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In 2002, Aaron McArdle was working as a low-voltage electrical contractor. But less than five years later, he went from employee to owner after he purchased the division he was working in. McArdle’s ambitions for starting his own company were pretty straightforward:
“I wanted to work with the people I wanted to work with and do the jobs that I wanted to do.
And I wanted to pick my own service truck.”
RoomReady, which installs videoconferencing equipment, started with 6 employees and $1M in revenue their first year. Now, the company generates over $50M in annual revenue, has more than 100 full-time employees across 20 states, and has their sights on hitting $250M in revenue by 2034.
McArdle said RoomReady was able to grow quickly after winning large projects in their first few years, starting with several Walmart projects in 2007. However, the company’s growth didn’t come without challenges. Topline revenue grew year over year, but their profitability fluctuated. Additionally, McArdle said at times they grew at an unsustainable rate.
Over time, RoomReady became a more stable operation—one McArdle now describes as sophisticated, predictable, and consistent.
This transition didn’t happen overnight; it was the result of establishing internal processes, financial discipline, and balance between customer satisfaction and the business’s needs. Some of the biggest lessons McArdle learned over the course of RoomReady’s 20-year history include:
Now, McArdle says RoomReady is, “Big enough to compete against the big guys, but small and nimble enough to do the personal things for both our employees and our customers.”
Here’s his advice for other subcontractors looking to improve their business operations and achieve sustainable, profitable growth.
RoomReady takes an innovative, technology-agnostic approach to AV integration, offering customized, intuitive audio/visual solutions that simplify collaboration, cut down installation times, and improve overall meeting space success.
RoomReady’s level of customer service helped them win projects and retain customers, but sometimes the level of service they offered was at the expense of their own operations. There was a period of time where they were willing to lose margin on projects if it meant keeping their customers happy.
When RoomReady started making changes to protect profits, the company overindexed on maintaining profitability and customer satisfaction levels dropped—as well as employee satisfaction. Over time, RoomReady was able to find a healthy balance between the two, finding the right mix of protecting profitability, taking care of their customers, and finding a way to go the extra mile—but not at their own expense. As a result, their customer satisfaction is high, they have high levels of employee satisfaction, and they’ve maintained healthy growth.
McArdle recognized the importance of creating consistency throughout the business, whether they were focused on their installation processes or the type of projects they worked on. Here’s how they were able to create and replicate their success.
In their early years, RoomReady had a diverse backlog of project profiles, but they quickly realized they couldn’t say yes to every type of project and still offer a consistent level of service. McArdle decided within the first few years that he wanted to focus on only one division of the business and deliver an excellent experience to their customers. They evaluated which projects would allow them to consistently uphold their standards and committed to only working on those projects. From that point forward, RoomReady chose not to pursue projects that created friction for them or that didn’t align with their ideal project profile.
One of the reasons RoomReady was able to grow so quickly was because of their processes. They have 12 patents and several inventions that allow them to install their equipment at a more cost-effective rate—even if they have to travel to the project. RoomReady can fly three technicians to a project and perform the work at a lower rate to the customer compared to a local team. Their process was so efficient that the only onsite equipment the team needed was a ladder—the rest of their tools went into standardized rollerbag kits that RoomReady built to travel with their employees.
When RoomReady started expanding into new markets, employees were frequently traveling to projects throughout the country. McArdle says this may have appealed to employees early in their careers, but after a few years or once they hit certain life events like starting a family, traveling so frequently became less appealing. RoomReady didn’t want to lose good employees, so McArdle focused on creating opportunities that kept these employees with the business.
RoomReady’s topline revenue grew consistently in their early years, but this growth could often hide the fact their profitability fluctuated. The company focused so much on their work in progress (WIP) and how much they were growing topline revenue that they weren’t analyzing their deals and determining how they affected the bottom line. RoomReady also didn’t diligently follow-up on past-due invoices from GCs because they felt like they always had enough cash in the bank. McArdle said the company concentrated on ending each month in the black, not analyzing the profitability of their projects.
As long as the business kept growing, financial problems didn’t appear—but when there was a slowdown in projects, the inconsistency in profitability came to light and left the business facing cash flow challenges.
McArdle realized his team needed better internal structure and consistency, so RoomReady implemented EOS and hired a chief operating officer who later moved into the role of president. This created more discipline around their processes and allowed their team to analyze project performance. After gaining this financial discipline and knowledge, RoomReady started sharing financial data with their employees on a consistent basis. Now, their controller shares financial data with the entire RoomReady team on a monthly basis, including their most and least profitable customers, most and least profitable projects, work in progress, and their cash flow forecasts.
When everyone knows the financial data that supports the business, McArdle says the staff thinks about the organization’s financial health more frequently.
RoomReady’s journey from $1M to over $50M in annual revenue illustrates that long-term growth isn’t only the result of taking on more work year after year; it’s the product of intentional choices and commitment. By focusing on standardizing experiences and expectations throughout the business, RoomReady is on their way toward their $250M goal.
