March 2009 / Volume 61 / Issue 3|
Now is the Time for Opportunity
By Michael Deren
Unless you’ve been living under a rock, you know the economy is tough and has been for months. Every week, I read about manufacturers and retailers shuttering their doors and filing for bankruptcy, and large financial institutions or the government taking over banks and Wall Street firms. And a year or so ago, who would have thought the Big Three automakers would be in their current dilemma? Even foreign automakers are having troubles.
As automakers dramatically cut production, the shops supporting them are also forced to cut back. This trickle-down effect will likely cause many shops to go under. On the brighter side, the downturn will also help other shops to succeed. How? By giving them the opportunity to diversify into healthy markets, such as wind and solar energy. Many more industries are not hurting, but thriving.
How many shops focus on one industry? I’ll bet the vast majority of small to medium-size shops specialize in one industry or are dedicated to one customer. Many shops started when a particular industry or customer company was thriving, but what happens when that industry or customer backslides? For example, oil prices quadrupled from 1973 to 1974. As a result, the U.S. started drilling for oil like crazy, and machine shops popped up all over to support the demand, only to fold later in the decade after oil prices dropped and their customers disappeared.
By doing something now, you can probably avert disaster. Many shops are adding new processes so they can attract new customers. Does your shop primarily do turning? Now might be the best time to invest in a couple of mills and train your best machinists and engineers to use them. Become an expert at milling and seek customers that require it. You did it with lathes, didn’t you? It’s never too late. If you have to, hire an expert milling machinist or a sharp milling engineer. You can even use them as consultants, if need be. Take a job or two and get your feet wet.
Consultants can help and you can even get free ones! One source is a machine tool builder. Not only do they have knowledgeable sales engineers, they also have applications engineers to help customers overcome part processing challenges. Chances are they have seen something similar to what you’re quoting. They can assist with workholding solutions and identify the machine tool that’s best for your application. Some machine tool builders help quote jobs. Once you land the job, they can even help your staff write the programs, set up the machine and run the first few parts. Some also write programs for a fee. They will help as much as possible, because you are a customer.
A local cutting tool vendor is another source, but not the general-line salesman who sells everything. I’m talking about toolmakers’ sales engineers, who are a treasure trove of knowledge. They have been around and have seen what other shops are doing. Cutting tool engineers tend to specialize. Some are experts at milling, others at turning and still others at drilling. If your sales engineer can’t help with the specialty you need, he can probably locate an expert or have someone travel from the factory to help. These services are usually free, but, remember, toolmakers expect you to buy their products.
Don’t get locked into one industry or customer. Diversify. Expand into a different field. Don’t try to be an expert in all applications—just more than one. This benefits your company in the long run and will help you weather economic slumps. CTE
About the Author: Mike Deren is a manufacturing engineer/project manager and a regular CTE contributor. He can be e-mailed at email@example.com.
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