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Wednesday, 11 January 2012 15:24

Confidence breeds expansion at Lee Steel

Written by  Rod Kackley
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Confidence breeds expansion at Lee Steel Courtesy photo
WYOMING — Confidence in a strengthening manufacturing economy has led Lee Steel to make a $6 million investment in new, state-of-the-art equipment the company hopes will open the doors to new industries in West Michigan.

“This is more than just putting together a building and installing a piece of equipment,” said Lee Steel Blanking Division General Manager Ric Price. “This is an investment in the city; it is an investment in this community.”

The move also marks a change in direction for Lee Steel, a family-owned business with its headquarters near Detroit. For a decade, Lee’s “bread and butter” and the reason it opened its operation in Wyoming was steel slitting. But Price told MiBiz the company decided that it was time to open this new line of business, multi-blanking, which they see as a complimentary offering.

“We think there are too many slitters in West Michigan. There is so much competition,” he explained. “This is going to differentiate us. There is only one multi-blanking competitor in town.”

A blanking line allows for a user to take a coil, whatever width it is, and level it, flatten it and cut it to a specific length. With the new Red Bud multi-blanking line, Lee Steel will be able to take the coil — inline — and slit it to multiple widths as well as cut it to length.

Price said this is the “single most modern leveling head and equipment. On top of that, we have a stretcher leveler that grips the material, relieving the stresses in that material.”

That is critical to office furniture and auto industry suppliers or anyone using laser-cutting equipment. Companies with laser cutters worry that if there are stresses remaining in the steel from when it was rolled, then it might pop up when it is being cut and slam into and break the glass on the laser.

Lee Steel is pouring the concrete floor and enclosing a 35,000-square-foot addition to their building in Wyoming that will be dedicated to this new line with room for skid building, finished goods and the 230-foot-long multi-blanking line. The new line should be operational in early 2012.

This new Red Bud line has all of the bells and whistles it will take to make Lee Steel one of the most cost-efficient multi-blanking operations around, but Price said that is not all they hope to accomplish with the new equipment.

“What we really want to do is to set the bar a little bit higher in terms of quality,” he said. “If we can provide a product that is going to be of higher quality and consistency, we are going to be able to eliminate some competition.”

New equipment means new people. The company needs to hire three or four people immediately, but Price said the talent pool is not as deep as he had thought.

“I am confident that we will find them, but it is not easy,” said Price. “I thought they would be jumping out of the woodwork. But we are getting people who are putting in an application because they have to for their unemployment.”

Lee Steel needs someone who knows the steel industry, can work with tolerances and has math skills, but the person doesn’t have to be a machine operator. Basically, candidates just need to understand the terminology.

“The line will run itself,” said Price. “We need somebody who inputs data and can measure and understand what they are measuring for the quality requirements. The rest will be learned as we move along.”

Concerns about talent aside, Price is bullish about the future of manufacturing in West Michigan. When asked whether his company’s investment could be seen as a sign of a turnaround and as a harbinger of a greater potential for sales, Price reiterated that the investment was bred by a growing confidence in the economy.

“I can’t say anything but ‘yes’ to that question because you don’t invent $6 million if you don’t see it that way,” said Price.

Perhaps the best sign for a manufacturing turnaround, he said, is that companies are again investing in equipment.

“We are seeing a lot of our customers doing that, investing in lasers,” he said. “And when you are operating lasers, you need a flat, consistent (steel) product.

Price said Lee Steel is seeing an improved business environment, although more on the west side of Michigan than in the Detroit area, but business is getting better all over Michigan. The company is also expanding into Indiana and Illinois. The company plans to pursue growth with clients in the office furniture industry in West Michigan — including the likes of Herman Miller, Steelcase, Haworth and Knoll.

“But they are going to be a tough sell because I think for the most part they are high-quality organizations that have loyalty to good suppliers,” Price said. “They are not going to change that for a small price reduction.”

Read 2203 times Last modified on Monday, 13 August 2012 13:48

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