2017 Top Shops Benchmarking Survey: Investments, Profits Are Trending Up

Analysis: Trends show more consistencies than differences over time; shops are increasing capital expenditures each year, with shops ranking at the top spending at 10 percent of gross sales.


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Jan Schafer has only stepped foot in a few electroplating shops, but she knows a lot about how the most efficient and profitables ones operate.

Schafer is the market research manager for Gardner Business Intelligence, a division of Gardner Business Media, the parent company of Products Finishing. She’s been poring over stacks of data from hundreds of plating shops in North America that took part in the Products Finishing Top Shops Benchmarking Survey in late 2016.

Each year, Schafer uses data from shops to compute scores and run algorithms that determine which shops place in the top echelon of the plating industry, and thus earn status as a Products Finishing Top Shop. Schafer’s team also tabulates the data to provide a comprehensive benchmarking report given back to participating shops to examine and use in their own operations to improve efficiencies and reduce waste.

This year, Schafer is looking at trends, a first-time analysis opportunity now that the program has been in place for three years. Looking at the different measures across years, she’s seeing a fair amount of consistency in how the values move over time, but is calling out some “departures” as well.  

“Sales growth rates, for example, decline year-to-year with the exception of shops in the top 20 percent on this measure,” she says. “Sales growth rates at the top of the range stabilize in 2017, while the average sales growth among total shops continues to decline. In fact, sales growth rates among shops at the bottom of the range have fallen to zero.”

Another observation is that, as a whole, shops are increasing their capital expenditures each year, with shops ranking at the top on this measure spending at an average rate of 10 percent of gross sales. That rate of spending is up almost 2 percentage points from a year ago, and up almost 4 points from the year before. For perspective, average spending on capital equipment among all shops is just half that rate.

Schafer offers a snapshot of what trends she sees in the 2017 report, which takes into account business activities in 2016. 

Across the board:

  • Profit is trending up
  • Investment rate is trending up
  • Quality is steady
  • Lead time is steady

 

Focusing on shops with values in the top 20 percent on the respective measures:

  • Sales growth rate is about the same versus a year ago, defying the otherwise pervasive downward trend.
  • Profits increase to a marginally greater degree versus shops landing at the other extreme, the bottom 20 percent.
  • Lead time is back on track following a downward blip the previous year.

 

Some contrasts:

  • Shops ranking at the top on sales growth rates are widening the gaps versus median and bottom ranked shops over time.
  • The same can’t be said for shops ranking tops on profit. On that measure, median-ranked shops are increasing profits over time to a greater degree.

 

Shops that completed the Products Finishing Top Shops Benchmarking Survey will soon receive a series of reports that separate the survey data into categories, including type of finishing business (job shop, contract shop or captive operation), number of employees and number of parts produced.

In addition, we send an Executive Summary comparing responses between the Top Shops benchmarking group and the rest of the survey participants. This benchmarking group represents the top percentage of electroplating shops determined by totaling the points assigned to select business- and technology-related questions.

These reports not only serve as a baseline “report card” of sorts, but also provide hard data that will eliminate the need to rely on gut feelings as a method of identifying and prioritizing improvement efforts. The survey for liquid and powder coating shops starts May 1. 

Here's our 2017 Top Shops list of electroplaters:

 

Top Shops: The Best of the Best for 2017

A.M. Metal Finishing Rick Hunter, President
Active Metal Finishing Allan Phillips, President
Advanced Plating Technologies Matt Lindstedt, Sales Manager
All Metals Processing  Michael Coburn, CEO
American Tinning & Galvanizing Rodney Chiarelli, Vice President
Anoplate Jim Stevenson, President
Arlington Plating Richard Macary, President
Avtec Finishing Systems Peter Waldo, President
Bronson Plating Toby Welch, President
Cadillac Plating Nick Salvati Jr., Owner
CENSA S.A. de C.V. Francisco Hornelas, General Manager
ChemResearch Co.  James Burriss, President
Coastline Metal Finishing Juan Cadenas, General Manager
Coating Systems, Inc. Arthur Sacco, President
Coating Technologies Inc. Robert Barrkman, President
Craftsman Plating & Tinning Brian Blacklidge, President
Electro Polish Co. Kevin Cancino, Manager
Electro-Spec Jeffrey Smith, President
Electrolizing Corp. of Ohio Greg Marn, General Manager
Freedom Metal Finishing Keith Eidschun, President
Galnik, Sa De CV Renato Villasenor, Director
Great Lakes Metal Finishing David Wachter, General Manager
Green Bay Anodizing Charles Dunham, President
Hohman Plating Brad Kremer, President
J&M Plating Mark Morris, President
Lincoln Industries Marc LeBaron, Chairman
Lustrous Metal Coatings Mike Paxos, President
Marsh Plating Matthew Marsh, President
Medina Plating Shawn Ritchie, President
Microfinish William Stock, President
Paulo Products Co.  Ben Rassieur, President
PEP General Metal Finishing Stephen Chatfield, General Manager
Perfection Industrial Finishing Charles Zinke, President
Pilkington Metal Finishing Van Pilkington, President
Pioneer Metal Finishing Robert Pyle, President
Professional Plating Larry Dietz, General Manager
Recubrimientos Metalicos Carlos Cielak, General Manager
Reliable Plating/Elite Finishing Jaime Maliszewski, President
Roy Metal Finishing John Pazdan, President
Saporito Finishing Co.  Jeffrey Logan, President
Seminole Metal Finishing Elliot Blackwelder, President
Silvex Inc. Phil Ridley, President
Surface Technology Inc.  Michael Feldstein, President
Surtronics Angela Stanley, President
Tanury Industries Michael Akkaoui, CEO
Techmetals Phillip Brockman, President
Valley Chrome Plating Ray Lucas, President
West-Tech Finishing Bob Ford, General Manager
Whyco Finishing Technologies Nick Post, President
Wolkerstorfer Co.  Joe Wolkerstorfer, President

 

How to Become a Top Shop

The Products Finishing Top Shops Benchmarking Survey is conducted every year, with the electroplating survey in the spring and the liquid and powder coating survey in the fall.

The survey consists of almost 50 questions about finishing operations, including questions regarding best finishing practices, finishing technology and business operations, as well as employee training and human resources.

All shops that complete the Products Finishing Top Shops Benchmarking Survey receive two detailed data reports that separate the survey data into categories that include number of employees and the comparison between the Top Shops benchmarking group and the rest of the survey participants. This benchmarking group represents the top percentage of shops determined by totaling the points from select business- and technology-related questions.

These reports not only serve as a baseline “report card” of sorts, but also provide hard data that will eliminate the need to rely on gut feelings as a method of identifying and prioritizing improvement efforts.

In the meantime, how can your shop prepare to earn the Top Shop status?

The first step is to compare your shop’s performance with the best in the business using this year’s Top Shops Executive Summary, and then formulate a plan for improvement in areas such as finishing technology, performance and practices, business strategy and human resources.

The best place to go for additional help and training is through trade organizations such as the National Association for Surface Finishing (NASF) and the Aluminum Anodizers Council (AAC). The NASF and the AAC can help captive and job shops that want to increase efficiency, improve their bottom line and work their way toward becoming a Top Shop.

Working with the AESF Foundation, the NASF holds in-person and online electroplating courses to help shops train staff in the latest and most effective processes. 

Both organizations offer a variety of training and educational programs designed to help shops improve their performance.  

For more information on the Products Finishing Top Shops Benchmarking Survey, click here

 

 


Originally published in the April 2017 issue. 

 

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