Our client is a milling operation primarily servicing OEM manufacturers with precision parts. The company invested in automated equipment over the last 5 years. It purchased a turning center capable of single-setup production. Automated systems require a skilled person to perform the setup. The Company’s mix of work ruled out any machine running all the way through an unattended shift.
The primary restraint for growth for our client was hiring skilled labor. This was the main obstacle that impeded the Company’s ability to meet its customers’ delivery demands and to maximize its capital equipment investment.
Our client was having trouble hiring skilled labor locally because of competition with public companies that offer a more competitive labor rate and benefits. The company work with local technical school graduate but found that it still took considerable training, and the training time is an opportunity cost.
After reviewing their options to meet their customers’ demands, their calculation for additional business with the acquisition with a labor force could hit the ground running now instead of organically hiring and training a skilled labor force.