Experience Plays a Key Role for Insourcing

Posted on Thursday, September 24, 2020

By Sheila LaMothe

For the better part of a year, a light line drawing of a powder coating system was on display in the office of Dave Larsen, president and CEO of Larsen Manufacturing. Not one to rush into a new venture, the drawing served as a subtle reminder for Dave to assess, and reassess, bringing the process in-house. PCT had the opportunity to talk with Dave, along with Jim LaCroix, vice president of operations, about their journey into the world of powder coating. 

After looking at the drawing in your office for months, what was it that brought you to pull the trigger to bring powder coating in-house?
Dave Larsen: Larsen was founded in 1999 as a metal stamping company. Around 2008, we added fabrication to our capabilities. Just being around the industry I learned the importance of powder coating and ultimately realized it was the most difficult outside process to handle. We regularly struggled to get parts back from our vendors on time and too often parts were damaged. Add to that, many of our customers wanted to work with a fabricator with paint capability. There aren’t many fabricators our size that powder coat, so we were trying to compete with the big guys, and we could not match their prices with outsourced quotes. Frankly, outsourcing this process was negatively impacting the entire Larsen organization. To be competitive, we had to bring it in-house. So, we did our homework, created the necessary space and, in 2017 we got the ball rolling.

Did you have a project team that spearheaded this effort?
Dave: During the research phase of this project, I spoke with a number of our powder coating vendors and related suppliers. One of our suppliers connected, or should I say reconnected, me with Glenn Harris, an installation engineer. Glenn helped us with another project in the past and has a broad knowledge base which includes powder coating. Initially Glenn and I worked on the project, but with the management of day-to-day operations taking most of my time, I needed additional support. Jim LaCroix, our VP of operations, stepped up and became the acting business unit director for the Specialty Division. He worked closely with Glenn on the setup of the line. In addition, Mike Booge (Jim’s right-hand guy) was given the opportunity to become the powder coat manager and was instrumental in setting up the infrastructure to support the system. Frankly, without Glenn, Jim, and Mike this project would have been far more difficult.

What special considerations or requirements did you have for the new system?
Dave: We wanted to keep the infrastructure changes to a minimum. We didn’t want to knock down walls in order to accommodate the system. It needed to be designed around the working space we had. We knew that we were going to purchase a new system. By purchasing everything new we could meet all of our needs and take advantage of the latest technology. We also felt that by going with a new system, the training would be easier. Lastly, we wanted to have the reliability only a new system would offer.

Jim LaCroix: Protecting the environment is important to Larsen, so it was important to us that the line be as eco-friendly as possible. We also have some customers that prefer working with eco-friendly suppliers which could create additional business opportunities. This led to the implementation of a pretreatment system that does not use iron phosphate. We are ISO 9001 certified and this approach better positions us to pursue ISO 14001 in the future if desired. Plus, the industry is headed in an eco-conscious direction, so we figured why not do it from the start.

Tell me a little bit about the system you ultimately decided on.
Jim: It’s a custom system, built by Eaton, with a five- stage washer. While it can accommodate automatic guns, we currently only use manual guns and spray-to-waste. Our application process takes place in a clean, separated environment using only virgin powder.

What is the reason for the virgin powder, spray- to-waste approach?
Jim: In the fabrication world it is typical to have high variety, low volume production. This rings true with our business and translates to a lot of color changes and setups on the powder coat line. With our current book of business, we do as many as five color changes per day. For now, this approach works for us.

It seems in selecting a system the team was not solely focused on the needs of today. Was there a general philosophy to choose a system taking into account potential future needs?
Dave: Yes, we designed the system to be expandable. We’ve already made a few changes and as we gain more volume, we expect to add automated guns,  automate  the line as much as possible, and increase the size of the powder booth. That said, I think we will always have a need for manual guns because, as Jim noted, we need to be able to make quick color changes, multiple times a day.

Jim: In addition to powder coating the fabricated components we make, we have some paint-only work and are looking to expand this part of our business. That could very likely influence future system needs. We have the infrastructure in place for higher volume, longer runs. And in terms of the powder booth expansion, since we are fabricators, we have the expertise to build our own extension in-house when we are ready.

Were there any specific challenges you faced during this process?
Jim: In addition to learning how to quote the powder coating process, reverse engineering legacy parts that were previously powder coated externally was probably our biggest challenge. We decided to use one of our mainstay products (a steel strapping cart) as our test case. This not only required a lot of outsourced powder coating, but also incorporated just about all of our other capabilities. We had some understanding of the fixturing and coating process because we saw it done at our former coating vendor. By reverse engineering this part, it actually assisted with designing our powder coating line capability.
As it turns out, this process illustrates our reasoning for getting into powder coating. We had to build custom carriers for our trucks to transport the parts to the vendor to be painted. With 208 units per 53-foot truck, it took eight to nine working days to get a full truckload of finished parts back. By powder coating in-house we now produce a truckload of components in less than 24 hours. And, since we fabricate, assemble, paint, and package the product under one roof, finished product goes directly into stock at the customer facility.

Did you encounter any surprises?
Jim: Believe it or not, not really. We went from initial trials and start-up to full production in about four weeks. We had very few issues with the equipment—kudos to the manufacturer.

To what do you attribute such a smooth installation?
Jim: Investing in an experienced installation engineer was an integral part of our strategy and success. One might assume this would be a costly venture, but in the long run I believe it actually saved us both time and money, and since time is money, I guess it saved us money and money. In  terms of specific timing, we began working with Glenn in October of 2017 and the line was operational in April 2018— that includes the four-week startup I already mentioned. Glenn served as liaison between us and the system manufacturer. He ensured we were dialed in on the front end by working with the engineering teams, being involved in drawing reviews, leading building prep and ensuring the line fit the allocated space, attending milestone meetings ,and more. Not only is Glenn fully versed in developing and installing new powder coating lines, he also has experience with automation, PLC, programming, etc., which proved beneficial on the back end when we fired up the system. He was able to read error codes and debug issues. Of course, it didn’t hurt that the line cooperated at startup.

Playing ‘Monday morning quarterback,’ is there anything you would have done differently?
Dave: Just one thing—I would have made the line speed faster. I didn’t realize we could do that. Our system isn’t slow. We are at industry standard, but I’ve since learned others can coat at 15 to 20 feet per minute. It would have required us to increase our overall footprint to support larger ancillary equipment, like ovens. We had the necessary space, it just would have required additional changes to the building. Something I would have seriously considered.

How has bringing powder coating in-house impacted your business?
Jim: Bringing the process in-house has positively impacted several aspects of our business. For example, we have decreased lead times to two of our largest customers by as much as 50 percent. In addition, we are now able to quote more value-add business, and we have complete flexibility to do R&D work in conjunction with production runs.

Do you have any advice for others who may be considering bringing powder coating in-house?
Dave: Surround yourself with good people who understand the powder coating industry. Identify a good project manager to lead the effort internally. I’m fortunate to have a guy like Jim who has been with us for 15 years. I’d also recommend engaging a good consultant.

Jim: Lean on your suppliers as they have a wealth of knowledge. Do your homework and hire good people to support and operate the line. They are key to your success.

One last question. Larsen Manufacturing joined PCI in June of 2018, just after startup of your powder coating operations. What was your reason for joining?
Dave: We want to better understand the industry, keep on top of technology, and be part of the powder coating community. PCI membership affords us the opportunity to do this along with the ability to share experiences, develop new relationships, and network. We are in this for the long haul.

Sheila LaMothe is editor of Powder Coated Tough.