Business Q & A

January 12, 2014

A conversation with Hale Ritchie

Hale Ritchie, former CEO of the Ritchie Corp., started in his family’s company driving concrete trucks during summers in high school.

Hale Ritchie, former CEO of the Ritchie Corp., started in his family’s company driving concrete trucks during summers in high school.

Ritchie, 64, was just nine credit hours shy of graduating from the University of Kansas when his father asked him to return home to join the business following the departure of the manager of one of its divisions, Allen’s Concrete.

He did.

But he also finished his degree in business administration, commuting to Lawrence to finish his classes.

Ultimately, Ritchie and his cousin, Tom Ritchie, owned and ran the company. Tom operated the asphalt side of the business, while Hale ran the concrete side of the company.

At its peak the company had about a dozen divisions and 1,000 employees. It included sand and gravel and ready-mix concrete divisions, six Quikrete plants and facilities in Kansas City, Wichita, Joplin, Mo., Oklahoma City, Tulsa and Dallas. At one time, it also had a tennis and track division, which built tennis courts and running tracks.

In 2005, the Ritchies sold the company to Lafarge North America, which has since sold it to Summit Materials.

Hale Ritchie, now retired, and his wife, Janie, are long-time volunteers and supporters of Rainbows United, a nonprofit group that serves children with special needs and their families. Ritchie is a current board member.

Ritchie’s uncle, who was paralyzed with polio, helped support Linda Weir Enegren as she began the organization more than 40 years ago.

When Rainbows United filed for Chapter 11 bankruptcy reorganization in 2009, Ritchie, who was living in Minnesota at the time, was asked to return to Wichita to take on the role of chief restructuring officer and lead it through the bankruptcy.

He worked full time as a volunteer for the next year and a half.

Ritchie was recently named the 2014 recipient of the Uncommon Citizen Award by the Wichita Metro Chamber of Commerce.

He and his wife have been married 44 years. They have four children and 10 grandchildren. He plays golf, travels and spends time with family.

What are you most proud of in your career?

I was proud of the fact that I was able to maintain a balanced life between family and business. All of our employees were like family to us. We were a close-knit company.

You sold the business because it got too big. What happened?

We got up to 1,000 employees. It was hard to keep that family feel that we had always been so proud of. ... All of a sudden instead of working with customers and employees, I was working with lawyers and bankers and bonding people. It just wasn’t as much fun. I don’t mean to speak ill of lawyers, but I like to get out to customers and our employees, and it was getting to a point I couldn’t do either. ... We were proud of the fact that we were a high-integrity company. We did what we said we were going to do – even if we lost money.

You saw a lot of changes in the industry. What was the biggest?

The industry was being taken over by a lot of multinational companies that were very impersonal and were very, very large. That’s another contributing factor (to the sale). The industry just wasn’t as much fun as it used to be.

Over the years, you provided a lot of concrete in this town on projects such as Towne East and Towne West, sections of Kellogg and many others.

We’re the most spat upon name in Wichita – if you look at the sidewalks when you walk around (which sport the name Ritchie Paving).

What was your biggest challenge in business?

The biggest challenge were things like government relations, OSHA, all the various government agencies that put extra demands on you and extra costs on your projects because of what you have to do to meet all their demands. Then as the big multinationals came in, it got so much more competitive because they were so big they could spread their costs over a much larger base of sales.

You mentioned that Wichita has changed with the loss of many locally owned businesses, such as Pizza Hut, Coleman Co., Rent-A-Center and others. Wichita’s airplane manufacturers are owned by outside firms. And that impacts the city and its nonprofit organizations, you said.

Now, decisions about what goes on in this community are being made in other cities. And the big question is: What are we going to do about it? You can sit there and let it happen to you, or you can get active and change something to make Wichita more competitive going forward. The younger generation that’s coming up now needs to pay attention to that, because with dinosaurs like me, it’s too late. It’s the younger generation that needs to get a hold of that issue and fix it.

Why did Rainbows United file for bankruptcy?

They had been spending more than they were making for two or three years by a considerable amount. But they were producing income statements that showed that everything was fine. They were falsifying the statements. They hid it from the board. One day, the CFO walked in and said ‘I can’t make payroll. I quit.’ And he walked out.

What was the hardest part for you during the bankruptcy of Rainbows United?

The toughest thing for me, I hate raising money, and I had to go raise money. There really hasn’t been a toughest part. Two board members stepped up and loaned some rather large dollars to Rainbows. ... We quickly promoted Deb Voth to interim president and then to president. She’s been wonderful. ... Our funders stayed with us and were very positive. Our parents stayed with us. Our employees and staff stayed with us. ... Our board got re-energized. We kind of changed the way we do things from a committee structure standpoint. All in all, it was a very positive experience.

At the time of the bankruptcy Rainbows was the largest of its kind in Kansas and had about 400 full- and part-time employees. It became a smaller organization. How so?

Rainbows is a very important charity and it needed to be saved. When it came out, it was smaller, but none of the children that were getting therapies from Rainbows lost therapies. What was smaller was day care. We used to provide day care for special needs children, but nobody will fund that. They’ll fund the therapies working with the kids and working with the families. All the therapy programs are still being done. We’re hoping long-term that we can eventually get in a financial position where we can put back some day care. It’s really needed in this community.

What is your best management advice for others?

My best management advice is make sure you stay true to yourself and be honest. We were kind of known for that. Our word was our bond. If we shook your hand, we’d do what we said regardless of the outcome. ... We found over the years that if we were honest and did what we said we were going to do people would want to do business with us, even if we weren’t the low bidder.

What’s the biggest mistake companies make in business?

I think they grow too fast. I don’t think that’s good. It takes cash to grow. If you run your liquidity into the ground trying to grow too fast and if you get a hiccup you don’t have any liquidity to pay for the trouble.

What’s your best business advice for nonprofits?

You have to run it like a business. If you run it like a charity, you’ll have trouble. There are a lot of charities in this town that are run like a charity, and they’re in trouble because funding in general is harder to come by now. It just is. Our previous staff at Rainbows would refuse to cut anything, because they liked all their programs. And when funding got tougher, they refused to cut. And that eventually caught up with them. You’ve got to run it like a business if you want to continue doing your charitable work.

What’s one thing many people don’t know about you?

For 12 years, I played in an oldies rock and roll band called the Grateful Not To Be Deads.

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