Golden Opportunities in the Golden State: Gary Johnson Turns ‘Sky is Falling’ Into Rising Star for WiZiX Technology Group

The last thing that Gary Johnson wanted to do was buy himself a job.

Gary Johnson, president, WiZiX Technology Group

After a long career in the industry that included stints with Wolco Business Systems, Zoom Imaging Solutions and Xerox’s Global Imaging Systems, Johnson had purchased a home in southern California. He was more than content to focus on his real-estate venture and investment portfolio. Between those interests, his beloved classic cars and spending time on the links, life was good.

Then came a pivotal phone call in 2017. There was a dealer in Fresno who was looking to sell his business. Would Johnson be interested in buying it?

“I asked myself, do I really want to get back into the business?” he posed. “It sounds like a lot of work.”

Johnson definitely had no interest in returning to the daily grind as an owner. But he saw a wonderful opportunity for the genesis of a new organization that focused on asset purchases in central and northern California. The day after his non-compete was up, Johnson called Eric McIntosh, his former vice president of sales, and pitched an idea. Johnson would mentor McIntosh and several other partners from an entrepreneurial standpoint and make a five-to-seven year commitment to see the organization gain its footing before selling his interests back to the group.

Johnson and his team of entrepreneurs quickly went to work, and thus WiZiX Technology Group was born (WiZiX being an acronym of Johnson’s career stops). Since late 2017, the company has added Stanton Office Machines of Fresno, Scott Technology Group of Sacramento, Complete Business Systems of Livermore and, most recently, Edwards Office Systems of Sacramento.

While Johnson is committed to the next five years, he is fully confident in the future of the industry. He has tucked in businesses whose owners did not share his positive outlook and has built (along with his team) a $12-$15 million performer that carries Ricoh, Savin, Lanier, Toshiba, Brother and Kyocera/CopyStar. Johnson also made a believer out of his own son, Tyler, who graduated from LMU with a business degree and originally felt the copier industry didn’t have a strong future as a career option. He needed only three months of working at WiZiX to experience the vitality and opportunity the industry offers.

Shown from left are Gary Johnson, president; Jill Jurevich, CFO; and Eric McIntosh, vice president of sales-north

We sat down with Johnson to discuss his whirlwind experience with WiZiX, the company’s blueprint for expansion and the challenges in turning an assembly of companies into a cohesive unit. Johnson envisions a bright future and opportunities that exist in a healthy segment of the Golden State, and a roadmap that will produce success for WiZiX long after he’s turned over the reins of the company.

How is business so far in 2019?

Johnson: We continue to grow and the acquisitions have helped a lot. Even without the deals, we’ve been able to increase from the baseline of where those acquisitions were at by more than 50% over what they were doing prior to the time that we took on the acquisitions. If you add them all up and look at our revenue now, it’s grown quite a bit.

What does WiZiX Technology Group pride itself on?

Johnson: I was blessed with getting a great group of people together. The integration of multiple companies into one identity is still a work in progress. The employees understand that the long-term goal is for this to be an employee-owned business. The people who are helping to build it will eventually own the business when we get to the point when it can happen. There seems to be a lot of emotional investment in the business from the employee standpoint, and they believe in where we’re headed, which makes me proud.

Everyone mentions great service, but I think that’s a hallmark of any good company in this industry. If you’re not taking take care of your customers, you’re probably not going to survive long. We do things the right way and make sure we take care of our customers and employees. You have to make money to do that, and we’re not giving away the farm just to grow the business. We follow the metrics of the Hanson/Hey model, the Global model. It’s a well-run business.

We do great job with hiring people, and the training we use, WiZiX University, gets them up and running. It’s a self-branded training program that was created by Grant Cardone. We made a six-figure investment in training for the next three years. It encompasses daily training, and our reps watch about 15-20 minutes of sales training videos. It’s a three-year course that takes you from beginner to intermediate, then advanced and masters, in sales. It’s making a huge difference in terms of the professionalism and productivity of our team.

Your company has logged nearly two years in business. What inspired you to start another dealership, and what are your objectives?

Johnson: My role in the business is to mentor, essentially run the company from a 30,000-foot perspective. I have a great CFO, Jill Jurevich, who has been with me from the beginning of Zoom, and she’s part owner of the business. She does an incredible job of taking care of the day-to-day operations. I have three VPs who eventually came over with me and others who have equity in the business. They’re all tending to the day-to-day operations. My goal is to do this for another four to five years, see WiZiX reach $25-$30 million, and then have them take over ownership and run the business. I will slowly fade away from being involved in the operation. That was the goal for me from day one, a five- to seven-year plan.

You boast more than 34 years of industry experience in guiding Wolco Business Systems and Zoom Imaging Solutions. Tell us a little about your background and how you leveraged it in creating this new dealership.

Johnson: It’s a lot easier the second time around, because you know the path, pitfalls and mistakes. What makes a big difference is having the capital to invest in the business and do things I couldn’t do the first time around until the business had been built to a certain point. We made a lot of investments in this organization that once took years to get to, if at all. Managing to that model is so important, it becomes a great road map to success for our business. I’m shocked at how many businesses I’ve vetted who have no clue about their numbers. They don’t understand how the pieces fit together. We see a lot of mistakes. They struggle, can’t buy equipment on cash with order because their cash flow is not good. They’re not properly priced, or their maintenance agreements and comp plans are a mess, so they’re not getting proper equipment contribution to their bottom line.

Most recently, you acquired the assets and customer base of Edwards Office Systems in Sacramento. What attracted you to this opportunity? Is there a common thread among your four acquisitions?

Johnson: The Edwards acquisition was attractive for us because it was a company we could fold into our current operation without adding overhead. We didn’t have to hire a substantial number of people, so we picked up the equipment base and a couple of great technicians. We were able to move forward and put all of it into our location. The real benefit to that program is that it added to our top line, but a lot of that acquisition fell to our bottom line. We had a substantial value-add on the profitability.

WiZiX Technology Group employees gear up for a company golf tournament in Fresno, California

I’m not a strategic buyer or a venture capitalist with a goal to build this up and then turn it public or flip it to an even bigger buyer. Our acquisitions are not big buys. But what I’m finding is there is a sub-culture of dealers who are probably my age or a little bit older, who aren’t of interest to the large consolidator players. Many of them have stopped farming their business and aren’t paying attention to it. They want to retire, and maybe they tried to sell a few years ago and couldn’t get their price, so they continue to see their value drop. We’ve been putting out feelers and it’s amazing how many responses we get from dealers who say, “We want to sell, but there’s nobody to sell to.” We get into the conversation and it becomes apparent quickly that there’s good value for us. The seller gets what they want out of it, and it’s a small enough bite for us to take. We can just continue to add them on, one after another, without burying our dealership in debt or dealing with the time it takes to get them integrated. That’s been the case in almost every deal we’ve done: older dealership, older ownership and diminishing revenues. Sellers realize they can either hold on until their business goes completely down to zero, or they can get some value for it. That’s where we step in.

What will you be looking to accomplish in future deals?

Johnson: The conversations I’m having are very similar to the deals we’ve done. We’ve had a few conversations with the $5 million-plus type acquisitions. They come with more risk and a lot more work to make sure we get payback. Uncontrolled growth can kill a company as fast as anything else if you grow too fast. We’re taking those bite-sized opportunities and running with them. If something bigger comes along, it would really have to make sense for us. We’ve got a couple of smaller acquisitions brewing right now that are inside our existing territory and don’t create additional overhead. We don’t have to take over leases or hire a bunch of admin staff. We can just take the base and put it into our base, and continue to grow.

Would you consider acquiring a company outside of the central and northern California market?

Johnson: I would never say never, but it’s not within our current focus. When you think about northern California, it’s vast, a huge marketplace. From an economic standpoint, it’s probably as big as many states. With San Jose, San Francisco, Oakland, Sacramento, Fresno and all up and down this valley, it’s a massive opportunity. It’s a fairly large geographic area as well. Stretching out before we maximize what we can do here would only add more expense and not offer as big a return.

With so many new faces and facilities, have you been able to develop a corporate culture/core values?

Johnson: Our focus on culture of the business is an everyday expenditure of energy. The goal is to ensure everyone comes together so that WiZiX has a united feel. The challenge is taking four companies and turning them into one. Although it’s only been 24 months and there’s only so much you can change in that time, the integration has gone well. It’s amazing how our people have bought into what we’re doing. We throw big company parties, hold sales trips and contests. There’s the training investments. We take care of our technicians and hired a certified trainer instead of sending them to the manufacturer. All of those things quickly change attitudes about how we do business. It’s never perfect, so it has to continue daily. And every time you do a new acquisition, you start all over to get those people on board.

The sales staff of WiZiX enjoy a trip to Chicago

It was different with Zoom. We bought Wolco Business Systems out, but I was the president of Wolco previously, so the culture was already in place and those employees understood how I was going to run the business. When we were making acquisitions at Zoom, the integration was easier because we already had a solid core platform and culture that other people had to integrate into, rather than trying to create a culture out of four new businesses.

What was your dealership’s biggest win last year?

Johnson: One of the things that is scary when you make these acquisitions is, are the customers going to stay with you? Can you get them to be loyal to the new name? We had a large school district that we closed about a year ago that was over a million dollars in sales revenue. We were able to get them to sign up for another extended term with all new equipment. We had several large, $300,000-$500,000 deals we closed in the last 12 months. From my perspective, the big wins are the acquisitions, integrating them and making sure they’re profitable. My job is to focus on acquisitions and culture. We’re doing a good job on both fronts.

What was your biggest challenge in the past year?

Johnson: Integration is definitely our biggest concern and a constant challenge. Every single day, we have to work on making sure people understand our goals, our culture and what we’re trying to accomplish. That seems to be a never-ending job. The prior year, we had to deal with a lawsuit from Zoom, which was dropped in less than nine months. Being able to move forward and not have the legal cloud over our head was huge. We can focus on the dealership, rather than a competitor wanting to slow us down.

What are your goals for the next 12-18 months?

Johnson: Part of the challenge of growing a business is you sink 100% of your profit into the business. There’s no way to grow without investment, so if we make money, we either spend it on another acquisition or we’re investing in hiring more people. It’s hard to get to a point of that model profitability when you’re growing, so within 18 months for sure, we need to start catching up with the investment. Instead of being just completely focused on growth, we have to work our model so we can also make sure that there’s some profit falling to the bottom line. When I first started, I told myself it would probably be about 36 months before I got to the point where we could get back to the 15%-plus bottom line and start to see some returns on our investment.

How do you view the industry changing in the future and what are you doing to adapt?

Johnson: The thing that frustrates me is the “the sky is falling” prognosticators, which is not unlike the media talking about a recession. If you continue to say the sky is falling and you act that way, eventually it’s going to become a self-fulfilling prophecy. The owners of these dealers I’m acquiring talk about how they have to get out of the business because it is dying. They give all these reasons why their business is going backwards. But I look at it completely different. The reason it’s going backwards is they don’t believe in the future of this business, so they’re not doing anything to adapt. And adapting is a slow process, not an overnight-type thing.

I think you need to be attuned to what the customers want. I don’t see our copy and page counts going down. From my perspective, page counts grew while I was at Zoom every year. Our customer base grew every year. At WiZiX, we’ve grown every month and year since we’ve been in business. We continue to grow and see page counts go up. Is that at the expense of the competitors? Probably. Is every customer increasing their page counts? No, but some are. I’m not a sky-is-falling guy; it’s just the natural progression of our business.

We need to keep our eyes on the opportunities out there. I fully believe going into print management was a great and necessary move, so we did that. I’m not a believer in being a full IT services provider. I talk to very few companies that are making money in IT services. You have to be really big to do it. Everyone I talk to seems to put a lot of money into it, but they’re not seeing a return on investment. It’s just not for WiZiX. Document management and software services are huge; we’re doing a great job with DocuWare product, and our reps have really made it a part of our sales culture. VoIP phones are a good fit for our industry and we are close to adding that to our product lineup. We’re keeping our eyes, ears and minds open for the next opportunity, but we do not forsake what got us here and what continues to make us successful.

What do you like most about your job?

Johnson: For me, it’s not really a job anymore. I focus on keeping the mentality of the business in check and making sure we’re recruiting. I mentor more than I’m operating on a day-to-day basis. I go out on big deals with reps and add stability within the discussion. When I started WiZiX, I explained that I didn’t buy myself a job and I don’t want to be here 8-5 Monday through Friday. But I will invest whatever time is necessary to grow the business.

Outside of work, what do you do for fun?

Johnson: I’m really into classic and collectible cars. The crown jewel of my collection is probably a 1970 Plymouth Superbird with a real HEMI engine in it. I also have a 2005 Ford GT, which is really special. My office has four cars in it and I’m in one corner. It’s probably one of my biggest passions besides golf. I do a lot of traveling and love to RV. Most of our family vacations during the last 10 years have been in an RV, heading out to some part of the country. We live in our motor home for six months out of the year.

Gary Johnson’s office at WiZiX Technology Group features a number of his classic automobiles
Erik Cagle
About the Author
Erik Cagle is the editorial director of ENX Magazine. He is an author, writer and editor who spent 18 years covering the commercial printing industry.