American Industry: Stark Manufacturing
When CoBe Capital bought the business from Dover, Stark Manufacturing was burning through a quarter-million dollars a month. They had a sea of customers, both original equipment and aftermarket, but just ten customers represented 90% of sales. The former management team, which had a career in the automotive aftermarket, believed that smaller customers added capabilities and diversified the customer base, but in reality they were unable to develop this business profitably. CoBe Capital needed to stop the bleeding.
The first step was to look at customers, account by account, and shed all the low or negative margin business. CoBe Capital hired new management that were experts at production and operations. This allowed Stark to then right-size the organization and reduce costs to win more business from bigger customers.
"We went from a people-intensive process to an engineered process utilizing all the tools, skills and equipment available," said Neal Cohen, Founder and Managing Director of CoBe Capital.
To ensure the sustainable implementation of best-in-class lean manufacturing practices, CoBe Capital appointed a new management team to take the reins. One example of their transformational approach to the business was replacing a labor intensive step-by-step quality control process with a more streamlined approach focused on final inspection rather than work-in-process.
The organizational skill-set was so low that Stark Manufacturing was not fully taking advantage of the automation capability in place. After Topgrading the management team, Stark Manufacturing was able to retrain the operators on new processes to dramatically increase labor productivity.
"Once we got our manufacturing operations streamlined, we had the ability to add volume through automation and we were able to confidently sharpen our pencil and be that much more competitive on our quotes for new business," said Mr. Cohen.
Stark Manufacturing is now focused on adding process engineers who will further optimize production to keep the equipment running with the same staffing. Developing more efficient batch sizes, production flows and changeovers, where the first part meets spec, are all contributing cost savings as Stark Manufacturing continues to move its portfolio from raw components to finished assemblies and lay a foundation for the future growth of this American Manufacturing success story.
About Stark Manufacturing
Stark Manufacturing is a leader in the design, manufacture, machining and fabrication of connective tubular flow solutions. Its capabilities include aluminum, steel, and copper tube and hose assemblies for a variety of industries, including automotive, aerospace, agricultural, heavy duty and military. The Company’s processing capabilities include bending, brazing, tube forming and assembly, and production of machined parts and fitting. It manufactures both high and low pressure products.
To learn more about the business, please see our operating company page for Stark Manufacturing.