By Eric Peterson | Mar 14, 2019
Denver, Colorado / Salt Lake City, Utah
Machine tools and automation
Denver / Salt Lake City
Privately owned by Productivity Inc.
Industry: Industrial & Equipment
Products: Machine tools and automation
Smith started selling Mazak CNC machines in 1982 in Chicago. "I was a young kid selling machine tools on the south side of Chicago, trying to explain to people that I knew something -- and I didn't," he laughs.
But he learned on the job as his career continued and developed a deep expertise over the decades.
In 1992, Smith traded Chicago for Colorado, lured by the mountains. On the Front Range below, he quickly realized that manufacturing was light years behind the Midwest in terms of CNC adoption and support.
Smith went to work for Moncktons Machine Tools (MMT) in 1999. The longstanding distributor has been supplying manufacturers in Colorado since the early 1950s. Customers include Metro Machine, Ball Aerospace, Los Alamos National Laboratory, and CoorsTek.
In 2015, Smith teamed with Minnesota-based Productivity Inc. to buy the company and become its regional arm in the Rockies. The company is now a full-service distributor of machine tools, robotics, tooling, and parts. "MMT's focus is on sales, service, and preventive maintenance," says Smith.
MMT also offers custom integration solutions involving multiple machines. One MMT customer has been able to reduce floor space for machines by 70 percent as the production time was cut in half.
Smith says MMT's sales have roughly doubled since the Productivity Deal. "We've grown from 20 employees to 40 employees," he notes. About 25 are based in Denver, 15 are in Salt Lake, and the company also has two employees in Albuquerque, as MMT services customers throughout the Mountain West.
The financial crisis of 2008 was a reckoning for both MMT and its Front Range customers. "If you didn't come out of that leaner and focused on reducing setups, you weren't going to survive," says Smith. "I saw those shops fold in 2008, 2009, 2010."
The shops that lived through the ensuing recession "came out of it stronger, leaner, and that makes them healthier," he adds. "I'm seeing a stronger, healthier CNC market in the mountain states."
The common thread of the survivors? "Unattended operation is where people need to go to be competitive."
The last decade has been an era of notable progress for MMT's customer base. "The Colorado market has matured," says Smith. "They're adding a little more automation . . . becoming more competitive as the market for CNC tools becomes more national and more global." He adds, "Our two biggest strengths are aerospace -- and that's commercial, military, and space -- and medical. Those two sectors look to be pretty strong for the next 10 years."
It's a preferable industrial base to automotive, oil and gas, and other industries prone to "big swings," he notes. "That's tough for machine shops and machine tool distributors."
It's a different picture than it was around the turn of the millennium when the Front Range lost a number of sizable manufacturing operations. "There's a philosophy with several OEMs to just do lowest bid," says Smith. "Lowest bid does not work." He notes that it "works both ways," in that it's good for both the bidder and the shop in that it allows for more investment in equipment and employees.
Smith highlights a few leading brands. "Haas is the largest U.S. manufacturer of CNC machine tools," he says. "They're positioning themselves for the next 50 years."
He likes the company because it's a big business that's privately owned and reacts to the market quickly. "I've been with them on this incredible growth curve."
Smith calls Makino "phenomenal on high-end aerospace and medical," highlighting its ATHENA voice-controlled platform. "You talk to the CNC control and it creates code and operates the machine. This is a possible wave of the future"
Japanese-made machine tools are often handcrafted, and that makes a big difference, notes Smith. "It's the hand-scraping, hand-balancing, and attention to detail during assembly." The end result is "a higher level of accuracy built into the machine."
MMT also sells Citizen's Swiss-style lathes and low-frequency vibration (LFV) machines. "We've grown that business," says Smith. "That's probably one of our biggest growth areas in the last four years."
He says a Citizen LFV machine "actually breaks the chip by coming in and out of the cut and yet still holds geometric tolerance. Chip management is one of the biggest problem areas for automation."
Additive manufacturing and 3D printing "is still a very interesting area," Smith adds. "It's not taking off like a rocket ship like some people thought it was going to."
That's largely because it's not able to match the accuracy or speed of CNC technology to be used in production, although it remains a go-to for prototyping. "The technology is evolving and it is getting closer," notes Smith. "It'll get there, but it isn't there yet."
MMT supports a number of local manufacturing organizations and schools. "We have been doing a lot with the technological institutes and community colleges," says Smith. "That's grown a lot in the last four years." MMT offers educational customers a big discount, he notes, but it's worth it because it introduces students to the company and its brands.
In the end, Smith says that MMT's differentiator is its steadiness: "There's nobody that has the stability we have."
Challenges: "The cliché answer is people," says Smith. "We've taken a different approach to that: We are investing in training. We are training lower-skill people and that works for us."
He describes leveraging Productivity Inc.'s human resources department as "a big advantage."
Opportunities: "My standard line is, 'We're lucky because of the aerospace and medical industries that are growing in Colorado, and oil and gas that comes and goes,'" says Smith.
Preventive maintenance "is one of our biggest areas of growth," says Smith. MMT's program involves annual evaluation and educational sessions that help reduce downtime. "There's nobody else doing that."
Medical has been growing for MMT, he notes, as have the company's tooling and service divisions. "As other people are reducing their staffs, we are growing," Smith says. Case in point: MMT is finishing a renovation on a 12,500-square-foot facility in Salt Lake for its Utah operation.
Needs: A strong economy. "We need stability -- that's what we need," says Smith. "As it has been."
MMT is also in the market for a bigger space in Colorado. "We will buy a building this year," he says, while calling the existing 17,500-square-foot facility in central Denver "a great space for us."