What would you risk to build a new business that you believed in, plus save the jobs of your friends and colleagues? For Alvin Gregorash and his wife Shirley, the answer was simple: They bet the farm.
March 26, 2009 By James Careless
What would you risk to build a new business that you believed in, plus save the jobs of your friends and colleagues? For Alvin Gregorash and his wife Shirley, the answer was simple: They bet the farm. To be specific, the Gregorashs bet their house by mortgaging it to raise the necessary capital,
|Aero Recip Canada shop floor (Winnipeg), part of the Gregorash umbrella corporation.
and Alvin was willing to do even more if necessary. “To make this deal happen, I was willing to mortgage the house, wife and kids,” he tells Wings. “It was a family effort.”
That was back in 1988, when Standard Aero of Winnipeg decided to exit the piston-engine servicing business. Gregorash had worked at Standard for years before striking out on his own as an independent parts broker. But when he heard that Standard was going to shut down its piston operation, and that Standard’s employees were unable to raise the cash to buy it, he saw an opportunity too good to pass up. “Piston engines might be old technology, but they are still a very important part of aviation even today,” he says. “I knew that if we could keep Standard’s piston division going, we could not only save it, but make it grow and thrive.”
As for the mortgaging of house, wife and kids? Gregorash indicated his willingness to do so to Standard Aero’s president, Bob Hamaberg. “When he saw how committed I was to saving the piston division, he said, ‘that’s all I need to hear’,” Gregorash recalls. “And that was that: With a handful of former Standard Aero employees, we had a company that we called Aero Recip (Canada).”
After 20 years, Aero Recip is now Gregorash Aviation; one of a group of companies that he has put together with the help of his dedicated employees. It has grown from 16 employees in 1988 to 60 today, with locations in Winnipeg and Anchorage. As well, there is a second generation of Gregorashs in the business; daughter Tracey, who started in 1997, has recently taken on the responsibilities of vice-president.
Tough Early Days
With Standard Aero phasing itself out of piston engines in the mid-80s, Gregorash knew that there was a big pool of unserved Continental, Lycoming and P&W customers out there. These were people who owned Cessna, Piper and de Havilland aircraft who couldn’t keep flying without regular engine maintenance. Surely they would flock to Aero Recip once they heard about the company!
Apparently not. “These customers were pretty ticked off that Standard Aero had left them high and dry,” Gregorash says. “Since our company was made up of former Standard employees, and because we had bought a lot of equipment from Standard, they thought we were essentially Standard by another name. As a result, they wanted nothing to do with us.”
Unwilling to lay down and die, Aero Recip fought back with an aggressive marketing campaign. “We put together a corporate brochure and created our own identity, then went out and talked to private owners, flying clubs, and commercial operators,” he says. “We talked about Aero Recip and what we could do for them; how we were here for the long haul to serve the piston market. We didn’t talk about Standard Aero at all; we didn’t tell people that we were ex-Standard people.”
Gradually, the strategy paid off. Over time, more and more piston aircraft started showing up at Aero Recip’s 20,000-square-foot Winnipeg facility (now 31,800 square feet). As business picked up, Aero Recip’s staff grew … and so did its opportunities.
|Alvin and Tracey Gregorash at the WPG event (Year of the Tour Kick off – 20th anniversary).
Having been saved from mortgaging his house and family by Aero Recip’s success, Gregorash was feeling bullish. So when the opportunity came to buy Winnipeg’s Ultimate Oil Coolers in 1993, he took it. “Every airplane needs an oil cooler,” he explains. “Since Ultimate was already operating out of Winnipeg offering products and overhauls, it made sense to acquire them.”
Some time later, a close friend of Gregorash’s who ran a parts business – “we used to have lunch together every second Friday,” he says – was killed in a car accident. Following his family’s unsuccessful attempts to keep the business going, Gregorash bought it and renamed it Airparts Network. Shortly before that, he bought Cantherm, which distributes European-made Arcotherm aviation heaters.
Enter Alaska. While attending a trade show in Anchorage in 1999, Gregorash learned that local piston overhauler Sea Air was up for sale. “I mean this is Alaska; everyone seems to own an aircraft here, and most are pistons,” he says. “I just had to take this chance.”
The result of all these purchases is a stable of aviation-related companies, all with different names and identities. To provide a coherent umbrella image, Gregorash Aviation was created this year. “Our individual companies still have their own identities, but now the family to which they all belong has been clearly branded,” says Tracey Gregorash. “This tells the world who we are, and all the integrated services that we offer.”
Gregorash Aviation has come a long way from its ex-Standard Aero roots. But even though the company has survived and thrived, challenges remain.
“Our biggest problem is the Canadian/U.S. dollar exchange rate,” says Alvin Gregorash. “Exchange fluctuations translate into real costs for us at any time, but it is really tough when a U.S. product that we bought for $500 last month now sells for $400 on the open market. To keep up, we have to eat that loss when selling to our customers, which hurts our bottom line.”
What about turbine engines – the high-tech piston vanquisher that motivated Standard Aero to abandon piston-engine servicing in the first place? “Servicing turbines sometime in the future has crossed our minds,” he admits. “We’ve kicked around the idea, and even talked about getting into bed with someone else to add this to our service offering.”
Should piston-engine owners be worried? “Not at all!” Gregorash declares. “Our focus remains on piston engines; providing reliable service and support to our piston customers for many, many years to come. After all, Ma and Pa have to have a way to keep commuting in Alaska, and you can be sure that a piston engine will always be more economical than converting to a turbine. So Gregorash Aviation’s piston servicing business is here to stay. Frankly, I expect the piston market to be there forever.”
If there is a moral to this tale, it is that sometimes it pays to bet the farm, family and anything else that may be at hand. Certainly for the employees of Gregorash Aviation, Alvin Gregorash’s chutzpah has paid off handsomely!
Meanwhile, for Canada’s piston-engine owners, knowing that there is a company committed to servicing this technology has to be a relief. After all, these engines have been flying for decades: With proper servicing, they stand the chance of flying for decades still.
|The Gregorash Aviation Story: A TV Drama
Across the Web, businesses are trying to find new and different ways to catch their clients’ attention. But arguably no one in the aviation industry has gone to the lengths of Gregorash Aviation, which hired Winnipeg’s Ozz Media to tell its corporate history as a series of short dramatic TV vignettes. Posted on www.gregorashaviation.com /ozzmedianetwork , the videos are based upon the actual creation and evolution of Gregorash Aviation out of the remains of Standard Aero’s piston engine servicing division, to today’s umbrella corporation that owns and operates Aero Recip (Canada and Alaska), Airparts Network, Ultimate Oil Coolers, Cantherm Distributors and Dyno Power Xperimental.
The Gregorash story is told in three black-and-white shorts with actors playing CEO Alvin Gregorash and his daughter Tracey at various key points in the company’s growth. There are also cameo appearances by historically relevant characters and an overarching on-camera narrative by Ozz Media founder/owner John Pineau.
For the full story on Gregorash’s unique approach to marketing, please visit www.wingsmagazine.com and click on web exclusives.