If ever a metal finisher made the case to invest heartily in the business when virtually all current manufacturing market indicators suggest a retrench, it’s certainly C.R. Hudgins Plating in Lynchburg, Va. Not only is the company pumping a hefty percentage of revenues back into its operation, but it is doing so unabashedly.
“We strongly believe in investing in the business,” said Angela (Renee) Hudgins, co-CEO of 60-year-old C.R. Hudgins Plating, a family-run company now under its fourth generation of management. How strongly, you might ask? Try nearly $4 million over the last five years alone. The most significant expenditures range from capital improvements and new, state-of-the-art equipment to energy/resource conservation and other green design initiatives.
“Because we’ve been in business for so long, there are pieces of equipment in here with some age on them,” Hudgins said jokingly. In particular, she cited a quarter-century-old plating line that was finally retired in 2006 and replaced with another, more spiffy automatic upgrade in 2006. “This machine allows us to scan in the bar codes on the work orders, and it just takes off,” she added.
When it comes to making the call on equipment purchasing, Hudgins says decisions fall on the shoulders of the management trio (herself; Bobby Robbins, executive vice president; and Byron Hudgins, the other co-CEO). “We really do our research when we purchase equipment and we make sure we purchase something that’s going to last,” Hudgins said. In fact, the company will often visit other finishing shops to preview equipment while contemplating a purchase.
Prior to the plating line overhaul was another sizeable investment—one that marked C.R. Hudgins’ entrée in the paint and powder coating arena. In the early 1990s, Hudgins said the company embarked on what she called its “biggest diversification” when it installed its first painting line. Paint and powder coating services today represent 30% of C.R. Hudgins’ gross sales; zinc plating represents about 60%, with chromate conversion film on aluminum substrates, passivation, and other specialty services accounting for the remainder.
Indeed, this cycle of investment, renewal, and diversification has been C.R. Hudgins’ forte and formula for success for the last six decades. While normal wear and tear was a key consideration in the investment decision-making process, there were also other considerations. For example, the need to broaden services into other areas (based on client demand and market shifts) as well as stringent regulatory mandates (i.e., restrictions on certain chemicals, metals, and processes) factored in as well. For the most part, though, it was just a matter of adapting to the manufacturing climate.
“Over the years we evolved from a ‘craftsmanship’ plater to more of an ‘industrial’ finisher,” Hudgins recalled. When her great-grandfather started the business in 1948, C.R. Hudgins was primarily a plater of silver, brass, and gold. At the time, grand-dad—who learned the trade while serving in the U.S. Navy—was doing light finishing work for major department stores, typically performing jewelry restoration work for many of the chains’ customers. But as the country’s industrial production surged, C.R. Hudgins’ move into heavy-duty commercial finishing likewise gained steam.
“In the 1950s, my grandfather (“J.S.”) put some capital into the business, moving the company more and more into the industrial side—which is where he saw the growth,” Hudgins said. “Today we service a variety of industries from electronics, automotive, military (indirectly), and finance/banking. It could even be more than that because, as a job shop, you don’t always know where the parts you finish are going to end up.”
That’s why it’s so vital, Hudgins says, to work closely with the customers—which entails really getting to know their business from the inside.
“There are typically several people involved with the specification, and all are representing the customer or customers,” she explained. “That’s why I visit the end user’s facility whenever I get the chance. When you go to their plant and see how a product is put together, you get a better appreciation for how the part must be finished according to certain specifications.”
Greener, Leaner Finishing
While investing in the latest equipment is tantamount to C.R. Hudgins Plating’s success, the company also espouses another mantra: “minimize the impact on the environment.” It’s a philosophy that’s evident across the company’s operations—from its diligent wastewater treatment procedures and smart reuse and reapplication of energy, to its recycling of cardboard and packaging materials.
“On the environmental side we’ve always tried to do what is required and even go beyond,” Hudgins said. Some specific examples: C.R. Hudgins reclaims much of the heat that’s generated during the critical parts drying processes. In fact, the company spent tens of thousands of dollars on heat exchangers to reduce its natural gas consumption. C.R. Hudgins also achieved additional savings by tweaking its pretreatment processes. At the same time, it employs computerized systems to control voltage, amperage, plating bath temperature and recipe, chemical feed pumps, position of hoists, etc., to eke out additional efficiencies. And if that wasn’t enough, the company installed additional containment ditches, or “pits,” which are installed near the tank areas just in case a rupture occurs.
C.R. Hudgins’ isn’t stopping there. One of its short-term goals is to completely overhaul its wastewater treatment department by incorporating newer technologies designed to not only minimize waste but also—taking it a step back into the process—use fewer resources and energy on the plating lines. On tap is a new high-tech sludge dryer that won’t spew out emissions. “You always have to look at what you’re doing to see where you can improve,” Robbins said.
The company’s eco-friendly efforts have not gone unnoticed by city regulatory agencies. C.R. Hudgins Plating earned an Environmental Excellence Award from the Virginia Department of Environmental Quality (Chesapeake Bay Program) in 2006, based on its effective compliance initiatives. Of course, Hudgins notes, it pays to have a very good working relationship with the DEQ.
Sense of Ownership
While C.R. Hudgins prides itself on its finishing prowess and environmental awareness, it also puts high stock in another area: its workers. By Hudgins’ count, many of the firm’s 74-plus employees have been with the company anywhere from 10–30 years. Not only does this speak to their experience, she says, but also to the commitment to C.R. Hudgins and its client base.
“One of the things that makes us successful are the people we have here,” Hudgins said. “There are many people where who have chosen to make C.R. Hudgins Plating their career and have been here since they started working. There’s a lot of knowledge and expertise there, and our people have a lot of pride in what they do. All that creates longevity.”
No surprise, then, that many employees at C.R. Hudgins are enrolled in the company’s employee stock ownership program (ESOP). “We not only think about the 74–80 people who work for us, but also their families,” Hudgins said. “They should also share in the success.”
It’s precisely that sense of ownership, Hudgins reports, that enables the company to remain not only profitable but competitive as well. Scanning the competitive landscape, she says some finishing operations are focused solely on price—which, she notes, takes the focus off of value-added services. “By the time the parts leave here they’ve been plated, painted, assembled, pre-packaged, and put in the final container so we drop-ship it to our customer’s end customer—all they have to do is stick it on the shelf,” Hudgins explained.
That illustrates precisely why C.R. Hudgins places so much emphasis on achieving operational efficiencies and manufacturing excellence—so that costs concerns don’t override service levels. “Our employees take great care in the work they do here, and it shows in the end product,” Hudgins said. And given the current competitive environment, that makes all the difference. “With all of the challenges finishers face today, it seems that something is zinging at us from all different directions. That’s why you need a good team of people.”
And when the occasional complaint arises, C.R. Hudgins is equally responsive. “With us the customers gets peace of mind,” Robbins said. “If you have a problem we’ll have someone at your shop the next day to work with your team to solve it. We try to give all the customers the same level of high service.”
Ramping up customer service levels is particularly critical in these challenging economic times. That’s especially true when it comes to helping customers save on freight in the face of today’s runaway fuel and energy costs. “You can’t go to your customers every 30 days with price increases,” Robbins said, “so that means you have to continually focus on ways to improve your operation.”
In the vernacular of modern manufacturing, that means trimming the fat. “The world changed after 2000–01; we had to correct a lot of things we did in the past,” Robbins said. Specifically, that meant moving away from storage of raw materials and inventory on site and adopting a just-in-time approach. “Essentially, we had to get leaner,” he said.
As it eyes the future of the business and the industry, C.R. Hudgins does not plan to deviate from the formula that has resulted in its successes. The company plans to continue investing in the latest technology, the overall business and its people, and protecting the environment. For example, the finisher is currently making room for a new paint line, which, according to its estimates, is about five years out. Plans are also in place to gradually phase out older equipment. And, of course, the continued pursuit of greater operational efficiency.
As it pertains to the challenges presented by the economy in general, C.R. Hudgins is taking it day by day—or, as Hudgins puts it, “month by month.” This year is a real question mark, she said, but the company is making plans as needed. “For many job shops it’s sort of like a rollercoaster—sometimes you have a full shop for two weeks and then other times it’s not as full. You just never know what’s coming.”
Hudgins best advice? “Hope for the best and plan for the worst.”