Maverick Industrial Risk taking for fun and profit

Rick Cortez graduated from the University of Texas with a degree in accounting planning to become a CPA just like his father, who is a partner in Burton McComber & Cortez.

After six months at an accountant's desk, Rick Cortez knew that wasn't the life for him. He soon opened a franchise dry cleaning store, and in less than five years he was running nine dry cleaning sites, handling a total of 5,000 pieces daily.

"It was a very labor-intensive business, hands-on, and dealing with about 1,000 customers a week in so many locations," Cortez said. He then ventured into the industrial laundry business in Reynosa, processing uniforms for maquilas.

"We edged into industrial laundry in the U.S., and it seemed to be a better fit for us." Maverick began providing laundry service for a major McAllen hospital and found a successful niche. The Valley dry cleaners operations was sold in 1999, and the Reynosa operation closed in 2003. "Dealing with a small customer base in healthcare, we could give the individual service that we wanted. We had everything under one roof, all the employees, drivers, and equipment. We were able to spend our day where everything was taking place, so it was a lot easier to control," Cortez said.

Success in winning and keeping hospital laundry accounts led Rick Cortez and his brother Jay to relocate Maverick to a larger facility in Weslacos Industrial park near the airport four years ago. Weslaco is a beautiful place for a company like ours... right smack in the middle of our customers so were able to get to McAllen as fast as to Brownsville. Being a smaller community, the city planning and permitting department just seemed to say, youre coming to help Weslaco. We want help you comply. I wasnt by myself in getting that side of moving to here taken care of. Maverick, which now employs about 70 and runs six days a week, qualified for incentives which were used to offset the expense of installing their massive washing and drying equipment.

From 50 pounds per hour capacity at the start, Maverick has grown to processing 4,000 pounds of soiled laundry hourly, or 30,000 pounds of hospital sheets, gowns, towels, and other linens each day. Customers include all but two of the Valleys major hospitals, and many medical clinics and specialty hospitals. Hospitals dont ever close down, Cortez pointed out, and their need for clean laundry is continuous and gigantic. For the largest hospitals, Maverick operates on a 24 hour turnaround, with built- in excess capacity and redundancy along with plans to cope with uncontrollable problems through strong relationships with other laundries. A hospital cant run without clean linen.

"Our existing customers are going to be growing, along with this area and healthcare in general, because of the aging population," Cortez said. Maverick is growing steadily along with its customers, automating more and more of its processes, using ergonomic lifts and sheet counters plus folding and stacking machines. Maverick follows strict guidelines including personal protective equipment because their workers are handling potentially infectious linen. Both the volume and type of laundry have resulted in growing computerization and automation.

The Cortez brothers do not have titles on their business cards. Jay jokes thats because We dont want to limit ourselves to just one thing, And they havent. An opportunity came up and Maverick leased the space next to the laundry facility for a related business.

"Our newest venture is document destruction," Rick Cortez said. Given that Mavericks healthcare customers are federally required to protect patient records and that the Valley is ranked third nationally in identity theft, the creation of South Texas Shredding was a natural. "This was an added service for our existing customers. It has allowed us to go outside of healthcare to financial institutes and businesses with sensitive documents," Cortez said. He has the company following industry Best Practices and participating in voluntary certification program of the National Association for Information Destruction.

"The certification puts a lot things behind you. Im not afraid to have anyone look at my procedures," Cortez said. "At the end of day, its geared to customers and their having confidence in us."

Now shredding 5,000 pounds every day, the inevitable expansion has required more machinery and more drivers. The exciting part of the last 12 months is to see the business go from one customer to over 100, Cortez said. To a certain extent, you enjoy it. The brothers say they are able to work together because they separate their tasks. "Im responsible for servicing customers and the administration. Jay is in charge of production and delivery." Interestingly, for a company headed by a man with an accounting degree, Maverick outsources its payroll and uses Burton McCumber & Cortezs CPA services.

"We dont mind taking risks," Rick Cortez said. "Its been our history. We've jumped into things and worked hard and made it work. We like controlled growth, but you cant be afraid to take a chance. As we continue to evolve, we see other services wed like to offer," Cortez said. Their core healthcare customers have multiple vendors, and Maverick can simplify life for customers by bundling some of those tasks into a package. "Our goal is to have long term relationships. Part of my job is to help my customers reduce what they spend on laundry." Cortez is studying ways to reduce the 15 pounds of linen used per patient per day, such as eliminating carrying excess towels into a room.

Perhaps his suggestions will reduce Maverick revenue temporarily, but Cortez can live with that. Longevity of a customer is the most important. A customer with you for a long period of time is going to be more profitable than a short- term one you take advantage of. And the more services, Maverick can offer, the more valuable it becomes. "On the surface, laundry is repetitive, boring, but not to us," Cortez said. "Its our life."