PhillyDeals: Power Home Remodeling looks at Detroit

Posted: August 15, 2013

Asher Raphael, "chief strategy officer" at Chester-based Power Home Remodeling Group, says it's time to expand into another new city.

Hire a couple hundred people. Send them out to bang on a lot more doors. Sell more windows.

Power has opened in Atlanta, Boston, and Chicago, and on Long Island in the three years since then- Gov. Ed Rendell authorized a $300,000 grant to ease the company's move into a state business-tax-break zone in Chester.

At that site in a former electric utility building, Power now employs more than 200, and claims $40 million in yearly local sales, at about $10,000 a customer. Its other offices are nearly as big, the company says.

Where's next? "We're going into Detroit," Raphael tells me.

Bankrupt Detroit? The city that's lost a million people? Whose state governor is feeding it, and the investors dumb enough to have purchased its municipal bonds, to the asset-sale wolves?

"We're a mission-based organization," says Raphael, "and we think this is a great time for Detroit. It's a very hardworking, blue-collar population. People own their own homes out there." He means in the suburbs, too.

With the state's having lost so many auto-industry jobs, Michigan's Republican-led government is going all out to welcome new employers - cutting taxes, easing regulations, making life harder for unions. "A lot of young business owners are reading up on Detroit and finding what a business-friendly environment that is," Raphael said.

Power was also a big beneficiary of President Obama's stimulus tax breaks for home repairs. So was its window supplier, the Alan Levin family's Northeast Building Products, of Bridesburg, which also sold lots of windows to the federally stimulated Philadelphia Housing Authority in the recession years.

The stimulus is over, but Raphael says business is still growing. He projects national sales of maybe $260 million this year, double what the company sold two years ago.

Assertive salesmanship and "scalability" - the ability to sell more windows, and collect more cash, per worker, as the company grows larger than the typical local installer - are part of the story. But also, "consumer confidence is coming back," Raphael says. "People still believe there's no better place to put their money than in their homes."

Line in the air

After rolling over for earlier airline mergers, why is the Justice Department suddenly trying to block the planned American-US Airways combination?

Is it because Washington's cash-strapped agency bosses, wealthy lobbyists, or members of Congress are nervous about having fewer competing airline choices at Reagan National?

Is it because new Justice Department antitrust chief William J. Baer, whose career up until now has been a typically lucrative Washington bounce between defending corporations like General Electric from price-fixing complaints and slapping at them during stints at the Federal Trade Commission, is tougher than previous Obama appointees?

The government's stand "came as a surprise, because not a lot of mergers are challenged, and American is coming out of bankruptcy," says Michael Carrier, Rutgers University law professor and antitrust textbook author.

Baer's office listed concrete reasons to fight the deal: It will leave more than 1,000 city-to-city routes facing less competition and choice between airlines, and the expected resulting higher airfares and fees, and it would combine two airlines that have lately reported healthy profits and higher sales, unlike some previous sky combinations, Carrier said.


Contact Joseph N. DiStefano at 215-854-5194 or JoeD@phillynews.com.

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