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 <<NAWBO Advice
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The male-dominated engineering industry is not typically thought of as fertile or even hospitable land for women entrepreneurs. But Wendy Lopez is not someone who is easily discouraged, nor readily pigeonholed. And so this woman of Hispanic origin, the child of parents with grade-school educations, decided in her teens that engineering was her career of choice and entrepreneurship her vehicle to success. Today, as CEO of the Dallas-based LopezGarcia Group, Lopez oversees a multidisciplinary engineering and environmental-planning firm with nearly 200 employees spread among nine offices in three states. Her company has been recognized as one of the fastest-growing engineering firms in the country, and as one of Dallas-Forth Worth's leading growth companies.
It's a long way from the one-woman engineering shop she opened in 1988, yet Lopez is neither surprised nor impressed by her own success. She has a relaxed nature and an easy confidence about her, and is matter-of-fact about the steps it took to get the LopezGarcia Group where it is today. Those steps included landing more and bigger clients, using her women- and minority-owned business status to access government contracts, acquiring another firm, and, finally, merging with a competitor. While the methods varied, her willingness to grow her company and her openness to business opportunities was constant, even when it meant treading into the unfamiliar waters of business finance. "I knew engineering," she says, "but a lot of this business stuff I was learning on the fly."
But Lopez proved a star student. In 2004, she was named the NAWBO Woman Business Owner of the Year, and was honored as a "Rising Star" by the Business Women's Network. Previously, her company was recognized as Employer of the Year by the Women's Transportation Seminar, and was cited as one of the top 50 women-owned firms in the Dallas-Forth Worth area.
Her start, however, was much more modest, and not nearly so high profile. After receiving her undergraduate and graduate degrees from the University of Louisiana, Lopez landed a job with a Dallas engineering firm. After only a few years, the company decided to close its Dallas offices, and Lopez had to decide if she would move with the firm to Fort Worth. It was the nudge she had been waiting for, and the decision was easy. "I had always thought I would own my own business someday," she says, "and so I said to myself, 'You're almost 30. Now's the time to do it.'"
And with that, Wendy Lopez & Associates was born. Of course, the "& Associates" was more for show than anything else, because for more than 18 months it was just Lopez--no associates, no employees, and nobody to share the task of starting and growing a business. Eager to generate revenue, but aware that her company wasn't large enough or well-known enough to land major contracts of its own, she decided she would focus on the plentiful subcontracting work doled out by the area's larger engineering firms. (These "prime" contractors receive contracts directly from municipal and government clients, then subcontract a good portion of the work to smaller firms.) Lopez also knew that, as a minority and woman business owner, she could qualify for contracts targeted to those owner groups. So she spent her days making connections and marketing herself to larger engineering firms, and her nights working to complete the jobs she landed.
The strategy paid off, and by the early-'90s Lopez had 42 employees and nearly $500,000 in annual revenues. She was going after bigger and bigger jobs, which kept the firm on its growth trajectory, but also meant a single late payment could cause a major cash-flow crunch. And because municipal and governmental clients are notoriously slow in paying, Lopez faced those crunches more than she would have liked. Often, she had bills and employees to pay but weeks and sometimes months before she would see reimbursement from a client. Very quickly, she learned that such cash-flow shortages are endemic to growing businesses, and that underestimating their significance can be fatal. "When you're growing really fast, your cash can't keep up with it," she says. "On paper you're making a ton of money, but in reality you don't have any cash."
Because of this formative experience, having a rainy-day cash fund became central to Lopez's business and growth strategy. In the early days, Lopez relied on a credit card to pick up the slack between her accounts payable and accounts receivable; later, she obtained lines of credit. These tools helped her juggle and eventually balance her cash demands, and as a result the company thrived. Soon she decided it was time she went after a few prime contracts herself, and in 1994, she applied for three big ones at once. Much to her surprise, she got all three--in the same month. At first, the challenge seemed daunting: There were new employees to hire, additional services to contract, and bills that had to be paid in order to fulfill the contracts. For many companies, the strain would have been too much. But because Lopez had the foresight to secure a line of credit before she landed the contracts, she was able to ramp up staff and make all the other necessary adjustments without a cash-flow shortage. Had she waited until after she secured the contracts to explore financing options, she could have fared far worse. Not surprisingly, she advises other business owners to think proactively about their cash-flow needs. "Get as much as you can," she says. "And get it when you don't need it, because when you need it, you might not be able to get it."
Over the next five years, Lopez continued to build her business in the Dallas area. Then, in 1999, quite by accident, Lopez came upon an opportunity to buy another, out-of-state company. She was interested in an Army Corps of Engineers contract in New Mexico, but had to team up with a local company to be eligible for it. One of the companies she randomly called mentioned that the firm was for sale, and might Lopez be interested? Indeed she was. She flew to New Mexico to learn more about the company's operations, contracts, and business potential. The firm specialized in land-development engineering and dam-foundation studies, and Lopez determined that Wendy Lopez & Associates would benefit from that additional expertise and contracting ability. She used her company's profits to purchase the firm's contracts and existing relationships. Now she was running a multi-state firm.
By 2002, Lopez & Associates had 110 employees and a strong, carefully built reputation within the engineering industry. Lopez had achieved growth of about 15 percent each year, and was now able to offer a wide array of environmental and engineering services. It was more than she could have imagined back when she launched the firm in 1988, but still, she had her sights set on more. She thought that with additional expertise and services to offer clients, she could land an even greater number of prime contracts. Meanwhile, one of her chief competitors, Fort Worth-based Garcia & Associates Engineering, was thinking the same thing. Lopez had an advantage when it came to environmental science and planning, while Ray Garcia was stronger in highway work. Rather than continuing to battle against each other, the two decided to merge their companies and create one full-service, multidisciplinary firm. The merger was handled through a simple stock swap among the two companies' principals, and in that one deal, Lopez achieved her five-year growth goal. The combined staffs totaled more than 200 people in seven offices, which they've since grown to nine. The new LopezGarcia Group offers civil, environmental, mechanical, electrical, structural, and geotechnical engineering, along with environmental planning and cultural-resource studies, surveying, and construction management and inspection. The firm's target market is municipal and government agencies that have needs in the aviation, surface transportation, transit, water and wastewater, and environmental areas. About 40 percent of its contracts are prime consulting work.
When asked if she ever looks around and wonders how she got where she is today, Lopez laughs and responds: "Every day! When I first started this business, I never thought it would be 200 people. I thought maybe I'd hire a technician to help me out, and then maybe if I got big enough, I could hire somebody to answer the phones." Lopez didn't set out to build an engineering empire, and yet the evolution from one-woman shop to multi-state firm with 200 employees was a natural one. The relative ease with which Lopez achieved this phenomenal growth has as much to do with her business concept, model, and market as it does with Lopez herself. At numerous points in her career she could have decided that the view from the current perch was adequate, and that her business strategy would be to maintain the status quo. But Lopez was never very good at the status quo. When opportunities arose, she couldn't keep herself from going after them. Granted, the opportunities she pursued were smart and sound, but they weren't without risks. Any time a business moves out of its comfort zone and into unfamiliar territory, it's something of a gamble. Yet time and again Lopez decided that the reward of growing her business was worth the risk, and so she embraced the challenges every opportunity presented.
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