Featured August 20, 2004
Case Study Questionnaire

The TPR visited with Tom Nielsen, president of Mo-Tech Corporation in Oakdale, MN, to find out what keeps the die cast die and injection mold manufacturer on the mark for success.

1) What is your company niche and what does your company do that is notable, unique or different? (ie, technology, innovations)

I would say it is our wide range of capabilities at Mo-Tech. We consider ourselves a high quality mold builder, building everything from unit dies to 
20,000 lb. molds. We build plastic injection, die cast and lead molds. The Die Cast molds consist of aluminum, zinc, magnesium and Thixtropic molds. Also, we are moving towards being more of a turnkey supplier. We can help with the product design, and then manufacture prototype parts, prototype or bridge tooling, and the trim dies for the die cast molds. These are services you don’t find with a lot of mold builders.

Most mold shops concentrate on either the Plastic or Die Cast sector. At any given time we could have a higher percentage of plastic vs. die cast or vice versa. If you asked me what we’re stronger in, I would have to say die cast, simply due to our current customer base.

We also offer building custom mold bases, gun drilling and plate grinding. 
This is a service we offer to other mold shops (mainly local). Together (with other shops) we’ve reduced deliveries by spreading out the work. Our relationships with the local shops are great.

2) When and how did you get into the industry, what attracted you to it?
 

I started my career in the trade back in 1982, working at Mo-Tech as a shop cleaner. It was my senior year in high school. Going to a four year college did not interest me, even though my father pushed me toward continued education. I liked working with my hands. So I enrolled at the St. Paul Tech Tool & Die program that summer and graduated from there in 1984. What attracted me to it? While I was cleaning the shop and working around the toolmakers I found it was very interesting and challenging work with a bright future. As I was going through trade school, I worked in the shop to get some hands-on training. A couple of people there at the time took me under their wings and I learned how to run the CNC machine (received our first in 1984). It was an exciting time. In 1989 I became Shop Manager evolving to Vice President then President. I’ve been President for the last 10 years.

3) Relate a notable "best time" for your company.
  The mid to late 90’s was the best time. Work was plentiful and we moved into a new building at our current location in 1992 which doubled our space. In 1997 we built another addition that doubled our floor space again giving us 27,000 square feet. Late in 1998 Leggett & Platt, a publicly held company on the NY Stock Exchange acquired us. The reason for the acquisition was for our ability to build high quality molds with short lead times. The sector we belonged to was the Aluminum Group, consisting of 14 die casters and three mold shops.

The next best time was in August 2002 when our original owner Richard Hesse reacquired Mo-Tech. After having one of our best years in 2001 we were part of a reduction within the Aluminum group, which consisted of closing or selling Mo-Tech & three of its die cast operations. I don’t miss being part of the large corporate umbrella business at all.
4) Similarly, relate notable challenges that your company has overcome.
  Rebuilding a customer base that was cut in half when we were acquired by Leggett & Platt. We lost 50% of our customers because they were direct competitors with L&P. It seemed like the day after the acquisition the tooling dried up. It’s the worst possible situation a company can be in. We had to try and develop new relationships within the Aluminum Group fast! From 1999 – 2001 that was our main focus. By 2001, we were in a good situation. It was easy to compete with the other two tool shops within the group because of our ability to reduce deliveries & cost. What took them 14 weeks to build we could build in 8 weeks.

In 2002, we were back on the blocks again with a loss of 50% of our customer base due to Leggett & Platt letting us go. They were trying to keep the work within the other two mold shops and we were no longer a part of that. So there we were, back in tough times again. We spread out again. What can we offer? Obviously we can offer reduced delivery times. We continue to work with Leggett & Platt because of that. But we also diversified and went into building trim dies & contract machining. Our die cast customer can come to us and we can build both the die cast die and the trim die. An advantage is that we can pre-build the trim die. This can save our customer up to 2-4 wks. Customers would rather go with us and maybe pay a little more for the project because they know they’re saving time, and that’s worth something.
 
5) When you are working on projects with your customers, what aspects would you like them to better recognize?
  Response time.

Feedback from the customer is critical on a fast track job. We lose valuable time trying to get questions answered.
 
6) List newly acquired technology, machinery or key personnel (in last year).
  One of Four LeBlond Makino Machining Centers in our core & cavity areaWe recently acquired some used machinery, including a Makino FMC 1210, which is a large high-speed machining center with travel of 51” x 39”. We also acquired a Makino EDNC 106, 58” x 48” tank size – possibly the largest in the twin cities – and a Fanuc iA-1 submersible wire EDM.

No new personnel have been hired lately.

7) Has your company recently expanded? Plans to expand or form partnerships/alliances?
  We are working on partnerships and alliances with some of our customers. I guess you could say we already have some form of alliance with some customers in that we feel like we are their number one supplier whenever they have new projects.
 
8)

Are you involved in any industry organizations or educational programs related
to the trade?

  I’m a NADCA (North American Die Casting Association) member along with Dave Rawlings who is the Chapter 16 secretary. Dave is a Sales/Engineer at Mo-Tech. We are also AMBA members, volunteering our time to our local chapter fundraising for scholarships for people going into the trade. We are SPE members & participate in their scholarship fundraising programs. I’m also an advisory board member for St. Paul Technical College’s Tool & Die Program.
 
9) What do you think about changes occurring in the industry due to globalization? How has it affected the way you do business?
  Mold Base DepartmentI believe it’s going to make the survivors stronger. We don’t have any alliances with overseas companies at Mo-Tech. We look at what is staying in the U.S. and that is the business we target. There will always be some of that business; it’s not all going overseas. We diversified because of the way things are going within the industry. You also learn to live with a limited backlog. I would be in panic mode if we had this backlog five years ago, but it’s amazing how you learn to adjust and walk on the edge constantly.
 
10) What will the industry look like in 3 to 5 years?
 

7 LeBlond Makino CNC EDMsThat’s a good question. I can’t predict the future. If you told me five years ago this industry is going to go through a recession like we did I would have said you were nuts. It’s incredible the way things have changed; the businesses that are no longer here that we thought would always be around.

Additional Background Information
  Number of years in business – 35 yrs Current number of employees
                                                      – 40 full-time; 7 part-time
Current square footage – 27,000
Additional locations – none at this time
Website URL – www.mo-tech.com
Phone number: 651-770-1515
Industries served: Consumer products, medical, recreation sporting vehicles, telecom, construction hand tools, and limited defense and automotive
 

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