By Derek Sankey
Business In Calgary
November 2006

When Fred Edwards started driving from his hometown of Winnipeg to Calgary, he got an uneasy feeling. The road ahead of him was as clear as the sky, while a rush of cars hurried past him in a mass exodus heading east. It was 1981.
Edwards had just graduated from high school and decided to make the move to Calgary to get into the residential carpet cleaning business. It was tough slogging for a few years, but he got a job and before long had opened up his own business, Chinook Building Maintenance, a small janitorial company servicing small businesses and retail stores.
He couldn’t quite figure out how to take his company to the next stage, so he decided to join Bill Kujat, a prominent Calgary businessman who at the time owned Focus Building Services. “He was one of the hardest guys I’ve ever worked for, but one of the best,” says Edwards, who spent six years with Kujat. When Focus was sold to an American company, Edwards stayed on and became the vice-president of western Canada.
Being in that industry, he always looked at the Servpro trucks hurrying around the city at all hours and wanted to own the well known janitorial and disaster services company. It was just a matter of time. He stayed with Focus for several years and then opportunity came knocking at his door, literally. It was the bank.
But long before Edwards ever set foot in Calgary, a man by the name of Lou MacEachern was way ahead of him. In 1964, MacEachern started a small company called Servpro. Born in P.E.I., MacEachern first came to Calgary in 1952 when the population of the city was about 110,000. “When I came in 1952, people said it was all over here – there was nothing left,” says MacEachern. He left Calgary for a few years, but had a strong urge to come back in 1964. “Then when I came back, the same people said, ‘You can’t start a business here, it’s all over.’”
But MacEachern was never one to give in to pessimism. He launched Servpro, a janitorial and disaster services company, which rapidly began to thrive. Word of mouth played a big part in the expansion of his company. He struggled through the carnage seen across the city in 1981. At one time, he had $5 million in financing that carried an interest price tag of about $1.6 million. “It looked as though it was going to go under at one time,” recalls MacEachern.
He didn’t go under, albeit by the skin of his teeth. At a meeting with his bank, he told his banker how unrealistic a 32 per cent interest rate was, but the banker insisted that was the reality of the day. It turned out to be the same day that interest rates turned around and began their descent. That allowed Servpro to begin its ascent. As for the secret to his success, MacEachern is very matter-of-fact about it: “You should be half smart, but work is the answer. There are so many people trying to run a business and not working,” says MacEachern, now 73.
By 1998, MacEachern was ready to retire. He sold Servpro to a publicly traded company for a considerable sum of money, but didn’t get paid until the following year. After he let the company go, Servpro took a turn for the worse. It struggled for several years under the new ownership, beginning to shake and shake some more. That’s when Edwards got the call.
“When the opportunity to buy came along, the public company had been de-listed, the bank was holding a note that wasn’t getting paid and they knew me,” says Edwards. “They actually approached me.” As for the price he paid for it? “Fantastic deal,” he says and leaves it at that.
Edwards wasn’t just buying into a company that had a tempting price tag on it. “It was really a dream come true,” he says. “If you can believe it, you can achieve it and it just happens.” Of course,

“It was really a dream come true,” he says. “If you can believe it, you can achieve it and it just happens.”

none of it happened without an extremely high personal cost. “I personally guaranteed everything I had in my life. Everything I possibly owned – my house, my cottage that was gifted to me by my parents – everything was on the line,” says Edwards. “In those circumstances, you can’t go bankrupt.” He took ownership of Servpro on April Fool’s Day, 2003, it was by no means a foolish move.
He had a vision and a strong commitment to see it through. A dedicated team of employees helped make the difference and Edwards makes no bones about the fact they are the heart of his business, along with his diverse client base. There were certainly some stressful days when he first took the helm, though. “Meeting the first payroll was one of the most anxious moments in my life,” says Edwards.
He immediately set about structuring the company in a way that he thought would bring the most success for himself, for Servpro and for his employees. Each division – maid service, carpet cleaning, janitorial and disaster restoration – operates independently by employees who lead each division with a personal financial stake. He implemented a licensing agreement that works much like any franchise: he licenses out the Servpro name and his division leaders must obey company policy, with each division paying royalties to him. The only exception is the janitorial services division, which is run in-house and is by far the bulk of the business.
Of 700 employees in Calgary, about 500 are in the janitorial side of the operation. The company is widely known in Calgary’s downtown core for keeping offices clean and tidy with a presence in many of the city’s skyscrapers. The structure allows him to run a lean operation and to focus on strategy and future growth.
And growth is certainly in his future. While the company presently operates solely in Calgary, it won’t remain that way for much longer with Edwards in charge. “We’ve seen such success with not only how much the business itself has grown, but just the way Servpro is marketed,” he says with a smile. It turns out a U.S. company by the same name has been spending millions of dollars on a massive television ad campaign, which inevitably trickled into the Canadian market. That’s just fine with Edwards; he owns the rights to the Servpro name across Canada.
Edwards has big things in store for his Calgary company. He’s working with Doug Queen, the former executive vice-president of Smitty’s Canada Ltd. to roll out the Servpro name across Canada. Without even trying, he gets dozens of calls every year from people in eastern Canada asking to sign up for a franchise. So, he

"The company is widely known in Calgary’s downtown core for keeping offices clean and tidy with a presence in many of the city’s skyscrapers. The structure allows him to run a lean operation and to focus on strategy and future growth."

decided to heed those calls. Edwards and Queen are currently finishing off the manuals, going through clearance with the security commissions and finalizing plans to launch the Servpro name across the country soon. “Franchising has always been on my horizon,” Edwards says.
He’ll start with western Canada and move his way east. When launched, it will be operated in much the same way his Calgary operation is structured, with each division being run by separate individuals. It’s a recipe that’s proven its success locally already, so he’s not about to mess with a formula that works well. In the meantime, he counts on his mentors – Queen and MacEachern – for solid business success and good friendships.
Never content with keeping things the same, Edwards is also leading a trend in the industry. Offices used to be accustomed to leaving the lights on at the end of the day for the cleaners, who would come in long after everyone was gone for the day and set about their routines. Edwards is changing all of that. Day cleaning is becoming common in downtown office towers and much of that is thanks to Edwards.
“(Day cleaning) was one of the innovative plans we put together,” says Edwards. “With the labour market tightening up, people who used to work a part-time evening job from 5 to 10 (p.m.) are now just working extra shifts at the factory or wherever to make more money, so the labour pool is eroded.” In other words, people aren’t lining up to take a part-time night cleaner job in this economy.

He’s currently testing and evaluating new battery-powered vacuums and ultra-quiet vacuums that make almost no noise and make day cleaning even more viable.

It’s caused Servpro to approach property managers and tenants with the idea of switching cleaning services to daytime, providing a flow of steady, full-time, Monday to Friday day jobs that are easier to fill. He partnered with Daylight Cleaning Services to make conversions on several downtown buildings, so he’s now able to offer higher wages and “the big upswing for property management groups is that there are less security issues and greater energy savings.”
“It was a culture change in the beginning to see a cleaner coming through with a cart during the day, but a relationship develops with that cleaner and you can leave for a coffee or go see a colleague and it’s not a big deal,” says Edwards. Most tenants and property managers are happy to have fewer security concerns and significant energy savings. In November, he’s doing another conversion of 350,000 square feet of office space in the Canterra tower. The Ernst and Young tower is already day-cleaning. His team stretches out some cleaning to a six-day period, where they come in on Saturdays to do things like vacuuming and other less subtle duties.
And even something as simple as cleaning has a high-tech edge to it. He’s currently testing and evaluating new battery-powered vacuums and ultra-quiet vacuums that make almost no noise and make day cleaning even more viable.
Throughout the three-and-a-half years he’s owned Servpro, much has changed under his leadership. Whatever he’s doing, he doesn’t lose sight of the community that has made him so successful. In August, Servpro stepped up to the plate – or to the tee – and sponsored the Missing Children Society of Canada’s fifth annual Charity Golf Tournament. Major sponsors turned out and Servpro has committed to a three-year sponsorship of the event as host.
The event raised $60,000 for MSCS and Edwards now sits on the board of directors. “My logic was that instead of going into research, I think one of the closest things to my heart being a parent would be to have your child abducted and it happens every day,” says Edwards, the proud father of 13- and 16-year-old boys. “To be able to help an organization that’s been around in Calgary for 20 years is just unbelievably touching.” He also supports the United Way and is a founding member of Business for Calgary Kids.
Edwards is still a relatively new owner of Servpro, and he’s focused on the future of the organization as it begins to cast its net wider and wider across Canada during the franchising process. “It’s been a fantastic run and the business has grown so much,” he says. “It’s all to do with the people and the customers.”