By Eric Peterson | Jul 07, 2019
Contract electronics manufacturing
Industry: Electronics & Aerospace
Products: PCBs, control panels, and wire harnesses
After working for Kohler in Wisconsin, Rohs pivoted from plumbing to electronics, but he remained a turnaround specialist. "I did a fair amount of turnarounds for them [Kohler]," he says.
After leaving Kohler in the late 1990s, he worked on a contract turnaround in Texas, then moved to Colorado. "When that assignment in Texas was wrapping up, we just decided to move to Colorado where our sons were and where our grandchildren were going to be," says Rohs.
In Colorado, he served as president of Custom Computer Solutions, the manufacturer of ruggedized computers for McData. "All of my career, I was running companies doing turnarounds," says Rohs. "I was always focused on custom products that had to be quoted."
"I was never the technical guy. I was always the finance guy. I started my career as a CPA," he adds. "The core competency was me understanding costs so we could quote better."
When Custom Computer lost its "only customer" when McData moved on, Rohs developed a plan for the company to become a contract manufacturer. "I basically came up with the strategy of this company [RPC Manufacturing] for them," he says. "They abandoned that strategy about halfway through, because the owner sold the company."
Rohs subsequently took that business plan and founded RPC based on it with five employees. "We started out with wire harnesses and cables," he says. "There wasn't very much of a barrier to entry there."
NASA was an early customer, and that work led to installations in boxes and devices, leading to box and panel builds. Growth has been "fairly steady," as the company has grown organically and through four acquisitions of local competitors.
In 2013, RPC bought Colorado Springs-based Peak Contract Manufacturing and moved into printed circuit board (PCB) manufacturing. "We weren't into printed circuit boards before that time," says Rohs. "It blends so nicely with everything else. Most of our customers buy all three of those from us."
Rohs says the three areas are "pretty evenly split," with PCBs and panels or box builds each accounting for 40 percent of sales and wire harnesses accounting for 20 percent.
Likewise, RPC's clients are spread across a number of industries. Rohs says medical and oil and gas are the two top verticals. "Together, they make up 20 to 25 percent of our business," he explains. "The rest of it is a million different things." That's included work on everything from luxury motorcycles to kiosks.
RPC bought its 11,000-square-foot facility in Broomfield in 2013 after a decade in Thornton. "We ended up in Broomfield because of the whole marijuana thing. Broomfield wasn't allowing it. We were competing with all the marijuana companies."
The company is ISO compliant and builds cables to the Wiring Harness Manufacturer's Association A-620 standard. About three-quarters of the staff works in production, with a big assist from automation. "We're a little unique in terms of equipment," says Rohs. "Even though we're one of the smaller printer circuit board manufacturers in the state, we have some of the most sophisticated equipment."
Rohs highlights RPC's automated plated through-hole PCB manufacturing as an industry rarity. "Most of our competition does that by hand," he says.
While manufacturing of surface-mounted boards is largely automated, legacy through-hole technology is still necessary for certain boards. "Anytime you're going to put any volume of electric current through the board, you need that old technology."
Competitors tend to focus on either surface-mounted or through-hole manufacturing, which plays into Rohs' broader strategy of diversification via acquisition. "Now we're a full-service company," he says. Orders typically range from $2,000 to $200,000. "We have a $1 million customer and we have $10,000 customers."
He adds, "Our growth has been phenomenal over the past few years." RPC's sales have increased from $2.2 million in 2016 to $2.7 million in 2017 to $3.9 million in 2018. For 2019, Rohs projects, "We're looking at $4.3 million."
What's driven a doubling in three years? "To a great degree, a good economy floats all ships a little higher," says Rohs. "We were developing a good reputation and this printed circuit board division was coming of age."
He adds, "It's a family business." Rohs works with his sons, Brian (VP of sales) and Rob (VP of operations), and says their collective ability to dedicate more time to the company has also driven growth.
Challenges: Workforce. "The challenge is keeping good talent and finding good quality talent to grow with," says Rohs. "Finding customers has been the easy part of it."
RPC's strategy is based on good salaries and benefits: The company pays for a vacation or cruise after 10 years and recently handed out five-ounce bars of silver to celebrate recent milestones. "We were making a point. The point was: We're rising up to a new level now," says Rohs of the silver.
Opportunities: About 80 percent of RPC's customers are in Colorado, and Rohs plans to keep it like that. "We're here to do what the region needs from us."
Aerospace work was "enticing," he adds, "but we sort of backed away from that. It was low-volume, high-mix, and very demanding." The company's forte is "more practical things," says Rohs. "We want to be in the bread-and-butter industries."
He also strives to find startups rather than take existing customers from competitors. "That's the path of most resistance," he says of the latter. "We have a new company coming in every week with an invention. We want to help them design their products well for manufacturability."
He highlights to key markets: "LEDs are a huge growth area. It's right down our alley," says Rohs. "The Internet of Things comes up a lot." That includes sensors for manufacturing.
PCB design is a possible area of future diversification. "As far as us being full-service, that would be the next area," says Rohs.
Needs: "We're always looking for qualified production people," says Rohs. "Finding good management isn't easy, either. When we're aware of good talent out there, we jump at the opportunity. . . . We'll sometimes mold the company around them rather than molding them around what we think we need."
Rohs is always on the lookout for acquisition targets -- "A great acquisition for us to make next would be a small engineering company," he says -- and he continues to look to automate production processes. Robotic soldering is something he'd like to invest in, but "right now the equipment doesn't quite exist."
"On the printed circuit board side of things, that is constantly evolving," he adds. "The equipment is getting better and the costs are coming down."
Space is a longer-term need. "When you're successful and growing as fast as we are, space is always an issue," says Rohs, noting that RPC owns an adjacent 3,800-square-foot facility it currently rents to an outside tenant. "We have it in our back pocket when we need it."