Circuit board assemblies
Privately owned (second largest African-American-owned business in Colorado)
President Edmond Johnson has tripled the printed circuit board manufacturer's staff and doubled its revenues since the onset of the Great Recession.
With a background in supply chain management for IBM, 3COM, and Maxtor, Johnson founded Premier Manufacturing in Longmont in 2000 with Philo Robertson. "We knew there was a void in the marketplace for our services," says Johnson. "We started in a 15,000 square foot facility in Longmont and we grew the business through without a sales force. We grew by word of mouth up until 2008."
Making boards for clients like Maxtor and Particle Measuring Systems, they piloted the company out of the gate through the tech collapse of 2001. "We took a strategy of diversity," says Johnson. "We wanted to be a low- to medium-volume manufacturer with a high mix of industries."
When Robertson retired right as another financial crisis hit in 2008, Johnson decided to "re-engineer” the company. "We were setting it up to be sold," he explain. "I set it up for long-term growth."
The pivot paid off. Premier has grown top-line revenue at a 20 percent annual clip in the time since, and the staff has jumped from 35 to 125 at the 50,000-square-foot facility in Frederick. Employees have gotten bonuses for hitting targets every quarter, with one exception -- and that bonus was made up the very next quarter.
Johnson points to the mix of industrial, storage, medical, and aerospace clients as one key to success. That allowed Premier to withstand a massive industry shakeout: About 50 percent of printed circuit board manufacturers in the U.S. went out of business in the past five years.
"We picked up business from competitors who went out of business," says Johnson. Many of those onetime competitors had one tentpole client typically a Hewlett-Packard, IBM, or another tech giant -- and when that client looked to move manufacturing offshore, it was nearly impossible to withstand the blow. "We didn't want to be what we call in our industry a high-volume, low-mix manufacturer," says Johnson. "You get too customer-dependent."
Employees take the brunt of the loss when this model failed at Premier's competitors . When you have one big customer that pulls out, layoffs follow, then the company goes into a death spiral. "We've never had a layoff," says Johnson. "We put a lot of emphasis on service and responsiveness and maintaining a workforce with very low turnover. The minimal churn makes the business work, because the skills involved with PCB manufacturing don't come overnight. "They're very skilled positions," says Johnson.
"It's employees and customers that make a business grow," he explains. "It's like shoes and shoelaces -- you gotta have both."
Along with the growth, Premier has invested $2.5 million into manufacturing equipment since 2008. "We've invested in leading-edge technology that's consistent with our customer's desire to have smaller components and a higher level of quality," notes Johnson. "They want to save real estate and money when they're making boards."
Challenges: "The big challenge is workforce," says Johnson. "Now the Baby Boomers are retiring and younger people didn't get into [manufacturing] because they didn't see a future in it." It follows that Premier's minimal turnover is critical. Johnson helps keep it low with perks like a wellness program -- a trainer comes to the plant twice a week -- and a program to keep employees out of the claws of the payday loan industry. "It's interest-free, and they can borrow up to $1,000," Johnson says.
He also points out that Premier does not drug test applicants or employees. "I feel if you come here and do the job, what you do in your private life is up to you."
Opportunities: Johnson points to the medical industry -- driven by an aging population -- as well as the "stable, steady-as-you-go” aerospace industry as growth areas, and also highlights the opportunities in the "Internet of Things” -- it manufactures for Colorado startups Roximity and Revolv -- and large manufacturers that are outsourcing but don't want to go to Asia.
Needs: Tax reform. "The biggest problem for us is that corporate tax rate," says Johnson. "It's a strangler -- especially for small businesses."