David is joined by John Greene to discuss what’s important to foundry buyers and sellers in today’s economy.
About this segment of Blackbird TV
Recorded: September 28, 2020
Published: March 29, 2021
John Greene from FL Sales in Cleveland Ohio. Let’s talk a little bit about what’s important to your clients, either your sellers or your buyers. Well I mean, so let’s talk in general terms. What we found is, and I go back, I used to work for my father in the same industry back in the ’70s, when I got out of school, and back then and we talked about this a lot of different people over the years, a foundry would have a maintenance staff of 25 to 30 people. [How big a foundry?] A normal, medium-sized foundry. [Ok that just sounds like a large maintenance staff, to me, that’s why I asked.] Well, and this is the point: What would happen is they would come to my father’s warehouse and say, “Earl, I don’t want you to touch the machine. I want to know where the problems are. I want to know where the leaks are, and we have a big enough staff, we’ll buy it just as it is we’ll take it back and we’ll do the work to it.” Now, we’re much leaner operations, the same foundry might have a staff of five or six people [okay] they’re working 24/7, they’re busy as hell. So they’ll come in and they’ll say, “John I don’t want to see the leaks, I want you to bring that machine clean it, paint it, repair it, and have it ready to be set on my floor,” so it’s forced us as a company to go from just selling as is, to doing what we call reconditioning. We don’t do any rebuilding, we do reconditioning, we’re you know typically we’ll we’ll strip a machine down we’ll sandblast it we’ll clean it we’ll paint it we’ll put it back together, we’ll replace any worn parts, and we’ll give the guy a warranty on it. So he knows he can take that machine and put it right on his floor, plug it in electrically, and he’s ready to go. [Do you think that that’s a change in management style, or is that because people have thinned down their staff? What drove that change?] Well I think it’s a combination of both, you know you’ve got automation, which has helped dramatically in foundries, you have to remember this is what a lot of people don’t realize the average pay scale for a foundry worker—not the maintenance guy—is 14 to 17 bucks an hour. [Wow.] Well you can go to McDonald’s or Amazon for 15 bucks an hour, so who wants to go into a dirty dark foundry where you’re lifting heavy weights, and doing that kind of labor? So they’re having a very very tough time finding labor for their foundries. We have one customer up in in Michigan who’s been a good customer for a long long time, and he has gone to Puerto Rico and brought back hundreds of people, houses them, feeds them, buses them to the plant, just so he can get workers. [Wow, that’s fascinating stuff, and I don’t think that it’s necessarily limited to the foundry industry. I think that finding, you know, good hard workers in jobs that may not be glamorous, that don’t pay a lot of money, is a real challenge, and I know that when when we do appraisal work, and we’re in many many different industries, and many different factories, 9 out of 10 times—and it’s been this way for years and years—one of the single largest challenges for the people that we talk to is finding good employees that are trustworthy and work hard.] And qualified! That’s the key. [And qualified. John Greene, FL Sales, Cleveland Ohio, thanks for your time this morning!] Thank you, David.