C-124 Part 4: Case Studies
sales of aggregate while also expanding the offerings and
breadth of the other business units. In establishing this
growth goal, Luck Companies will allocate 80% of avail-
able capital to growing the Luck Stone business unit, while
the remaining 20% of capital will be focused on growing
the Luck Stone Center and Har-Tru business units.
Luck Stone accounts for over 80% of the total rev-
enue of Luck Companies, and will continue to lead
the firm’s growth over the next five years. While Luck
Stone’s growth plans do not include vertical integration,
there are opportunities for innovative new products to
help drive these growth efforts. For instance, manage-
ment has identified a growing demand for engineered
soils and bio filtration media. Engineered soils and bio
filtration media are used in retention ponds to filter
contaminates in water run-off before it is released into
streams or large bodies of water. Management believes
that new regulations that focus on water quality and
eco-friendly systems will make this a viable new oppor-
tunity for their Luck Stone business unit. Some of the
key inputs to these soils are taken from the top layer
of material that covers the stone at quarries, known as
over burden. Over burden is typically removed to reach
the material below and is stockpiled on site, often tak-
ing up valuable real estate. This market has been served
through a small division of Luck Stone called Luck
Specialty Products. In 2015, Luck Specialty Products
was rebranded into Luck EcoSystems and is now aggres-
sively entering the engineered soils market and seeking
growth opportunities.
While some new product offerings and innovations
in the industry are possible, the almost doubling of reve-
nue for Luck Companies is to be accomplished primarily
through a strategy of acquisition and internal growth.
Some internal growth is possible given Luck’s investment
in equipment, processes and people during the past five
years. In addition, the volume of aggregate sales in tons
is still below peak levels, therefore some capacity in cur-
rent operations is available.
Side Note:
In the northern region of Virginia, the Luck Stone Fairfax
Plant has nearly reached the end of its reserve life. In antic-
ipation of this event, Luck Stone has invested nearly $40
million into their Bull Run Plant, which is only ten min-
utes from Fairfax, to back fill demand from Fairfax. By
2016, the Bull Run Plant will have the capacity to produce
5 million tons per year, making it the largest of any Luck
Stone plant.
Luck Companies devoted considerable effort to iden-
tifying acquisition targets. Maps were constructed of all
the growth areas from Virginia to Texas and over 600
independent aggregate producers in the targeted mar-
kets had been identified. In late 2014 and early 2015 Luck
Companies pursued and/or explored potential opportu-
nities in Virginia, North Carolina, Tennessee, Alabama,
South Carolina and Maryland. These conversations were
typically started with an introduction to Luck Companies’
culture and Values Based Leadership model. Many of the
quarries that Luck Stone targeted as potential acquisi-
tion opportunities were small to medium sized family
owned companies. These companies and their owners,
similar to Luck, view their employees as an extension
of their own family. If and when the various aggregate
producers decide to put their companies up for sale, it
is the belief of Luck’s management team that some will
want to sell to Luck Companies because of their reputa-
tion of igniting the potential in their associates through
values based leadership, thus having a positive impact
on all they touch. These owners truly care about their
people and therefore do not want to sell to one of the
large industry conglomerates. Furthermore, by targeting
small to medium sized family owned companies with
similar values and beliefs to Luck Companies, it is the
belief of management that the integration of these com-
panies into Luck Companies will come with less hard-
ship and burden.
Luck Companies was off to a fast start in 2015 with
many “irons in the fire”. The largest plant expansion
in Luck Stone history was underway at Bull Run. Luck
Stone Center was embarking on a new business strategy
under a new brand. Luck EcoSystems was developing
new products in a relatively new market and growing
rapidly. Har-Tru completed their first “turn-key” tennis
court installation supplying everything from court mate-
rial to netting and all other accessories. InnerWill had
put a board of directors and strategic development team
in place and had submitted an application for 501(c)(3)
status. Luck Companies overall was poised for tremen-
dous growth over the next five years. As Charlie reflected
back on his time as CEO and thought forward to 2020
and beyond to future generations, he stated, “The firm
is in strong financial condition and has many associates
who have untapped potential and we need to give them
opportunities to realize their wildest dreams. I feel a
deep responsibility to handoff this company to the next
generation of associates and family who will have signif-
icant opportunities for decades into our second century
of running a family business.”