Manufacturing support strong

LONGMONT — Longmont is home to numerous small manufacturers, most of which find their sustenance in projects outsourced from larger companies.

Although they may seem to be many small, scrappy fish devouring a limited food supply, each company has developed a niche that keeps the manufacturing ecosystem working. And when a source of work is eliminated during lean economic times, shifting to another keeps these companies in business.

?With the economy as it’s been, a lot of the larger manufacturing companies have been taking the smaller-run projects,? said David Halleck, director of business development at Longmont-based HWI Manufacturing.

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In a flush economy, large companies usually don’t bother with little projects, leaving plenty of work for companies like Halleck’s.

Although losing small-run manufacturing jobs hurts HWI, Halleck isn’t discouraged.

?We have put manufacturing on hiatus for six to nine months,? he said. ?We can’t support it until the economy is back up.?

The company cut five of its 20 employees at the beginning of the year, but ?we’re keeping our heads above water,? Halleck said, by focusing on HWI’s original niche: prototyping.

HWI has designed, researched and developed prototype projects for outside companies for 18 years.

The company was founded by Halleck’s father, Mike. Michael, the founder’s other son, is president. Halleck wouldn’t reveal the company’s yearly revenues.

HWI has a few out-of-state clients, but most hail from Longmont and Boulder because of the company’s limited marketing reach.

?There is need in the local area, and it’s easier to go after the local area first,? Halleck said. ?We get our national leads through word of mouth.?

Shifting focus to one area of the business also proved to be a good strategy for Colorado Aerospace in Longmont.

?Certain industry sectors — telecom and fiber-optics — forced us to concentrate our efforts on other areas,? said Jack Cahn, president of the 4-year-old firm. ?We regrouped and went into defense, satellite and government laboratories.?

Because of the high-tech, narrow niche the company fills, most of its clients are from the East and West Coasts. Only 30 percent are local. The diverse customer locations also help stabilize the company.

?We have more of a national presence, to remove ourselves from economic fluctuations in a regional scope,? Cahn said.

The company was co-founded in 1998 by Brent Svendson and Jack Cahn, and currently employs 30.

Cahn would not comment on Colorado Aerospace’s 2001 revenue, but said that it increased by 15 percent from the previous year.

Cahn sees the economic slowdown as an opportunity to regroup.

?We’re in a retrenching phase,? he said, ?because it’s become a protracted recession that’s lasting longer. We’re having to modify our marketing approach, pricing, and deal with a soft economy. We’re focusing on the type of customer that works well with our capabilities.?

St. Vrain Manufacturing in Longmont found greener pastures in aerospace, compared to the company’s previous focus on telecom.

?We have had to shift the focus of our major customer base,? said Bob Bergstrom, president and founder. ?We serve information storage, telecommunications and aerospace. The aerospace industry has remained strong.

?That diverse customer base has enabled us to continue growing the last year.?

2001 revenue for the 7-year-old company was more than $1.5 million, and Bergstrom projects breaking the $2 million barrier this year. The company employs 21.

Bergstrom believes that diversity is St. Vrain’s key to survival.

?From what I’ve seen with other industries, allowing one customer to become too large a percentage of your business isn’t good in good times, and in bad times it can be fatal,? he said. ?Having a lot of different customers helps. As we grow, looking out of state will allow us to grow more and be more diversified.?

For some companies, being closer to clients is better. Wilcoxson Manufacturing, a Longmont-based custom sheet metal fabricator, has carved a niche in the industry by emphasizing its efficiency and convenience for local clientele.

?We’ve seen a big change in the way (bigger companies) buy,? said Sandy Irby, business manager. ?They’re buying more conservatively.?

?Because of that, they have a much tighter turnaround time,? added Dan Nolte, engineering and computer specialist.

Not surprisingly, most of Wilcoxson’s clients are located within a 90-mile radius. ?It’s more convenient for customers,? Irby said.

The late Gary Wilcoxson founded the company in 1982. His widow, Lea Wilcoxson, is now president and owner. The eight-employee company’s 2001 revenue was slightly less than $1 million, according to Nolte.

?We can’t compete with companies that do a huge volume,? Irby said, ?but with quality, on-time delivery is where we compete.?

Longmont’s small businesses report that the dense concentration of manufacturers in the area makes the industry highly competitive in terms of obtaining laborers and projects.

?We think the higher wages in Boulder County have created artificial expectations on pay scale,? Cahn said. ?We try to source people from out of state. The industry has priced itself out of the work, and the work is sent to China and Mexico, where wages are lower.?

Increase in the number of manufacturing companies also has made a difference.

?It has made it easier in the past because many of them were larger,? Halleck said, ?but the competition among smaller ones now makes it harder. You tend to bid on projects against a few other companies.?

Competing against large manufacturers, however, is not part of these manufacturers’ plans.

?As it is with any business, you find your niche,? Irby said. ?We enjoy the niche we’re in: providing products for larger companies.?