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Building a lifetime of relationships: VETS Group marks 100 years in the business

There are few companies in the world who can say they’ve been around for 100 years. But, VETS Group, which manufactures and installs HVAC systems and their components, including dust collection systems for the wood products industry, can now add their names to the list. To mark their 100-year anniversary, CFI sat down with VETS Group owner Sean Rayner and his sister, Erin Rayner, VETS Group marketing and business development officer, to learn more about the company’s history, experience getting into the wood products industry, thoughts about the future of dust safety, and more.

CFI: So, 100 years, that’s a big milestone. Can you give me a brief overview of VETS’ Group and its history?

Erin: VETS was founded in 1921 by World War I veteran Fred Rayner, our great-grandfather. Fred had immigrated from the UK to Canada before World War I, but went back to the UK to fight in World War I. He was injured in the war and he met a nurse, who he convinced to move back to Edmonton. They had just had their first child. He was actually a carpenter by trade, and he was working at a place called Barry’s Sheet Metal. At the time there were party lines – a shared phone line system where, for example, two rings was your house, three rings was my house, and in theory I wasn’t supposed to pick up your house’s ring, but lots of people did. Fred’s wife was eavesdropping on the party line one day and overheard that there would be some layoffs at Barry’s Sheet Metal, and Fred’s name came up. So, she chimed in and said, “Don’t worry about it, tell him he quits, and send him home.” So, his wife quit on his behalf and he got home and presumably she said something along the lines of, “I guess you better find a job because you’ve got kids to feed.” That’s how he started the business. Due to his injuries, he wore leg braces most of his life, but that didn’t seem to stop him from rolling sheet metal under his arm and riding his bicycle from residential jobsite to jobsite installing the VETS Supreme Furnace, which is a gravity furnace he patented.

So, VETS got its start in residential construction. Fred’s son Alan then took over the business and the focus changed to commercial and institutional construction. Then our father, David Rayner, took over. He took over the business and he did some pretty incredible things when it came to custom fabrication. He changed the company’s focus from construction to custom fabrication, with a focus on safety. He also modernized the company, bringing in computers, etc. By doing so, he was able to govern the business through two pretty intense recessions and maintain the status quo for years.

By this point, Sean and I were doing what we called our “externship.” We both got away from the family business, and lived and worked in Toronto in totally different industries until our dad got sick. When we got that call, we both packed up and came home. Sean and I spent six months in the company together full-time at that point. But before this, I was working at the CBC, and going from a major company to the family HVAC business in Edmonton was a 180-degree turn. So, I stepped away for about a decade and just recently came back.

CFI: So, Sean, since taking over the company, what’s changed?

Sean: I was 24 when I took over, and, interestingly enough, my grandfather was 24 when he took over as well. Erin and I came back to the business, which she decided wasn’t what she wanted to do. She helped me put together a business plan to present to my mom and dad, who had been given less than two years to live. It was a plan for purchasing the company and taking it into the future. Once that was in place, Erin left and went on to do her own thing.

The company under my dad’s tenure was pretty stable. It did between $1.8 and $2.4 million per year for around 30 years, and it didn’t fluctuate a whole lot. We did custom job shop manufacturing and small industrial ventilation projects. But, I learned relatively quickly that if I wanted to pay for the business and earn a living, it was going to have to grow. So, we set to growing both sides of the business – trying to grow our custom fabrication side as well as our industrial ventilation side. Given the boom times of the mid-2000’s in Alberta, the industrial ventilation side started to grow relatively quickly. In about five years, we went from $2 million per year to $10-$12 million per year and had moved away from job shop fabrication, focusing almost exclusively on industrial ventilation.

That part of the business is really the core part of the business today, though we have gotten in and subsequently out of a number of different things as we continue to evolve today. We got into the HVAC service business through acquisition and that part of our business is thriving and doing well today. In 2016, we bought a company in British Columbia to grow our reach and depth into the industrial wood market in that area. We were manufacturing industrial ventilation systems and dust collection systems before that, but this acquisition really made us a player in that market in western Canada. Today, dust collection is the strongest side of our business; it’s where we put most of our focus and energy and where we have success. It’s a big part of what we do.

CFI: What was it like when VETS first got into the wood products industry?

Erin: I think there’s some really obvious synergies between VETS and the organizations that we work with in the industry. There’s a grounded-ness in the wood industry. The general mentality is, “If we have a problem, let’s work together to solve the problem.” That’s where our teams thrive – helping to solve problems. I call it the “partnership perspective.” We have an expertise and understanding in an area where there’s a lot of risk, especially for the wood processing industry, when it comes to dust collection and explosive dust. We’re able to sit down at the table with those folks, and understand where their priorities are and how we can support them to have a safer more community-focused grounded workflow.

Sean: It’s been a challenge bringing that approach into the industry because I think people have felt taken advantage of in the past, maybe not feeling like they received what they paid for. But, I think that’s changing. In all types of construction, you really need to have the best of all of your stakeholders in mind, whether it’s your customer or your supplier, and you have to be willing to work together to get there. I think that’s still relatively new in this side of the business.

But, we’ve always had a consultative approach. I’ve always said we’re going to do everything openly and honestly. We’re not in this business to get rich off of one customer; we’re here to build a lifetime of relationships. We’re 100 years old, and that’s part of it. We’ve said that to customers recently who still seem to be holding their cards close to their chest. I say to them, “This is our 100-year anniversary this year; I want to still be doing business with you in 100 years. So, don’t worry, I’m here for you.”

CFI: What are some of the advantages and disadvantages to being a family-owned and operated business?

Sean: Statistically, very few companies have been around 100 years. Being family-owned and feeling the connection to the history and the legacy, not just for the Rayners, but for the employees, has been really beneficial. It has given us a level of continuity in all things that is really hard to find in private enterprise, although the wood industry has a lot of old and successful family businesses.

Erin: That’s one of the immediate commonalities between VETS and the wood products industry. In a room full of wood industry people, there’s an inordinate number of family businesses present, typically.

Sean: We’ve been very present the last few years at the Alberta Forest Products Association (AFPA) annual conference, and I remember sitting at the table this past year – which was a much different experience, very spread out, a small group – and we just talked family business. Having that common ground, regardless of industry, that’s always fun to discuss.

But, we’re actually planning a big change. A number of years ago, I was considering the idea of employee ownership. Ownership mentality is one of our core values and, looking back over our history, we’ve had several families with multiple generations involved in the business. So, we’re actually in the process of rolling out an employee share ownership plan here at VETS to try and take us forward through the next 25, 50 or 100 years as an organization with commitment and buy-in at a different level from our employees.

CFI: The wood products industry has changed quite a bit just in the last five years, with more and more companies aware of the importance of dust safety. How has VETS positioned itself to navigate these changes and different challenges?

Erin: One of the biggest pieces would be a focus on education. Further to what Sean said, we’re not in this business to get rich off of one customer. The idea has always been to educate our customers. And as the education has progressed, customers are realizing what they’re facing, the possible consequences of it, and that not just anybody can provide a solution that will keep them safe. So, I think that’s definitely been good.

Sean: I think that’s a different approach, one that’s kind of inherent within us. When we acquired the company in B.C., we hosted one of the wood dust safety seminars, which Dalhousie University would usually put on and charge $2,000 a head. We came in and I said, “I’m going to pay for the whole thing, and I’m going to invite people to it, because I want them to be aware of the challenges that they’re facing and understand them.” The guys from the company that we bought thought I was bonkers. The old-school mentality of the industry was, “Show them nothing, tell them nothing. This is your livelihood.” And I said, “No, it’s better if more people know what the risks are and how to mitigate them. And I’m just going to do such a good job that they want to use me, and I’m going to be open about it.”

CFI: So, where do you see the industry going in the short-term with regards to dust safety?

Sean: From a dust side, I expect that the customers who take it seriously are going to continue to do so and are going to continue to get tighter and tighter with their compliance. And with those who haven’t, we’re going to see an increased level of knowledge and understanding with the regulatory bodies that are going to push them more to do so. We’re seeing that mostly in B.C. and a little bit more here in Alberta. We’re seeing WorkSafe and WCB starting to push the issue more. I think it’s a good thing for everyone.

CFI: What are the plans for VETS in the coming years?

Sean: Pre-pandemic, we were looking at how we continue to develop as a regional player. We do think we bring a value-driven approach that we can deliver further afield from where we currently operate. I really want to put a lot of intention and effort about how we can mix technology with our business to address the needs of the customer. We need to work with some customers on that to give them a product and an offering that makes sense. That’s long-term, trying to figure out what our customers need and how we can use technology to make our delivery better.

This interview has been edited for length and clarity.