Starting up a Shop Requires Grit, New Thinking & New Tools
Having your own shop and working for yourself may be the stuff of dreams for many. But when you take the step for real, the stuff of the dream often fades in the face of hard reality. Where and how do you open your business? How do you make your presence—and capabilities—known? How do you win and grow a customer base? Here's one example of how a one-man shop got going and continues to build on the dream
CELINA, OH—"I started this in my two-car attached garage, three years ago," says Eric Roy, owner of Eric's Tool Room Inc. "About a year after that, I built a 1200 sq ft facility in my back yard and moved into it; I grew out of it about as fast as I moved in. By the time I got in there and set up, I needed something bigger. It just didn't work."
That was then. Today, Roy is in a new 7200 sq ft facility with four employees and growing. He's got a big DeVlieg mill with 42" rotary table; a Meuser lathe with 55" over the gap bed, 40" over the ways and 30" x 15" over the carriage; a LeBlond lathe that can do 80" between centers, 24" over the ways and 16" over the carriage; a Monarch 10EE, which is used primarily in the tool room; a couple of Bridgeport mills; a small Cincinnati mill and a bigger 50" Cincinnati Gilbert horizontal boring mill.
"We're set up to do larger jobs," Roy says, "but we do all sorts of things. Maintenance and repair of die cavities, replacement parts for die cast machines, regrind urethane feed rollers, building weldments up to 3000 lbs, which we machine and paint on site, and machining castings up to 3000 lbs. But largely we focus on prototyping work, which is where I want to be but that type of work wasn't always easy to fill the shop."
Which is understandable, considering the nature of prototypes. Typically, if you're doing prototype work, it's one or two of something, with no follow-on volume production of the part. "I might be doing a very small, complicated, close tolerance valve for the medical industry, which takes a lot of time and cost, and when I'm through with it, that's that. I know there are not another 5000 in the pipeline. So, I'm constantly rolling through different customers, looking for work."
Which in the early days was very tough. Roy says he quickly discovered that cold calling wasn't going to get the job done. There simply was not enough work in his surrounding area to support his business. Which for many, if not most startups, would simply have led to closing up shop and looking for a job working for someone else.
New tool broadens reach
"The reason I set up Eric's Tool Room," Roy says, "is that I didn't want to work for anyone else any longer. I wanted my own business, to set own goals, to govern my own future. And when I realized that there wasn't enough specialty work in my area to keep me busy, I knew I had to try something new. That's when I signed on with MFG.com."
MFG.com is an online production-level solution for OEMs and suppliers of engineered-to-order components. The site instantly and "intelligently" matches buyer requirements with potential suppliers possessing the right expertise, credentials, and capacity for the job being sourced.
"Once I got on the system," Roy says, "it brought me clearly into focus. I suddenly saw that there were thousands of people out there for me to look through, and they had jobs they wanted done, now. It was like, here's a buyer needing the types of parts that I really like doing, the specials and prototypes. I don't need to think about running production to stay in business. There is enough of the specialty and prototype work on this site to keep me more than busy."
Roy says he uses the site weekly and tries to keep the open RFQs that he's interested in to about 50 to 60. These are jobs that he can bid on at any time, and now he can devote all his time and effort to productive work, he says, instead of being on the road, calling, faxing prints back and forth and so on. Plus, he's able to quote globally, and while he has yet to penetrate the European market, he has won jobs from Canada. "With MFG.com I've been able to broaden my reach and exposure to a larger audience and geographic area. Well over 80 percent of the jobs I win come from outside my local area."
"So, it's not just the dollars that result from securing jobs over the system," Roy says, "it's the time I save and am able to channel into doing work. And how do you put a price on that?"
The nature of the work
If there's one thing in common about the type of work the flows through Eric's Tool Room, it's this: It's not likely to be a candidate for outsourcing. Certainly not the maintenance and repair work, but much of the prototyping work as well. "Prototypes seem to be inherently late when they hit my door," Roy says.
Roy points out that it's impracticable (if not often impossible) to sacrifice quality and workmanship on the altar of expediency. Quality isn't expensive, he says, it's priceless. "We do make the part exactly right the first time, but that type of effort doesn't come cheap and it doesn't come fast. But if we establish a reputation—and we are—of being able to turn work quickly, to spec and to top quality, that gets around and we end up with more work, especially in prototypes, where the customer knows he's pushed you against the wall time-wise and delivery. There's a delicate balance between accuracy and competency and delivery and quick turnaround, and some customers try to make an allowance for that. But others, well, they're just always late."
Another observation Roy makes is that if you can hold a part in your hand, it's probably going to be outsourced to China, especially if it's a high volume, low tolerance, uncomplicated job like a fitting, coupling or washer. And that's part of the reason he has some large capacity machinery, like the DeVlieg, the LeBlond and the Meuser lathe. "Machining a one ton casting for the refinery industry isn't likely to be sourced overseas," Roy says, "but we do things that are pretty much all over the size/tolerance range. Typically we work within 0.001" or 0.002", but we can get a lot tighter than that. It all depends on what kind of tolerance we're discussing—flatness, diameters, distance, roundness—and the kind of part. We've done parts requiring 0.000050" in flatness. On ODs and IDs, we're typically in the 0.0001" or 0.0002" range or tighter."
He notes a nitrous oxide valve he's dong for the medical industry. "This customer had already tried the non-domestic route and found the experience completely nonfunctional," says Roy. "They simply couldn't work with the long distance on problems and issues they had with the part. So, now the part is with us. It's a very small valve; the whole assembly weighs just a couple of ounces. The tolerances are 0.0002" with surfaces calling for a four or five micro finish. It's a pretty elaborate part and the customer wants it done right, so he can successfully test it. I've got to figure out how much time it's going to take to do everything that's required, the diamond lapping, the jig grinding, the multiple setups, and it's going to be a pretty expensive job. But that brings up the quality issue again. And that's why the customer has sent the job to us. It's not a price issue or delivery issue; it's a quality issue. They want something they can test, to see how well their idea works and how to improve it, and that's what we give them."
Using the site
There are a number of things that Roy is particularly pleased with about MFG.com. One, he says, is the profile that MfgQuote created for him that gets him to the top of many search engines. "Customers looking for prototypers with this or that type of expertise, with a specific capacity or capability can look at my profile, check me out and also see some of the ratings past and current customers have given me," Roy says. "I've gotten a lot of work just through the profile by customers contacting me directly. Plus, I can look at all those who've looked at my profile. I know who they are, whom they work for, what their contact information is, and I can get a pretty good idea of what they're looking for. There must be thousands of them."
Another thing that Roy likes is that MFG.com has just begun rating its previously unrated buyers. "This is a huge jump," Roy says. "When I first joined the system, there was everyone on there from Lockheed Martin to a guy wanting a part for his backyard grill. Until a buyer actually issues an RFQ and begins to buy and receive supplier ratings, you really don't know much about them. By rating the buyers before they buy anything, MFG.com is providing me with enough information to decide whether I might or might not want to work with a company."
And then there is the control issue. "I really like the aspect that the system allows me to go after the kind of work that I want to do. I have full control of my company's direction, and I can turn up or down the work volume as I see fit. And this is great; it's something I'm not going to let go of anytime soon."
Revenue is another issue. "My first year with MFG.com, I took in $30,000 to $40,000. My second year that rose to $65,000. This year, with the new building and employees, I've done more work in the last two months than I did in the previous ten months. This year, I'll probably go to $120,000 and next year I'll be over $250,000. Which says a lot about the power of MFG.com. Not bad for a guy who started out three years ago in his attached two-car garage."
For more information, contact:
Eric's Tool Room Inc, Celina, OH, 4i9/586-6692
no1toolmkr@hotmail
MFG.com Inc., Atlanta, GA, 770/444-9686, www.MFG.com
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