when a series of national security jobs — at $200 million to $250 million each — came Hitt’s way.
“They were transformative,” Brett said.
In the lobby of Hitt’s headquarters, giant flatscreens resembling the departure and arrival screens at airports list dozens of jobs that Hitt is running around the world: World Bank, BAE Systems, Crystal Marriott. There’s a dry cleaners, hair salon, cafe and gym.
It’s a long way from the dining room table in Arlington.
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