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Joining Forces for Shop Survival
Get tax credits, share best practices and pool resources by joining a collaborative effort. It can be key to your shop’s longevity.
What do you get when you combine a leading automotive plastic injection mold builder with a shop that
specializes in mold repair and engineering changes? A partnership that fills the needs of both the mold builder H S Die & Engineering, Inc. (Grand Rapids, MI) and Easley, SC-based mold services provider United Tool & Mold Inc. (UTM)—allowing each company to focus on what each does best. Together, they can offer their customers increased capabilities and strengthen their positions in today’s world market.
Four years ago, Kent Hanson, general manager of H S Die & Engineering, Inc. and Scott Phipps, president of United Tool & Mold, Inc., met at an AMBA convention. Upon discovering that several of H S Die’s competitors had moved down south near UTM’s facility, Hanson decided to explore the possibility of UTM performing mold repairs and small engineering changes.
In exchange, if UTM was asked to build a tooling package, H S Die would quote and build the molds, then ship them to UTM, who would then support the molds. A sales rep from H S Die visits the area on an almost monthly basis, with office space in UTM’s facility. And—on occasion—a UTM employee will visit H S Die to collaborate on a mold build. So far, the collaboration is working out beautifully.
Here, UTM machines a 65,000-pound cover half of a fender mold. Photo courtesy of H S Die & Engineering and United Tool & Mold.
Starting Out
It may be hard to imagine partnering with another mold shop, but Phipps maintains it can only strengthen the resolve of all U.S. moldmakers to survive in today’s globally competitive marketplace. “The guys across town are not your competition anymore—it’s the guys over in China, Korea, Portugal, Germany, etc.,” Phipps states. “Look at it from a global perspective: We all need to pull together and learn how to take the foreign competitors on ourselves. We all specialize in separate things, so get to know each other’s specialties and build a solid team (see Collaboration Pays Off Sidebar). Trust each other because trust is key. Respect each other and be open-minded.”
Hanson couldn’t agree more. “You should find people you are comfortable enough to work with and trust all throughout the U.S.,” he urges. “If I have a guy on the road in Ohio and there is a molder that wants to make a change or repair, I use my AMBA contacts to see if one of my mold technicians can go to a local shop so the job can get running, to avoid added time and logistic problems.”
Working Together
So, how can a moldmaker go about building this level of trust that exists between UTM and H S Die? As Hanson mentioned above, joining a moldmaking association like the AMBA can help to develop contacts and foster relationships. He urges touring prospective shops before entering into a collaborative effort. While he and Phipps started their relationship with a gentleman’s agreement and a handshake, both companies have signed an Ethics Agreement (see Ethics Agreement below) developed by Hanson to seal the deal.
HS Die and UTM work together on pricing concerns so that each job will allow for both companies to give the best pricing for their respective customers. “It is a mutually beneficial relationship,” Hanson notes. Phipps adds that it isn’t difficult to get a sense of how a shop operates by looking at its customers and the shop’s reputation in the marketplace. “I had a sense of Kent’s ethics and values when I first met him,” Phipps notes, “which was reflected in H S Die’s work. We are truly a team.”
Ethics Agreement
The following Ethics Agreement was written and developed by H S Die & Engineering, Inc.’s General Manager Kent Hanson.
Outsourced Machining and Subcontracted Vendor Work Business Ethics Agreement:
Honesty in Reporting
Report fair costs and provide breakdowns of all operations needed to complete the work agreed upon. So when you are doing work as time and material, report and invoice for the correct number of hours it took to complete the tasks. Be fair if you add time for handling, setups and program management.
Communication
Be sure to effectively communicate tasks that need to be completed and provide prints, CD, data transfers, solid models or sketches needed to properly line up the vendor. To validate that the vendor understand all tasks to be completed, repeat the line-up back to the subcontractor. This will help avoid errors, problems and additional conversations.
Errors (Unintentional)
Please be patient, fair and understanding when problems occur or mistakes are made. Have enough integrity to discuss them with all parties involved and resolve them fairly.
Confidentiality
We many times entrust much information—whether on purpose or by accident—that is confidential to our companies and provides information about our customers. This information can never be used to secure business for the Vendor Company or be divulged to anyone else or even be used to contact someone else’s customer for any reason. We are partners and our relationships must be built on trust in this regard.
Thanks/Appreciation
A simple phone call or an e-mail to let each other know that the machining has been completed will be needed. A job well done is appreciated and we need to extend a thank you for all those who have helped us. This is a common courtesy we all need to avail ourselves of. |
Collaboration Pays Off
Collaborative efforts are on the rise in the moldmaking sector. In 2006, plastic injection moldmaker J. S. Die & Mold, Inc. (Byron Center, MI) decided to work with a manufacturer’s rep to build a national customer base. According to J.S. Die & Mold President Bob Sloma, the rep—who also had been working for Wes-Tech Automation Solutions (Buffalo Grove, IL)—a provider of production line automation design, build and implementation products and services—came across a larger company that was looking for a shop who could take on both mold manufacturing and automation. “This company was having difficulties getting the molds and automation working together out of the gate with new product releases which were leading to significant additional launch costs and delays,” Sloma recalls. “Our rep was good enough to recognize the potential for J.S. Die & Mold and Wes-Tech to solve their problem and put us in touch with each other. After reviewing each other’s capabilities, we decided to jointly go after their business.”
Sloma adds that the prospect has since voiced additional needs for which it appears there is only one other company in the world (Japan) that does what they want. They sourced the first project with the Japanese source, but wanted to develop a source domestically. “The combined resources and contacts of J.S. Die & Mold and Wes-Tech with our combined resources and contacts can do what they want, so we should be able to land one of several projects within the next year,” Sloma says. “I also can see the potential to increase our business with existing customers with the added capability of integrating the mold and automation as one delivered product.
The companies have been working on developing the collaboration with injection mold tooling provider Jungwoo USA for close to a year. “This allows us to have some offshore sourcing capability,” Sloma elaborates. “Eric Ludge, a program manager I hired in June 2006, has worked with them before and we know that their tooling is top quality and cannot be distinguished from domestic made tooling. Jungwoo USA has been quoting tools for us since the fall of last year; and this spring they agreed to have us be their certified shop for the Great Lakes region. We will be receiving tooling bound for their customers in this region—prepping them to run and doing any engineering changes that may be required.”
Sloma recommends other shops look for opportunities to collaborate with other companies both upstream and downstream in the product development and launch process. “This can be done either through strategic acquisitions or by searching for and developing relationships with companies that do the work,” he states. “I started by looking for ways to broaden our geographical reach, believing that if companies are willing to source tooling offshore there is no reason why we can’t build a national market. I also view the collaborative relationships as a way to create new sales channels for our products and services. As our customers continue to look for ways to reduce the number of people required in their processes and reduce their new product launch costs, it opens up opportunities for us to provide not only the products but also the services to help them get a product to market.” |
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