Manufacturing Today - Winter 2011 - (Page 138)
www.mid-continent.com / Proj 2010 sales: $14 million / HQ: Minneapolis / Employees: 80 / Specialty: Precision manufacturing / Sanders Marvin, CEO: “We downsized overhead and stopped taking on customers that weren’t profitable.”
mid-continent restructured operations to become a more profitable and growth oriented company.
‘A Good Feeling’
mid-continent engineering has become a high-end manufacturer by refocusing. by luke gillespie
Quality over quantity – it’s a maxim that has been uttered throughout the business world, but one can accuse its proponents of not putting the words into practice. At Minneapolisbased Mid-Continent Engineering, CEO Sanders Marvin discovered the company would survive only if it truly began to focus on the quality of its work and not how many contracts it took on – a difficult change in mindset for an aerospace and defense 138
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customers in order to focus on exceptional service for a select group of customers,” Sanders says. “Our revenue shrank by 10 percent in 2006, but our profitability soared to record highs. Our quality ratings improved and lead times collapsed, freeing up space, inventory and cash.” For example, Mid-Continent took a complicated aluminum weldment from a manufacturing lead-time of 12 weeks down to two weeks. This led to the customer increasing their volumes with Mid-Continent from $2 million per year to more than $6 million. “Prior to the restructuring, we were chasing top line growth,” Sanders states. “With the restructuring, we downsized overhead and stopped taking on customers that weren’t profitable.” In addition, he acknowledged that the company needed to cut payroll, which took an added hit with the recession, but notes that employment is back up at Mid-Continent from 65 employees to 80, along with profit margins. “We’ve done very well attracting good, profitable work, so my expectation would be to continue doubledigit growth for the next three to five years,” he asserts. “That said, we’re a 60-year-old legacy manufacturing company working to make ourselves relevant in today’s globally competitive market. At the end of the day, top line is fine, but generating bottom line results and cash flow from operations is the name of the game.”
manufacturer in business since 1949. “We did a lot of work starting in 2003 in kaizen and lean operations,” Sanders explains. This included restructuring the company, with Sanders chopping away at its client lists to find the ones that may not have brought in the most contracts, but the most profit, and had the greatest potential to grow over time. “Over the course of six months, we eliminated over 80 percent of our
Possibly the most significant change at Mid-Continent has been its shift in client focus. Healthcare, which was once 20 percent of its business, now takes up 75 percent of all sales, due to its adoption of lean manufacturing. Sanders explains that defense products are often short-term contracts that leave the plant with no use for its manufacturing cells after two or three months of work. But with
Table of Contents for the Digital Edition of Manufacturing Today - Winter 2011
Manufacturing Today - Winter 2011
Freudenberg Household Products
O.K. Foods Inc.
Packaging Progressions Inc.
Burr Oak Tool Inc.
Patriot Forge Co.
Aseptic Solutions USA
Comex Group/Frazee Paint
Fabrica Fine Carpet and Rugs
Peerless Mfg. Co.
R.F. Hunter Co.
Advanced Fiber Technologies
Behringer Saws Inc.
Berger Paints – Trinidad Ltd.
DBS Manufacturing Inc.
Fisher Tank Co.
Hess Industries Inc.
New England Ropes
SET Enterprises Inc.
Total Electronics LLC
Weinbrenner Shoe Co.
Manufacturing Today - Winter 2011