VOL. 127 | NO. 4 | Friday, January 6, 2012
Millington Company Provides Key Supply Chain Link
By Bill Dries
Much of the shoptalk in logistics is about the journey goods make by roads and rail and jet and by river or sea.
But another critical distance is much shorter. It is the movement of goods into containers and from one mode of transportation to another and at the beginning and end of the longer journey.
That is the business of Millington-based Hi-Speed Industrial Service, which sells, repairs and does preventative maintenance on the overhead cranes, electric motors and hoists that put the chain in the supply chain.
“Most of our business is indoors,” said Ben Buffington, Hi-Speed’s chairman and majority owner. “It’s in the facility. … We’re really moving things inside the plant.”
The company has more than 50 employees with 60,000 square feet of shop and inventory space between its two facilities in Millington and Little Rock. Hi-Speed plans to hire more this year.
The company recently built a “stiff leg” system to move steel on and off barges for a barge manufacturer. Less typical is another system to help move items on rail.
Buffington and Mark A. Burke became the new owners of the 65-year old business in July.
Burke, the former president of True Temper Sports and Vitamaster as well as Samsonite Furniture and Vitamaster, is chief executive officer.
Like Burke, Buffington was a business consultant. He ran a financial consulting firm that worked with family owned and other closely held corporations including setting up employee stock option plans.
Buffington’s business roots go back to working in an automotive business.
“I’ve been in the nuts and bolts. I’ve been in the grease,” he said before talking about his careful analysis of operating companies before he decided to trade consulting for that. “What I saw is generationally there’s not many people that want to get out and operate a traditional business. What I saw was an opportunity to participate in what is going on which is a trend of baby boomers with no way to transition their businesses,” Buffington said. “There are a lot of very core companies out there either manufacturing a product or providing a service. And there is just not generationally the next wave of either entrepreneurs or people with an industrial background who can take the ball and run with it.”
Hi-Speed had its most profitable year in a 65-year history in 2010 and Buffington believes the results will continue to be good when he and Burke close the books on 2011.
“We are seeing some capital expenditure within our customer base – those big Fortune 500 companies gearing up for what they believe is going to be a lot bigger year. We’re picking up some of that project work … a pretty significant increase in manufacturing activity” in the company’s five-state area of Tennessee, Arkansas, Mississippi, Alabama and Louisiana, Buffington said. “Hopefully we’re going to see more building things in this country. I hope and the trend is that it’s going to be in the Southeast, which is really good for our business.”
Hi-Speed sells it clients a trademarked process called QualiTest that anticipates equipment problems with an eye toward reducing downtime.
“It’s basically a predictive maintenance process,” Buffington said of a hot trend in manufacturing and logistics that was for a time, an early casualty of the recession.
“It’s like a marketing budget. In a down economy, you’ll see marketing budgets go away and that’s what really happened to predictive maintenance in 2009,” he said.
There has been a resurgence since 2010 as manufacturing companies move away from the “old-school maintenance man” who fixed machines when they broke.
“The trend now is more process engineers and plant engineers who really want to see the data on what is going on with their equipment mix so they can plan for shut down maintenance instead of reactive maintenance,” Buffington said.
Hi-Speed is also a parts business – one of the largest distributors of overhead hoist and crane parts in the Southeast. It also supplies parts directly to companies that might have their own in-house maintenance apparatus as well as other smaller parts suppliers in different parts of the country. The company just made the largest inventory purchases in its history based on past recent growth in the sector and optimism.