Startup Takes 21st Century Approach To Business
Starting a new machine shop takes persistence and dedication. Although the founder of this startup had no shortage of either, he was aided by an online sourcing platform that eased the process of finding work, building relationships with customers and establishing a reputation for quality.
Once upon a time, the enterprising machinist would take a leap of faith and start a fledgling business in the garage. With any luck, the entrepreneur would connect with a few local manufacturers and build clientele until the new company was on solid ground. The rules were simple, and the playing field was usually a 50-mile radius from the machine shop
Enter the Internet, and these 20th-century business rules might no longer apply. A case in point is the experience of Brent Long, who founded Maryland Machine in his garage, just like his entrepreneurial forebears. His approach to soliciting business for the Baltimore-based shop, however, was markedly different. To date, more than 70 percent of the shop’s customers—some of which are based more than 3,000 miles away—have been located through MFG.com, an online marketplace designed to connect buyers and sellers in the manufacturing industry. By providing an easy way to find work, build customer relationships and market his capabilities, the service has been a key factor in Mr. Long’s success.
After vocational school, Mr. Long worked for 25 years as a machinist making parts for NASA, NRL and other manufacturers in the Washington, DC area. Nonetheless, he always wanted to go into business for himself. In fact, he undertook one project on his own while working for his last employer. An avid remote-control helicopter enthusiast, Mr. Long designed a new turbine fan to replace a model that made his helicopter vibrate. He purchased a CNC machine to build it in his garage, and the project was a success—he sold the fans via a hobbyist Web site for three years before the manufacturer of the remote control helicopter remedied the issue in its standard models.
Using that garage-based machine as a sole means of making living, however, was a different matter entirely. As a one-man operation, getting the word out about a new business would have been challenging to say the least. When he learned about MFG.com through an e-mail from a colleague, he saw an opportunity. "It made me confident enough to make the investment required to get started," Mr. Long explains. "I probably wouldn’t have tried to start my own business without it."
Mr. Long signed up for the service and took the plunge just one year before the current economic downturn. Two weeks later, he netted his first contract from MFG.com, a job that provided enough revenue to pay for the first year’s membership to the online marketplace. Since then, Maryland Machine has moved out of Mr. Long’s garage into a 3,000-square-foot facility and added a number of new CNC machine tools. Mr. Long does the programming and runs the business, while a new hire helps run the machines. His equipment is paid off, and the shop has successfully surpassed the two-year milestone—a point at which most new companies tend to fail.
Maryland Machine’s specialty is high speed, light-duty milling and turning in aluminum and plastic as well as exotic steels and super alloys. Most of the jobs the shop pursues through MFG.com involve prototyping and aerospace work—the more challenging, the better, Mr. Long says. Especially with its recent equipment purchases, including two Fanuc Robodrills and a Haas mill with fast cycles, the company is well-equipped to machine high-tolerance, complex parts from materials ranging from aluminum to exotic steels and super alloys.
MFG.com is designed to connect industrial buyers with contract manufacturers at the exact moment the buyer has a need and the supplier has the capacity to fill that need. While suppliers like Maryland Machine pay a yearly subscription fee, buyers can use the service at no charge. Subscribers include shops of all sizes working in more than 300 manufacturing categories, including machining, fabrication, molding, casting, extrusion, forging, stamping, assembly and more.
Mr. Long says the service is intuitive and easy to use. In fact, he was able to begin quoting on jobs within a few hours of signing up. From a personalized "dashboard," he can track the progress of pending bids and view all open RFQs that fit his chosen criteria, such as jobs requiring turning or five-axis machining. Each RFQ typically contains a CAD drawing or solid model of the part, as well as the phone number, address and other information about the prospective customer.
As a small operation, Maryland Machine benefits significantly from using MFG.com as a marketing and sales vehicle, Mr. Long says. The sourcing platform essentially frees time for him to focus on making good parts. "I am an expert machinist, and that is where my value is," he explains. "I am not a good salesman, and I didn’t know that until I tried. I can spend 15 minutes at MFG.com and see which jobs fit us well."
Additionally, all subscribers receive a profile that lists their capabilities, certifications, contact information and more, including pictures and video. This complements Mr. Long’s own Web site and provides an additional tool to draw attention to the business. "When people search ‘Maryland Machine,’ they’ll see that page," he explains. "They can see the last 40 customers with which I’ve done business and the ratings they’ve given me for quality, price and delivery. I’ve had a lot of people find me through that site and decide I’m a good shop with which to start doing business."
That rating system goes both ways, and is a key factor in how Mr. Long decides which RFQs to pursue. "We try a lot harder to get business from higher-rated prospects—we know we’ll get paid," he notes. Each buyer’s profile also shows how many parts it has sourced, which suppliers have bid on those jobs and how much each supplier was paid, with the latter information laid out in a line graph. Mr. Long says this helps him tell the difference between worthy prospects and those that are simply looking for the lowest possible quote.
While MFG.com was invaluable in getting Maryland Machine off the ground, Mr. Long emphasizes that the sourcing platform is, in essence, a tool. As such, its benefits depend on how it is applied. For example, while the platform provides an easy way to locate work, Mr. Long typically puts in extra effort to pursue the jobs he really wants. This involves researching the potential customer, making phone calls and other efforts geared toward establishing a relationship, as opposed to bidding solely online. He also closely examines contracts lost to other suppliers to learn what he might do differently in the future for a higher likelihood of success.
Based on his experience, Mr. Long offers some advice for making the most of the matchmaking service for shops that might consider subscribing. "The key word is persistence," he says. "Don’t go too low—charge what you need to run your business, and you will eventually filter out a good customer or two. It takes time and it takes a lot of things to line up right. If you’re persistent, you can establish a relationship. Don’t get discouraged when you don’t win every single job."
In the case of Maryland Machine, that persistence has paid off—despite a dismal economic environment. "We’ve doubled in size since we started, in large part due to MFG.com," Mr. Long concludes.