Franklin Building Supply with Rick Lierz - Dead quiet in the backseat
Hi, this is Ain't That Somethin', and I'm your host, Levi Smith, CEO of Franklin Building Supply. We're an employee owned building material supply company headquartered in beautiful Boise, Idaho. I'm a former ranch kid from Texas who found his way to Idaho and into leading this storied company. We're proud to be part of the fabric of communities we operate in and want to help share stories of other companies doing the same across this great state. In each episode of Ain't That Somethin', I interview founders or leaders about the stories of companies you may be surprised to learn have either had their start in Idaho or now call Idaho home.
Levi:In every interview, you'll hear about an interesting cast of characters, learn about daunting obstacles, and be inspired by the persistence it took to succeed. Get ready to be surprised and entertained with each episode of Ain't That Somethin'.
Rick:I was the oldest of all the kids, and I don't recall any of the eight kids ever saying, Yeah, I can't wait till I take over the water.
Levi:Today, I have a conversation with Rick Lierz, my predecessor as CEO of Franklin Building Supply. Rick and I get into the story of how his dad, Dick Lierz, and a friend Bud Fisher started the company back in 1976. We talk about the first couple of decades of being in business, eventually Rick and then his sister Rhonda coming into the business as CEO and CFO and becoming owners. We get into stories about the station wagon and long road trips and moving across the country and the great recession and all kinds of things that happened over the multi decade history of the company. One of the common threads throughout all of it though, was this dream, this vision that Dick had very early on for the company to eventually be owned by its employees.
Levi:And Rick and Rhonda in 2015 were able to see that vision become a reality when Franklin Building Supply became a 100% employee owned company. So enjoy this conversation with Rick Lierz, former CEO of Franklin Building Supply. Rick, welcome to the podcast. Let's learn a little bit about the Lierz family.
Rick:Thank you very much. I'm happy to be here. From my earliest memories, my dad was a lumberman. He was involved in the lumber business. He actually got involved in the lumber business with a company in Denver, Colorado.
Rick:And that company was purchased by Boise Cascade in the early sixties.
Levi:When he got involved in Colorado, like is that just graduated high school and this was just something to do? Did he have some other connection to the lumber business? Was it just, you know, No, he was Employees wanted sign and he stepped in.
Rick:Out of college. He was an accountant. Okay. And he started, I think his first job was with an electric company. This was I don't recall the exact history but this was just a company that hired him and he was happy to have a job.
Rick:They moved from Pueblo, Colorado to Denver, Colorado for this job. And in 1962 or '63, that company was purchased by Boise Cascade out of Boise. And in 1963, he was transferred with that company to Boise and our family moved to Boise.
Levi:So that's the first time the Lierz family lands in Boise, Idaho.
Rick:Exactly. And, you know, young family, my dad and mom were in their twenties. At that point, we had four kids, all very young. I was five years old when we moved. So, my memories, you know, kind of start there.
Rick:Dad was involved with Boise Cascade which is a lumber business. Every time we went in the family station wagon anywhere on vacation, we had to roll through town
Levi:hall and find the local lumber yard. Now how excited were you and your siblings about this plan?
Rick:Well, you know, I mean, kids and eventually five kids in the back of a station wagon, we weren't happy most of the time, But, you know, kind of rolling slowly through every little town to see the local lumberyard. My dad was just kind of obsessed with lumberyards.
Levi:So He sounds like a lumberman.
Rick:He is a lumberman. Yeah. That's exactly right. Yeah. So grew up in Boise until 1970 when his job with Boise Cascade took him to the East Coast.
Rick:We moved to the Washington DC area because Boise Cascade had purchased some lumber yards up and down the East Coast and they sent him back to run that division.
Levi:And that's a huge change to go from Colorado. I mean, back in the sixties, we're talking about, I mean, obviously much smaller than it is today. It's not the Denver of today, and then you come to Boise and it's not the Boise of today, and then the East Coast. I mean, did that transition go for the family?
Rick:It was from a 13 year old boy's perspective, it was fairly dramatic, but it was actually pretty cool. It was, we drove across the country in a station wagon with a cat and a dog and five kids and Did
Levi:you stop at every lumber yard along the way? I mean, that would have made for a really long trip. This takes you five, six days.
Rick:I think it took us about five days to get across because there's only so much you can handle in a station wagon per day with that many living bodies.
Levi:Now, this is a station wagon where some of you were facing backwards.
Rick:Oh yeah. Oh yeah. The very backseat face backwards. Yes. And and you really kind of wanted to get to the backseat, right?
Levi:That's the prime seat for
Rick:his dad couldn't reach you from the backseat, you know, because the kids are
Levi:and you can play with the cars behind you. You could, you know, you should have your own little games and exactly. Yeah.
Rick:But II remember that the the timing worked out when we pulled into Northern Virginia after this long drive across the country, it was early evening and the sun was down and dad drove us right into Washington DC and drove around the monuments in on the Capitol Mall and
Levi:that's kind of your first impression of being in DC was yeah, The the awe inspiring mall
Rick:and Yeah. So, he did that on purpose and that was fun but anyway, he he worked for Boise Cascade in the five five and a half years that we were in Virginia and then he got transferred at the 1975. Yeah. At the 1975, he got transferred back to Boise. Okay.
Rick:With his job and then he's been in Boise ever since
Levi:and you were finishing up high school then, right?
Rick:So, you stayed home. I was actually in my first year of college,
Levi:the first year of college. So, you stayed behind us.
Rick:I stayed for the full year and by the time I got out of college that year, he he was involved with Franklin. So, what happened there was when he was working at Boise Cascade in the 60s in Boise, he and another man named Bud Fisher were running a division called Building Materials and Services which was really retail lumber yards and wholesale lumber yards. The kind of work that we do now today, right?
Levi:So, the Boise Cascade just for our listeners today is known as a primarily a distribution business, a manufacturing business but back then, they actually had these lumber yards all across many parts of the country at least.
Rick:Yes. Okay. Our yard in Gooding, Idaho was a Boise Cascade yard, for example, a small little yard. They had big yards and small yards. They were very much in the retail sales business of lumber.
Rick:Bud Fisher and my dad ran that division. And then dad was not back in Boise very long in early nineteen seventy six when Bud came to him and Bud had left Boise Cascade in the interim and was working for another company. And he heard about a small lumberyard in Boise named Franklin Building Supply that the owner was aging out and was selling. And Bud came to dad and said, I need a partner to be able to afford this. Would you be interested in being a silent partner?
Rick:And dad and mom talked and they went all in and went fiftyfifty with the Fishers, Bud and Anne Fisher and bought this lumberyard. And the plan was Bud was going to run that business. Dad was gonna continue to keep his job at Boise Cascade.
Levi:So he really in that earliest moment really viewed himself as an investor, passive investor in the business. I'm familiar with this industry, this business, I'm gonna put my money in here. I trust Bud, your family, I think had a long history or familiarity with the Fishers. And that's how he viewed himself. He's an investor, is that
Rick:an accurate betrayal? Completely accurate. And he went to his boss at Boise Cascade and disclosed all of this
Levi:and so. Because now he's an investor in a competing business, right? At some level?
Rick:He is. Yeah. And Boise Cascade was dad describes it as they were always changing their mind about whether they wanted to be in retail. So they would go through a phase where they sold off retail lumber yards and then the new CEO would come in and he'd wanna buy a Buy more back. So, you know, he was very familiar with buying and selling lumberyards for that company.
Rick:So he went to his boss and got approval from his boss to be a silent investor in this. And it took about a month of him working at Boise Cascade, but thinking about what was going on with his investment every day to say, you know, this is tearing me up. I'd really, really rather be out there with bud working.
Levi:He lasted a month.
Rick:I don't think it was any longer. Yeah,
Levi:it was pretty quick. Because all the risk and reward was over there. I mean, you have the day to day job, W-two jobs are, but the investment was down the road.
Rick:With Boise Cascade, he had a stable job, salary, benefits, retirement plan. He was thinking about leaving all of that behind his career that point and jumping into this little enterprise that did not have any of that guaranteed.
Levi:Yeah. You know, you're leaving a lot of that safety and security behind. I mean, just when I say a lot, I mean, all of it. Yeah.
Rick:But you know, as he also says, they had mortgaged their entire lives to make that investment. So mom and dad went out and and leveraged everything they could to to come up with the money to put in to buy this business. And he said, I I needed to follow where my heart was and my heart was with my investment and what was going on at this little lumberyard. So in early, 1976, he left Boise Cascade and went to Franklin Building Supply full time for the next twenty years. Dick and Bud sat next to each other at the lumberyard every day.
Rick:Yeah. Family members. And it really kind of became a fixture. You'd walk in that lumberyard, that very first one and there were two chairs or two desks in the corner, right on the Sales Floor next to each other and that was Dick and Bud. Dick and Bud.
Rick:Wow. They kind of carried that model. There were no there were no offices. Everybody sat out on the floor. They waited on customers.
Rick:They loaded customers in the yard.
Levi:I mean, they're in it. Yeah, they are in it.
Rick:Yeah. Yeah. So, I came back from college in June and went to work at the lumber yard.
Levi:So that's the first time you would ever step foot in a lumber yard. Is that right? As an employee. As an employee. Okay.
Levi:I'm sure you've visited, but first time that you're getting paid to work at a
Rick:lumber yard. Here's a set of gloves that cost you a dollar 79, put those on, go out and sweep the yard. Here's how to run a forklift. Learn how to run the one forklift we had. Load the one two ten truck we had, started carrying sheetrock in the houses.
Rick:You know, really everything. It was a it was truly a one horse lumberyard at that time.
Levi:So, it's like as I tell employees today, I mean, work at Franklin Building Supply comes with a free built in gym membership.
Rick:That's right.
Levi:So yeah, it does.
Rick:Yeah, I was in pretty
Levi:good shape. You're in pretty good shape. So one of the things that is gonna be different about this podcast, I think it's gonna be fun is that we're gonna play some clips of some conversations that we've recorded with your dad over the years that will give us something to kind of respond to. And so I think now would be a good time to play one of those first clips as we think about the very early days of Franklin Building Supply and 1976 and it all getting started, Dick and Bud sitting there in that corner. So let's listen to this clip and then you and I can kind of respond to what we hear Dick say about the vision when they first started the business.
Dick:And going into the business, we didn't have any grandiose idea as to where it might end up. We just knew one thing and that was to work hard.
Levi:There's a lot in that statement. Yeah. You know, I've heard Dick in conversations I've had with him talk about that, you know, he's very sincere in the fact that there wasn't this grandiose vision. It started with one location and working really hard to do a good job and service customers at that one location. What's your reaction to that?
Levi:How do you kind of unpack that as we're going to get to where you fully thread into this story later? We just started with your first exposure as a paid employee for the yard during a summer, but as someone who came into the business later and hearing that from your dad, what are your thoughts about no grandiose vision but knowing how to work hard?
Rick:I think that he's exactly right. They didn't have a ten year plan that says we're going to grow to this, we're going to turn this into What they knew how to do was run lumber And they knew what their philosophy was. They were very confident men and they put their heart and soul in the entire thing and things evolved. And they were not afraid to jump in as things evolved, as needs evolved to, expand kind of organically. I I remember they were they were the first ones at work in the morning and they were the last ones to leave.
Rick:Dad would come home every night with the tickets for the day and, you know, this is way before computers. Yeah. So all of the sales tickets were done by hand on these five part, you know, on these five part tickets and he'd come home, he'd extend the tickets, he'd price them and he'd extend them so that they had a total that he'd take back the next day for the bookkeeper to enter in the ledgers of what people had bought the day before.
Levi:Did he occasionally rope you all into that activity? Absolutely.
Rick:We all learned how to work a 10 key and extend tickets. We understood how to price by a board foot. It was a family affair.
Levi:Yeah. And I think there's something really insightful and wise and what he's saying there in that approach where today, I think a number of people are thinking about starting something or have an entrepreneurial bent, assume that they've got to have that end plan figured out and they got to know where this is going to end up to get started. And if it's something that you have a dream about, you're familiar with, you have some knowledge, talent that you can bring to the table, just getting started and doing the work. And sometimes we get tripped up over having the bigger plan all figured out. People read magazine articles about how startups made a pitch and got investments and all this type of stuff.
Levi:But those are kind of the magazine version and glossy and glittery versions, right? So many businesses across The US like Franklin Building Supply in 1976, just get started by people who roll up their sleeves and just start getting to work, put a little bit of capital at risk or sometimes a lot of capital at risk, but just start doing the work and see where it goes instead of being paralyzed by what this may become.
Rick:Yeah, I think that's right. They knew how to work hard and they liked being their own bosses and they just took it as it came. And I think they had the confidence that if they worked hard and they focused on what their philosophy was, they would be successful in a very competitive market. Their philosophy was from the start, we are going to provide the best service to our customers. And that's that can sound really trite.
Rick:It's something that I heard them talk about every single day that first year that I worked there.
Levi:They're really trying to figure out how to actually deliver that, not just say it, deliver that as an experience to customers.
Rick:Right. They hired an outside lumber salesman, which was not the norm in Boise, Idaho at the time. They were doing things that were different than their competitors. And one of their competitors was Boise Cascade or a spin off from Boise Cascade. It was called Boise Building Supply, and it had been a Boise Cascade yard.
Rick:So they just worked hard and kept their eye on the ball and grew as growth came.
Levi:Yeah. So before we get to you and your sister, Rhonda coming into the business, you talked about Dick and Bud sitting in the corner for twenty years and, you know, operating in the business every day, leading the business. Give us an idea of what, big picture, what transpired over those twenty years? How did the company grow? It obviously started with one location.
Levi:Not too long after it started, moved to a bigger version of that location just down the road on Franklin. But over those twenty years, what did the company go from and become before we get how you and your sister Rhonda ended up coming into the business?
Rick:That's a great story. They didn't have any money. Everything they had was put into this one lumberyard and was picking up some steam and they added a door shop, for example, they bought a used door machine and they started pre hanging doors and that was kind of their first expansion if you will. And then, there was a lumberyard in Caldwell that was called Caldwell Building Supply that was owned by two young guys. And they were the sons of a man named Earl Chandler who ran a building wholesaler.
Rick:Building supply wholesaler in town. It was one of our, main wholesalers, Chandler Supply. So the Chandler boys owned this little lumberyard in Caldwell and they wanted to sell it. So Earl Chandler came to Bud and Dick and said, would you be interested? And so they made a deal to buy it over time from the Chandler boys.
Rick:And that became their second in Caldwell.
Levi:And so Dick and Bud didn't split up at that point saying, Hey, you run this one, I'll run the other. They stayed together in that corner. They did. Okay.
Rick:They had a manager in Caldwell. They would split up as they grew and added locations. They would split up which of the owners oversaw that from an executive management standpoint, but they they both stayed in Boise throughout twenty years. And so, not too long after that, they, they had an opportunity to buy a piece of property West Of Boise, kind of between Boise and Meridian. That was a farm farmhouse and a bunch of farmland way out in the country at the time.
Levi:Hard to believe today, how in the country back in the, I mean, is early 1980s or late seventies This this property became available.
Rick:Yeah, this is probably about 1980. Okay. Right around there. And so they bought this piece of land on time from the farmer. Their thought was eventually we'll move the lumberyard there.
Rick:People thought they were crazy because it was so far out. That's where the lumberyard in Boise is now or but at the time, it was affordable because of the price and the terms because it was way out there. So they bought that, and then they ended up selling a part of it to Idaho Power because Idaho Power's had a facility close to that. And they used the money from that sale to build a lumberyard in McCall, Idaho. And that was their third location.
Rick:Okay. And so stories like that as they grew Yeah. Just kind of piece by piece, they opened the lumberyard
Levi:and savvy, taking advantage of some opportunities.
Rick:As opportunities came up, they were looking for them, but they weren't afraid to get into them. They just had to be smart because they weren't loaded running, you know, looking they they didn't have a bunch of cash. They were looking for.
Levi:They're pouring money back in from the business into the business. Everything went into the business. Yes.
Rick:Alright. So, they opened a lumberyard in Elko, Nevada. Then, they opened a lumberyard in Bellevue, Idaho which is near Sun Valley. The most important consideration in every one of those expansions, Caldwell, McCall, Elko, Bellevue was who's gonna run it.
Levi:Who the people. You can get the building built and fill it full of material, but if you don't have anyone to run it, you've got a problem.
Rick:Yeah, and running it, they're small every year, the key is how are you gonna sell? You gotta run it smart, but you also have to be able to sell in those markets where you're going in as a Greenfield. They figured those things out and it took a number of years for them to grow to that level. And that kind of takes us to the point where we get to the nineties and things start to change in the partnership and in my family's involvement.
Levi:So before we talk about you and Rhonda entering the business, I want to play this clip from your dad about how he and Dick thought about kids, their kids, you, your siblings in the business.
Dick:When Bud and I first, one of the deals in our operating plans, because he had three kids and we had five. And so our agreement was that none of the kids would come into the business. What we'd want them to do would be to go out and establish themselves in life in whatever they desire to do, you know.
Levi:So Dick and Bud, I mean, sounds like not only did they not assume that the kids would come into the business, but they in fact really kind of went into this not wanting the kids to come into the business. And it sounds like they wanted, you know, you, your siblings, same thing on Bud's side to just be able to go do their own thing. Didn't want this model where the kids are only in this business because their parents are in this business. Is that how you remember that and how that was communicated to you at the time?
Rick:Yeah, very clearly. Bud was mentor of sorts to me. We knew the Fisher family really well. Dad and Bud worked together at Boise Cascade. We socialized together.
Rick:We knew their kids really well. Anne and my mom, were friends. So we were already close. And when I started working in the lumberyard for that year, one of the things Bud told me very clearly was this is not a family business and my dad said this too but to a certain extent by saying it held more meaning to me
Levi:like you're here to get some gas money.
Rick:Yeah, I'm here to save money to go to college. Yes. Yes. And I almost remember where we were standing when he said this to me. This is not a family business.
Rick:You're not going to work here after college and my dad used to call me summer help, temporary help, things like that. So, it was very clear that this was this was a this was just a job. Yeah. It was not a career and that was made clear throughout both families from the start and that was that I was okay with that. I had a good year working there II learned a lot but I wanted to get a long ways away from the lumber industry.
Levi:There were no kids clamoring to get in the business. Like please, please, please let me get in the lumberyard business.
Rick:Exactly, I was the oldest of all the kids and I don't recall anyone of the eight kids ever saying, yeah, I can't wait till I take over.
Levi:I mean, it's not an industry that's glamorous, doesn't have that reputation. It isn't sort of shiny and sparkly in that way. It's an industry that is part of the fabric of every community across the country because to establish new communities in towns and even their predecessors, right, you needed material. So lumber yards just, you know, follow the Western expansion of The US, but they're very practical, very just kind of functional in what they do. And so, yeah, not that surprising, guess, as I'm saying that out loud, thinking about that the kids weren't thinking, man, this is, it didn't have a romantic view of the lumberyard building materials supply business.
Rick:At the same time, I think we were all very proud of Franklin Building Supply, but you're right. And a large part of it was that they set the expectation. The comment that this is not a family business and you need to go do something else was a very clear expectation for all of us. So I never expected or strove for coming back to Franklin Building Supply. Went out and did other things.
Rick:I got a undergraduate degree and I went to law school and got a law degree. And I set about building a law practice. And I did that for a dozen years after I got out of law school. So I was never looking at Franklin Building Supply as something that I was going to join. Yeah.
Rick:Until my dad had a conversation with me. We're gonna get to
Levi:that because your dad ends up bringing your sister Rhonda into the business when he needed a controller and she had gone and pursued a career in accounting and She was a CPA. She comes into the business as a controller before you came into the business, right?
Rick:She did and she did not, this was not something that orchestrated. So she applied for a job that he posted to control and she talked to him about it. And he said, well, you're gonna have to talk to my partner. And she ended up talking not only to Bud Fisher, but she talked to all of the other key managers.
Levi:He interviewed her just like anyone else.
Rick:He kind of over interviewed.
Levi:Over interviewed. Okay. She had This is the coach's kid situation.
Rick:It is the coach's kid situation. And they all said thumbs up. So he talks about having a fear of managing his kids and that was a big hurdle for him.
Levi:So it sounds like Rhonda coming into the business helped him get over that hurdle to some extent where he had some trepidation about managing one of his kids. And I assume a lot of that had to do with, not mixing up the relationship, right? That knowing what I know about y'all's family and the relationship that y'all have with Dick, there's concern that that would just make it messy. He wanted to just be able to be dad and not also be the boss. Is that before we get into you coming into business, is that, do you think that was the main issue there or is he more concerned about how this looked to other employees?
Rick:No, he's not the kind that is, if he thinks something's a good idea, can,
Levi:he's
Rick:not afraid of what other people are gonna think about it. But I think he was worried about the relationships. And I know that in their marriage, my mom was also very worried about that. She was, even when I joined
Levi:Don't mess this up. Oh, she was
Rick:petrified about me leaving my career and having a Franklin because she didn't want there to be conflict that would ruin something.
Levi:Yeah, that's a real issue in a lot of family businesses. I mean, you and I seen other family businesses really struggle with this, not only in bringing a second generation in, but then subsequent issues that arise. So I think it's interesting that that was so top of mind for your mom and dad that it wasn't worth getting y'all into the business if the cost was to damage anything on the relational or family side. Seems like there's a really clear order of priority in terms of what mattered in life.
Rick:There was, and he was worried about it. My youngest sister was in college at Oregon State and she took a class in the business school on family businesses. And he was fascinated by that. He read, he got her textbook, he read the textbook, he asked me to read it. He was worried about making sure if they did this, that we it, went about it the right way.
Levi:This season of Ain't That Somethin' wouldn't be possible without the generous support of Truss Joist, a division of Weyerhaeuser. Truss Joist has been a great supply partner to Franklin Building Supply with their array of engineered wood products, including their marquee truss joists, which you may be surprised to learn was invented and first sold right here in Boise, Idaho. Now ain't that something? Future twenty years of Dick and Bud running this business, growing this business, being savvy about that growth, they reach a point, I wanna play a clip here, when Dick realizes, hey, you know, we might need some help. And, you know, it's him thinking about bringing you into the business again after Rhonda had already come in.
Levi:So let's give this a listen and react.
Dick:Well, my ex partner decided that he wanted to retire back in '96. And, it took about two months for me to figure out that I needed some help. And so that's when I talked to Rick about coming into the business.
Levi:So he needed some help, Bud was transitioning out. And this isn't the situation where Rhonda came to Dick saying, want this job, want in the business. What was it like when he first talked to you about possibly coming in to Franklin Building Supply?
Rick:I couldn't have been more surprised.
Levi:It was Was it call? Did he set up a meeting? What was the initial conversation? Where did it happen?
Rick:We drove down with our wives, my mom and dad and Suzanne and I to a football game in Reno, Nevada. And we were driving back from Reno when he brought it up.
Levi:So he's been sitting on this the
Rick:entire trip. Dad and I are in the front seat, the ladies are in the back. Okay.
Levi:Is this still the station wagon? No.
Rick:Probably not the station wagon,
Levi:but something similar. But no one's sitting in the back this time making faces at parts behind art.
Rick:It was dead quiet in the back seat when we were talking about it. I think my mom was petrified the whole time. He brought it up and I couldn't have been more surprised and it was like, no, that doesn't make any sense. I mean, I was just becoming good at being a lawyer. I mean III was really enjoying my career.
Levi:You're in the prime of your career practicing law.
Rick:Yeah, I'm I'm now have I'm good at it and I have people who want me to work for them and and so it was it was just it was a huge shock But he was very gentle about it. He just talked about, let's take our time and let's think about this. We thought about it and talked about it for a year. And I think an important point is when Bud retired, there were four very key managers that bought Bud and Ann stock. So dad had new partners.
Rick:I knew all of them really well. I was doing some legal work for Franklin. I, you know, I've worked with some of them. I just, I knew who they were. I knew they were good men.
Rick:I knew things were progressing along well. I was really proud of Franklin. I I'd learned through the work I did in a legal work for him that there, it was a really well run company. Had a lot of confidence in Franklin, but that was not my career.
Levi:You've been told your whole life that this is, I mean, not only are we discouraging this, but you talked about remembering where you stood with Budd reinforcing, like this is never going to be the place for you. Yeah. And now headed back from Reno, your dad is saying, maybe this is the place for you.
Rick:We talked about it over the next year in a lot of different ways. A lot of that was just him being very patient with me as I worked through everything in my mind and then we'd get back together and we'd talk about the what ifs and how things would work. Yeah, it it was just that was a a an interesting year because I was I was really busy as a lawyer and in the back of my mind at a 100% of the time was, Oh my God.
Levi:What if That soundtrack was playing constantly. Nonstop. Now let's hear your dad's, you know, maybe condensed and his recollection or version of how part of that conversation over a period of time.
Dick:Rick at that time said, well, you know, if I come into the business, you know, I'd want to, I would like to lead the business. I want to be the boss. Well, I was the boss at that time, so you know,
Levi:he couldn't do that. You know,
Dick:I thought it was great, because you know, you always need somebody to succeed in business. And so that would have been a
Levi:natural transition. So it sounds like you and your dad were really talking about succession. And did you understand that that was the conversation from the get go? And why was it important to you to make sure that the two of y'all were on the same page about that? Mean, he sort of laugh about this, he said he wanted to be the boss, but that was the conversation about succession and who would lead Franklin in the future.
Levi:So kind of take us back to that moment in time as you're wrestling with, do I get into this business? And if so, what's my role and what's the timeframe?
Rick:That's exactly the conversation. And that was over a period of the year as I wrestled with, did this make sense and what did it mean? Not just for me, but for Franklin. The folks that were his partners were all very, really good at their jobs, very strong willed, confident people. I was also a very confident person.
Rick:And so, we just had to work through that. It was a really healthy conversation. If it hadn't been a healthy conversation and I give all the credit to dad because he was very patient about it. He was not.
Levi:He said it took a year.
Rick:It took a year for me to decide And he didn't put a lot of pressure on me and he didn't have a didn't have a deadline. He he was talking about the future. And one of the key moments actually was, one of his new partners, Mike Hire came to me and Mike and I knew each other through the legal work I was doing with Franklin. And, he came in, I think we probably sat down and had a beer and he said, you need to do this. We need none of us can lead this company into the future after your dad, and we need you and we want you.
Rick:And that was another thing that helped me get past the hurdle of, is this the right move for me and my family? And so, you know, after a period of contemplation that was probably really consistent
Levi:It with was my decision that it impacts your career, your family. I mean, is, stakes are big.
Rick:Yeah. And it's a very different culture, which I love the culture. But at the time I was a lawyer in a downtown law firm that had a really nice office and a secretary that sat outside the office and I wore a suit to work every day. And I went to lunch with other lawyers and it was a Different habits. I had a milieu that was very different than Franklin.
Rick:In Franklin, we didn't have offices. I mean, was the best decision I could have ever made. I didn't see all of that at the time I was contemplating the decision. I saw the potential, I saw the risks, I had the time to make a decision so I took all of it.
Levi:Took all the time, well, to make what ended up being a great decision. I mean, you've affirmed that, but obviously proof is in the pudding. You come into the business, you decide to come in and I want to play this clip. Your dad talks about, you know, some of the differences between you and him and take us back to, especially those early days as you're working through this transition, because he didn't come in and take over day one, you stepped into the business and you're learning it and all that, but y'all are not the same people. And let's see your dad comment on that and take me back to your recollection of what it was like to step in the business when you and your dad were both there.
Dick:I'd gotten over the fear of managing one of my kids with Rhonda. And once I had gotten over that fear, then I was very comfortable with Rick coming in because I knew him, I knew what his talents were and everything like that. And we hadn't worked closely enough, but one of the interesting things I had found not too long after he came into the business that our personalities were just totally different.
Levi:So it took a year to make the decision to come in. And it sounds like after you arrived, your dad's operating at different pace. He's just got a different style. What was it like when you came in and you're more, you know, contemplative, let me think this through, you're used to legal work, you have time to go back to your desk, really kind of research the issue, maybe even prepare a brief or memo and your dad's decision made. What was that like in the early days?
Levi:Let me tell
Rick:you about my first day on the job. Okay. He scheduled, it was a Monday. I started on 03/01/1997. He scheduled a management team meeting at 6AM.
Rick:My first 6AM meeting in my entire
Levi:There was no judge that ever asked for you to show up at 6AM for a courtier.
Rick:And when I was always an early riser, that wasn't the problem, but I'd get up and I'd go work out. And then if I got to the law firm at 08:00, I was the first one.
Levi:Right.
Rick:It's a totally different.
Levi:This is an early morning business.
Rick:This is an early morning industry when II, I'm sure when he said meeting at 06:00, I'm like,
Levi:oh, okay.
Rick:So II drive to the lumberyard and I time it. I am there at 06:00 and I come in and you know, the place is alive. I've never experienced that. Okay. This is this is 6AM, you know, right?
Rick:This is this is an industry and a business that is already going hard. So, I go in to the conference room and I'm the last one there at 06:00. They're all sitting there and all of the it's it's all of the folks who were dad's new partners and Rhonda and dad and I
Levi:and they're just waiting on you
Rick:and they're waiting on me and I'm there on time and they all look at me and you know, they're kind of grinning except for dad and one of them says, you don't know about Lombardi time.
Dick:Okay. No, I don't. What is it?
Rick:And dad says, Lombardi time is fifteen minutes before the meeting starts or you're late. That was my first day on the job. And and so when it came to how we communicated and how decisions are made, dad is very much he has no problem making decisions based on the information in front of him right then and if he gets more information later, he'll make another decision as if he has to. That's a dominant personality. He's very much like that.
Rick:He always has been. He's very comfortable with that. That is not my personality. I want to gather information and make the best decision. Perfect decision if possible.
Levi:Let's do this once.
Rick:So, we communicate differently and sometimes that was frustrating for both of us. If he was out of town, he'd call me with an idea and I had to learn to say, let me think about that after he threw it out. He threw out the craziest ideas and I'd, you know, I'd be sitting there in shock and I'd have to verbalize. Let me think about that. So, he knew I was thinking about that.
Levi:I heard you
Rick:We worked through that fine. I mean, kind of grew in confidence with each other.
Levi:So throughout the 90s, you and Rhonda are taking more and more leadership of the business. You end up becoming equity partners in the business, buying out your mom and dad. Let's kind of fast forward a little bit late 90s. Y'all are running the business. There's an opportunity that comes along to buy this business in Central Idaho.
Levi:This essentially being kind of fire sold because they had no succession plan. They didn't have someone who reached out to a son or somebody else and say, I need help. And how do we think through succession? They weren't reading the textbook on a family business. They were really backed into a corner.
Levi:You and Rhonda and the other partners decide to acquire this business that is now, you know, what makes up most of our, you know, Central Idaho locations. That started a process for y'all thinking about your succession and just the, really the business long term. And you started at that time thinking about what would it be like and your dad had thought before about what would it be like for Franklin to become employee owned. So can you take this kind of those late nineties, that transaction, what really sparked this idea or gave you motivation to go deeper into this subject matter of what would it be like to have an employee owned company one day instead of just one family succession after another selling out to somebody else?
Rick:Yeah, I got to go back to dad and his teaching of principles of, guess, business strength to all of us involved with management at that time. His four new partners, Ron and me, he spent a lot of time talking to all of us about the future, not in terms of how big we'll grow the company, but how we manage the company, how we succeed in leadership, things we needed to think about so that the company could continue beyond him and beyond us.
Levi:What do you think it happened? I just go back to the book. So we talked about early in this conversation, no grand yes plan, take it as it comes, see what the best opportunity is today or, you know, I mean, there's certainly planning involved.
Rick:Yeah.
Levi:But now you're describing interactions twenty plus years later that are more future oriented. Is that just him, you know, twenty years later, you know, maturing, thinking about the future more, because that's significant transition from not having any, you know, big plans or spending a lot of time thinking about that in the early days to by the time we're in the 90s and you and Ron are involved, that's really what he's wanting discuss with y'all.
Rick:Yeah, I think that he was 39 years old when he bought Franklin, he and Bud and you know, you fast forward now he's in his 60s. He's seeing what he needs to put in place so that, you know, he doesn't want he doesn't want to have to sell Franklin Building Supply. And he he has he is he is focused on employees and what they've built at the company. He wants to see that continue. It's he believes that it's it's a good place, that it's doing the right thing for folks.
Rick:And, so he started to think through that at at at a well before any of us, and he was really teaching us that it's important to start thinking about that now. He mentioned employee ownership early on and and I can't give
Levi:you a date but it was planted early on.
Rick:It was planted because he was with this new group of leaders in the company. He was very much in teaching mode with us all the time teaching us. We knew how to run lumber yards. He was teaching us how to be owners and leaders in a different at a different level. So in 1999, we had the opportunity to buy Volco, which was four lumber yards and a truss plant in the Magic Valley.
Rick:We had no presence in the Magic Valley, Twin Falls, Jerome, Burley, Gooding, that area of Southern Central Idaho.
Levi:Just to have the location built. That was the closest location at the time. Right. Right.
Rick:And so, we had this opportunity because that company which was, you know, it was probably a 50 year old company at that time. The ownership was elderly. The guy who was running it died. Somebody came out of retirement at like 82 to run the company long enough to sell it. They had the same basic desire.
Rick:They wanted they had a bunch of employees they cared about. They had four locations, five locations with the trust plan. We had the opportunity to buy all of it at a fair price but a good price because they had no succession plan and hadn't done anything to prepare for this moment. We had some leverage. Right.
Rick:So, and we wanted to operate all of those units. And so we bought the company on very favorable terms and in his teaching mode, he said, alright, this
Levi:is an object lesson here.
Rick:Yeah. We don't want this to happen to us. So, you guys, you know, you're new at at the ownership game here but you need to start thinking about what you're going to do when you get to the point where it's time to transition out. You want to retire, you want to do something else in life. How how is this going to work?
Rick:So, with his with his poke, you know, is is really guiding us. We formed a subcommittee of the board to study ownership transition and we looked at every you know, we spent about three years doing this because we're also busy running lumberyards. We looked at every style of ownership succession and we interviewed in in that process. We interviewed companies in our sector in our industry that were employee owned and we decided as a group, we brought that back to the board. The board decided we're going to pursue employee ownership
Levi:and this is the early 2000s. Yes. Yeah. Mid two thousand.
Rick:Early two thousand five at this And point so we we kind of continued down that vein. And in 2007, we hired a consultant and we were ready to launch an ESOP in the 2008. We had the valuation, we had the transaction ready, everything was teed up with our consultant to launch to become employee owned in 2008.
Levi:Now, if memory serves me correctly, something kind of consequential transpired in 2008, hit this industry especially hard, hit Idaho especially hard. So of course the great recession runs up against this plan to become an ESOP. What did that do to y'all in 2008 as your plans collided with this exceptionally challenging economic moment?
Rick:Yeah, we had done a lot of preparatory work and we had talked to key employees about what our plan was. There was some excitement building around this concept and we had to pull back. We had to we looked at it as putting it on hold, but we just kind of shove the ESOP idea out of necessity. The years 2008 through 2011 were, an existential crisis in our company, not just our company, the entire industry. All of our every competitor larger than us either went out of business or filed bankruptcy.
Rick:Bankruptcy. We went from sales of $227,000,000 in 2007 to about 67,000,000 the next year. Over the next two years, we went from a high of just over a thousand employees to under 300. We lost a significant amount of money for four years in a row.
Levi:I mean, is just survival.
Rick:Survival mode. Every employee that was left, including all of us took significant pay cuts. We wanted to save all of our locations and we did. We had to do a lot of things to make that happen. We just basically, we managed cash.
Rick:We had banking issues. We had, it was as close to the edge as you can come without falling over.
Levi:Every financial challenge obstacle you can have, you're navigating for these four years.
Rick:And it's survival. It's we wanted to survive. And that's a long time. That's a long four years. In 2012, we broke even for the first time and that was a huge victory.
Levi:Did that feel like just finally coming up for air and getting a breath?
Rick:Yeah, exactly. It was a huge relief. It was something we could be proud of. It was something, was really like starting over. At that point, we had depleted the cash in the company.
Rick:We had depleted the equity in the company and we were literally starting fresh. We had all of our locations still open. And we started, you know, the building building started up again at a more reasonable pace. It wasn't robust for several years, but it kept growing. And our concentration at that point was just pulling out of it and continuing to build back as a company.
Rick:One of the things that really, was an emotional boost for everybody that was left was the concept that when we got done with this, when we got out of this crisis, we were still going to become employee owned. And that was something we were, I think it even still
Levi:That that dream wasn't lost, it was paused. And maybe reinforced.
Rick:It was like, we have to do this. This is we we did this together. We survived this. Now, we're going to do ownership together. So, as soon as we could after the after the recovery.
Levi:So, as soon as you kind of shifted from headwinds to having some tailwinds in the business, the economy, it put back on the table this opportunity to once again pursue employee ownership.
Rick:Right, and that came to reality in 2015. At the 2015, we launched our employee ownership plan. The rest is history.
Levi:So in December 2015, you went all in a 100% ESOP. And for those that maybe aren't that familiar with ESOPs, helpful to know that that's not maybe typical. A lot of ESOPs start as a partial ESOP below 50%, whoever forms the ESOP maintains majority control, and then maybe later they transition to majority employee ownership or 100% employee ownership. But y'all went all in, delivered on this dream that it sounds like in many ways, kind of provided you the lifeblood to get through those four years, knowing that you're going to get this done later, have that dream of getting it done later, you go all in, 100% employee owned, December 2015. And of course, December 2025, just a matter of months ago from when we were recording this podcast, we celebrated ten years.
Dick:Isn't that great?
Levi:Of a 100% employee ownership and seeing that vision and that dream come to fruition.
Rick:Yeah, it's worked out as well as we'd hoped it would, but you're right. In 2015, we decided let's go in. We've talked about this, we've dedicated our future to this, so let's just get it done. And it was kind of a restart for a lot of other things as well. Old management was gone.
Rick:I was running the company. Rhonda was CFO. That's when I decided to add a COO.
Levi:Yeah. Yes, let's go back to this. So, you know, your dad twenty years in all of a sudden says, well, I'm not quite done, but I need some help. And I want to think about leadership transition. And he ends up on a trip back from Reno.
Levi:Yeah. In something that wasn't a station wagon, know, gets into this conversation with you. So, you know, you're alluding to, if we fast forward to January 2016, just a month after becoming a 100% employee you
Rick:know, at
Levi:the 2015, you and I had started to talk. We got, you know, connected and won't go into all of that story here, but you and I started to talk. And I was in Texas at the time where I was born and raised and in business there. But for a number of reasons, my wife and I were interested in a different environment and adventure for our young family at that point. And I can't help but chuckle at a couple of things that match up to some stuff that we've covered previously in this conversation.
Levi:So one is some version of you telling, I mean, Dick sort of, you know, retold a humorous way of you wanting to be the boss. I remember telling you, if you're not looking for a successor, I'm not interested. And, you know, there's something in that you and I both knew what wanted, but also what we were being asked, what the obligation, the responsibility is. And I think like your dad are the type of people that either want to bear that weight or not. And so, you know, yeah, take us back to, you know, into 2015, you see the ESOP through you and Rhonda do, but you're starting to think about bringing in some additional help and what succession looks like for you as the CEO.
Rick:I was well trained by my dad and he, when I came in the company, I mean, he knew what my desires were, I knew what his were. When I came in the company, he was running it, but he gave me a lot of responsibility and a lot of, he had a lot of expectations for me and I took it and ran with it. And we worked, he could have very, he loved what he did. He could have very easily kept all of that for himself and he didn't. He moved aside in a lot of ways and let me have leadership, leadership growth, leadership learning.
Levi:He created space for you. He very much did.
Rick:And so I was a great, at one point, he moved his office out of the lumberyard in the Boise store so that people
Levi:physically removed himself
Rick:physically removed himself so that people would because he he said, as long as I'm here, people are going to come to me for everything. They need to be coming to you. It was unexpected, but it was the right move. So that was my training. And I was looking when I was interviewing for the job that I posted and you and I started to talk, was actually looking for someone who could succeed me.
Rick:So had, you and I had similar interests, our desires, our plan aligned, because I was not looking for someone that couldn't run on their own. I really needed somebody that could come in and compliment what I did and really develop into the leader that the company needed for the future. At the same time, just like when my dad hired me, I wasn't ready to leave at that point. Right. I wanted to continue to develop.
Levi:You still say things you're trying to finish. Yeah.
Rick:We had a lot of things going on. The company was growing and I was comfortable with, I was very comfortable with the desire you had to come in and leave the company and hit the ground running and you were very comfortable with me staying and sharing that in a way that made sense for both of us. So it worked out, it was exactly right.
Levi:And really a legacy, you know, that really goes back to your dad, And just good modeling there, you having that experience and then our transition and what a blessing to the business to have that type of model and legacy to be able to learn from and replicate. And I think about how much employees, customers in the business benefited from using that with your dad, and how much I know I and the business and our employees and customers have benefited from me being a recipient of the same. So as we're getting towards wrapping up our conversation here, I think about a couple of things that I want us to react to that your dad also had shared. Let's listen to your dad talk about the role of leaders. What are leaders and managers really supposed to be doing for their people and for the business and kind of react to what he shares here.
Dick:Because the fun of the job for me was to be able to bring people aboard, teach and train them to do something different, something a little better. And if they did that, then I was always rewarded by it.
Levi:What do you think about that?
Rick:That's exactly right. It's, I share that with my dad. I think I share that with you. I know you well enough. The real charge I get out of our business is working together with other people and watching people excel, helping people really grow in their abilities, grow in their responsibility and have success.
Rick:I had lunch coincidentally, last week with a former employee who it was really fun to watch him go from the time he came on as an 18 year old in the company and grow through. He probably had five different jobs in the company over a seven or eight year period of time that he worked with us. And he grew into really a remarkable leader himself. And it's just a lot of fun to have, to see that kind of impact on people that they can grow like that in your company. And then in turn have an impact on other people as well.
Rick:That is the true joy of running a company like this. Yeah. Being able to have that impact kind of water falling out through the company and seeing all of those folks, who are now employee owners, really grow and thrive.
Levi:I couldn't agree more with what you just shared there, the clip from your dad. You know, sometimes it seems like we can let, you know, the business or our work take on this disproportionate role in life and our priorities get misaligned. And you and I, your parents believe at the end of the day, the people are who really matter. The employees, the customers we get to serve, the vendors. It's not their businesses that really matter.
Levi:It's the people that really matter and the opportunity to have a significant impact on people's lives, to develop them, to see them achieve things they didn't think were achievable, to extend service to a customer, to be able to help other people in the industry vendors also share in the success with the ESOP to be able to see people's lives changed financially, that goes beyond their time in the company. Like all these things connect back to people. And I think one of the things that's so rewarding and satisfying about being able to be part of the Franklin Building Supply Leadership legacy and get a baton handoff from you and you'd gotten a baton handoff from your dad is that this is a business that has remained about people. And sure, we move a lot of lumber, install stuff, make stuff, all those things, but at the end of the day, people matter more. And we're okay with that.
Levi:We're okay with owning that. We're okay with leading like that. We're okay with our ownership structure reflecting that the business is important, but the people matter more. That's just what comes to mind as I hear you share and I hear that clip and some others that we've listened to from your dad.
Rick:And that's the ethic and philosophy that those two guys started with fifty years ago, and it's carried through to this day, that's very gratifying. I couldn't be prouder of this company, our legacy, I couldn't be more optimistic about the future. With your leadership and the leadership of everybody that you're developing and that are working with you, that is continuing, focus on people, that focus on individual development of all of our employees and our focus on the right things.
Levi:Well, like you, I'm not only delighted with where we're at today, and it's fun to celebrate. This is our fiftieth year in business when we're recording this in 2026. Again, we just recently celebrated our tenth year of employee ownership, but believe that even better days are ahead and looking forward to what the decades ahead bring. And with that, I think it would be great for us to wrap up this conversation with this comment from your dad about the and how he thinks about the ESOP coming into existence and what it means today. But this is a comment, not just about what has been, but really a comment that you and I believe also is about who we're becoming and what the opportunities are for our employees.
Levi:So we're not done. Let's hear this clip here and wrap up our conversation today by hearing some thoughts from Dick.
Dick:With the ESOP, with an employee owned company was one of my desires from a long time ago. And it just fulfills my heart.
Levi:That's a man who cares more about people than anything else. It's reflected in y'all's family, it's reflected in this business. And that's really the legacy that most defines Franklin Building Supply. So I thank you for taking the time for the conversation today and helping us kind of pull back the curtain on the Lierz family and some of the early days of Franklin Building Supply. And thank you for taking the time and sharing.
Rick:My pleasure, thanks for having me.
Levi:Thank you for listening to this episode of Ain't That Somethin'. If you enjoyed the episode, please consider subscribing to the podcast in your listener and sharing the podcast or this episode with others. Thanks again to our season sponsor, TrustJoyce, and to our guest for graciously sharing their time and story. So go start, create, or build something surprising so I can share your story. Until next time.
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