Rock Solid

Kurt Swenson, of Rock of Ages in Barre and Swenson Granite Co. in New Hampshire, started in the quarries and wound up in the CEO's office

by Amy Souza

Kurt Swenson stands before some of the 1,500,000 cubic feet of granite Rock of Ages sells each year, half of which comes from Barre. Swenson purchased the company in 1983 when it went up for sale.

Solid branding is a tenet of good marketing, but branded tombstones? If you think about it, it makes good sense. Tombstones are not purchased by the dead but by the living. The reasons anyone seeks out a name brandtrust and qualitystill apply, maybe even more so.

Kurt Swenson, chairman, president, and chief executive officer of Rock of Ages Corp. in Barre, knows the value of a strong brand. Rock of Ages has terrific name recognition, but that doesn't mean much when the memorial industry takes a dive, which is what Swenson says has been happening for the last decade. "People spend $5,000 on a casket and then $800 to $1,000 on a headstone."

Swenson chalks up the phenomenon to lousy marketing, what he calls the "barbershop mentality." In other words, monument dealers wait until someone walks into their shops to sell, or even market, their products.

Swenson doesn't want that to happen to Rock of Ages. His goal is singular; his path is clear: "To create a dedicated, branded distribution system of retailers selling our branded product line," he says. "It's a challenge when you change, but unless you're involved in change, I think you're dead."

Rock of Ages was founded in 1885 by Scottish immigrant George Barron Milne, who came to Barre from Aberdeen to work in the booming granite industry. In 1913, the company trademarked its name, clearly recognizing its worth. Today, the company calls itself an integrated granite quarrier, manufacturer and retailer. Rock of Ages owns 13 quarries, about 110 retailer outlets and 10 manufacturing facilities across North America.

A sculptor who recently came to Barre from Italy works on a statue. All sculptors abide by the same rule, stated in a sign above the Rock of Ages shipping department: "If it's not right, don't ship it."

Swenson's family has been in the granite business since 1883, when his great grandfather started John Swenson Granite Co., Inc. in Concord, N.H. As a teenager, Swenson worked in the quarries during the summer. "The job was making curb," he says. "Basically we were drilling all day."

Swenson, 56, was born in Rome, N.Y., when his mother went to stay with her family with his father in the Pacific during World War II. Before he was 6 months old, his family moved back to Concord. As a child he liked to fish and thought the perfect job would be to own and run a fishing camp. He still lives and fishes in Concord, and runs Rock of Ages out of the company's Concord office.

Swenson graduated from Colby College in 1967 with a degree in business. Though he wanted to continue on for a master's in business administration, Swenson listened to his father and college roommate, who urged him to study law. "My father said to me, 'Whatever you do, don't go into the (family) business.' "

After graduating from Boston College Law School in 1970, Swenson had a one-year clerkship with a federal district judge in Boston. He then joined the firm of Wiggin and Nourie in Manchester, N.H. practicing corporate law, and handling mergers and acquisitions.

A year later, duty called back home. Swenson Granite was in financial trouble and the family looked to him for help. "I thought somebody's got to straighten this out." He took a leave of absence from the law firm to help the business get back on its feet. He sold the company's granite building business to a group of employees and refocused the company's efforts on granite curbing for highways. He slimmed down the company and hired a new chief operations officer. "Once you go through something like that, you get attached," he says, "but the company was too small for me. I couldn't work there because they couldn't pay me."

By 1975, he had returned to practicing law but kept his hands in the family business. He was still a chief executive officer and eventually returned to the company full time. "In 1983 we learned that Rock of Ages was for sale," he says. "We couldn't compete with them in the sale of granite for memorialswe wanted to buy them."

So did many others. Swenson scrambled to put together a $20 million leveraged buy-out of Rock of Ages from its then-owner, Nortek of Providence, R.I., which had acquired Rock of Ages in 1969. Investment bank Morgan Lewis put in $2 million; Swenson Granite put up another $1 million and a managed trust company contributed the rest. "It must've been destined to happen because we were lucky to get it," he says, "but it happened and it worked."

Over time, the tools used to manufacture stone from the quarry have made it much easier to do business. "We produce more with 100 people in Barre and Bethel than they did with a 1,000 people in the early 1900s," Swenson says.

Standing above the E.L. Smith Quarry in Barre, a Rock of Ages property in Barre, Swenson asks, "Do you have a problem with heights?" Below, men the size of ants blast and cut stone blocks, or benches, out of the earth. The quarry drops straight down 300 feet, and from a distance the outlines of where blocks have been removed look like a strange mirrored wall without a reflection. A photo of the quarry, shot in 1992 by Canadian photographer Ed Burtynsky, is part of Microsoft Inc.'s art collection.

The size of a typical quarried block is 10 feet long, 5 feet high and 5 feet wide. A block that size weighs up to 22 tons. Swenson says Rock of Ages is the largest revenue generating quarrier in North America with sales of 1,500,000 cubic feet of granite each yearmore than half of which comes from Barre.

Though workers still use sledgehammers and hand-held drills for part of the process, technical advances have made it much easier to extract granite. "We produce more with 100 people in Barre and Bethel than they did with a 1,000 people in the early 1900s," Swenson says.

The Vermont quarries shut down from Christmas through Town Meeting Day, the first Tuesday in March. Swenson says it's not worth keeping them running through the cold Vermont winter because it ends up costing more to extract less product. The company's Partners in Productivity program offers workers a bonus if they meet a quarrying quota, typically amounting between $2,000 and $3,000. "All of our quarries are already sold out for the year," he says. "Demand is great right now."

Kurt Swenson is a tall man with sand-colored hair, and blue eyes that seem to smile on their own. He isn't afraid of heights, physically or professionally. He says he's the only CEO he knows who includes "philosophical musings" in his annual report. This year he used Tibetan and Chinese folk stories to illustrate his thoughts about recent company changes.

In 1997, Swenson put together an initial public offering that raised $60 million. Between 1998 and 1999, the company used that money to make 17 acquisitions, including quarries, manufacturers and retail outlets. Not all of these acquisitions worked out.

Some of the quarries didn't produce enough quality product. Some purchases were overpriced. The retail outlets were spread out across the country, making centralized functions less efficient than the company had hoped.

When Rock of Ages went public, the initial offering price was $18.50 a share. It's now trading at $5. "As the largest shareholder, I've lost the most money," Swenson chuckles. Despite this, he remains undaunted and knows what needs to be done. "We're alive and well and profitable," he says. "We're moving ahead, slowly but surely. We have to show consistent earnings from retail at a level that provides a sufficient return on investment."

Sun dials and sample headstones lead the way to Rock of Ages.

In 2000, Rock of Ages purchased 16 cemeteries in Kentucky, a move the company touts as securing freedom of choice. Many cemeteries have restrictions regarding the size and type of memorials; some allow only bronze markers.

The Rock of Ages Vermont offices and visitors center are located in the small Barre village of Graniteville. Fifty thousand visitors a year come here to take a bus tour of the Smith Quarry, just across the way. This quarry's granite supply is estimated by geologists to last another 3,000 years.

The Smith Quarry produces Barre Gray, a popular stone of mottled gray, off-white, and black, used primarily for monuments but also used throughout Barre for statues, name plates and counter tops.

Then, there's Bethel White from Bethel. In the early 1990s, it was used to build the Mormon Bountiful Temple in Salt Lake City, Utah. From Pennsylvania comes American Black, also popular for monuments. Pink granites hail from Quebec and North Carolina. Another white granite with striations of black comes from North Carolina. Brownish red comes from Oklahoma. Different types of gray come from Georgia. Grayish pink comes from South Carolina. Some of the granite is sold to builders, some to other monument makers. Some is manufactured by Rock of Ages employees into end products.

The manufacturing plant in Graniteville is the size of a giant plane hangar. Conveyor belts hold various shapes and sizes of granite, mostly Barre gray destined to become headstones. On any given day, hundreds of pieces of stone in various stages can be found in the manufacturing plant. A high-tech bar code system keeps track of each piece.

The action inside stops for the lunch whistle, and the men"most of the workers are men," Swenson saysare on break. One of the large, diamond-blade saws continues to run; it's mechanized and doesn't need half an hour to refuel. An empty work area holds a dark piece of granite out of which half a boat is carved. The carver is working from a photograph of a boat model; Swenson thinks it's the Mayflower. Hanging above the shipping station nearby is a sign that states, "If it's not right, don't ship it."

In his button-down oxford and khakis, Swenson stands out against the gray walls and floors. A few workers sit inside. They keep their eyes on Swenson as he walks around, more curious than wary. They greet him kindly, as he does in return.

Rock of Ages employs 1,000 people, about 400 in Vermont. "It's hard as you grow," Swenson says. "There was a time you knew everybodyevery single person. When you're 1,000 people, it's impossible."

Across the expansive room, one man still works. He's grasping a small pneumatic drill and stands next to a nearly 7-foot tall, half-carved statue. "That carver just came from Italy last week," Swenson says. "I haven't even met him. I have to go over and say hello later."

In another building across the way, an 80-ton press roller is being fashioned. The roller will be used by a paper manufacturer to dry pulp. Nearby, there's a huge, intricately carved mausoleum, large enough to hold a family of five comfortably, shrink-wrapped and ready for delivery.

Today, Swenson and his brother Kevin
own 55 percent of Rock of Ages. Kevin is the vice president of curb sales at Swenson Granite, which is still privately held by the family and continues to manufacture curb and landscaping products. Barre-native Bob Pope is Swenson Granite's president and CEO. "He's the first non-family CEO, ever," Swenson says. "I've always thought it's smart to surround yourself with people who are smarter than you are."

Swenson married his wife, Elaine, in 1967, just after college. They have two sons, Todd, 32, and Jake, 28. Todd is a Reiki master in New Hampshire, and Jake is in a graduate environmental services program at the University of Michigan. Neither, it seems, is interested in taking over the family business. "We're the fourth generation," says Swenson of his brother and himself. "We're probably the last generation of running the businessof active management."

If Swenson has his way, though, the company he passes on will be a living memorial with the staying power of solid granite.

Originally published in August 2001 Business People-Vermont