Sunday, February 25, 2007

by Einat Paz-Frankel (


Everything that flows through pipes is Mike Gallagher's business.


Excited about valves, pumps and instrumentation, Gallagher makes one forget his company distributes some of the highly obscure elements that make the manufacturing industry -- and him -- tick.

So enthused about industrial distribution, Gallagher took a loan and put all of his life savings, his 401(k) and his house into buying Centro Inc., in 2001 with his partner, Dave Forell.


Centro distributes industrial solutions to the manufacturing industry, including valves, filters and pumps.


Both Gallagher and Forell came from corporate America -- Gallagher was a division president at Thomas & Betts Corp. and Forell was Catherines' CFO -- and decided to be their own bosses.


"This is the one and only life that we get," Gallagher says. "Owning my own business means running it according to my values."


Gallagher took a company with a leadership crisis and revenues of $11 million, and has steadily grown it to a $24 million business that covers everything that flows through pipes in manufacturing environments -- from milk and beer through gasoline and bleach. Selling products that help to flow, control and measure those materials, Centro's roster of clients include giant oil refinery Valero Energy Corp. and beer maker Coors Brewing Co.


In the past four years, Centro has acquired three companies: Shreveport, La.-based Pelican Industrial Equipment Co., a distributor of pumps and compressors; Green Controls, Inc., of Little Rock, a supplier of flow control solutions; and most recently, El Dorado, Ark.-based BAT Pump & Supply Co., which expands Centro's line of pumps.


The acquisition of BAT gives Centro exclusive distribution of Flowserve's Durco valve line in northern Louisiana, eastern Texas and southern Arkansas. It also enables Centro to offer additional products and engineering solutions for companies in the process flow market across South Arkansas and North Louisiana.


Centro's road to success and growth was not painless. In the first three months after Gallagher and Forell bought Centro, the company was losing $5,000 a day.


"The bank called us every day asking, 'do you guys know what you're doing?" Gallagher recalls.


Gallagher implemented a new organizational structure, business plan and a compensation program that rewards sales people according to performance. That took some time and much money, but made Centro a leading industrial distributor in the region.


"Centro is among our top three distributors," says Paul Kolberg, sales manager for the Eastern Region at Hoke, Inc., a wholly-owned subsidiary of giant valve manufacturer Circor International, Inc.


Gallagher's innovative initiative, Centro College, has won the respect of his suppliers. During 'college' sessions, vendors pay tuition to train Centro's sales people on their products and solutions.


"I fight tooth and nail to get focused training time," Kolberg says. "None of my territories have that. Centro College has helped me boost sales."


Kolberg says Gallagher took a "waffling company and rejuvenated it" by motivating his employees and by implementing astute marketing strategies.


At 55, with a rich career behind him, Gallagher is not your typical corporate type. Laid off from Memphis-based Thomas & Betts Corp. in 2001 when the company restructured, Gallagher is careful to grow his own company with a greater focus on people than on mere numbers.


"I owe my bad bosses as much as I owe my good bosses," Gallagher says. "I've also learned what not to do."


Being more of a team builder and a strategist than a numbers guy, Gallagher and co-owner Forell, who is the vice president and CFO, are a perfect match.


"We've got complementing skills. I let him do what he's good at and he lets me do what I'm good at," Forell says. "He knows how to put the right people in the right spots."


And that's why Gallagher is the president of the company, despite the 50%-50% ownership.


"He's a really strong leader who's not afraid to make difficult decisions," Forell says. "We all march in one direction."


Michael Gallagher


President, Centro, Inc. 
Age: 55 
Education: B.S. in business administration and MBA, both from Plymouth State University, Plymouth, N.H. 
Birthplace: Stuttgart, Germany 
Residence: Germantown 
Family: Wife, Janice; children: Bobby, 25; Kate, 23; and Daniel, 14 
Hobbies: Jogging, reading, golf, marathon running ("I'm the man crawling to the finish line") 
Last good books read: The 7 Habits of Highly Effective People by Stephen R. Covey, and Only the Paranoid Survive: How to Exploit the Crisis Points That Challenge Every Company by Andrew S. Grove


Original article appeared in the Memphis Business Journal.