Monday, June 29, 2009
Interview with Bernardo Herzer, LEHR
There has been a lot of recent interest in green technologies and products which attack the green/clean technology space, with a number of firms in Southern California tackling parts of that problem. One of those companies is LEHR (www.golehr.com), which develops and markets lawn and garden equipment which uses propane--not gasoline--for power. We sat down with Captain Bernardo J. Herzer, the founder and CEO of LEHR, to hear about how the company came about, why he believes his firm's products are better for the environment, and more about its business.
Where'd the idea for the company come from?
Bernardo Herzer: My background is the ocean. I was a sailor since I was 14, and left on my first world tour at age sixteen with the family for a six month world tour. Four and a half years later, I arrived back in the states, on the same boat. That gave me a passion for the ocean and the sea, and most recently I have owned oceanographic research vessels, doing work for governments and universities surveying the North Sea for Her Royal Majesty's department of Fish and Wildlife in England. In working on the ocean, I saw first hand the massive disruption of the oceans by technology, if it isn't controlled. The North Sea has been fished out, we've fished out the Atlantic when it comes to code, and we could fish out the Bering Sea in one season if there weren't limits. People might say they don't believe the poles are melting, and don't believe in Gore, but the reality is, our technology is way more powerful than our environment is.
Since an early age, I've been converting small engines to use propane, and also have done so working on my own research ships. Working with scientists, they don't want to be around engines producing cancer causing agents and smog, so what they do is convert lots of their engines to run on propane. Plus, its made equipment much more reliable, you don't have problems with having to mix gas and oil, you reduce greenhouse gases, and reduce particulate matter by 97 percent--plus they are much more efficient.
It turns out, this is applicable to the lawn and yard care products area, because those products cause 5 percent of all of the pollution in the United States. Lawn and garden equipment uses a Class 4 Engine, the dirtiest of all engines. That's the only category where 2-strokes are still dominant. That's a significant part of what we're doing. In fact, we've just won an air excellence award from the EPA for helping to improve the nation's air quality.
Are your products available yet?
Bernardo Herzer: Our products are on the shelves around the country, at Home Depot, Sears under the Craftsman brand, powered by Lehr, at Ace Hardware, True Value Hardware Stores, Do it Best hardware Stores, and Meijer Stores. They've been available since the first of the year.
How does the cost of the product compare, compared with using traditional gasoline equipment, particularly with fuel?
Bernardo Herzer: Going into a green product, you've got several selling propositions to the consumer. The two major issues, in my opinion, were price point, and the second was ease-of-use. Even though you might have a superior product for the environment, if those criteria are not met, you're fighting a strong uphill battle. We're not only comparably priced to 4-stroke lawn and garden equipment, we're much easier to use. There's no going to a gas station, no storing of gasoline and oil, and not transporting that gasoline and no mixing. Plus, gasoline tends to only have a life expectancy of 35-40 days, before it starts to separate. Not to mention, you really should only use high-test gas for small internal combustion engines. That compares with using a small, 16.4 oz., typical camping style propane canister, which is available just about everywhere at major retailers, and even at some pharmacies. With that, you're able to run the equipment on average for two hours. When it comes to buying one of these, it's pretty much a push, except if you tend not to use your equipment over a period of time--because no one goes to the gas station to just buy 8 ounces of gasoline. Instead, you tend to buy a gallon or more, which also tends to become a very serious environmental issue.
Turning to the company, how is your firm funded?
Bernardo Herzer: We're currently funded by friends and family, and are now moving into institutional funding sources.
Can you talk any about your management team, and what experience you have in taking products to the retail market?
Bernardo Herzer: There's a whole team of people working with us. Some of them have as many as fifteen years of experience working with Home Depot, ten years with Ace and True Value, and our national sales manager has been in the industry for 25 years. Our CFO, Kelly Lefkowitz, is an operator in the financial markets, plus we have a very strong board of directors, including John Doggett, who is a professor at the University of Texas Red McCombs Schoool of Business MBA program.
What's the next goal for the company?
Bernardo Herzer: We're an explosive growth business, and we're now capturing other large retailers who have agreed to come on board. We'll be rolling out additional products--we have a leaf blower coming out this fall--and are expecting a lawnmower and other products down the line. A lot of what we are doing is mandated by the states, and as you well know, this administration has issued regulations to increase gas efficiency on cars. We expect there will be additional efforts to reduce greenhouse gases and our dependence on foreign oil. One advantage we have is the propane which is used in this country, is made in this country.