By Eric Peterson | Jun 04, 2018
Precision sheet metal and machining
Industry: Contract Manufacturing
Products: Precision sheet metal and machining
Founder Bob Chapman saw opportunities and broke away from another sheet metal manufacturer when he started Dynamic Design & Manufacturing in the early 1980s. "At that time, it was mostly the disk drive business," says Beam. "IBM was one of Bob's early customers."
The company made its mark in high-tech manufacturing machining and fabricating stainless steel, aluminum, titanium, and other materials, and its in-house engineering team.
Chapman ran the business with his wife, Peg, until she passed away in 2007. Beam joined shortly thereafter and now runs day-to-day operations. He had consulted for the company in the past, and "jumped at the opportunity" to come in as COO.
He's maintained many of Dynamic's longtime customers. "Our largest customer is the division of Emerson Electric that manufactures flow meters" for the oil and gas industry, says Beam.
But having oil and gas contributing 50 percent to the company's bottom line led Beam to pursue diversification. A recent pivot to aerospace in has paid off. The sector now accounts for about a quarter of revenue and helped buoy the company when energy prices were low.
"We're rocking and rolling right now," says Beam, noting that the company hired more than 10 employees in the the first quarter of 2018. "Now we're looking for another expansion."
"We really started looking for new clients in earnest in the last year," Beam says. "Proactive versus reactive is the huge change for us over the last year."
With a background in high-precision manufacturing, Johnson has spearheaded this shift since joining the company in 2017. He's targeting companies in aerospace and defense, especially satellite manufacturers. "We're mainly working with the primes," he says.
"We are a high-tech, high-accuracy, high-precision machine shop," says Johnson. "Generally, sheet metal is less high-tolerance. We're doing things other machine shops wouldn't even look at. We've got some projects that failed four times at other machine shops we're working on right now."
Dynamic's engineers recently came up with more pliable components for satellite clusters, using a process developed in-house to soften aluminum so it won't crack when it bends.
Clusters of less expensive satellites require a different kind of contract manufacturer, says Johnson. "The tech companies on the West Coast are getting into aerospace with a different kind of approach. Instead of one satellite or 10 satellites that cost millions of dollars, it's hundreds of satellites or thousands of satellites that cost tens of thousands of dollars. We're not building one part for one satellite, we're building thousands of parts."
The company has also moved into the medical sector with enclosures and instruments. Dynamic is well-suited for both medical and aerospace: The company has been ISO 9001-certified since 2000 and made significant investments in technology. "The general theme is we try to stay ahead of the curve," says Johnson. "We're one of four companies in Colorado with DMG NVX [vertical mill]."
"We're the first company in Colorado to have a combination punch-laser machine," adds Beam.
The market starts with local clients, but that usually leads to opportunities elsewhere. "Most of our business starts in the Front Range and expands out from there," says Beam. "We have a lot of companies in Colorado."
"We ship worldwide and all over the country," says Johnson, noting that exports account for about a quarter of sales. "We've got a large customer in Florida and a large customer in California, and we ship everywhere in between."
Challenges: "It's difficult to find people in the sheet metal and machining areas," says Beam. "The number of people has dwindled in these areas." The solution? "We're looking for bright young people we can train."
That's critical, because he's planning on making several new hires by mid-2018 as some existing employees approach retirement age. "We're scrambling to find new people," he says.
Opportunities: "Our biggest opportunity is with commercial airlines right now," says Johnson. "These are FAA-certified parts. . . . It fits very well with our approach. It's a natural for us."
Echoes Beam: "It's not new for us. It's what we've always done."
"The difference is we're putting our name out there to new people," adds Johnson.
A comeback for oil and gas prices is another opportunity. "We've seen some recovery in that," says Beam, noting that he expects 2018 to hit numbers last achieved in 2012.
Needs: "Space is an issue," says Beam. "We're kind of bursting at the seams. We're somewhat landlocked. We own the building and the property, but we're looking to grow beyond that." A second location is a possibility, he adds. "We're looking at leasing some property nearby."
Beyond that, it's all about execution. "We're financially sound," says Beam. "We're unencumbered. We're in a good position to acquire new equipment" -- including a new vertical mill and finishing equipment.