Robust counsel: SCORE not just for startups

When businesspeople turn to the Service Corps of Retired Executives (SCORE), it could occur at any stage of their business. Just ask Brent English, the proprietor of Robust Tools in Barneveld. He’s leaned on SCORE counselors at various junctures in the life of his business and flourished afterward.

In Robust Tools, English runs the only U.S.-based manufacturer of woodturning lathes. The self-financed business is not large by any means, but it benefited from SCORE’s advice at the beginning, and more recently when English realized he’d better get a handle on his costs. Even with a bootstrapping business model and a history of managing growth through cashflow, the company eventually encountered growing pains that prompted English to seek help.

Enter SCORE counselor Bob Sands, one of 51 retired executives who volunteer for the Madison Chapter, one of 350 nationwide. Sands’ background illustrates the kind of expertise that’s available, free of charge, to local entrepreneurs. For 35 years, Sands worked in manufacturing, foods, and agricultural businesses with companies like Case Corp. in Racine and Swiss Colony in Monroe, starting in positions like entry-level purchasing and ending up running companies in Texas and California for private equity investors. Sands used his experience in manufacturing management to advise Robust Tools on inventory management systems and strategic planning.

Even before reaching out to SCORE yet again, Robust Tools had become a premier manufacturer of high-end woodturning lathes, catering to professional artisans and serious hobbyists. Its tools make the craft of turning wood with a lathe, and using a hand-guided chisel or gouge to shape the wood as it turns, possible. There are no computerized controls for the operator, and with the exception of an electric motor with variable speeds, anybody using a lathe 300 years ago could use one of Robust Tools’ lathes in short order.

According to English, woodturning is, for many people, a fine art like pottery. “Ninety-five percent of our sales go to serious hobbyists and probably 5% of our sales go to professional artisans,” he says. “These are craftspeople who make one-off items.”

On the make

A self-described “compulsive maker,” the 57-year-old English has long made things for sale, sometimes as a business owner and sometimes as just a sideline. About 30 years ago, with visions of becoming a shop teacher, he stopped making things and pursued a bachelor’s degree in engineering and a master’s degree in industrial technology. The hoped-for career path never materialized, but product development would became his life’s work.

As a hobbyist, English was familiar with woodturning. “A friend of mine who knew about my design background and metal background suggested that I make a lathe, and he meant make a lathe for myself,” English explained. “I started showing my anticipated design to other woodturners to get their input, and I was encouraged to make them for sale.”

When English realized there might be a related business opportunity, he confirmed it with market research. In 2004, he started the business in his garage, working part-time on evenings and weekends. He had $25,000 to launch the company and used it to buy some old equipment. Brent and his wife, Deb, ran the business out of a checkbook and on an Excel spreadsheet.

However, “As we grew, that model no longer served us,” Brent acknowledged.

So the couple approached SCORE for help in understanding their cost drivers. Sands recommended ways to improve inventory control, including MRPs (manufacturing resource planning systems) that English rejected based on staff considerations. “I didn’t feel we had the people power on staff to incorporate them,” he explained. “They are only as good as the data you put in them.”

Sands, he noted, reviewed different Excel-based speadsheets the company developed to monitor inventory and work orders on the floor. Sands referred to them as a “home-brewed” supply chain management system, but also said they worked quite well. What the system lacked was a degree of sophistication that would enable Robust Tools to tie everything together.

English considered a couple of systems in the marketplace, but he was more interested in certain capabilities. Rather than start over, English decided to incorporate a missing module into his existing system, and it connects the company’s inventory with its purchasing, production, and sales plans. “Basically, he added that himself,” Sands said in admiration.

In addition, Sands helped craft a long-term plan to grow the company and prepare it for sale. “The business was doing well, but we put together a long-term plan to grow the company [by] three times in 10 years,” Sands noted.

(Continued)

 

The company also began the search for a general manager to handle operations so that English could focus on product development, sales, and strategic direction. Sands, who traveled from Madison to Robust Tools’ Barneveld facility every second or third week, helped the company write a job description for production-management help. In the wake of the recession, there were qualified manufacturing employees who had been let go, especially in the Milwaukee and Racine areas.

The first individual hired to be the GM didn’t work out, so English has established and is still monitoring the effectiveness of a hybrid position — a working manager to do both floor management and direct labor.

Noting that a person with the necessary qualifications would, at minimum, command a salary in the $80,000 to $120,000 range, Sands also suggested there might be people who would take a smaller salary in lieu of an ownership share. That would require an agreement in which the company provides additional shares over time, based on performance or success of the company. Upon Brent’s retirement a few years later, the company could be sold to the individual.

“Maybe by then, he or she has a good interest equity-wise,” Sands noted. “That’s the kind of thing we worked on.”

English says that’s still an active possibility, but given what he has invested both financially and emotionally, it would take “a special person” for him to share ownership. “It would take the right individual,” he says, “and it’s something we would phase in over time.”

Sands also suggested the company import more parts to lower costs, but English wanted to stick to his goal of making its products with at least 85% U.S. content. “That’s really important to us and our customer base,” English explained.

The company also received some validation from SCORE on how it was approaching advertising, marketing, and its online presence.

Returning the favor

In the two years since he last worked with SCORE, English says the organization’s advice has worked out well. “I’m a shop guy,” he stated, “but it’s helped me gain a sense that the shop and maintenance stuff is only half of it. The other half, an equally important half, is the management side and understanding or knowing your costs, and knowing how to set priorities.”

As a result, English strongly recommends SCORE to anyone who is starting a business or who wants to grow an established business. “I would hope that someday I’m good enough, when I retire, to be a SCORE volunteer,” he said. “I hope that I can return the favor that SCORE did for me.”

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