Industry Today, Volume 21, Issue 1 Celebrating Industry Today.....And Tomorrow

CELEBRATING INDUSTRY TODAY…..AND TOMORROW TH

YEARS

ANNIVERSARY

Industry Today 1998-2018

paper + print reimagined Working with Unisource means you’re working with one of the largest independent paper and print consultants in the world.

We help clients located around the globe manage more than 2.4 million tons of paper annually.

From recommendations for managing customer-production processes with more agility and efficiency to flexible purchasing options and cost-saving alternatives to traditional bulk paper and print agreements, our expertise will help you drive down costs, support quality performance and promote increased corporate visibility.

Contact us today to align your paper and print needs with your organizational and brand goals.

F

or over 110 years OHAUS has provided the industrial market with high quality, high value products. Our Ingeniously Practical portfolio is based on innovative features, modern design, ease-of-use, and affordability. With an expansive portfolio of scales and balances suited to a wide range of applications, the OHAUS name is synonymous with accuracy, durability, and dependability.

From semi-micro balances to 10,000lb floor scales, OHAUS has a product for use in every area of your facility for R&D, manufacturing and QA/QC applications and more.

www.ohaus.com | 1.800.672.7722

INDUSTRY TODAY 1

PUBLISHER’S LETTER—20TH ANNIVERSARY

TH

YEARS

ANNIVERSARY

Industry Today 1998-2018

2 INDUSTRY TODAY

W

hen we started this magazine twenty years ago in 1998, the manufacturing industry was confronting predictions of its “imminent demise”; fortunately, as Mark Twain remarked about inaccurate reports of his death, such accounts were greatly exaggerated. Sure, there were problems—various recessions, the banking collapse of 2008, loss of jobs and factories to overseas competitors with lower labor costs and undervalue currencies, lack of skilled workers in traditional manufacturing roles.

American manufacturing proved itself more than up to these challenges, adopting effective automation while retraining workers to perform new and more rewarding jobs, implementing continuous improvement to do more efficiently with lower costs, and providing higher quality that easily outperforms cheaply made foreign products.

Today, American manufacturing is at the center of a thriving economy driven by continuing innovation, highly connected with most other business sectors, which includes transportation, healthcare, retail, mining and utilities, as well as general business and professional services.

PUBLISHER’S LETTER—20TH ANNIVERSARY

Just as the manufacturing industry has evolved in response to changing conditions, so too has Industry Today. What was once a periodic print publication is now delivered digitally, with on-line access to more than 5,000 profiles of industry leading companies we’ve published over the last two decades.

We’ve had to change to keep up with the times, just as have our readership and advertisers. What hasn’t changed is our commitment to quality writing and graphic presentation, informed commentary and positive promotion of our industry. That tradition continues with this issue and the commencement of our 20th year of publication.

American manufacturing added 196,000 jobs in 2017. But we believe there’s more to be done. Inside you’ll find a discussion of how the U.S. needs to act on various trade issue to restore even more factory work. This includes meaningful action to discourage China from dumping heavily subsidized steel and aluminum imports into already over glutted markets where supply exceeds demands, identification of new domestic sources rare earth minerals, ways to improved government “Buy America” procurement policies, more

aggressive intellectual property protection and, last but not least, greater investment in infrastructure and Made in America manufacturers.

We’re also covering the inaugural event of the new year for the National Marine Manufacturers Association (NMMA). The Progressive® New York Boat Show at the Javits Center. The four-day exhibition featured exhibitors of a wide range of recreational boats ranging from yachts to kayaks as well as engines and other marine accessories.

Additional topics covered include economic growth in Wisconsin spurred by the energy industry, particularly in the area of sensors and controls, the need for improved cybersecurity, opportunities to bring back to the U.S, some four to five million manufacturing jobs currently performed off-shore, and the need to improve supply chain readiness in light of recent severe weather conditions that have closed ports and roadblocks across Georgia, Florida, Texas and California.

Read all about it here in the pages of Industry Today. Covering our industry like no one else has for the last 20 years, and more years to come.

INDUSTRY TODAY 3

CONTENTS

FOUCS

FOCUS ALLIANCE FOR AMERICAN MANUFACTURING

FOCUS ALLIANCE FOR AMERICAN MANUFACTURING

AUGUSTA FIBERGLASS • PROFILE

PROFILE •AUGUSTA FIBERGLASS

Augusta Fiberglass Coatings, Inc. is a world leading manufacturer of custom designed and fabricated fiberglass reinforced plastic tanks and equipment.

David Soyka reports on this South Carolina-based company’s future growth.

TRUMP HAS MORE TO DO ON TRADE THIS YEAR A President Trump promised to restore factory jobs, and with these smart initiatives, he might just do that.

Scott Paul, President of the Alliance for American Manufacturing comments.

merican manufacturing added 196,000 jobs in 2017 and bounced back thanks to stronger economic growth around the world.

While President Donald Trump put the wheels in motion on a number of policy changes that could help manufacturing in the trade, tax, energy, and regulatory departments, most of these efforts are incomplete.

I’ve got my eyes on a couple of these initiatives that the president introduced last year, but remain unfinished. Here are some of the big ones.

6 INDUSTRY TODAY

INDUSTRY TODAY 7

06 ALLIANCE FOR AMERICAN MANUFACTURING

INDUSTRY TODAY 141

140 AUGUSTA FIBERGLASS

FEATURE GLOBAL DATA SCIENCES

FEATURE GLOBAL DATA SCIENCES

140 INDUSTRY TODAY

GRUPO BONASA • PROFILE

PROFILE •GRUPO BONASA

CYBER REALITY: IS IT TIME FOR A RESET?

America has sacrificed security for simplicity and consequently left itself vulnerable. A reset of cyber security helps companies take nothing for granted.

N

ot a day goes by that cyber security isn’t front and center in the news. Consumers and businesses alike are impacted by a series of interconnections that are all driven by technology. These are tied to an unseen network

of processes, data collection systems, and programmed decisions—all intended to minimize risks, facilitate business growth and protect our communities, workplaces, and country. However, as recent decades have proven, something

isn’t working. At the core of the problem lies one simple truth: the United States and the rest of the world have sacrificed security for simplicity.

The resulting vulnerability begs the question: Is it time for a reset? Should companies take a step

44 INDUSTRY TODAY

back to determine whether they are as secure as they think they are or should be?

Cyber security basics Many companies have fallen victim to huge data INDUSTRY TODAY 45

44 GLOBAL DATA SCIENCES

Managing Editor: Susan G. Poeton Project Director: Brian McMillan

www.industrytoday.com corporate@industrytoday.com

Profile Writers: Reuben Ford, Lorie Greenspan, Michael Sommers, David Soyka

Director of Business Development & Audience Engagement: Steve Jabon

Industry Today is published bi-monthly by Positive Publications LLC, 65 Madison Avenue, Suite 540, Morristown, NJ 07960. Copyright © Industry Today 2018. All rights reserved.

No part of this publication may be reproduced in any form or for any purpose without prior written consent from the publisher and payment of the agreed fee. ISSN # 1521-8058

he origins of Bonasa – a leading Brazilian producer of eggs as well as live and processed chicken, pork and meat products – date back more than half a century. And yet, when asked to pinpoint the firm’s major milestones, CEO Alexandre Abreu easily narrows it down to three.

“Of course, Bonasa’s first major milestone was the company’s foundation,” he declares, referring to the creation, of a small poultry hatchery by businessman Aroldo Silva Amorim, in Brasília back in 1964. At the time, the futuristic new Brazilian capital, designed by famed architect Oscar Niemeyer and urban planner Lucio Costa,

106 INDUSTRY TODAY

INDUSTRY TODAY 107

106 GRUPO BONASA FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

FULL SPEED AHEAD UNDERWAY FOR RECREATIONAL BOATING

Project Managers: Marcos Elias Jonathan Listig Production: Melissa S. Burge Art Director: Seema Mazhar Contributing Designers: Jorge Leandro Rodrigues

65 Madison Avenue, Suite 540, Morristown, NJ 07960 Ph. 973.218.0310

4 INDUSTRY TODAY

After 50 years of thriving as a family-owned producer of poultry and pork, Brasília-based Bonasa found itself fighting for survival. Hired to spearhead the company’s recovery, the new CEO Alexandre Abreu talks to Michael Sommers about the challenges and changes ahead.

16 INDUSTRY TODAY

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

T

he recreational boating industry kicks off the new year with its oldest (over a century) and earliest (last week in January) event, the Progressive® New York Boat Show at the Javits Center. Winter is a crucial selling season and expectations are set high—according to the National Marine Manufacturers Association (NMMA), a six percent bump in unit sales of new powerboats occurred in 2017 (about 260,000 new boats sold) and 2018 promises another five to six percent increase on top of that.

“The New York Boat Show is a barometer of what upcoming sales are going to be like,” notes NNMA president Thomas J. (Thom) Dammrich. One good indicator is that the show sold out exhibition space. “We’re bursting at the seams,” Dammrich says, “and we’re already hoping that with future expansion of the Javits Center we’ll be able to add more exhibitors.”

The industry has good reason to be optimistic. “Any time GDP is three percent or more is typically a good sign for the recreational boating

INDUSTRY TODAY 17

16 NATIONAL MARINE MANUFACTURERS ASSOCIATION

VOLUME 21 • ISSUE 1

FEATURE RESHORING INITIATIVE

FEATURE RESHORING INITIATIVE

VÄDERSTAD • PROFILE

PROFILE • VÄDERSTAD

J

obs are flowing back into the United States in unprecedented numbers. For the first time in decades, more manufacturing jobs are returning to the United States than are going offshore. The combined reshoring and foreign direct investment (FDI) trends grew by more than 10 percent in 2016, adding 77,000 jobs and exceeding the rate of offshoring by about 27,000 jobs. The rate of jobs coming from offshore accelerated further in 2017, up 200+% since the 2016 presidential election (Fig.1). This trend has helped drive a manufacturing workforce that is now about 2 million higher than would have been projected in 2007.

This is exciting progress, but there are still huge opportunities and challenges to bringing back all of the four million to five million U.S. manufacturing jobs still offshore. The country needs companies to do the math with TCO (Total Cost of Ownership) when making location decisions.

A Purdue Manufacturing Extension Partnership (MEP) Center study shows that “better total cost of ownership decisions” was the top-ranked area of concern for companies. Here are some actions that we can take together to accelerate the use of TCO and the rate of reshoring.

U.S. JOBS ARE FLOWING BACK BUT YOUR HELP IS STILL NEEDED 62 INDUSTRY TODAY

INDUSTRY TODAY 63

INDUSTRY TODAY 93

92 SEED HAWK

62 RESHORING INITIATIVE

PROFILE • SUBARU OF INDIANA

92 INDUSTRY TODAY

SUBARU OF INDIANA • PROFILE

FEATURE SUPPLY CHAIN PREPAREDNESS

FEATURE SUPPLY CHAIN PREPAREDNESS

SUPPLY CHAIN PREPAREDNESS: SURVIVING THE STORM W

The capacity crunch is real. When ports shut down, is your supply chain prepared to handle a disaster? hen ports shut down, restrictions are put upon on an already stretched supply chain industry. Recently, the industry had to respond to several natural disasters – hurricanes, wildfires, floods – leading to closed ports and roadblocks across Georgia, Florida, Texas, and California. While recovery efforts continue across these states, the aftermath is being felt across the entire U.S., and putting further strain on truck capacity and supply chain resources at a time when shipping needs spike.

At different times, numerous ports such as those in Savannah, Tampa, and Miami all suspended operations due to storm related activity. Others, like the Port of Charleston, closed for an entire day, while ships were forcibly rerouted. This unfortunately added further stress in port cities and regional hubs and resulted in higher rates between carriers and brokers everywhere.

These recent hurricanes and other inevitable tragedies have taken a tight market and applied a vise grip to it. As of October, market data suggested FEMA had control of an estimated six to ten percent of the market with relief shipments, and their layover system is creating an environment

Subaru’s 2019 Ascent will be manufactured in Indiana, representing the perfect mix of modern vehicle technology, state-of-the-art plant production and an effort to add to the strength of a local state economy. Lorie Greenspan reports on the company’s latest ascent into the stratosphere of motor vehicle design.

he manufacture of Subaru automobiles, unarguably in a class by themselves, moves forward at a rapid pace at Subaru of Indiana Automotive (SIA), with the addition to its portfolio in 2018 of the company’s new Subaru Ascent.

The Ascent will be produced in the Lafayette, Ind., plant beginning in May 2018. To support the increased production, the company plans to create up to 200 new jobs, adding to its current workforce of 5,600 and strengthening SIA’s 72 INDUSTRY TODAY

INDUSTRY TODAY 73

72 SUBARU OF INDIANA AUTOMOTIVE (SIA) PROFILE •THE BID GROUP

54 INDUSTRY TODAY

INDUSTRY TODAY 55

54 SUPPLY CHAIN PREPAREDNESS

THE BID GROUP • PROFILE

British Columbia-based BID Group is by far the largest integrated provider of equipment, services and turnkey solutions for North America’s forestry industry. As Michael Sommers discovers, following a tremendous growth spurt, the group is in full optimization mode as it prepares to branch out into new markets.

T

RAF AMERICAN D JOBS PROJECT

FEATURE WISCONSIN

ADVANCED ENERGY MEANS WISCONSIN JOBS

FEATURE WISCONSIN

Wisconsin can capitalize on its strengths in sensors and controls for the advanced energy industry to drive economic growth and support over 44,000 jobs annually.

W

ith over $1.4 trillion in annual private-sector revenues, the global advanced energy market is a can’tmiss opportunity, and dozens of U.S. states are well positioned to reap the benefits.

A case in point: Wisconsin. The latest report from the American Jobs Project details the state’s competitive advantage in sensors and controls for advanced energy, an industry that could support tens of thousands of Wisconsin jobs. The report, created in partnership with the Wisconsin Energy Institute and the Midwest Energy Research Consortium, counts the state’s robust industrial base, technical training programs, engaged university research community, and local market potential as key assets for strategic cluster development.

With targeted investments and forward-looking policies, the sensors and controls sector could support an annual average of over 44,000 Wisconsin jobs through 2030.

The Growing Sensors & Controls Market The sensors and controls industry is projected to grow by 6.9 percent annually through 2022 due 122 INDUSTRY TODAY

122 THE BID GROUP

INDUSTRY TODAY 123

30 INDUSTRY TODAY

Copyright © Industry Today 2017. All rights reserved. No part of this article may be reproduced in any form or for any purpose.

Copyright © Industry Today 2017. All rights reserved. No part of this article may be reproduced in any form or for any purpose.

INDUSTRY TODAY 31

30 WISCONSIN

INDUSTRY TODAY 5

FOCUS ALLIANCE FOR AMERICAN MANUFACTURING

TRUMP HAS MOR DO ON TRADE TH President Trump promised to restore factory jobs, and with these smart initiatives, he might just do that.

Scott Paul, President of the Alliance for American Manufacturing comments.

6 INDUSTRY TODAY

FOCUS ALLIANCE FOR AMERICAN MANUFACTURING

RE TO HIS YEAR A

merican manufacturing added 196,000 jobs in 2017 and bounced back thanks to stronger economic growth around the world.

While President Donald Trump put the wheels in motion on a number of policy changes that could help manufacturing in the trade, tax, energy, and regulatory departments, most of these efforts are incomplete.

I’ve got my eyes on a couple of these initiatives that the president introduced last year, but remain unfinished. Here are some of the big ones.

INDUSTRY TODAY 7

FOCUS ALLIANCE FOR AMERICAN MANUFACTURING

8 INDUSTRY TODAY

FOCUS ALLIANCE FOR AMERICAN MANUFACTURING

No. 1: Meaningful Action on Steel, Aluminum and Other Imports That Threaten National Security For years, China’s managed economy has churned out too much steel and aluminum. It’s now the world’s leading producer of both. Most of its largest mills and smelters are state-owned, and both of its sectors are key contributors to the state of global overcapacity in these metals, meaning there’s far more steel and aluminum being produced (and for sale) than there is demand for it.

Chinese manufacturers are dumping this heavily subsidized glut into the international market, and the resulting price plunge has been felt far and wide: Beleaguered factory workers have marched in Europe. There have been tens of thousands of layoffs and dozens of plant closures in the United States. And foreign governments are increasingly making it a diplomatic issue with Beijing.

This problem precedes President Trump. Near the end of President Obama’s tenure his administration was regularly raising it with its Chinese counterparts, and it issued duties on specific steel and aluminum products. But it wasn’t enough to solve the problem long-term.

Trump might have a long-term solution. In April 2017 he opened trade cases known as “Section 232” into the two sectors and was applauded by steel and aluminum manufacturers because 232s give the president broad authority to act.

Plus, they aren’t required to meet tests of injury, subsidies, or dumping.

INDUSTRY TODAY 9

FOCUS ALLIANCE FOR AMERICAN MANUFACTURING

A 232 investigation, performed by the Commerce Department, is meant to determine if the level of imports in question are threatening to national security. If that judgment is reached, the president can restrict them – be it by tariffs, quotas, or some combination of the two.

But the Trump administration needs to wrap up the reports first.

He promised quick turnarounds, but Commerce took nearly all of its 270-day deadline to complete the 232 on report on steel, and the aluminum report is nowhere to be found. And while 10 INDUSTRY TODAY

he has the steel report in hand, the president hasn’t announced any actions based on its conclusions.

Foreign manufacturers, meanwhile, have taken advantage of the delay to rush imports in before restrictions can be set in place. Steel imports were up more than 15 percent in 2017.

This case should have been finished months ago, but it was put off in favor of a run at a healthcare repeal and a tax package. So here’s what U.S. steel and aluminum producers are looking for in 2018: A conclusion of these investigations with a robust defense of beleaguered American industry.

FOCUS ALLIANCE FOR AMERICAN MANUFACTURING

It should include not only imports from China, but also from other major importers like Japan, Korea, Turkey, and Brazil.

No. 2: Movement on ManufacturingRelated Executive Orders The steel and aluminum imports investigations aren’t the only thing the administration has left in limbo. President Trump also issued a series of executive orders in 2017 for analyses of the health of the U.S. manufacturing sector. The president ordered in December a report identifying new

domestic sources of rare earth minerals, for instance, and another in August on the strengths and weaknesses of the defense industrial base.

In April, he signed an order for a study of ways to improve “Buy America” government procurement policies – rules that do a great job of boosting domestic manufacturing activity and the jobs that come with it. But that report, due months ago, has yet to surface. Has the president received it? Has it even been completed? No one knows!

This hasn’t gone unnoticed. Wisconsin Sen. Tammy Baldwin (D) – who represents a state INDUSTRY TODAY 11

FOCUS ALLIANCE FOR AMERICAN MANUFACTURING

with a strong manufacturing presence that swung for Trump in 2016 – has called on the president to make the report public. I’m with the senator on this one, and hope to see Trump release the report in early 2018.

No. 3: Intellectual Property Protection China has clearly been a focus of the administration’s trade policy priorities (see No. 1). Chinese imports of solar panels, for instance, were recent12 INDUSTRY TODAY

ly the subject of trade enforcement actions. But another China trade issue concerns the security of intellectual property. Back in August, the U.S. Trade Representative (USTR) launched a “Section 301” investigation to determine whether “acts, policies and practices” of the Chinese government related to “technology transfer, intellectual property, and innovation are unreasonable or discriminatory and burden or restrict U.S. commerce.” It’s expected the USTR will

FOCUS ALLIANCE FOR AMERICAN MANUFACTURING

ers who don’t favor aggressive trade enforcement are believed to be “comparatively comfortable with targeted actions against truly bad actors, as in this case.”

Will Trump address the topic of IT theft?

There’s some reason for optimism – just last week the president said a “potential fine” against China for the practice is imminent. I’ll be watching for it closely.

No. 4: A Big Infrastructure Investment Package

indeed find there are discriminatory practices. American companies have long complained about being forced to share intellectual property as a prerequisite for Chinese market access – and China is regularly accused of stealing trade secrets.

The question, then, is what will this president do about it. The United States long has lectured China on this subject, without extracting any meaningful change. Even some of Trump’s advis-

There aren’t many policy areas where the U.S. Chamber of Commerce and the AFL-CIO come together to work on, but infrastructure is one of them.

It’s not that surprising: The United States simply needs major infrastructure work. The American Society of Civil Engineers, producers of an annual review of the shared systems underpinning our country, gave U.S. infrastructure a D+ grade in their 2017 report.

The backlog of projects doesn’t just mean that there are more potholes on the road and that subway trains are more often delayed – it also means the United States is less competitive in the global arena because our economic engine just doesn’t run as smoothly on D+ train tracks. What’s more, that some estimates say underinvestment has cost the United States up to 900,000 jobs.

And it’s a huge safety issue; 70,000 bridges across the country are classified by the government as structurally deficient.

INDUSTRY TODAY 13

FOCUS ALLIANCE FOR AMERICAN MANUFACTURING

Scott Paul,

President, Alliance for American Manufacturing Scott N. Paul is President of the Alliance for American Manufacturing (AAM), a partnership established in 2007 by some of America’s leading manufacturers and the United Steelworkers union. Scott and AAM have worked to make American manufacturing and “Made in America” top-ofmind concerns for voters and our national leaders through effective advocacy and data-driven research.

Scott has hosted more than 80 “Keep It Made in America” events, including a presidential candidates’ forum on manufacturing, and has testified before seven committees of the House and Senate. He frequently appears on television news shows, and regularly blogs at Huffington Post. Scott is also a co-author of the 2013 book ReMaking America.

Scott served as a staff member on Capitol Hill at various times from 1989 to 2001. He currently serves on the Board of Directors of the National Skills Coalition and the Board of Visitors of the Political Science Department at the Pennsylvania State University.

Scott earned a B.A. in Foreign Service and International Politics from Penn State and an M.A. with honors in Security Studies from Georgetown University’s School of Foreign Service. Raised in the small town of Rensselaer, Indiana, he currently resides in Silver Spring, Maryland, with his spouse Ilisa Halpern Paul and twin boys. You can follow Scott Paul on Twitter at @ScottPaulAAM and on Medium at @ScottPaulAAM. There’s widespread agreement, across politi- paign.

But while the White House maintains infracal parties and advocacy groups, that something needs to be done. And President Trump promised structure is a top priority, it pushed release of its $1 trillion for infrastructure during his 2016 cam- plan until after the competition of Republican tax 14 INDUSTRY TODAY

FOCUS ALLIANCE FOR AMERICAN MANUFACTURING

reform and into a midterm election year. Trump’s $1 trillion promise now looks a lot more like only $200 billion in seed money the administration says will help raise $800 billion of private, state, and local investments.

I’m not holding my breath. But, now that taxes are done, there’s a glimmer of hope the Trump administration and his congressional allies can work across the aisle to pass a robust infrastructure investment plan. A real one would create millions of jobs, benefit domestic manufacturing, and make our economy more competitive.

No. 5: Trump-branded Items Actually Made in America While the other items on this wish list require coordination among various government agencies and officials, the final one is a decision that can be made entirely without the input of “the swamp.”

Ever since President Trump started talking about bringing manufacturing jobs back during the

campaign, he’s faced charges of hypocrisy as the vast majority of Trump-branded items are made overseas. That criticism has also hit his daughter, Ivanka Trump, especially after three Chinese human rights activists were arrested for investigating working conditions at factories making goods for her fashion line.

The president and his daughter are no longer involved in the day-to-day operations of their companies, but their name is still on the label.

Imagine the power of a shift to Made in America production by Trump brands. It won’t happen overnight, of course, but it would send a great message if Ivanka opted to manufacture some of her shoe line in America.

With elections looming in November of 2018, voters will be taking stock of the economy and how their lives and communities are faring in this new political era. Our elected officials would be well served by following through on promises made to manufacturing.

INDUSTRY TODAY 15

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

FULL SPEED AHEAD UNDERWAY FOR RECREATIONAL BO

16 INDUSTRY TODAY

D

OATING

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

T

he recreational boating industry kicked off the new year with the world’s first and longest running boat show, the Progressive® New York Boat Show at the Javits Center (last week of January). Winter is a crucial selling season and expectations are set high—according to the National Marine Manufacturers Association (NMMA), a six percent bump in unit sales of new powerboats occurred in 2017 (about 260,000 new boats sold) and 2018 promises another five to six percent increase on top of that.

“The New York Boat Show is a barometer of what upcoming sales are going to be like,” notes NNMA president Thomas J. (Thom) Dammrich. One good indicator is that the show sold out exhibition space. “We’re bursting at the seams,” Dammrich says, “and we’re already hoping that with future expansion of the Javits Center we’ll be able to add more exhibitors.”

The industry has good reason to be

INDUSTRY TODAY 17

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

Progressive New York Boat Show The five-day event features exhibitors of a wide range of recreational boats, including yachts and cruisers to canoes and kayaks to fishing boats and pontoons, as well as various marine accessories such as engines, electronics and fishing gear. Last year’s show drew a 21 percent increase in attendance. This year, Dammritch notes, advanced sales are up by 20 percent. He adds, however, “While that’s a good thing, ordering online these days is a convenience more people take advantage of, so it’s not really a predictor of what type of turnout we’ll actually get.

However, we’re pretty confident that we’ll have excellent attendance. The show is a great way for people to learn about boating, discover new boats and features, comparison shop and just overall have a fun time. when you come down to it, it is what boating is all about.”

18 INDUSTRY TODAY

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

INDUSTRY TODAY 19

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

20 INDUSTRY TODAY

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

U.S. Recreational Boating at a Glance The NMMA reports U.S. consumer spending on boats, marine products and services totaled $36 billion in 2016 and $37 billion in 2017. There were an estimated 981,600 pre-owned boats (powerboats, personal watercraft, sailboats) sold in 2016, accounting for $9.2 billion in sales. An estimated 11.9 million boats were registered in 2016, and 95 percent of boats measure less than 26 feet in length, meaning they can be easily trailered to waterways and don’t need to docked. Ninety five percent of boats sold in the U.S. and made in America; the U.S. boating industry supports 650,00 direct and indirect American jobs and almost 35,000 small businesses. The top ten states leading the nation in sales of new powerboat, engine, trailer and accessories in 2016 were Florida ($2.5 billion), Texas ($1.4 billion), Michigan ($866 million), Minnesota ($710 million), North Carolina ($689 million), New York ($688 million), Wisconsin ($622 million), California ($615 million), Georgia ($551 million) and South Carolina ($544 million).

INDUSTRY TODAY 21

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

optimistic. “Any time GDP is three percent or more is typically a good sign for the recreational boating industry,”Dammrich notes. “Consumer confidence is at a seven year high so there are a lot of positive indicators for our industry.

22 INDUSTRY TODAY

Discover Boating Prospective buyers include a healthy mix of new boat owners as well as boat owners looking to upgrade to newer models. “We have a website DiscoverBoating.com where anyone who might

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

be interested in getting into boating can find a lot of useful information, not only about types of boats and how to go about buying a boat, but the boating lifestyle,” Dammrich says, adding that, “We encourage comparison shopping. The

association doesn’t promote any specific manufacturer or dealership, we’re an association that represents the voice of the industry to the media and the public. We’re all about promoting boating and providing resources and services to INDUSTRY TODAY 23

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

24 INDUSTRY TODAY

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

support that.”

Innovation is a key factor driving interest in boating, particularly among millennials. “The pace of innovation is ever-accelerating,” Dammrich says. “Just one example is a new joystick control that makes docking so easy a 12 year old can do it, and probably do it better than an oldtime boater.”

Another new feature is the ability to connect to and manage all a boat’s systems using a smartphone. “For the younger generation in particular, being connected all the time wherever you are is very important,” Dammrich points out.

“Boat makers today are very conscious of addressing that market.” The situation is much the same as it is the automotive industry where prospective buyers may be less interested in engine horsepower than Bluetooth connectivity.

“There’s a range of electronic conveniences

INDUSTRY TODAY 25

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

available, from GPS navigation to fish finders,” Dammrich says. “Depending on the size of the boat, you can literally have all the conveniences at home with you on the water.”

He points out that just getting out on the water with family and friends is a big attraction to pro26 INDUSTRY TODAY

spective boaters. “A recreational boat is a discretionary purchase, and with the improving economy consumers are looking for something that provides a fun relaxing activity,” Dammrich says.

“These technical advances make getting into the boating lifestyle easy for just about anyone.”

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

Making Waves Fastest growing segments include powerboats, offshore salt water fishing boats, personal watercraft and water sports boats, particularly ski and wakeboard boats. These boats are designed to create wakes behind them for watersports., serving

as a kind of “launch ramp” for wakeboarders to achieve their biggest “air.” In addition, unlike conventional boats that rely on outboard motors in the rear, ski/wake boats position an inboard engine in the center to keep propellers safely away from the wake surfer. “This is a very popular INDUSTRY TODAY 27

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

THOMAS DAMMRICH President, National Marine Manufacturers Association Under Thom Dammrich’s leadership at National Marine, the association represents 1,300 marine industry members that produce 80 percent of the recreational boating products currently sold in North America. NMMA is the industry’s unifying force working to Promote and Protect recreational boating. NMMA supports these objectives through timely research and industry data, providing sales and marketing opportunities, and working tirelessly to keep recreational boating top of mind with consumers and legislators at the federal and state level.

Most notably, Dammrich has been instrumental in helping bringing together the industry with the Grow Boating Initiative. From this project, the Discover Boating campaign was refined as an industry-wide effort to promote the boating lifestyle, improve the boating experience and increase participation. The results have been optimized sales of marine products and services, and expanded research on boaters.

Dammrich furthers his involvement and commitment to recreational boating interests by serving on several marine-industry boards such as the International Council of Marine Industry Associations, the Center for Sportfishing Policy, the American Recreation Coalition, as well as yachting and fishing councils.

28 INDUSTRY TODAY

FEATURE NATIONAL MARINE MANUFACTURERS ASSOCIATION

water sport, and we’ve seen a lot of growth with this particular type of boat,” Dammrich says.

Rising demand for recreational boats is floating industry expansion. Boat manufacturers are adding capacity for two reasons; one is consumer confidence and corresponding sales trends, the other is the improving economy and what looks like a more favorable tax picture that promotes investment. “Production is up, and as a result, so is jobs creation, There’s definitely a lot more employment opportunities in our industry,” Dammrich notes.

“While the overall picture is existing manufacturers expanding, there are also some start-ups bringing further innovation to industry. One example is a Minnesota company that invented a pontoon boat that detaches automatically from its tow vehicle and then, with the push of a button, expands like an accordion to its full 11.5-foot width.

Interestingly, as manufacturers expand, dealerships are consolidating, at least in terms of ownership. “What we’re seeing is that a lot dealers who have been in business for a long time are deciding to retire, and they are selling their dealership to larger national companies. Which is actually a good thing for consumers. You’ve got a broader network with more consistency in the brands and types of professional services that can be offered across the country.”

For 2018 and beyond, the recreational boating industry finds itself in particularly safe harbors: with mounting consumer demand, accelerating innovation and manufacturing expansion, the industry is riding high waves for future success.

INDUSTRY TODAY 29

FEATURE WISCONSIN

AMERICAN JOB PROJECT ADVANCED ENERGY MEANS WISCONSIN JOBS

30 INDUSTRY TODAY

BS

FEATURE WISCONSIN

Wisconsin can capitalize on its strengths in sensors and controls for the advanced energy industry to drive economic growth and support over 44,000 jobs annually.

W

ith over $1.4 trillion in annual private-sector revenues, the global advanced energy market is a can’tmiss opportunity, and dozens of U.S. states are well positioned to reap the benefits.

A case in point: Wisconsin. The latest report from the American Jobs Project details the state’s competitive advantage in sensors and controls for advanced energy, an industry that could support tens of thousands of Wisconsin jobs. The report, created in partnership with the Wisconsin Energy Institute and the Midwest Energy Research Consortium, counts the state’s robust industrial base, technical training programs, engaged university research community, and local market potential as key assets for strategic cluster development.

With targeted investments and forward-looking policies, the sensors and controls sector could support an annual average of over 44,000 Wisconsin jobs through 2030.

The Growing Sensors & Controls Market The sensors and controls industry is projected to grow by 6.9 percent annually through 2022 due INDUSTRY TODAY 31

FEATURE WISCONSIN

to increased interest in active, agile, and efficient energy systems. Advanced energy systems require extensive monitoring and operational controls to optimize production, minimize energy use, and leverage storage. Sensors and controls are hardware solutions that enable these systems to be nimble and responsive to changing conditions, such as weather patterns, available resources, and energy demand.

Wisconsin could tap into the growing market for sensors and controls, especially in the biogas, efficiency, grid, and solar industries. For example, the market for smart grid sensors is expected to grow 15.3 percent annually between 2017 and 2021, while sensors for energy management systems will see a 13.2 percent increase yearly from 2016 to 2024. Wisconsin manufacturing companies are well prepared to serve this growing regional, national, and global demand.

Opportunities Abound for Wisconsin Manufacturing Manufacturing is a key pillar of Wisconsin’s economy, providing workers with good wages and causing a multiplier effect in terms of local revenue and employment. Wisconsin’s manufacturing industry supports the second-largest employment concentration in the nation. It employs over 16 percent of the state workforce and is responsible for 19 percent of the state’s total output.

Pictured previous spread: Photo by Taber Andrew Bain; Right: Photo by Sandia National Laboratories.

32 INDUSTRY TODAY

FEATURE WISCONSIN

INDUSTRY TODAY 33

FEATURE WISCONSIN

Manufacturing workers are paid well, with an average annual compensation of nearly $69,000.

However, Wisconsin suffered a blow to its legacy manufacturing industry during the recession, and has yet to recover fully.

The sensors and controls industry presents an opportunity to bolster manufacturing in Wisconsin. At least 209 companies already manufacture sensors and controls for advanced energy

systems, anchored by corporate leaders such as Johnson Controls, Rockwell Automation, Regal Beloit, A. O. Smith, and Eaton’s Cooper Power Systems. An additional 700 businesses engaged in energy generation, transmission, distribution, and storage as well as the energy-water nexus can support supplier networks and local market activities for these manufacturers. The emerging information and communications technology

Pictured above: The Wisconsin Energy Institute at the University of Wisconsin-Madison. Photo by Wisconsin Energy Institute; right top to bottom: Photo by Alliance for Excellent Education, Photo by Institute for Apprenticeships, Photo by U.S. Department of Energy.

34 INDUSTRY TODAY

FEATURE WISCONSIN

sector for software development complements the state’s manufacturing expertise in sensing and control hardware.

The American Jobs Project’s research indicates that Wisconsin’s sensors and controls industry could support an average of 44,000 jobs each year through 2030. That includes direct jobs in manufacturing and software development, and a wide array of good-paying jobs that cater to different education and experience levels, including operators of computer numerical control machinery, electrical engineering technicians, and industrial production managers. Our jobs calINDUSTRY TODAY 35

FEATURE WISCONSIN

culation also includes indirect jobs supplying equipment, materials, and services to manufacturers and developers, as well as induced jobs resulting from increased spending in the local economy. Additionally, Wisconsin could cultivate a local market for sensor- and control-embedded advanced energy systems to amplify job impacts in installation, operation, and mainte36 INDUSTRY TODAY

nance businesses across the state.

Building Blocks for Cluster Development So exactly how can Wisconsin capitalize on this exciting opportunity?

At the American Jobs Project, we specialize in matching states’ unique assets with advanced

FEATURE WISCONSIN

energy technologies that are poised for growth, then working with local leaders to expand these sectors, developing state economies and creating good-paying jobs.

In our experience, in today’s competitive, globalized economy, businesses are more likely to thrive in cities and states that support a comprehensive value chain, boast a highly skilled work-

force, offer a rich innovation ecosystem, provide fertile grounds for capital investment, and foster a local market for homegrown goods. These building blocks — coupled with networking, coordination, and cooperation within the industry Pictured: Aerial view of Downtown Milwaukee.

Photo by Towpilot (Wikimedia Commons).

INDUSTRY TODAY 37

FEATURE WISCONSIN

— form the foundation for robust clusters that can increase local job creation and revenues. By identifying the state’s assets and gaps within each building block, state and local leaders can strategically plan for growth.

Cluster development is nothing new to Wisconsin. The state’s existing networks fortify the sensors and controls value chain. Wisconsin is home to robust energy, power, and control and Pictured above: Photo by PSNS-IMF; right: Photo by U.S. Department of Agriculture.

38 INDUSTRY TODAY

water technology clusters backed by the Midwest Energy Research Consortium, The Water Council, and the Wisconsin Economic Development Corporation. These organizations foster entrepreneurship and innovation, business recruitment, market development, and stakeholder education.

Wisconsin excels at hands-on technical training, and is committed to career readiness via its youth learning programs and higher education network.

For example, in one year of the Youth Apprenticeship Program, over 3,000 Wisconsinites worked at 2,150 businesses, and nearly 67 percent earned

FEATURE WISCONSIN

The American Jobs Project is a nonprofit, nonpartisan, think-and-do tank focused on creating good-paying jobs in advanced energy and manufacturing through bottom-up, data-driven, 360° economic development. Our experts tailor best practice strategies for bolstering advanced energy and manufacturing, identify assets across the value chain, estimate an industry’s job-supporting potential, and support stakeholder-led initiatives by communicating ideas and analyses. Through engagement with a broad cross-section of stakeholders, we develop a shared vision of effective strategies to leverage the unique competitive advantages offered by each state and generate positive economic impacts. http://americanjobsproject.us/

INDUSTRY TODAY 39

FEATURE WISCONSIN

40 INDUSTRY TODAY

FEATURE WISCONSIN

skill certificates. Regional training labs that build skills in energy conservation, grid infrastructure, and smart manufacturing also support workforce development. Targeted training, recruitment, and retention are critical to improving conditions for Wisconsin communities facing employment barriers and addressing a potential labor shortage as the state’s working-age population decreases.

Wisconsin’s existing infrastructure helps entrepreneurs and researchers bring ideas to market. Its universities already host numerous research partnerships dedicated to sensing and control technologies and their end-use applications, from power conversion at the Wisconsin Electric Machines and Power Electronics Consortium, to biogas testing at UW-Oshkosh’s Environmental Research and Innovation Center. Additionally, groups like Kinnektor and gener8tor are cultivating a new generation of entrepreneurs and innovators.

Seed funding is increasing due to a strong angel network and momentum from the Badger Fund of Funds. But Wisconsin companies face critical funding gaps between the early/growth phase and late stages, and venture capital has only partially addressed this “valley of death.” Wisconsin received less than 0.2 percent of national venture capital investments in 2015, roughly the same as in previous years.

Wisconsin has local resources for financing advanced energy projects that could integrate locally manufactured sensors and controls. For Pictured: Photo by EE Image Database.

INDUSTRY TODAY 41

FEATURE WISCONSIN

tailored recommendations for Wisconsin leaders to grow the sensors and controls industry. These strategies draw on best practices to target gaps in workforce development, the innovation ecosystem, access to capital, and local market growth.

For example, Wisconsin could take a page from the successful Opportunity Maine program and offer tax credits for student loan payments, reducing brain drain and helping attract out-of-state talent. Also recommended: facilitating greater knowledge sharing for entrepreneurship and innovation via mentorship networks, open-access test beds for large-scale energy systems, and incentives for university-based consulting on local bioStrategies for Growth The American Jobs Project’s report provides 13 gas projects. Wisconsin could increase corporate example, Wisconsin has the potential to add over 1,300 new biogas systems, which could embed Wisconsin-made gas contaminant monitors to ensure viable output. The state is also projected to add 249 megawatts of installed solar capacity over the next five years, and these systems could use Wisconsin-made solar trackers to maximize generation. In-state deployment of sensors and controls could bolster Wisconsin’s energy economy while returning some of the estimated $14 billion currently spent on energy imports to Wisconsin communities.

42 INDUSTRY TODAY

FEATURE WISCONSIN

investment, following in the footsteps of successful programs such as American Family Ventures and the Cincinnati-based Cintrifuse Syndicate Fund.

Other recommended strategies focus on cultivating local markets for sensor- and control-embedded biogas, efficiency, grid, and solar technologies.

For example, Wisconsin could expand the Focus on Energy program to enable contributions from water utilities and expand eligibility to energy-water nexus projects.

Wisconsin’s emerging sensors and controls cluster is a solid foundation upon which the state can grow its economy, support 44,000 jobs, and become a leader in the production and deployment of advanced energy technology. Maximizing the opportunity that increasing global demand presents would require a concentrated effort from

leaders in state and local government, industry, and academia.

When a state succeeds in building a vibrant economic cluster, benefits echo throughout its economy. Rewards include a more resilient statewide economy, a skilled 21st century workforce trained for the jobs of tomorrow, a growing base of young people optimistic about job opportunities close to home, and a rich hub for innovation and collaboration. Wisconsin is well positioned for just such a success story.

Read the full report here: http://americanjobsproject.us/ajp-state/wisconsin/ Pictured above: Photo by Brookhaven National Laboratory; right: Photo by Wisconsin Tech Colleges.

All images courtesy of Flickr.

INDUSTRY TODAY 43

FEATURE GLOBAL DATA SCIENCES

CYBER REALITY: IS IT TIME FOR A RESET?

America has sacrificed security for simplicity and consequently left itself vulnerable. A reset of cyber security helps companies take nothing for granted.

N

ot a day goes by that cyber security isn’t front and center in the news. Consumers and businesses alike are impacted by a series of interconnections that are all driven by technology. These are tied to an unseen network 44 INDUSTRY TODAY

of processes, data collection systems, and programmed decisions—all intended to minimize risks, facilitate business growth and protect our communities, workplaces, and country. However, as recent decades have proven, something

FEATURE GLOBAL DATA SCIENCES

isn’t working. At the core of the problem lies one simple truth: the United States and the rest of the world have sacrificed security for simplicity.

The resulting vulnerability begs the question: Is it time for a reset? Should companies take a step

back to determine whether they are as secure as they think they are or should be?

Cyber security basics Many companies have fallen victim to huge data INDUSTRY TODAY 45

FEATURE GLOBAL DATA SCIENCES

breaches—some of which never recover from the destructive effects. Taking a step back to reset, reevaluate, and ideally to reverse the trend is easier when companies start with the basics: • Adopt the mindset that responsibility for cyber security starts at the top. Companies that want to safeguard their organizations from cyber attacks need leadership buy-in at the C-suite level. When management and employees know cyber security is a priority mandate and has the full attention and backing of the CEO, they are more likely to 46 INDUSTRY TODAY

focus their attention on the issues that can cause cyber breaches and adopt the appropriate behaviors to prevent them.

• Make establishing a comprehensive cyber security policy a priority. In spite of all the talk about cyber security, there are many companies that haven’t established adequate protection for their information systems. In many cases, that’s because they don’t understand the risks they face.

Just because a system has never been hacked doesn’t mean complacency is acceptable. Proac-

FEATURE GLOBAL DATA SCIENCES

tive cyber security policies and procedures must be established, tested for effectiveness, and shared throughout the organization.

• Seek outside expertise when necessary. Not every company has the internal proficiency in tying all the cyber security pieces together, including vulnerabilities in supply chain logistics, shop floor visualization, electronic data interchange, predictive analytics, and disparate information systems.

So what’s the best way to address the knowledge shortfall? Apply this analogy: Companies regular-

ly seek out legal and financial professionals when they need specialized expertise. The same principle holds true when it comes to cyber security. Just like consumers don’t leave their homes unlocked or make their valuables accessible to strangers and intruders, businesses need an airtight protective gateway that encloses and shields the company from risk.

• Manage the mindset. Once an appropriate risk management team is in place and responsibility for oversight is clear, implement practical

INDUSTRY TODAY 47

FEATURE GLOBAL DATA SCIENCES

48 INDUSTRY TODAY

FEATURE GLOBAL DATA SCIENCES

training to build knowledge and communications training to develop employee awareness.

Some say that people are the weakest link when it comes to cyber security. Consistent, ongoing training is essential to overcome that probability.

The value of this investment cannot be overstated. The effort will allow businesses to pinpoint the relevant metrics that can yield actionable protective measures.

The role played by government In October 2017, the Cambridge Cyber Summit invited security experts and top technology leaders to explore cyber threats and to help secure America’s future. Hosted by CNBC and The Aspen Institute, the Summit’s name was Right Hand, Left Hand: Transparency, Communication and Conflict. There it was agreed that at some level government and private industry

INDUSTRY TODAY 49

FEATURE GLOBAL DATA SCIENCES

must cooperate in an effort to protect the data security and privacy of U.S. citizens. Guest speaker, Tom Wheeler, former chairman of the Federal Communications Commission, spoke very candidly, “The challenge is we look at 21st century technology issues and discuss them in 20th century terms and propose 19th century solutions,” Wheeler said. “That paradigm has to be broken…the going forward regulatory structure has to be the one that doesn’t retreat from the field but leaves behind industrial-era concepts

to become more agile, and that means working with the companies.” The Summit concluded with an agreement as to the role government can play and it’s largely educational.

Stakes and risks for business Even back in 2015, there were over 666,000 internal security breaches of U.S. businesses. The difference is, despite that high volume, at the time less than 20 percent of managers considered the threat of cyber security to be a top priority.

When

Company

Nature of Business

Description of Data Breach

3/15/17

Dun & Bradstreet

Business services

4/25/17

Chipotle

Healthy fast food

5/3/17

G-mail

E-mail service

9/17/17

Equifax

Credit agency

Found marketing database with over 33 million corporate contacts shared across the web. While D&B claims it wasn’t breached, but that it sold the 52 GB database to thousands of companies—one of these companies suffered a breach that exposed the records.

The company detected unauthorized activity on the network that supports in-restaurant payment processes. This affected payment card transactions that occurred over almost one month.

G-mail users were victims in a phishing scam that attempted to gain access to accounts through a third-party app. Although Google stopped the scam within an hour, an estimated one million users may have been affected.

Ranking as one of the worst security breaches ever, hackers gained access to the company’s system from mid-May to July. Compromised data was reported to include full names, addresses, birthdates, credit card numbers, and more from 143 million customers.

50 INDUSTRY TODAY

FEATURE GLOBAL DATA SCIENCES

Now that has changed. The problem has become far more prevalent and the time to deal with it is now. A sampling of data breaches that have occurred in 2017 follows.

Cyber security in a global marketplace The 2017 Global State of Information Security Survey was conducted to explore how businesses

are embracing a modern approach to threat management and information sharing. The survey drew on the responses of 9500 executives in 122 countries and over 75 industries. Key findings indicate good news and bad news. On the positive side, there seems to be increasing commitment to cyber security; however, the good news stops there. The darker side shows that 48 percent of INDUSTRY TODAY 51

FEATURE GLOBAL DATA SCIENCES

About the Author: Michael Mantzke is the CEO of Global Data Sciences, Inc. (GDS), headquartered in Aurora, Ill.GDS identifies and resolves known and unknown inventory problems that reduce customers’ headaches and increase their profits.

Areas of expertise include global operations, inventory management, process and procedure optimization, systems integration and optimization, and cybersecurity and data forensics.

For additional information, please call 630 299-5196, visit www.globaldatasciences.com, or email info@globaldatasciences.com

52 INDUSTRY TODAY

FEATURE GLOBAL DATA SCIENCES

respondents report being without a security awareness program, and 54 percent lacked incident response plans. Furthermore, only 45 percent conducted vulnerability assessments and just 42 percent ran penetration tests. It’s of grave concern that these four measurements represent cornerstones of basic cyber security control and more than half of respondents couldn’t even weigh in.

Imagine the crystal ball If we could look into America’s cyber security crystal ball, we would want to know what the future holds. What role will IT departments have?

How will hacking be reduced? What will drive the biggest change? Which risks aren’t being tak-

en seriously enough? The catastrophic breaches that have played out over the past five years are sending a message. In general—and with no time to lose—America needs to accept the cyber reality, and force a reset in its thinking. The cyber culture must stop sacrificing its precious security for the promise of simplicity. Such a sacrifice comes with threats that can’t possibly be worth the loss of vital protective layers. Consider the potential benefits to resetting protective policies and decide that, regarding cyber security, nothing can be taken for granted. If today’s cyber culture doesn’t see the looming danger as a motive for change, it will evolve into a culture of cyber fools.

INDUSTRY TODAY 53

FEATURE SUPPLY CHAIN PREPAREDNESS

SUPPLY CHAIN PRE SURVIVING THE ST

54 INDUSTRY TODAY

FEATURE SUPPLY CHAIN PREPAREDNESS

EPAREDNESS: TORM W

The capacity crunch is real. When ports shut down, is your supply chain prepared to handle a disaster? hen ports shut down, restrictions are put upon on an already stretched supply chain industry. Recently, the industry had to respond to several natural disasters – hurricanes, wildfires, floods – leading to closed ports and roadblocks across Georgia, Florida, Texas, and California. While recovery efforts continue across these states, the aftermath is being felt across the entire U.S., and putting further strain on truck capacity and supply chain resources at a time when shipping needs spike.

At different times, numerous ports such as those in Savannah, Tampa, and Miami all suspended operations due to storm related activity. Others, like the Port of Charleston, closed for an entire day, while ships were forcibly rerouted. This unfortunately added further stress in port cities and regional hubs and resulted in higher rates between carriers and brokers everywhere.

These recent hurricanes and other inevitable tragedies have taken a tight market and applied a vise grip to it. As of October, market data suggested FEMA had control of an estimated six to ten percent of the market with relief shipments, and their layover system is creating an environment

INDUSTRY TODAY 55

FEATURE SUPPLY CHAIN PREPAREDNESS

where it is taking weeks for these drivers to get unloaded.

In addition to the recent weather related events that have caused volatility to transportation rates and capacity, the government mandated Electronic Logging Devices (ELD) for commercial

56 INDUSTRY TODAY

trucks is also having a significant impact. The soft enforcement went into effect in December 2017 where non-compliant carriers are fined for not meeting the ELD requirements. Hard enforcement begins as of April 1, 2018, where non-compliant carriers and drivers will be placed

FEATURE SUPPLY CHAIN PREPAREDNESS

out of service for violating the ELD rules. The total impact of how the ELD mandate will ultimately affect both transportation rates as well as capacity is still unknown. Many analysts believe it could have a four to seven percent impact on capacity and a five to 15 percent impact on car-

rier rates.

What can shippers do to prepare for and better navigate “the perfect storm”?

Regrettably, if an organization is unprepared at this point in the year, there won’t be anything to do except pay the higher rates and execute

INDUSTRY TODAY 57

FEATURE SUPPLY CHAIN PREPAREDNESS

58 INDUSTRY TODAY

FEATURE SUPPLY CHAIN PREPAREDNESS

where possible across the distribution network.

There is no magic bullet. Organizations must get creative and survive the season. On the other hand, surviving the season and the pressures of the capacity crunch does not mean sitting back and bracing for impact. Companies must have a strategy to prepare for future natural disasters or rises in consumer demands.

If an organization is still operating on a static, closed, on-premise transportation solution, they have no flexibility to adapt. Everything becomes more difficult on these systems, including connecting with new partners, new carriers, and optimizing routes. Finding, locating, and preparing

new carriers or new lanes will require a long and manual process. These systems truly limit an organization’s ability to react to changing conditions.

The first step in developing a “preparedness” strategy is to join a network. The power of a network lies in its ability to bring clarity and certainty to a volatile situation and can offer “on-demand” connections to thousands of potential carriers.

Forming connections, processes and identifying new capacity can be found and accessed faster than ever.

As part of joining a network, organizations should ask if doing so will also provide these

INDUSTRY TODAY 59

FEATURE SUPPLY CHAIN PREPAREDNESS

benefits to strengthen their supply chain solution: 1. A global capability – Does it create a more resilient network that will allow a business to sell across borders and trade zones like it’s right next door? Can systems be updated easily as new custom requirements are put into effect?

2. Value flexibility above the certainty of the status quo - Supply chain managers cannot afford to sit still with static supply chains and think they’re prepared. Those that make the extra effort to prepare for multiple scenarios will be able to

satisfy their customers in times of trouble.

3. Provide supply/demand insight - Market data combined with a deep network can help secure the best rates and protect an organization’s budget. For example, with a global-trade-network view of the market, Logistics as a Service (LaaS) customers have the potential to keep rates lower than with a limited view of providers.

4. Seek best-practice solutions – Does the solution provide the capability to capture and identify successful new processes, ideas, and tech-

Jeff Potts is Vice President of Client Services at BluJay Solutions, leading the company’s client services group in North America.

He has over 30 years of experience in the transportation industry including roles in sales, consulting, and business development, as well as co-founder of the former LeanLogistics. Jeff brings a wealth of diverse supply chain knowledge and a deep understanding of the industry to his role and every customer interaction.

60 INDUSTRY TODAY

FEATURE SUPPLY CHAIN PREPAREDNESS

nologies so they can be learned and implemented based on proven results? Once identified, can these advancements be learned and implemented faster than the competition?

Flexible, adaptable supply chain solutions posi-

tion an organization for success. Supply chain is the competitive battleground of the future. Organizations that start planning for unavoidable roadblocks / disasters now, will be able to live to tell the tale.

INDUSTRY TODAY 61

FEATURE RESHORING INITIATIVE

U.S. JOBS ARE FLOW YOUR HELP IS STIL 62 INDUSTRY TODAY

FEATURE RESHORING INITIATIVE

J

obs are flowing back into the United States in unprecedented numbers. For the first time in decades, more manufacturing jobs are returning to the United States than are going offshore. The combined reshoring and foreign direct investment (FDI) trends grew by more than 10 percent in 2016, adding 77,000 jobs and exceeding the rate of offshoring by about 27,000 jobs. The rate of jobs coming from offshore accelerated further in 2017, up 200+% since the 2016 presidential election (Fig.1). This trend has helped drive a manufacturing workforce that is now about 2 million higher than would have been projected in 2007.

This is exciting progress, but there are still huge opportunities and challenges to bringing back all of the four million to five million U.S. manufacturing jobs still offshore. The country needs companies to do the math with TCO (Total Cost of Ownership) when making location decisions.

A Purdue Manufacturing Extension Partnership (MEP) Center study shows that “better total cost of ownership decisions” was the top-ranked area of concern for companies. Here are some actions that we can take together to accelerate the use of TCO and the rate of reshoring.

OWING BACK BUT LL NEEDED

INDUSTRY TODAY 63

FEATURE RESHORING INITIATIVE

Fig.1 Data on reshoring and foreign direct investment (FDI) from the Reshoring Initiative Library.

Use TCO when buying Several trends are driving the shift from offshoring to reshoring: the rising costs of offshore production; the impact of distance on innovation, flexibility, responsiveness, inventory and availability; improved competitiveness via automation and lean; and the increased use of the more sophisticated TCO model to quantify the hidden costs and risks of offshoring. Companies are increasingly deciding to use a “local for local” strategy and bring production and sourcing closer to home.

The economic logic of TCO is built around the 64 INDUSTRY TODAY

FEATURE RESHORING INITIATIVE

savings achieved by producing or sourcing locally.

The savings from low, but rising, offshore wages and purchase prices are increasingly offset by dozens of hidden costs. To help quantify those costs, the Reshoring Initiative website provides tools to help companies decide whether their overhead will come down more than their manufacturing cost goes up when sourcing locally. Use the Total Cost of Ownership Estimator® to help your company more accurately assess the total company impact of offshoring or reshoring decisions.

Our user data shows that, under current con-

ditions, if companies use the TCO Estimator instead of price to make their decisions, they can reshore an average of 25 percent of what they have offshored and improve their profitability.

The TCO Estimator typically closes a 15 to 20 percent price gap, but some companies find that the analysis is worthwhile even if the gap is as much as 50 percent!

Use TCO when selling vs. imports Use TCO to make a strong case when selling against offshore competitors. Sixty percent of

Pictured: previous spread: HIA Velo: “Photo courtesy of HIA Velo”; below: “Kent International bikes are part of Walmart’s $250 Billion U.S. Manufacturing program”.

“Photo courtesy of of Kent International.”

INDUSTRY TODAY 65

FEATURE RESHORING INITIATIVE

companies make sourcing decisions based on rudimentary metrics, such as wage rate, ex-works price or landed cost, often resulting in a 15 to 20 percent understatement of actual offshoring costs. The TCO Estimator is a free online tool that helps companies account for all relevant factors—overhead, balance sheet, risks, corporate strategy and other external and internal business considerations—to determine the true total cost of a part or assembly.

When you find yourself competing with a lower-priced offshore product, we suggest offering to help the customer compare the TCO of your offer vs. the lower-priced offshore offer. Ask about offshore-sourced products that are causing the customer problems, such as late deliveries, poor quality, intellectual property theft, excess inventory, lost orders and travel costs. Buyers often ask a salesman, “Can you match the Chinese price?” Your response should be, “Maybe not, but let’s see if I can offer you a lower total cost that increases your profitability.”

Compete in the Second National Reshoring Award Competition The First National Reshoring Award was won

by Mitchell Metal Products, Merrill, WI. The Reshoring Initiative, in conjunction with the Precision Metalforming Association (PMA), invites companies that have successfully reshored Pictured: Detroit Bikes: “Photo courtesy of Detroit Bikes”.

66 INDUSTRY TODAY

products, parts or tooling made primarily by metal forming, fabricating or machining to compete in the second National Reshoring Award

FEATURE RESHORING INITIATIVE

(http://www.pma.org/sourcingsolutions/). There will be one award for buyers and one award for suppliers. You do not have to be a PMA member to

win. See if your reshoring is eligible. Use TCO to evaluate reshoring an eligible product. The deadline is September 1, 2018.

INDUSTRY TODAY 67

FEATURE RESHORING INITIATIVE

68 INDUSTRY TODAY

FEATURE RESHORING INITIATIVE

Tell Washington what policy changes are needed!

The Reshoring Initiative and Plante Moran are launching the “Manufacturing Reshoring Survey” (https://hbb.qualtrics.com/jfe/form/ SV_9Liu8h9lQw1oElf ) to examine the overriding issues and national policy changes needed to impact plant location and sourcing decisions. Past surveys tell us whether companies have reshored or will reshore and why. This survey focuses on how much companies have offshored and what national policy changes would motivate them to reshore X% of their offshoring.

We will offer the survey results to the administration and Congress to drive policy so the 75% of offshoring not currently suitable for reshoring can be reshored. We hope your company will complete the survey. The deadline is February 20, 2018.

INDUSTRY TODAY 69

FEATURE RESHORING INITIATIVE

Harry Moser President - Reshoring Initiative Harry founded the Reshoring Initiative to bring manufacturing jobs back to the U.S. after working for high end machine tool supplier GF AgieCharmilles, starting as President in 1985 and retiring 12/31/10 as Chairman Emeritus. Largely due to the success of the Reshoring Initiative, Harry was inducted into the Industry Week Manufacturing Hall of Fame 2010 and was named Quality Magazine’s 2012 Quality Professional of the year. Harry participated actively in President Obama’s 1/11/12 Insourcing Forum at the White House, won The Economist debate on outsourcing and offshoring, and received the Manufacturing Leadership Council’s Industry Advocacy Award in 2014.

Harry is frequently quoted in the Wall Street Journal, Forbes, New Yorker and USA Today and seen on Fox Business, MarketWatch and other national TV and radio programs. He received a BS in Mechanical Engineering and an MS in Engineering at MIT in 1967 and an MBA from U. of Chicago in 1981.

70 INDUSTRY TODAY

FEATURE RESHORING INITIATIVE

Import Substitution Program We are about to launch the Import Substitution Program (ISP), which will create opportunities for U.S. companies to compete with imported products and thus reshore. The ISP is designed to enable companies, industry associations, equipment suppliers and economic developers to cooperate to substitute domestic production for imports. Keep up with ISP updates by signing up for our eNewsletter or contact us directly to learn more.

Reshoring Resources Are you and your company using all of the Reshoring resources available on our website (www.ReshoreNow.org)? Here is a list of just a few helpful tools to aid in your reshoring

decision-making process: • Calculate TCO with the Total Cost of Ownership Estimator® • Submit your own reshoring case for free publicity and get a Manufacturing is Cool t-shirt, Made in U.S.A. • Search our Library to see which of your customers’ competitors are reshoring and to find sales prospects committed to domestic production.

• Invite the Reshoring Initiative to address your or your customers’ industries at a speaking engagement or meeting.

• Volunteer – Individuals, academic institutions or companies can contribute time or expertise.

• See how you can help the country bring back jobs.

Help us reshore and restore U.S. manufacturing!

INDUSTRY TODAY 71

PROFILE • SUBARU OF INDIANA

Subaru’s 2019 Ascent will be manufactured in Indiana, representing the perfect mix of modern vehicle technology, state-of-the-art plant production and an effort to add to the strength of a local state economy. Lorie Greenspan reports on the company’s latest ascent into the stratosphere of motor vehicle design.

he manufacture of Subaru automobiles, unarguably in a class by themselves, moves forward at a rapid pace at Subaru of Indiana Automotive (SIA), with the addition to its portfolio in 2018 of the company’s new Subaru Ascent.

The Ascent will be produced in the Lafayette, Ind., plant beginning in May 2018. To support the increased production, the company plans to create up to 200 new jobs, adding to its current workforce of 5,600 and strengthening SIA’s 72 INDUSTRY TODAY

SUBARU OF INDIANA • PROFILE

INDUSTRY TODAY 73

PROFILE • SUBARU OF INDIANA

AT A GLANCE: • Subaru of Indiana Automotive; • www.subaru-sia.com; • Lafayette, Indiana; • Production: Subaru Legacy, Subaru Outback, Subaru Impreza, Subaru Ascent; • Production volume: 400,000 units annually; • Size: 4,419,093 square feet; 3.3 million footprint; • Associates: 5,600; • SIA Senior Executive Vice President, Secretary and Chief Legal Officer: Tom Easterday.

As Subaru grows and expands Heritage will be by their side to ensure they maintain their ZERO LANDILL status.

See Heritage in action: 74 INDUSTRY TODAY

SUBARU OF INDIANA • PROFILE

INDUSTRY TODAY 75

PROFILE • SUBARU OF INDIANA

status as a major employer and community leader in Lafayette.

“The Ascent was designed for the North American market to meet the demands of our customers,” notes Senior Executive Vice President Tom Easterday, adding that Subaru’s vehicle lineup in North America previously was missing a key market segment: customers who wanted a 3-row SUV. The Ascent offers plenty of everything: room for up to eight passengers, increased cargo space, leg room and head room, a state-of-the-art entertainment system and 19 cup holders. Perhaps not as sexy as the Direct-Injection Turbocharged, 260-horsepower SUBARU BOXER® engine or STARLINK™ Multimedia technology, but cupholders are 76 INDUSTRY TODAY

nonetheless important if you’ve got a big family on long drives. And Subaru is nothing if not a company that prides itself on supplying the best to the customer – down to every last detail.

At the time the announcement was made of the company’s newcomer to its production line, Easterday had said that the Subaru Ascent was a “great addition to our production mix. This great new family vehicle allows us to create hundreds of new jobs at SIA, and also at our suppliers in Indiana and across the country.”

As far as physical renovations to the Indiana plant, Easterday explains that the company will not add on to the main plant at present, noting that an addition was previously built onto the paint shop by knocking out a wall to allow to

SUBARU OF INDIANA • PROFILE

allow for production of larger vehicles. The plant currently measures 4,419,093 square feet. That amounts to a 3.3 million square foot imprint and a lot of space for the efficient production of automobiles.

As an incentive, the Indiana Economic Development Corporation offered Subaru of Indiana Automotive Inc. – the company’s only plant outside of Japan – up to $500,000 in training grants based on the company’s job creation plans.

The expansion in production represents an investment of more than $140 million in the purchase of new machinery and equipment. SIA will produce approximately 400,000 vehicles in 2018, including the Subaru Legacy, Impreza, Outback and Ascent. Since the start of the company’s production in September 1989, the facility has produced more than five million vehicles.

Pictured: The Subaru Ascent offers room for up to eight passengers, 19 cupholders, and wifi, making it a perfect vehicle for big families.

INDUSTRY TODAY 77

PROFILE • SUBARU OF INDIANA

78 INDUSTRY TODAY

SUBARU OF INDIANA • PROFILE

Ascent to Excellence So what’s there to like about the 2018 Subaru Ascent? Everything.

Heralded as “the biggest Subaru SUV ever,” the Ascent offers a Direct-Injection Turbocharged, 260-horsepower SUBARU BOXER® engine designed for optimal balance and an even distribution of power for maximum traction. And it drives nice, too.

“It has more towing capacity than many other SUVs. It offers a smooth ride and better fuel economy,” Easterday says.

The Ascent also comes with standard Pictured: The Subaru Ascent offers plenty of storage, seating and towing capacity as well as a smooth ride and great fuel economy.

CONGRATULATIONS

SUBARU

on your continued success.

2001 West Just Industrial Parkway, Austin, IN 47102 PH: (812)794-0062 / www.tri-hawk.com INDUSTRY TODAY 79

PROFILE • SUBARU OF INDIANA

ENVIRONMENTAL STEWARDS: SIA’s drive to become a manufacturing plant that reaches out beyond its own footprint has earned it the status of being the first U.S. auto assembly plant to achieve zero landfill status, the first to be ISO 14001 (Environmental Management) and ISO 50001 (Energy Management) certified and the only U.S. auto assembly plant to have its entire site designated a Backyard Wildlife Habitat by the National Wildlife Federation.

May 4, 2014 marked SIA’s 10th anniversary of achieving zero landfill status. SIA officials and Associates gathered to celebrate the milestone with a commemorative tree planting in front of SIA’s plant in Lafayette, Indiana. The tree, a tulip poplar, is Indiana’s state tree and will grow as a reminder of the commitment to the environment made by each of SIA’s nearly 5,600 Associates.

In 2002, SIA set the goal to achieve zero landfill by 2006. Due to the diligence and innovation of SIA’s Associates, the manufacturer achieved zero landfill on May 4, 2004, two years ahead of schedule.

“Most recently,” says Senior Executive Vice President Tom Easterday, “we’ve launched a major initiative to reduce our carbon footprint,” by undertaking programs such as switching to CNG (natural gas) from diesel for its trucks.

In 2014, SIA was honored with the Governor’s Award for Environmental Excellence in the category of Energy/Renewable Resources. The Governor’s Awards recognize organizations throughout Indiana who have implemented outstanding environmental strategies into their operations and decision-making processes.

The award for Energy/Renewable Resources recognizes projects or programs that prevent pollution by either reducing energy use or by producing energy using zero- or very-low-emission technologies. SIA won the award again in 2016 for the CNG Conversion project Easterday also notes that, in cooperation with U.S. Fish & Wildlife, the company has designated 200 acres surrounding its plant as a backyard wildlife habitat.

Additionally, SIA restored 30 acres to 1800s Indiana prairie to show, as Easterday stresses, “how manufacturing can live in harmony with nature.”

80 INDUSTRY TODAY

SUBARU OF INDIANA • PROFILE

Symmetrical All-Wheel Drive that offers great stability, efficiency, and enables the driver to respond quickly to changing driving conditions.

With 19.3 gallons of fuel capacity, it offers drivers the chance to reach their destination with their wallets intact.

What else can customers look forward to?

Heading out on rough terrain, drivers can rely on the vehicle’s 8.7 inches of ground clearance and standard X-MODE, which optimizes the Symmetrical All-Wheel Drive system for maxPictured: Safety features are of top importance to Subaru. This back-up camera offers the driver a wide view of what is behind the vehicle.

imum traction on slippery surfaces. X-MODE also incorporates Hill Descent Control for stability when climbing difficult grades. If you’ve brought your boat or other recreational vehicles along, you’ll be ably to rely on the Ascent’s 5,000-pound towing capacity, along with a Class III trailer hitch and a wide selection of Thule racking accessories. The Ascent is also one of the only vehicles in its class with standard raised roof rails and offers an extensive line of racking accessories — from kayak and bike carriers to rooftop containers.

In terms of driving safety, the Ascent has you covered. “Subaru safety is the best in the INDUSTRY TODAY 81

PROFILE • SUBARU OF INDIANA

industry,” Easterday says. Coming in as a standard feature is EyeSight technology that monitors traffic movement, optimizes cruise control, and warns you when you’re swaying outside your lane. Other features of the 2019 Ascent include: • Blind-Spot Detection that warns drivers with a visual indicator in each side mirror if it senses a vehicle in your blind spots.

• Rear Cross-Traffic Alert that warns you of traffic approaching from the side as you are backing up.

82 INDUSTRY TODAY

• Pre-Collision Braking that can apply full braking force, bringing the vehicle to a complete stop in emergency situations.

• Smart Rear-View Mirror, which uses a dedicated camera to maintain visibility when the view behind is obstructed, while a standard Rear-Vision Camera provides extra safety when Pictured: The Subaru Ascent offers families an entertainment system that includes Apple CarPlay, Android Auto, and SiriusXM All Access Radio.

Additionally, passengers can enjoy access to eight USB ports and wifi connectivity.

SUBARU OF INDIANA • PROFILE

“I’ve driven the Ascent--it has more towing capacity than many other SUVs. It offers a smooth ride and better fuel economy.” --Senior Executive Vice President Tom Easterday reversing. And an available 180-Degree Front Camera gives the same confidence that your path ahead and to the sides is safe and clear. A lane-assist feature will push the vehicle back into its lane should you begin to drift.

After giving peace of mind that the family’s

safety is taken care of, the designers of the Ascent next focused on comfort and the 2019 vehicle provides that in triplicate. Three rows of seating provide optimum comfort for long trips.

Passengers can opt for second-row captain’s chairs for easy access to the third row and space

INDUSTRY TODAY 83

PROFILE • SUBARU OF INDIANA

for up to seven, or second-row bench seating to make room for eight. The interior features 72.6 cubic feet of available cargo space and up to 153.5 cubic feet of passenger volume plus underfloor storage.

With all those passengers, you’ll need something to keep them entertained. The 2019 Ascent 84 INDUSTRY TODAY

offers built-in Wi-Fi connectivity, up to eight USB ports as well as SUBARU STARLINK™ Multimedia that integrates Apple CarPlay™, Pictured: The Subaru Ascent is produced exclusively at Subaru of Indiana Automotive, Inc. in Lafayette, Indiana. This is the only Subaru manufacturing facility outside of Japan.

SUBARU OF INDIANA • PROFILE

TOP QUALITY: SIA is an industry leader in quality and safety and its employees have won numerous awards in these areas, including the prestigious 2013 J.D. Power Platinum Plant Quality Award and the 2016 J.D. Power Silver Plant Quality Award.

The plant’s OSHA (Occupational Safety and Health Administration) Incidence Frequency overshadows the industry average, with SIA as the only auto plant to achieve five straight years with an OSHA Incidence Frequency of under 1.0.

In addition, SIA was awarded the 2015 Indiana Governor’s Award for Safety.

SIA was the first auto assembly plant in the United States to receive ISO 9001 (Quality Management), ISO 14001 (Environmental Management) and ISO 50001 (Energy Management) certifications.

Android™ Auto, and Pandora® plus SiriusXM® All Access Radio. STARLINK connects passengers to music, navigation, and podcasts, plus allows easy access to apps and content, such as iHeartRadio®, Yelp and Magellan. A built-in, voice-activated navigation system powered by TomTom® and an 8-inch touch-screen are also

available.

Whew! Is there any wonder, with such built-in excellence and appointments, that 98 percent of Subaru vehicles sold in the last 10 years are still on the road today? The Ascent will no doubt add to that percentage as it circulates among INDUSTRY TODAY 85

PROFILE • SUBARU OF INDIANA

86 INDUSTRY TODAY

SUBARU OF INDIANA • PROFILE

“This great new family vehicle allows us to create hundreds of new jobs at SIA, and also at our suppliers in Indiana and across the country.” --Senior Executive Vice President Tom Easterday. drivers in North America and beyond. Currently, exports represent 5-7 percent of the company’s production volume, Easterday says.

Technology Pros To enhance the pace of production in its plant, Subaru has made a host of investments in terms of robotics in the areas of boxing and sequencing, accommodating for the larger vehicle size on the production line and other automated features, representing a $110 million investment in equipment and $30 million in building improvements.

Overall, SIA production volume has more than tripled in the last decade, reaching 350,000 in fiscal year 2017, which ended March 31. In Pictured: The Subaru Ascent has allowed SIA to add 200 jobs. The increase in production has also positively impacted companies who supply parts for the vehicle.

INDUSTRY TODAY 87

PROFILE • SUBARU OF INDIANA

88 INDUSTRY TODAY

SUBARU OF INDIANA • PROFILE

December 2016, SIA rolled out its five millionth vehicle, a blue Outback, and the previous July, Subaru’s Indiana facility marked production of its three millionth Subaru. SIA currently produces only Subarus for the North American market, including Outback, Legacy and Impreza and has exported vehicles to more than 50 countries worldwide. In addition, SIA’s supply chain is an integrated network of 38 direct material suppliers located in Indiana and 140 direct material Subaru suppliers located in Indiana and the surrounding states of Michigan, Illinois, Ohio and Kentucky.

With 30 years in Indiana, the company’s plant employs two production lines to build the Outback, Legacy and Impreza, utilizing kaizens, new technologies and best practices to bring efficiencies to the manufacture of these vehicles – a business model that will no doubt extend to the Ascent.

To enable the proficient manufacture of all vehicles for Subaru, and to continue to ensure best practices while providing employment to the region, SIA participates in a military-to-hire program through the army at Fort Campbell in Kentucky and Indiana’s national guard and reserves, to identify potential new associates.

Another program, AIM (Advanced Internship in Manufacturing) is offered to local high school Pictured: SIA believes in hiring the best people to make the best vehicles. A military-to-hire program with the U.S. Army and the Indiana National Guard is one of the ways SIA finds great Associates.

INDUSTRY TODAY 89

PROFILE • SUBARU OF INDIANA

graduates as a way to combine college-level classroom study with hands-on experience.

Through this effort, students take classes through Vincennes University and Purdue University at the Purdue Polytechnic Institute-Lafayette campus, located at the SIA plant, to earn an associate’s degree in Computer Integrated Manufacturing.

The company has gone far to pursue a Pictured: SIA’s plant occupies 3.3 million square feet, but the company’s grounds also include a recreation center, fishing pond, health & wellness center and child care center for Associates.

90 INDUSTRY TODAY

commitment as a major job maker in the region – in four years it has added more than 2,000 jobs.

So, as it has done since its founding, Subaru continues to push the envelope in both technology, safety and comfortable vehicles for its passengers and drivers, while providing jobs and career skills to the citizens of Indiana. As Easterday attests: “People maintain a close connection with Subaru – it’s a trusted brand in terms of safety and reliability.”

And that is why SIA will continue its ascent with an all-star lineup that includes the best manufactured automobiles on the planet.

SUBARU OF INDIANA • PROFILE

INDUSTRY TODAY 91

PROFILE • VÄDERSTAD

92 INDUSTRY TODAY

VÄDERSTAD • PROFILE

INDUSTRY TODAY 93

PROFILE • VÄDERSTAD

Saskatchewan-based Vaderstad Industries, previously Seed Hawk, a business unit of Swedish farm equipment maker Väderstad, makes precision seed drills that deliver higher yields. David Soyka reports on how Vaderstad Industries grows the grower’s business. eed Hawk manufactures innovative drill systems that provide exceptionally precise seeding and fertilization placement. After partnering with the world leading Swedish farm equipment manufacturer for more than a decade, and after 25 years as a Canadian enterprise, this past October, Seed Hawk officially became Vaderstad Industries Inc., as part of global parent the Väderstad Group.

94 INDUSTRY TODAY

However, the time-tested and familiar Seed Hawk brand farmers rely on for fast, even crop emergence with higher yields isn’t going away.

While the seeding systems and equipment now sport the red paint finish consistent with all Väderstad branded equipment, Seed Hawk continues as the nameplate customers have come to know and trust.

“We are pleased to become a part of Väderstad.

VÄDERSTAD • PROFILE

Both businesses are leaders in the development of some of the world’s most innovative agricultural equipment,” says Nigel Jones, CEO of Vaderstad Industries Inc. “Joining with Väderstad provides us with synergies, both from a corporate perspective, such as the ability to integrate with their financial and management systems, as well as to expand our product line with Väderstad tillage, drilling and planting equipment, that we can now

offer to our existing Seed Hawk customers.”

Seed Hawk products are sold through 19 dealerships representing 86 locations throughout Western Canada, the United States and Australia.

There are currently more than 2200 machines working in the field., Seed Hawk manufactures a Pictured: 2018 Seed Hawk Seeding System featuring a 660bu air cart and a 45 Series-60ft toolbar with the new Väderstad branded red paint.

INDUSTRY TODAY 95

PROFILE • VÄDERSTAD

PLANTING BUSINESS: Seed Hawk started out in 1992 from a small shop near agronomist Pat Beaujot’s family farm in Langbank, Saskatchewan. As is often the case, the first prototype was invented to address something that wasn’t then on the market—a tool to shallow seed, place fertilizer with exceptional accuracy and pack evenly in a single pass. Along with Beaujot’s brother and two others, they exhibited their tool at a farm show and sold six seeders that year, taking as inspiration for their company name the hawks that follow the seeder looking for mice. By 1995 it had 30 customers; by 2006 it had grown to the point where it partnered with Väderstad AB to develop a large-scale seeder for the East European market. Shortly thereafter it invested over $10 million over two phases to expand its manufacturing capabilities to meet rising domestic and global demand for its products. Pat Beaujot, who continues to serve on the company’s board of directors, was inducted into the Saskatchewan Agricultural Hall of Fame in 2016.

FARMERS FEED THE WORLD. WE FEED SOLUTIONS. The Carlstar Group is proud to partner with Vaderstad Industries, offering leading tire, wheel and assembly solutions for the North American farmer.

D

iemo Machine Works is an industry leader in the custom machining and fabricating world. We are a team of 85+ people who are passionate about working and investing together, adding value to Original Equipment Manufacturers through machining, fabricating and welding metal parts and assemblies.

Contact Information

WWW.CARLSTARGROUP.COM ©2017 The Carlstar Group LLC.

96 INDUSTRY TODAY

info@diemomachine.com

1-888-364-2404

www.diemomachine.com

VÄDERSTAD • PROFILE

“In October 2017, Seed Hawk officially became Vaderstad Industries, Inc., part of the gobal Väderstad Group. Its products, however, continue to be sold under the widely recognized and respected Seed Hawk brand.” range of air carts for custom blending and precise seeding, as well as toolbars that follow the contour of the land for consistent seed depth regardless of terrain with industry-leading opener assemblies that operate independently, delivering superior shallow seeding, depth accuracy and optimal fertilizer placement with one pass operation. The Seed Hawk Seeding System include features like pioneering Sectional Control® Technology, Fenix

III metering technology, and iCon® Wireless Control.

Väderstad products manufactured in Sweden, but offered through Vaderstad Industries throughout Western Canada and the United States include the Tempo Planter – which provides both speed and precision planting for all row crops, in comparison to competitive planters that offer either one or the other – and the Carrier INDUSTRY TODAY 97

PROFILE • VÄDERSTAD

Hi-Tec Profiles has been a Proud Supplier of Seed Hawk/Vaderstad for over 20 Years. Congrats on the continued success, and all the best in the future!

Solutions For Today's Lean Manufacturing Environment

Hi-Tec Profiles is one of the largest Steel Processing Companies in Western Canada with a combined 80,000 Square Feet of production facilities. With the changing market place, we have done our best to stay ahead of the curve by investing in new equipment to help give our customers the competitive edge in their respective market places.

Our current processing line-up includes:

11 big bed Plate/Sheet Lasers, 1 Tube Laser, 2 sets of Heavy Duty Rolls (10' & 7'), 2 Torch/ Plasma tables and 8 CNC Brakes (Largest being 22' 850 Ton) with over 50+ employees operating 7 days a week, 24 hours a day to meet all of our customer requirements.

CONGRATULATIONS

VADERSTAD INDUSTRIES on your continued success in the agricultural industry.

Contact Us: Phone: (306) 374-1199 Email: kevin@fastenerwarehouse.ca |www.fastenerwarehouse.ca

98 INDUSTRY TODAY

2301 Industrial Drive, Box 1727, Regina, SK S4P 3C6 PH: 306.721.3800 | www.hitecprofiles.com

VÄDERSTAD • PROFILE

“Seed Hawk seeding systems and equipment are sold throughout Western Canada, the United States and Australia, with some 2200 machines currently operating in the field.”

– a disc cultivator that is fully customizable to the tillage needs of specific farm and field conditions.

Another benefit of the Väderstad relationship, Jones points out, is that the company is more customer-focused than ever. “While, like any successful company, we pay attention to customer needs, product development was more internally driven in the past,” Jones says. “Working with Väderstad, we’ve become much more con-

centrated on soliciting customer input. Before our R&D was all about coming up with what we’d thought was the next innovation; now we’re more about asking customers what we can do to make their products better.”

Pictured: The Seed Hawk 45 Series 60ft toolbar folds up to a width of 15.5ft for easy transportation.

INDUSTRY TODAY 99

PROFILE • VÄDERSTAD

Iconic Products Chief among these is the use of software and modular components to not only provide innovation, but extend product usefulness. For example, Seed Hawk was the first manufacturer to introduce Sectional Control® Technology (SCT), which works in conjunction with a GPS system mounted on the toolbar to eliminate misses and overlaps commend when seeding among

100 INDUSTRY TODAY

odd-shaped fields and ones with obstacles. When the toolbar encounters previously seeded ground, SCT instantly stops the roller rotation and product flow, which reduces input costs. SCT also lifts the openers, so you don’t disturb the precision seed and fertilizer placement already

VÄDERSTAD • PROFILE

completed. A new electric drive meter makes SCT more efficient than ever.

“The key value for farmers is how to seed faster and more efficiently. Software is one way to continually upgrade without the expense of new hardware,” Jones explains. “Our iCon® Wireless Control System, for example, provides a simple and easy-to-use iPad interface that can tell you instantly how many acres remain until your

next product fill. In-field calibration ensures you are applying products at the correct rates. And a blockage monitor tells you immediately of a problem. On top of that, you can get out of the cab and carry the iPad with you to help locate and fix the issue. All of this both improves operations and reduces costs. The farmer can conduct a seeding in one pass, saving time and fuel to do the necessary tillage while also ensuring the most

Pictured: 2017 Seed Hawk Seeding System featuring an 800bu air cart and a 70ft toolbar - one of the last burgundy machines prior to the company’s rebranding.

INDUSTRY TODAY 101

PROFILE • VÄDERSTAD

102 INDUSTRY TODAY

VÄDERSTAD • PROFILE

effective seed placement that results in the best yields.”

And as improvements are made in the wireless control systems, an upgrade is only a download away. “Farmers are technologically-savvy; they’re always looking for how they can be more scientific and more efficient in their methodologies.

These days, a lot of that smart innovation is driven by software, which is much easier and quicker to push out to customers,” Jones notes.

How long the hardware itself lasts in the field depends on how it is used. “The more acres that have to be covered, the harsher the terrain and the longer the machines run, the shorter the lifespan, “Jones notes. “It could be five or six years for aggressive situations. That said, many farmers have equipment much older and still in good working condition that’s doing the job for them.

Farmers are mechanically adept and perform a lot of their own maintenance, and are Pictured: Seed Hawk officially changed its name to Vaderstad Industries Inc. on October 31, 2017.

INDUSTRY TODAY 103

PROFILE • VÄDERSTAD

ISO Accredited

ENHANCED IMPLEMENT CONTROL

A precision machine shop that combines technology & innovation to create manufacturing excellence.

AND MONITORING OF AGRICULTURE APPLICATIONS • Equipment/ Farm Management • Mapping • Diagnostics

• Smart Phone • Tablet • Virtual Terminal

We are proud to be working with Vaderstad to provide them with precision machined, quality parts.

• Controller • Loadcell/ Sensors • Telematics

PLEASE CALL TODAY AS WE SPECIALIZE IN THE FOLLOWING ELECTRONICS & SOFTWARE | WIRE HARNESSES & CONTROL PANELS MANUFACTURING & ENGINEERING

104 INDUSTRY TODAY

Contact us for further information.

105 Kittel Ave., Yorkton, Saskatchewan, S3N 3G2 Tel: 306-782-2833 | Toll Free 1-877-782-7281 | www.rpmcnc.com

VÄDERSTAD • PROFILE

particularly diligent about keeping equipment in top shape. It doesn’t pay to operate poorly operating equipment.”

Faster and Flexible Vaderstad Industries maintains 22,000 square feet of research and testing facilities, as well as 75,000 square feet of manufacturing space, employing 150 in Langbank, Saskatchewan.

Machines are built both for dealer inventories, as well as to custom orders. Jones notes that while they are looking into robotic welding, Seed Hawk equipment is basically an assembly-line process. “The labor market is a little tight, particularly for skills like welding, but we’ve been able

to fill a number of new positions,” Jones says.

Jones is confident in continued business growth. “As part of the Väderstad Group, we can offer more products to our existing customers, as well as expand geographically. We’re particularly looking to establish dealer relationships further into eastern Canada. We consider ourselves the technology-leader, and with our established brand recognition we continue to provide innovations that help farmers work faster with increased flexibility.”

Pictured right: “An aerial view of the Vaderstad Industries facilities outside of Langbank, Saskatchewan; left: Production staff in front of the Vaderstad Industries facility.

INDUSTRY TODAY 105

PROFILE •GRUPO BONASA

After 50 years of thriving as a family-owned producer of poultry and pork, Brasília-based Bonasa found itself fighting for survival. Hired to spearhead the company’s recovery, the new CEO Alexandre Abreu talks to Michael Sommers about the challenges and changes ahead.

106 INDUSTRY TODAY

GRUPO BONASA • PROFILE

he origins of Bonasa – a leading Brazilian producer of eggs as well as live and processed chicken, pork and meat products – date back more than half a century. And yet, when asked to pinpoint the firm’s major milestones, CEO Alexandre Abreu easily narrows it down to three.

“Of course, Bonasa’s first major milestone was the company’s foundation,” he declares, referring to the creation of a small poultry hatchery by businessman Aroldo Silva Amorim, in Brasília back in 1964. At the time, the futuristic new Brazilian capital, designed by famed architect Oscar Niemeyer and urban planner Lucio Costa, INDUSTRY TODAY 107

PROFILE •GRUPO BONASA

AT A GLANCE: • Company Name: Grupo Bonasa S.A; • President: Alexandre Abreu; • Foundation: 1964; • Headquarters: Brasília; • Core Business: Producer of hatching eggs, live and processed chicken and pork; • Product Portfolio: More than160 items; • The company has had an independent board of directors since 2013.

• The company has had access to credit lines funded by international organizations since 2014.

• The company has been financially audited since 2004.

• POS centers: 35,000; • Direct Employees: 3,500.

was still undergoing construction in a remote central region of Brazil referred to by many as “the middle of nowhere”.

“Looking back it’s hard to recall how audacious it was to start a food business just as the city was coming into being,” muses Abreu. “At the time, Brasília had no infrastructure; Aroldo Amorim was a pioneer.”

108 INDUSTRY TODAY

Pictured previous spread: One of Bonasa Group’s 70 sheds for breeding birds; above: Abattoir in Aguiarnopolis, Tocantins with the capacity to process 120,000 birds a day; right top: Abattoir in Nova Veneza, Goias with the capacity to process 110,000 birds a day; right: Alexandre Abreu, CEO of the Bonasa Group; former President of Banco do Brasil.

GRUPO BONASA • PROFILE

Decades of Growth The small family business grew quickly and by 1970 it had launched Só Frango, a company that specialized in the poultry raising and processing business. Over the next two decades, the business expanded by developing partnerships with small poultry farmers and consolidating its activities from the hatching of eggs to the butchering and processing of meat. In doing so, it gradually became one of the region’s most vertically integrated players in the food industry.

As a result of this growth, in 1994, the business split into two separate companies: Só Frango, a poultry processing plant, and Asa Alimentos, devoted to the production of hatching eggs and day old chickens. Abreu identifies this move as the second pivotal moment in the company’s history.

INDUSTRY TODAY 109

PROFILE •GRUPO BONASA

Commitment to the client.

Proud partner to Bonasa.

Main office R. Carolina Florence, 641 – Guanabara – Campinas, SP +55 19 3237.3333 – e-mail: profilax@profilax.com.br Branch office Av. D. Pedro II, 1.580 – Alto Umuarama – Uberlândia, MG +55 34 3216.1492 – e-mail: profilaxmg@profilax.com.br

110 INDUSTRY TODAY

Although Asa was initially focused on producing hatching eggs and day old chickens, over time it expanded into other activities including the processing and selling of various frozen poultry cuts in addition to fresh products. In an effort to increase vertical integration, Asa invested in the production of its own feed. It branched out geographically, founding and acquiring new businesses in the neighboring state of Tocantins.

It also branched into new product lines, most significantly by adding pork and processed pork Pictured: Slaughterhouse for pigs in Sao Sebastiao, Federal District with the capacity to process 800 swine a day; right top: One of the Group’s Breeder farms; right below: Pig production unit produces 8,620 piglets per month.

GRUPO BONASA • PROFILE

products (bacon, sausage, hams, mortadella) to its already expanding mix of poultry items.

A decade later, in 2005, Asa’s expansion was such that the company created a new brand, Bonasa, under which existing and diverse new products – including pizzas, lasagnas and a whole range of prepared and seasoned cuts of meat – were sold. The company subsequently changed

its name to Bonasa Group. Having completed the vertical integration of their operations, the family business consolidated its control over the regional markets of Brasília and the neighboring states of Goiás and Tocantins while extending its reach throughout Brazil, particularly in terms of live products. In recent years, it has also initiated exports to the Asian, African, Middle Eastern, Central American and Caribbean markets.

Rise, Fall and Repercussions By 2016, business was booming for Bonasa.

The family-owned group boasted 5,000 direct and 25,000 indirect employees and reached a portfolio with more than160 items distributed via 35,000 points of sale. Then suddenly, catastrophe hit the sector. Virtually overnight, the price of INDUSTRY TODAY 111

PROFILE •GRUPO BONASA

Brazilian corn – a major source of feed for both chicken and pigs – skyrocketed from R$25 to R$60 per bag (60kg). The repercussions were immediate and brutal – not to mention perverse.

“At that time, the situation was such that the more products we produced and sold, the greater the losses we suffered,” said Abreu. “Imagine that you’re earning a good salary, and one day, all of a sudden you have to pay 120 percent income tax upon it!”

“At that time, the more products we produced and sold, the greater the losses we suffered.”

112 INDUSTRY TODAY

GRUPO BONASA • PROFILE

In order to survive, Bonasa was forced to aggressively cut production levels – which led to severely reduced revenues. Ultimately, the group reduced production by 30 percent and incurred an annual loss of R$100 million (roughly US$30 million). Although the crisis only lasted seven months – by early 2017 the price of corn had returned to previous levels – Bonasa emerged in a Pictured left and right top: Pork slaughterhouse in Sao Sebastiao with capacity to produce 40 tons of processed meat per day.

precarious state. Crippled by debts owed to both suppliers and banks, it possessed scant recourses for digging itself out of a deep hole.

Alexandre Abreu views this recent crisis as the third major milestone in Bonasa’s long history.

After all, the recession was both a game-changer and a life-changer. In order to stay afloat and pay off its debts, Bonasa’s stockholders decided to hire a non-family CEO with both great financial and managing experience to lead the company. With this goal in mind, in July of 2017, Alexandre Abreu, former president of INDUSTRY TODAY 113

PROFILE •GRUPO BONASA

A STRATEGIC LOCATION:

ourofinosaudeanimal.com

Although Bonasa began life as Brasília was just coming into existence, today the group’s location is a major factor in its dreams for the future: “As we look to the future, we see ourselves becoming a consolidating group among Brazil’s middle-sized industry players,” says Alexandre Abreu. “Bonasa’s location in the cradle of Brazil’s largest corn and soya-producing Central-West region is of strategic importance, with advantages that range from lower costs to faster logistics.”

Ourofino

Inspire to care, produce and develop.

Since the first day we knew that to conquer our space in the Market we would need to excel. With entrepreneurship we were pioneers in innovative actions in the Brazilian veterinary industry. We reinforced our commitment to continue inspiring practices and investing in integrated solutions to the pet and production animal markets.

Anuncio_Institucional_9,2x11,4cm_Ingles_1217OF01.indd 1

114 INDUSTRY TODAY

15/12/17 14:15

GRUPO BONASA • PROFILE

Brazil’s largest bank, Banco do Brasil, was hired as CEO. Before taking on the role of CEO of Bonasa, Alexandre Abreu established a prominent career in the Brazilian banking sector. Michael Sommers asked him about the surprising decision to migrate from finance to food.

MS: What motivated such a radical – and surprising – career change?

AA: That’s a good question! In reality, I had actually already left Banco do Brasil. My educa-

tion was in finance and I had worked in many different areas of the bank before becoming president. I knew it well, but I didn’t want to be in the financial market anymore. I wanted a new challenge.

MS: Why chicken and pork?

AA: Food production has always interested me on a personal level. Food is something that Pictured left: Pork sausage production line; above: Warehouse and distribution center located in the Federal District.

INDUSTRY TODAY 115

PROFILE •GRUPO BONASA

nourishes millions of people. In Brazil, so many people depend upon chicken to survive; it’s a relatively cheap source of nutrition suitable to inferior socio-economic conditions. As such, it’s really an essential product.

MS: What’s the biggest challenge of suddenly being the CEO of a food company?

116 INDUSTRY TODAY

AA: Right now the biggest challenge is to lead this business that’s facing a difficult situation to recovery. The company has placed a lot of confidence in me to turn things around and I aim to do it quickly.Tailwinds are expected in the sector ahead and I believe rebound is on track.

GRUPO BONASA • PROFILE

Pictured above: One of the Group’s four feed factories in Recanto das Emas Federal District with a capacity of 4,000 tons per week; right top to bottom: Chicken Farm; Egg processing plants in Recanto das Emas, Federal District, Riacho Fundo each processing 650,000 and 780,000 eggs per week respectively.

Forging Towards Solvency Upon his arrival, Abreu immediately and completely overhauled the company’s administration, hiring market specialists to fill 100 percent of all key positions. Led by Abreu, the new team forged an ambitious recovery plan. On INDUSTRY TODAY 117

PROFILE •GRUPO BONASA

the agenda was to increase output and revenues to their previous levels; create new debt agreements with banks in order to build up capital for operations; pay off debts to suppliers; and make the group solvent by the end of 2017.

A major part of meeting these goals involved taking a hard look at, and correcting, past inefficiencies. Says Abreu: “This was a family business with many employees who had been around for Pictured: Skewer plant, Riacho Fundo in the Federal District; right: Poultry Abattoir in Nova Veneza , Goias, Lab used for quality tests.

118 INDUSTRY TODAY

a long time, and many processes that had been around for a long time.” Examples of such inefficiencies ranged from sectors in which digitalization was inexistent to the lack of a commercial director in the sales department.

Even while Abreu has been busy restructuring, revising and revamping Bonasa, he concedes that the major ace up the company’s sleeve is its very name, and the loyalty it has garnered after so many years in the marketplace. “Bonasa is an extremely strong brand in the region and we have a really strong reputation for quality.

In Brasília, Goiás and Tocantins, our products

GRUPO BONASA • PROFILE

tion – Abreu is also planning on revamping the Bonasa brand itself to make it more competitive in the marketplace. “We want to give the brand a new face, with a design that will reflect our new phase in the marketplace and the new directions in which the company’s headed.”

Such new directions include ramping up exports – which presently represent 10 percent– to 30 percent of the business. They involve cultivating strategic partnerships with multinationA New Face – and New Directions That said, along with other strategic modifi- als specializing in genetics and nutrition, with cations – such as creating a more streamlined the aim of developing feed and animals that are business with a more participative administra- increasingly healthy and sustainable. The group are among the top in terms of market share and have a strong presence in Brazil’s northern states of Pará and Maranhão.”

“Over the past year, we never had a problem selling product,” he points out. “In fact, the only complaint we ever received was that, due to production cuts, there weren’t enough products on the shelves!”

INDUSTRY TODAY 119

PROFILE •GRUPO BONASA

also plans to strengthen relations with suppliers, to invest in ramping up production levels, and to expand its product lines, particularly related to pork and its derivatives.

Abreu appears to be meeting all these strategic challenges head-on. However, when asked 120 INDUSTRY TODAY

if Bonasa has a guiding vision, he claims that the company is currently without one. As he explains: “We entered into a phase in which we had to rapidly extricate ourselves from a crisis.

We haven’t created a new vision because we’re still in the process of rapidly recovering. First of

GRUPO BONASA • PROFILE

“The only complaint we ever received was that, due to production cuts, there weren’t enough products on the shelves!”

all, we want to return to our previous levels of production and revenues. Then it will be time to retool the group so that it becomes more efficient and possesses fewer risks. We no longer want to be at the mercy of price fluctuations. Instead, we want to grow in a sustainable manner.”

INDUSTRY TODAY 121

PROFILE •THE BID GROUP

122 INDUSTRY TODAY

THE BID GROUP • PROFILE

British Columbia-based BID Group is by far the largest integrated provider of equipment, services and turnkey solutions for North America’s forestry industry. As Michael Sommers discovers, following a tremendous growth spurt, the group is in full optimization mode as it prepares to branch out into new markets.

INDUSTRY TODAY 123

PROFILE • THE BID GROUP

hen asked how to explain the BID Group’s transformation into North America’s largest provider of equipment, services and turnkey installations for the forestry industry, Steve Dalby, the Canadian company’s Vice-President of Business Development, confesses that much of the company’s success has to do with the Great Recession – and its aftermath.

“In our industry, when the dark days hit, forest product companies really had to batten down the hatches financially,” he recalls. “Spending capital got chopped. Money for projects dried up. Many players folded due to lack of capital and planning.”

AT A GLANCE:: • Company Name: BID Group; • Chairman and Managing Director: Brian Fehr; • President and CEO: Alistair Cook; • Foundation: 1983; • Headquarters: Prince George, British Columbia; • Core Business: Integrated provider of equipment, services and turnkey installations for the forestry industry; • Facilities: 15 (British Columbia, Quebec, Washington, South Carolina); • Employees: 1,200.

124 INDUSTRY TODAY

THE BID GROUP • PROFILE

INDUSTRY TODAY 125

PROFILE • THE BID GROUP

Engrenage Provincial inc.

EBI has supported Comact with its electrical services and products since 1990 From the simple electrical installation to the major electrical engineering project requiring hundreds of miles of power and control wiring, EBI Electric steps in as a valuable partner for sawmills. From small to large turnkey projects, EBI offers:

A business such as yours deserves our congratulations for your success and strong growth.

Dry Kiln Duty Motors: High temperature Dry Kiln Duty Motors designed for hardwood and softwood lumber dry kilns since 1995.

Sawmill Electrical Installation and Project Management: turnkey projects for sawmills and the wood processing industry.

Control Panel Builder for Sawmills: 2000 control panels a year including sawmill console, motor control centre (MCC), edger, planer, stacker, log loader, trimmer, unscrambler, canter line: CSA and UL certified electrical panels.

Electrical Component Distribution: Yaskawa, Weg, Schneider Electric and Rittal products.

2250, 90th Street, Saint-Georges, Quebec, Canada, G5Y 7J7 Phone: 1-888-228-5505 / www.ebielectric.com

126 INDUSTRY TODAY

www.engrenageprovincial.com

THE BID GROUP • PROFILE

SMART 3D VISION FOR THE MILL Proudly working with COMACT for 15 years

LMI is the industry’s leading supplier of high-performance 3D scanning and optimization solutions for automatic wood grading applications in the saw and planer mill.

PROUD BID GROUP PARTNER SINCE 2005 9200 Glenlyon Parkway | Burnaby BC | V5J 5J8 T: +1 604 636 1011 | www.lmi3d.com/wood

MAC QUALITY

MAC VALUE

USA Manufacturing

Western Sales & Warehouse 1-800-663-0072

Canadian Manufacturing

Western and Eastern Sales & Warehouse 1-800-663-0072 1-877-833-1653

macchain.com INDUSTRY TODAY 127

PROFILE • THE BID GROUP

HP RATING Up to 235 HP (175 kW)

0.5in to 7in (Solid Shaft)

AL HA NDL ING

IV OT OM AUT

E

2H Gen II Heavy Duty Hydraulic Cylinders

RI TE MA

Less maintenance Optimized performance Reduced downtime

T EN ATM TRE R E T WA

Rating applies to specific products.

parker.com/GENIICanada/Sawmill

www.sumitomodrive.com 128 INDUSTRY TODAY

ANCE FORM PER

3:1 up to 658,503:1

LOGY HNO TEC

RATIO RANGE

N TIO

Up to 603,000 Ib•n (68,130 N•m)

&

C N DU ESIG RE GD VIN SA EAC ACITY CAP AD LO CE AN RM

TORQUE

CYC LOI DA LS PE UNM ED ATC HE D, L I F G E & N S HIGH LO P SH OC K T I O P N E A C L PE EX RF O

L NA IO PT CE EX

DIAMETER

UNMATC HED REL IAB ILI TY

THE BID GROUP • PROFILE

SERIOUS GROWTH SPURT In the past 5 years, BID has made 4 major acquisitions (Comact, Miller, MoCo, and McGehee), has expanded into the Southern U.S. and the Pacific Northwest, has tripled the number of its facilities (from 5 to 15) and doubled its revenues.

According to Dalby, those that did survive had to pare down and cut their overheads. As a consequence, when business finally picked up again and there was new demand to upgrade machines, there wasn’t enough support in the system to do all this work. “And that’s where we came in.”

Growth and Acquisitions The BID Group had started out as a father-son Les Équipements

INC

YGE inc.

Producing filing Equipments since 1998

Guide dresser Model 301

outfit in 1983, when Ike Fehr and his two sons, Brian and David, formed a construction company in Vanderhoof, a small town in the heart of British Columbia’s interior. Initially, the firm provided services and repairs for sawmill equipment. Over the years, it expanded into construction, installation and some fabrication.

By the time the 2008 recession hit, the group Comact impacts all four corners of North America.

YGE’s team wants to congratulate BID Group for their success!

It is a pride for us that our products are part of their projects.

PLP saw lubrication panel

For further information, contact us at : 418 337-2177 - www.ygeonline.com INDUSTRY TODAY 129

PROFILE • THE BID GROUP

Reliable, efficient PeRfoRmance.

Timken® Type E Housed Unit

Timken® Revolvo Split Block Housed Unit

Timken® Spherical Roller Bearing

Timken® Solid Block Housed Unit

Drives® Engineered Class Chains

The Gold Standard for Performance

Titan chain offers the ultimate in extended wear-life. ™

When it comes to critical applications, reliability is everything. But not just any chain can withstand the nonstop stress of high speeds and harsh conditions. That’s why Tsubaki designed its Titan chain to deliver superior durability in challenging environments. Specially coated pins, solid lube groove bushings* and a patented ring-coining process increase fatigue strength while minimizing wear. The result is a significantly longer wear-life, even in extreme environments.

So go on, hold your chain to a higher standard — the Titan gold standard.

To learn more, call 800.263.7088 or visit tsubaki.ca *Lube groove bushings available in sizes 80–140.

had already made the first of many strategic acquisitions. In 2006, it had purchased DelTech, a leading designer and constructor of industrial plants, also based in British Columbia and specializing in energy solutions for the forestry sec-

ROLLER CHAINS • ENGINEERING CLASS CHAINS • BACKSTOPS • SPROCKETS • CABLE & HOSE CARRIERS • POWER TRANSMISSION PRODUCTS

A log wave feederTM, one of over 600 in operation worldwide.

Total Package TSUBAKI.CA 16-TCL-0019_ad_Titan Print Ad Resize for Canada_MRO_5.875x 7.875_v2.indd 1

130 INDUSTRY TODAY

11/22/16 9:00 AM

THE BID GROUP • PROFILE

tor. The acquisition was part of a plan to transform the BID Group into a uniquely integrated company offering turnkey solutions to the forest industry. In the aftermath of the recession, when business began to boom, BID was the only player in the marketplace able to conceive of, design, build, and deliver a complete fully-working mill.

The group shrewdly leveraged its growth with further acquisitions. In 2013, it purchased Comact, a North American leader in the design, manufacture and optimization of wood processing equipment and PLC/Controls for mills, headquartered in Quebec, which had itself just acquired PHL, another Quebec-based INDUSTRY TODAY 131

PROFILE • THE BID GROUP

“Others are trying to do it.

But nobody else is doing it like we’re doing it.” producer of sawing and planing equipment.

Two years later, in 2015, it purchased Miller Manufacturing, a specialist in state-of-the-art planing systems, located in Washington state.

These, and more recent acquisitions, have given the BID Group a degree of integration, unrivalled in the North American market.

“Others are trying to do it,” confesses Dalby.

Pictured: Comact provides the wood industry with high-performance equipment and superior services.

M. DRIVESHAFT HD IS A PROUD PARTNER OF THE COMACT TEAM FOR INNOVATIVE SOLUTIONS TO DELIVER A FIRST CLASS PRODUCT.

Best wishes for many more years of success.

M. Driveshaft Inc.

275 Quinlan, Lasalle, Qc H8R 3W4 1-877-363-1821 - www.industrieshd.com

132 INDUSTRY TODAY

“But nobody else is doing it like we’re doing it.”

Dalby speaks from experience. Before joining BID, he worked for Comact’s “Number One competitor” and admits that “we’ve never, ever

THE BID GROUP • PROFILE

seen anything like this in the industry.” Dalby compares the traditional process of constructing a sawmill to the hiring of different tradespeople in order to build a house.

It used to be that a mill would contract separate firms, designers, engineers, project managers and then juggle them all. The BID Group breaks with this tradition by offering clients a INDUSTRY TODAY 133

PROFILE • THE BID GROUP

single price for a whole project. In return, they receive a working mill in full operation, with all the equipment designed and manufactured

by BID’s stable of companies – and start-up and after-sale service to boot. Says Dalby: “Our success is really a result of the synergy we have between these different specialists; from design and engineering to the staging of deliveries to meet on-site demands.”

134 INDUSTRY TODAY

Such synergy translates into very real gains, in terms of logistics as well as time and money. It means that pieces can be manufactured at one of the group’s facilities and delivered in finished form as opposed to built on-site. Such advantages drastically reduce construction and installation time and allow mills to start-up much more quickly.

“We’ve seen projects that take up to 50 percent

THE BID GROUP • PROFILE

INDUSTRY TODAY 135

PROFILE • THE BID GROUP

136 INDUSTRY TODAY

THE BID GROUP • PROFILE

less time to complete between conception and hand-off,” admits Dalby. “And when modular equipment shows up at the site, the benefits include cost savings that show up in total project costs. With this in mind, we’re always looking for ways to maximize effectiveness in terms of the relationship between supply and installation.”

Interestingly, much of BID’s effectiveness can be traced back to the group’s origins, when the Fehrs worked in British Columbia’s sawmills, doing repairs and installations. “The mentality and experience of working on the mill floor, the sense of urgency and priorities involved, has driven processes to become particularly quick and efficient,” explains Dalby.

Regional and Cyclical Demand Such practices have won the group accolades – and contracts – throughout Canada and the United States. With manufacturing locations in British Columbia, Washington state, Quebec and South Carolina, the group has created a strategic, four-corner presence embracing the main sawmilling regions of North America, while significantly lowering the total costs of delivery that accompany the building of a mill.

At the moment, business is particularly booming in the Southeast U.S., where the forest industry is undergoing unprecedented growth.

“There’s a tremendous amount of work in the Southeast forest industry, the likes of which we’ve never seen before,” exclaims Dalby. “Much of the technology was fairly antiquated and there’s

SAME LOG, MORE WOOD “The technology is always driving to increase lumber recovery, to extract more high quality wood from the same log.

We’re always looking at how can we do this more efficiently, while achieving better quality wood; for this reason, we put a lot of money into R&D.” – Steve Dalby, VP Business Development

“We’ve seen projects that take up to 50 percent less time to complete.” been a strong movement toward retooling and upgrading. Major forest production companies, including many from Canada, have bought and built operations in the region. It’s been become such a major focus for us that we built facilities in St. George, South Carolina, so we could hire locally and service the market from within.”

Indeed, in terms of business, the Southeast is currently as strong as, and in some cases stronger than, the combined rest of the North American market. Its growth has certainly been an important factor in the BID Group’s own remarkable growth spurt, which has seen revenues more than double within the past 5 years. And yet, because it’s keenly aware of the cyclical nature INDUSTRY TODAY 137

PROFILE • THE BID GROUP

of the forestry industry, BID is already preparing to branch out into new regions – and markets.

“Our customers are in a commodity-based environment, which creates a lot of challenges,” admits Dalby. “There may be a point in which Western Canada is retooling less than the Southeastern states. All we can do is to stay out in front, and plan and react appropriately.”

138 INDUSTRY TODAY

In the short-term, this means meeting demand as best it can while maintaining high-level products and solutions. In the mid-range, it means finding ways to maintain business at levels that allow its workforce to remain consistent and growth to continue unhampered by the effects of a cyclical industry. As the group looks to the future, it is exploring alternatives to sawmilling

THE BID GROUP • PROFILE

May of 2017, BID took on an equity partner, Highland West Capital. And in June, it added another equipment supplier to its roster: MoCo, a leading manufacturer of sawmilling equipment, specializing in stickering lumber stackers and stick recovery systems, based in Spokane, Washington. “Because we’re already fully integrated, when it comes to future acquisitions, there really has to be a compelling strategic advantage,” explains Dalby.

Indeed, having experienced such massive rates of growth over the past few years, BID is now content to maintain incremental growth while focusing its energies on optimizing operations.

“While we’re developing strategies to translate our success in North America to international markets, we won’t engage until we’re comfortable that we have the capacity to expand,” confesses Dalby. “Until then, we want to service the clients we have, providing them with the best and most complete range of turnkey solutions possible.”

such as CLT, panel plants and other industries.

It is also studying overseas markets.

Optimization and Expansion With these plans for expansion in mind, in Pictured; OLI-CS3 optimized infeed, short enough for any installation; Comact engineers offer solutions for every need.

INDUSTRY TODAY 139

PROFILE •AUGUSTA FIBERGLASS

140 INDUSTRY TODAY

AUGUSTA FIBERGLASS • PROFILE

Augusta Fiberglass Coatings, Inc. is a world leading manufacturer of custom designed and fabricated fiberglass reinforced plastic tanks and equipment.

David Soyka reports on this South Carolina-based company’s future growth.

INDUSTRY TODAY 141

PROFILE •AUGUSTA FIBERGLASS

f you’re looking for an example of a Made in America company that exemplifies the American tradition of hard work, employee dedication and loyalty, commitment to customers and continuing innovation, look no further than Augusta Fiberglass Coatings, Inc. “This is a company that literally started from nothing,” says a company spokesman who, along with John Boyd, the founder of Augusta Fiberglass participated in the interview with our reporter. “In 1974 it had one owner, one employee, and one pickup truck.”

Today, Augusta Fiberglass has the same owner— John W. Boyd—but now employs more than 230 workers, engineers and craftsmen to design and fabricate customized fiberglass reinforced plastic (FRP) tanks and equipment. Augusta Fiberglass annually converts millions of pounds of resin and fiberglass fabric into custom-made fiberglass tanks, ducts, scrubbers, stack liners, and other equipment. Moreover, to accommodate continuing growth, the company is investing $625,000 on a 12,000 square-foot addition to its more than 300,000 square feet of manufacturing space located at its Blackville, South Carolina headquarters in Barnwell County. The expansion will add 12 new jobs.

Pictured previous spread: One of the world’s largest fiberglass vessels 119’ diameter and more than 50 feet tall. Built for the power industry by Augusta Fiberglass; right: 22’ Internal Diameter scale FRP duct project fabricated and installed by Augusta Fiberglass.

142 INDUSTRY TODAY

AUGUSTA FIBERGLASS • PROFILE

INDUSTRY TODAY 143

PROFILE •AUGUSTA FIBERGLASS

baysidesales@comcast.net

144 INDUSTRY TODAY

baysiderubber@comcast.net

AUGUSTA FIBERGLASS • PROFILE

Company founder John Boyd views this most recent expansion as a continuation of what AFC has been doing from the start. “It’s always been about the future, we are always looking for the next challenge Boyd says” Over the years, Augusta Fiberglass has overcome a number of challenges and since the company’s inception has recorded a number of firsts, both in the size of the vessels it fabricates as well Pictured left: Augusta Fiberglass Home office and plant in Blackville, South Carolina; above: Stack Liners for the Power Industry fabricated by Augusta Fiberglass.

as the development of technological innovations.

In 1978, the company designed and fabricated one of the first fiberglass chlorination towers and in 2007 completed the largest FRP column in North America, to cite just a few of Augusta Fiberglass’ many accomplishments.

Among Augusta Fiberglass accomplishments are the massive units designed and fabricated for the power industry. These successful projects include more than 11 miles of stack liners weighing more than 20 million pounds; seven of the world’s largest Jet Bubbler Reactor fiberglass vessels weighing more than 1 million pounds each, INDUSTRY TODAY 145

PROFILE •AUGUSTA FIBERGLASS

measuring from 108 to 119 feet in diameter and standing more than 50 feet tall. All together Augusta Fiberglass has provided the power industry with fiberglass vessels and liners that weigh more than 26 million pounds.

In 1995, Augusta Fiberglass was authorized by the American Society of Mechanical Engineers (ASME) to design, fabricate and code stamp

“Augusta Fiberglass is a niche business with customers in a variety of industries. Because of our expertise and experience, we can expedite fabrication and delivery that is unmatched.

Our ability to deliver-ontime is one of our key competitive differentiators.”

146 INDUSTRY TODAY

RTP-1 pressure vessels. Only a few years later, ASME authorized the company to fabricate and stamp RTP-1 vessels in the field anywhere in the world “We’re one of the few fabricators to have the RTP-1 authorization,” Mr. Boyd points out.

“Even for customers who don’t require that stamp on their tanks, they can be confident that they are getting the same people with the same high level expertise that is mandated by the ASME standard. In addition, we can set up shop anywhere in the world and provide the same Pictured left: Fiberglass Hoods, John W. Boyd, Founder and President of Augusta Fiberglass; right: Installation of a fiberglass breech for the power industry.

AUGUSTA FIBERGLASS • PROFILE

engineering and manufacturing quality that we do from our facilities in South Carolina.”

Specialized equipment and techniques unique to Augusta Fiberglass allow field fabrication and field assembly of very large vessels.

Dual Laminate Capability In 2010, Augusta Fiberglass acquired B&D Plastics based in Ocean Springs, Ms., A world leading fabricator of dual laminate vessels in the world. Shortly thereafter it expanded the site to to increase its capacity to produce fiberglass and dual laminate products. “Dual laminates significantly improve the corrosion resistance of plastics,” Tom Reeves, the chief operating officer of B&D Plastics explains. “When the corrosion resistant inner plastic liners are structurally reinforced with an outer shell of fiberglass, you have a lightweight and economical alternative to high-cost metal alloys. The flexibility of plastic allows you to customize molds for just about any use, including storage vessels, sump covers, tower tops, ducts and scrubbers.”

In 2015, B&D Plastics successfully met the ASME standards and became an ASME RTP-1 authorized dual laminate fabricator and an ASME RTP-1 authorized fiberglass fabricator making B&D Plastics one of only 2 fabricators in the world to hold this dual authorization.

More recently, Augusta Fiberglass acquired property in Angleton, Texas with an eye towards developing a manufacturing site to serve the western U.S. “By being closer to our customers INDUSTRY TODAY 147

PROFILE •AUGUSTA FIBERGLASS

“Even for customers who don’t require an RTP-1 stamp on their tanks, they can be confident that they are getting the same people with the same high level expertise that is mandated to have such a demanding certification.”

John Boyd. in the west and mid-west, we can both expedite shipping time as well as save on transportation costs.”

Serving the customer is paramount at Augusta Fiberglass. “We are a niche business with customers in a variety of industries,” Boyd says.

“Because of our expertise and experience, we can expedite fabrication and delivery at a speed that is unmatched without sacrificing quality.

Our ability to deliver-on-time is one of our key competitive differentiators.”

Boyd adds that, “We don’t spend any time worrying about what our competitors are doing.

We keep our attention on what the customer needs and how we can best satisfy those needs.

Pictured: A 20’ dual laminate tower produced by B&D Plastics, Augusta Fiberglass’ sister company.

148 INDUSTRY TODAY

AUGUSTA FIBERGLASS • PROFILE

Everything else falls into place.”

Custom to Any Market Augusta Fiberglass does not sit still in certain markets. “Years ago, the coal fired power plants were big customers for us. But today coal isn’t the industry it was. Same with the paper industry. Today we’re doing a lot of work for the chemical and petrochemical industries. Since we’re a custom business, we’re not industry-focused and we don’t depend on any particular market segment,” Boyd says. “We continually create new processes using patented innovations that often represent firsts in fiberglass fabrication. No matter how large or small, Augusta Fiberglass brings world class engineering to each project and offers unprecedented capacity to produce quality, complicated projects at the speed modern industry demands, without sacrificing quality or safety. Augusta Fiberglass quality products satisfy a sophisticated worldwide need for solutions to problems that face virtually every industry sector in the world. Companies that must handle or store caustic or corrosive chemicals or which need complex duct systems look to Augusta Fiberglass to provide the FRP products they need. That’s how we as a company continue to grow.”

Happy Company Mr. Boyd points out that the people who work for the company have grown with it as well.

“We have many third generation employees. In INDUSTRY TODAY 149

PROFILE •AUGUSTA FIBERGLASS

addition to experienced FRP workers and supervisors, we have a staff of highly skilled engineers with decades of experience who perform manual calculations as well as those that require computer assistance, and have the knowledge and skills to perform finite element analysis. Our drafters

use AutoCad and Solid Works for 3D. Our customers can be confident that they are getting the very best professionals and craftspeople.”

Dedication to safety also contributes to company morale. “Safety is the most important consideration in everything we do”, Mr. Boyd stated.

PARTNERING WITH SOUTH CAROLINA: “You can’t find a better place to do business than in South Carolina,” Boyd says. “At both the state and local levels, government is there for us, listening to what we need and working with us to achieve it. And, for us, it’s a two-way relationship. If the government has a regulation we need to comply with or something they need us to do, we do it.”

150 INDUSTRY TODAY

AUGUSTA FIBERGLASS • PROFILE

Such dedication results in what Boyd terms a happy company. “Loyalty to and from employees is a hallmark of the effort at Augusta Fiberglass. Employees who started in the early days of the company and worked for decades on our projects have passed the torch to their adult grandchildren who continue to meet and exceed the high standards set by those who have gone before them. Together, we look forward every day to solving customer issues with innovative products built to the highest quality standards.”

Pictured left: Complex duct and process vessels; right: An FRP process vessel.

INDUSTRY TODAY 151

ADVERTISER’S INDEX

VOLUME 21 • ISSUE 1

A Austin Tri-Hawk Automotive, Inc................................ 79 B Bay Side Rubber & Products ................................... 144 Berry Plastics.............................................................OBC D Diemo Machine Works Inc......................................... 96 E Engrenage Provincial inc. .......................................126 EBI Electric..................................................................126 F Fastener Warehouse Ltd.............................................98 H Heritage ......................................................................74 Hi-Tec Profiles Inc.........................................................98 J JCA Electronics.........................................................104 L Lee Adcock Construction........................................ IBC Les Equipements YGE Inc.........................................129 LMI...............................................................................127

M Mac Chain Co. Ltd...................................................127 M.Drive Shaft Inc.......................................................132 O Ourofino.....................................................................114 P Parker..........................................................................128 PolySell........................................................................108 Profilax Saude Animal...............................................110 R RPM Machining Ltd...................................................104 S Sumitomo Drive Technologies................................. 128 T The Carlstar Group......................................................96 Timken........................................................................130 Tsubaki........................................................................130 U Unisource................................................................... IFC

IBC – Inside Back Cover IFC – Inside Front Cover OBC – Outside Back Cover

www.berryplastics.com/

152 INDUSTRY TODAY

www.unisourceworldwide.com www.leeadcock.com/home

A universe of possibilities

“We Build Our Reputation from the Ground Up”

Since 1989, we have built and continue to build our reputation with every job we perform.

As a success driven, customer oriented company we offer: • A Commitment to Excellence • Quality Workmanship • We are safety conscious in all aspects of our work • We are 100 percent reliable We are proactive in the way we address your construction projects because we streamline and coordinate the process. We pride ourselves on the fact that many of our customers are repeat customers or referrals. Please give us the opportunity to earn your business by contacting us.

Kent Holt Lee Adcock Construction Vice President of Operations Office: 931-684-1771 / Mobile: 931-580-2194 Fax: 931-684-4044 email: k.holt@leeadcock.com