President Mike Clark is growing his metal bar grating upstart with a big investment in capital equipment -- and more to come.
With a sizable budget and a few key strategic partnerships in place, Clark recruited a group of former colleagues from the metal grating industry and launched Interstate Gratings in 2007.
The company's primary focus is steel grating for use in mining, energy, and construction in the West, and it also makes stainless steel and aluminum gratings.
Consolidation in the 1980s and '90s cut the number of metal grating bar manufacturers from about a dozen to three, including AMICO Grating in nearby Orem, says Clark, leaving "a void" in the western market.
There were a few big barriers to entry. "The startup costs associated with a metal bar grating manufacturing facility are pretty high," he says. "Out initial investment was $10 million. We've certainly in eight years put a lot more money into the company."
Clark is quick to note that the initial timing wasn't ideal. "I don't think we could have picked a worse time to start," he laughs. The founding team started with a small warehouse and fabrication shop while brainstorming a better way to make bar grating.
They took two years to design and build a world-class factory in Lindon while waiting out the worst of the recession. "By the time we got it together, things were starting to turn around."
The slow start allowed them to make sure they got everything right. "The innovation was just the opportunity taking the knowledge and experience we had in starting from scratch," he says. "It really allows you to focus on flow and layout."
The company's 100,000-square-foot facility is stocked with equipment from Clifford Welding Systems of South Africa. "We helped them design and modify and make the equipment," says Clark, noting that there are no domestic producers of grating manufacturing equipment.
With a number of his team being members of their families' second and third generations in the gratings business -- Clark himself is third -- there are around 200 years of industry experience now on the payroll. "We all pretty much bleed grating," Clark says. "It's an in industry that pretty quickly you get to know all of the players, both competitors and customers."
After jumping to 60 employees three years after the new facility opened, growth has slowed since 2013, he says. "The industries we serve have been off the past couple of years. Our business has been flat."
Regardless, Clark says he sees a bright future ahead. "This industrial downturn is going to be short-lived. Whether that's a year of three years, that's still short-lived."
Challenges: "We have the same challenges most manufacturers have: the cost of doing business, insurance, taxes, regulatory issues," says Clark.
"Hiring and retaining employees is definitely high on our list," he adds. "I can't say it's been a challenge because we addressed it properly from the get-go" with good wages and benefits. "We treat our employees extremely well." For this reason, Interstate is able to recruit most new hires locally, Clark says. "Most of our recruiting has been word of mouth."
Opportunities: Renewable energy Clark says that the solar industry uses a lot of metal bar gratings, as do gas-fired power plants and retrofits of coal plants.
"We're slowly spreading out geographically, and we're exploring additional complementary products," he adds.
Needs: "We're not content where we're at and we definitely want to continue growing," says Clark. "To do that we're going to need to invest in additional equipment. We're waiting for the markets to improve to decide what direction to go in. My partners and I are extremely committed to further investment in the company."