Protective Covers

PARTNERING: HOW SMALL FABRICATION SHOPS CAN BECOME BIG ONES (conclusion)
by Don Araiza
President, Eide Industries, Inc.

LENGTHY TRACK RECORD

Partnering is so valuable a strategy that we, at Eide Industries, have sought to support it with a formalized program.

The origins of this program date back 30 years to the time when we stopped making awning frames out of plumbing pipe in order to join the revolution for readily shapeable, thin-walled tube framing. Soon after, we began supplying these better frames at wholesale to awnings shops throughout Southern California. By the early 1980s, we had developed sufficient wholesale volume regionally that we felt confident about expanding the operation nationally. After coast-to-coast sales went through the roof, we then began offering covers to go along with those frames, again on a wholesale basis. This too was successful. But more than giving us a national presence, it opened the door for opportunities to enter into partnering relationships, As our wholesale customers came to recognize that we possessed expertise and capabilities they did not, they began approaching us for help with their individual custom projects.

Partnering is more common today than even five years ago. Several reasons for that, but one of the most important has been the explosive proliferation of computers. With computers on more and more desks – and, now, in pockets and purses as well – the prospective partner shop on the other side of the country is suddenly a lot closer. Down-the-hallway close, in fact, thanks to email, instant messaging, virtual private networks, Blackberrys, video cell phones and any number of other information exchange technologies that allow partners to work together with a heretofore unimaginable degree of cohesion.

“Twenty years ago, before all this technology, you would have had a much more difficult time partnering with anybody,” says Mescher.

A concern Cove Awning’s Petrizzi initially had about partnering was that conducting business by long-distance might be problematic, even with fluid, facile communication.

“We worried about the costs of shipping cross-country,” he says. “We thought those costs might make partnering cost-prohibitive. We were wrong about that. We also worried about product being damaged during transit. We were wrong about that too.”

A WIN-WIN SCENARIO

The first time Cove Awning partnered on a project it was to build and install a four-sloped freestanding awning above a residential terrace.

“We could have done this entirely on our own, but I wanted to try partnering to see if it could help me reduce overtime – this particular job came along in the middle of summer, when each member of my crew was putting in an 80-hour workweek,” he recalls. “All of this overtime was driving up my costs, especially for workers’ compensation insurance.”

As it turned out, the partnering arrangement he entered into did indeed reduce his overtime. Since then, Petrizzi has been able to pare his sewing room staff of 2.5 workers to 1.5, and almost all of the jobs they now handle are easy ones that aren’t likely to necessitate overtime.

“The big jobs, the complicated jobs – those I give to my partners,” he says.

Clearly, for Cove Awning, partnering represents a win-win.

“Our margins are up because of it,” Petrizzi confides. “The way I look at it, my shop benefits the most when I’m out on the road selling awnings rather than being in the sewing room or the welding department to help out with production. That’s what partnering allows me to do – it gives me the ability to put my talents and those of my employees where they can do the most good.”

I predict partnering will become all the more popular in the years to come. The amount of money it takes to be successful in the fabric products business is continuing to spiral skyward, and there is no letup in sight. At the same time, customer requests are becoming more complex and challenging. The best solution is partnering. Companies that engage in it are the ones who will be best positioned for solid, sustainable growth.

(Eide Industries, Inc. is headquartered in Cerritos, California. Founded in 1938, it is one of the world’s largest manufacturers of awnings, tensioned fabric structures, canopies and other industrial fabrics products. For more information about the company’s partnering program, call 800-422-6827 or visit Eide Industries on the Internet at http://www.eideindustries.com.)

PARTNERING: HOW SMALL FABRICATION SHOPS CAN BECOME BIG ONES (continued)
by Don Araiza
President, Eide Industries, Inc.

NOT SUBCONTRACTING

To the uninitiated, partnering sounds like trendy lingo, a fanciful substitute term for good old-fashioned subcontracting. But it’s not. There are sharp differences making one quite unlike the other.

Chiefly, with subcontracting, there exists between the parties a rigidly defined relationship in the mold of supplier-and-customer or employer-and-employee. By contrast, in partnering, the relationship involves mutually cooperating equals (although not necessarily equals with regard to company size or capabilities) that function as a true team.

Here again is Petrizzi: “Partnering lets me view the other company as an extension of my own shop. We work together, side by side. The more closely we work, the better the results of the partnership. At its finest, partnering is a two-way street. With one of my partner shops, they help me make product – but, from time to time, I help them with installations. We’re helping each other accomplish things that would be much harder if we tried to do them on our own, separately.”

As an illustration of what it can mean to a small company that partners with an experienced, larger company, consider a common practice here at Eide Industries wherein we send one or more of our installers to team up with the installers employed by the shop that has sought partnership. By working alongside our highly trained installers, the partnering shop can learn many useful tricks of the trade which then can be profitably put to use when tackling projects on its own.

FORMS OF PARTNERING

Partnering relationships come in two primary forms.

The first is where a shop teams with another to deliver services that the former acting alone cannot muster due to costs, time constraints, or market conditions. Prominent among such needs is the requirement to price large, difficult or risky portions of jobs – including design and engineering, a requirement many small shops are unable to satisfy without help.

The second major type of partnering is the turnkey approach. Here, a smaller shop hands over to a larger one the entire responsibility for producing the job from start to finish, but does not disappear from the picture. This is the way Georgia Tent & Awning went about its initial foray into partnering six years ago. What transpired was this: In 2000, the shop was approached by one of its key customers – a large construction contractor – that needed 75 canopies built and installed to cover a parking deck atop a high-rise condo in Sarasota, Fla. Under normal circumstances Georgia Tent & Awning would have declined this out-of-area job. But not wanting to disappoint (and thereby risk losing) a preferred customer, the shop contacted us here at Eide Industries with a request to pick up the ball and run with it, knowing that we could – and would – discretely perform everything from site visits to CAD drawing and from fabrication to installation while Georgia Tent & Awning devoted its freed-up full energies to providing customer care.

“We were able to satisfy our customer’s need with minimum effort and still be financially rewarded at the end,” says Mescher. “Best of all, we hung onto this customer – a customer we have even to this day.”

(to be continued)

PARTNERING: HOW SMALL FABRICATION SHOPS CAN BECOME BIG ONES IN THE BLINK OF AN EYE
by Don Araiza
President, Eide Industries, Inc.

Confronted with a job that seems too big or too complicated, many industrial fabric shops will politely tell their customer thanks but no thanks. That, says Gary Mescher, is self-defeating, an act that undercuts a company’s growth potential.

“You want to be the one who important customers always come to, yet as soon as you start turning them away because the project in question is beyond your capabilities or outside your geographic service area – or you start telling them it’s going to be six months before you can get around to their project because you’re too busy with other jobs – then you’re not going to get called by them again in the future,” says Mescher, vice president and general manager of Georgia Tent & Awning in Atlanta.

Mescher’s shop and a steadily increasing number of small-to-medium-sized firms across the country are adopting a strategy known as partnering as a way to accept jobs they otherwise would be forced to pass up. “Partnering lets you grow from small to large in an instant, with just one quick phone call,” Mescher says.

NEEDED MORE CAPACITY

A sterling example of this practice comes from Stamford, CT, where Cove Awning Co. Inc. has been a local market leader for most of its 75 years in business. Co-owner Bill Petrizzi (who bought the shop in 1987) says Cove was enjoying boom times but found itself stymied from advancing to the next level because of prohibitive expansion costs.

“We needed larger facilities to keep up with demand,” he says. “But real estate costs in Connecticut are so high that we couldn’t afford anything grander than what we already had.”

Petrizzi thought that perhaps by relocating outside the area – where real estate prices would be lower – he could find more spacious quarters in his price range. After mulling the ramifications of such a move, he realized the idea was a non-starter.

“Cove Awning was such a well-established name in Stamford that pulling up stakes and going someplace new would have been like taking several giant steps backward,” he says. “That just made no sense.”

What made sense was the notion of partnering with a larger company elsewhere that had sufficient production prowess and distribution savvy to handle jobs Cove Awning couldn’t.

“We were able to stay in our market by entering into partnering relationships with three other shops,” he says. “I started out only occasionally drawing on the resources these partners offered me. Now, I work with them on a regular basis.”

(to be continued)

For over 70-years, Eide Industries, Inc. has been recognized as the leading manufacturer of custom protective covers, commercial awnings and canopies, tension structures, architectural designed shade structures, industrial sewn canvas products and transporter race canopies. We specialize in complex and difficult commercial, government and prototype designed projects regardless of job size, scope of work or administrative demands.

Operating from a 41,000 square foot Southern California facility, Eide remains on the leading edge of technology with professional services and state-of-the-art-machinery to offer high quality engineering, industrial sewn products, large-scale graphics applications and welded metal products.

Eide Industries, Inc. is a licensed Contractor in the states of California, Nevada and Arizona:

• California Contractor # 211771 B, C10, C61, D03
• Nevada Contractor # 68052 B-5 Prefabricated Steel Structures ($1 Million Limit)
• Nevada Contractor # 68053 C14H Awnings & Louvers ($1 Million Limit)
• Arizona Contractor # 133892 Commercial Class L-3
• Arizona Contractor # 133893 Residential Class C-3
• Los Angeles Type 1 Metal Fabricator License # 1716

Eide Industries, Inc. is a canvas products manufacturing firm opened in 1938, by Mr. E.S. Eide. The firm originally known as Hi Grade Tent & Awning Company has achieved growth partly by the acquisition of other local firms such as The Los Angeles Awning Company and Jensvold Sailmakers. Mr. Eide’s two sons, Jim and Jack, were also in the local awning business. Jim Eide owned and operated Glendale Awning Company, and Jack Eide installed the awnings for both firms.

In 1958, the family consolidated its operations and incorporated, forming Eide Industries, Inc. In subsequent years the corporation has continued to grow, acquiring other companies with compatible product lines, such as Tech-Sew. In 1973, Mr. E.S. Eide retired and sold his stock to Don Araiza and George Ochs. Growth continued with the acquisitions of Santa Ana Canvas Company, Shady Manufacturing, G.W. Cox & Sons, Long Beach Awning & Tent, and Specialty Design, Inc. Jim Eide retired in 1982; Jack retired in 1989. Both men sold their stock to the Corporation. Jesse Borrego and Joe Belli became stockholders of Eide Industries in 1995. George Ochs retired from Eide Industries in 2004 and sold to the Corporation. Dan Neill became most recent stockholder in 2005.

Today, Eide Industries, Inc. manufactures a variety of canvas products for commercial, industrial and military applications, as well as producing awnings, canopies and shade structures for restaurants, hotels, condominiums, storefronts and other commercial properties. Eide Industries, Inc. is a custom manufacturer of commercial canvas-and-metal structures, has the capability, experience and technical ability to manufacture any related product. Eide also produces fabric and back-lit awning frames and covers, along with excellent graphics applications for these structures. A worldwide product installation service is also offered. Most products are manufactured on a job shop basis with in house CAD design of all products. In January 1988, Eide moved its three operating locations to its present 41,000 square foot facility in Cerritos, California.