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Features Venture Local series investigates manufacturing

Companies employ hundreds in Macon County

In 1985, two men opened a custom furniture shop on Depot Street under the name Brown’s Woodworking. From there, it evolved into a manufacturing facility in the early 1990s, producing large quantities of picture frame mouldings and component parts for Aristocraft Cabinetry and Baker Furniture. In 1998, the business name was changed to Liberty Wood Products and was relocated to a new 35,000 square foot facility in the Iotla Valley area. The new facility has allowed for more growth as the business continued to increase sales.

On the construction side, Liberty offers quality products including moulding profiles, flooring, interior doors, rustic siding, custom millwork, custom residential and commercial cabinetry, built-ins, closets, countertops, and one-of-kind specialty items with services including design work, material take-offs, door schedules, jobsite deliveries and installation.

On the manufacturing side, Liberty offers full production capabilities from raw material to packaging.

Liberty Wood Products, which employs 15 people, is currently managed by Don Hill and Richard Watson. In 2004, seeing the growth in the housing market, Liberty began to focus on the needs of the local home builders, according to Hill. Products such as tongue and groove paneling, interior trim and mouldings, wood flooring, doors, cabinetry and custom millwork replaced the component parts. Most items included pre-finishing which became a favorite among the local builders due to the time saving aspect of having the materials ready to install as soon as they reached the job site.

In 2005, the business was purchased by Drake Enterprises.

During the height of the recession, Hill said that Liberty experienced a significant loss of revenue during 2008 and 2009.

“This was mostly due to the fact that our product lines were geared towards working with the home building industry which took one of the hardest hits of all,” he said.

Currently in its 27th year of operation, business at Liberty is on the rise. “The recession has caused some setbacks for the business,” said Hill. “But with anticipated sales for 2012 in excess of $2 million, we are headed in the right direction.”

Liberty Wood ProductsAlthough business is improving, it didn’t happen overnight. “The recession has caused us to do several things,” said Hill. “First, we had to re-evaluate our product lines and the markets that we served. Since new home construction had slowed to a crawl, our focus was redirected to some other areas such as the hospitality industry. Hotel remodels provided opportunities for several items and some in large quantities. In addition, we have recently added the manufacturing of some wood furniture for a company located in Asheville.”

In addition to pinpointing how to market the business to ensure a constant stream of revenue, Hill noted that the recession lead Liberty to evaluate the business and cut down on areas to save on costs. “We learned the ‘do more with less’ way of business,” said Hill. “Some reductions included lowering of material inventory, a cutback on some overhead costs, and also the reduction in payroll which meant some layoffs of personnel.”

Another way Liberty dealt with the recession was by tapping into the market in surrounding areas in order to increase their customer base.

“We had to broaden our reach to potential customers by expanding our service area from Macon, Jackson, and Haywood counties to as far as Charlotte to the east, northern Georgia to the south, and eastern Tennessee to the west and the north,” said Hill. “This was achieved by increasing our exposure in those areas by direct sales calls, hosting product seminars, trade show exhibits and attending home building association meetings and events. Nationally we have achieved some growth through the internet by sharing our product offerings via our website.”

While most companies looked at downsizing when the economic downturn hit, Liberty looked at expanding. “We acquired Southern Heritage Wood Products,” said Hill. “This acquisition provided us with an additional customer base as well as some new product offerings. Both Liberty and Southern Heritage customers would now have the benefit of many years of experience in the industry and an increase in service and support from our combined team of professionals.”

“Finally and most important was to have the strong financial backing of Drake Enterprises to help get us through the difficult times,” said Hill.

Drake EnterprisesWith business continuing to improve, Hill said that he hopes Liberty will continue to expand. “One of our goals is to continue to develop new products, improve efficiency, and increase sales in our construction and hospitality markets,” said Hill. “It is also a goal to find more customers who are looking for a manufacturing facility to produce their products here in the U.S.A. Both of these goals will help facilitate an additional goal of being able to provide more jobs for the people in our local community.”

The largest manufacturer in Macon County is Drake Software, owned by Phil and Sharon Drake. “I first started writing tax software in 1977, and began selling it in 1978 to other accountants,” said Drake. “The business was ‘accidental.’ I did not know that I could sell software to others. At first, I was only attempting to automate our tax practice. I began selling the software when a computer to run it on cost more than $20,000.

Drake Software focuses on the accounting and tax preparation profession and tries to provide them any software that they might need. They also facilitate the electronic filing of tax returns for our customers. This past year, Drake Software transmitted more than 11 million federal tax returns, and more than nine million state and city returns.

According to Drake, the company’s software business is good. “We have been blessed with continued customer growth every single year,” said Drake. “Today, we have over 35,000 accountants who purchase software from us each year. The recession has slowed our growth, primarily because it is more difficult for new accounting offices to open up in this environment.”

Being an innovator in the manufacturing of tax software, Drake said he has had to change and re-evaluate his business plan to keep up with the change in technology.

“When I first started this business, tax software was in its infancy. Almost no one owned a computer in 1977, and my biggest challenge was to convince accountants who used a pencil and a calculator to trust a computer,” said Drake. “Now, every accountant in the country owns a computer (because they are cheaper), and no one does a tax return ‘by hand’ any more. And when I started, there was almost no competition. Now, there are giants in this industry, and it is difficult to compete against them.”

As their customer base grew, Drake Software had to add departments to handle the growing number of clients. “We also have had to increase our Technical Support staff based on the number of customers that we have,” said Drake. “When we get a customer, we ‘adopt’ them, and attempt to help them in their tax practice in every area (even if it is not related to our software). Our Technical Support is second to none in this industry. Our customers get a live person in an average of eight seconds.”

Like Liberty, Drake Software viewed the recession as an opportunity to expand. “We have grown through acquisition (buying some of our competitors) and organizationally,” said Drake. “In addition, we have begun to offer some additional products to our existing customers so that they see greater value in us, we create more brand loyalty, and are able to increase our sales to existing customers.”

Through all of the enterprises owned and operated by Drake, he employs more than 600 people (part time and full time). In Drake Software alone, Drake employs approximately 375 people and pumps more than $25 million in payroll into the local economy in the form of wages and benefits each year.

Being centrally located between areas like Atlanta and Charlotte, Franklin is a mecca for businesses to grow, which is what Carlos Mira and his family thought when they moved Tek- Tone to Macon County. “My mother, father and I started the business in 1973, in a warehouse bay in Riviera Beach, Florida,” said Mira. “Originally we were focused on apartment intercom systems. And we still sell them today - you'll often see a TekTone intercom station on many of the New York-based TV series - ‘Law & Order,’ ‘Friends,’ etc. We began manufacturing Emergency/Nurse Call systems in 1977 - that quickly became our primary focus.”

With true family values, Mira’s family all own portions of TekTone. “It is owned by members of the family,” said Mira. “The majority of the shares are held by my father and mother, Manuel and Maria Mira, and my sister, Teresa Mira-Knippel and I. My sister is our CFO and I'm the company's president. Other members of the family in the business are my nephew, Johnny Mira-Knippel, our VP focused on Marketing and Sales, and my brother in-law, John Knippel, our surface mount technology automation department Manager.”

TekTone® Sound & Signal Mfg., Inc.TekTone® Sound & Signal Mfg., Inc., which employs 85 people, opened its manufacturing facility in Franklin in 1989. The company designs and manufactures nurse call, apartment entry, wireless emergency call, area of rescue assistance systems, and alert integration systems. TekTone® nurse call systems are found in assisted living facilities, nursing homes, and public and private hospitals around the globe. TekTone® headquarters is in Franklin - plus a network of first-rate distributors and representatives that stretches worldwide.

In order to continue improving the business, TekTone sets goals to encourage performance standards. “We are doing well so far this year,” said Mira. “We set a pretty aggressive goal and are still on track, but we still have a quarter to go. Our business has experienced steady growth in its 40 years. We are most proud of the fact that we've shown a profit every year we've been in business.”

According to Mira, TekTone has escaped the recession unscathed. “2009, 2010 and 2011 were below what we would've projected had we not been in a recession, but we adjusted accordingly and seem to be coming out of it in pretty good shape,” said Mira. “We plan to hit the market this year with a product that we think will revolutionize Health Care Communications. We plan to show the product to our TekTone Elite Partners at our annual partners’ conference coming up in September.”

In addition to new product offerings, TekTone management identified waste areas to help reduce unnecessary costs. “We instituted a management philosophy focusing on the reduction of the seven wastes — over-production, waiting time, transportation, processing, inventory, motion and scrap — in manufactured products,” said Mira. “By eliminating these seven wastes, quality is improved, and production time and cost are reduced.”

Despite changes to the original business plan, TekTone’s goals have remained the same. “TekTone was founded as a residential and commercial intercommunications business,” said Mira. “As the market changed, we made an executive decision to enter the healthcare market since that area was showing more growth and stability. There is no doubt we made the right decision as our healthcare systems are now the driving force behind Tek- Tone.”

According to TekTone’s marketing manager Brad Hyder, by 2015, the nurse call industry is expected to be a $175 million market. “Tek- Tone is poised for success by focusing on key customer segments including assisted living, and skilled nursing facilities,” said Hyder. “The driving factors of our business include an increase in the aging population and increase of assisted living and skilled nursing facilities. Moreover, facilities are searching for opportunities to increase overall efficiency, and our products are centered on the goal of increasing a facility’s performance. Performance is identified as improving efficiency in terms of facility goals (rounding, reducing time to answer calls, tracking staff performance using metrics), improving staff satisfaction, and improving patient satisfaction.”

Whitley Products IncorporatedEmploying 120 people in Macon County, the national company, Whitley Products was founded in 1942, by M.V. Lowe. The Company originally manufactured screw machine parts for the war effort, but expanded its product line in 1946 to include tube fabrication in an additional facility located in Pierceton, Ind.

In 1972, a second plant was established in Fort Wayne, Ind., to supply fabricated tubular assemblies primarily to the agricultural and construction equipment industries. In 1977, the company again expanded its operations to include a 17,000 square foot facility in Plymouth, Ind., for the exclusive production of diesel injection line assemblies. The plant has since undergone expansion on two occasions with current floor space of 40,000 square feet.

Beginning in the early 1980s, the Company established a niche as a Tier Two supplier when their large automotive OEM customers began to consolidate their supplier base. The continuing stagnation of the farm implement industry, coupled with the recession at the beginning of the decade, precipitated exiting the screw machine parts business, the closing of the Fort Wayne, Indiana facility in 1991, and the transfer of its business to both the Plymouth and Franklin operations.

In the late 1990s, the Whitley executive team decided a leaner, more efficient and flexible organization would be necessary to meet the future requirements of its customers. It is this concept and the leadership of the executive team that has provided the drive resulting in Whitley consistently exceeding its customers’ expectations. While the Whitley executive team monitors all aspects of the business, they are constantly measuring how the Whitley organization aligns with the current and projected needs of its customers.

Whitley Products is the leading and largest Tier Two supplier of fabricated tubular products serving the diesel engine, agricultural and off highway industries. It is strategically located close to its customer base, which includes primarily large Fortune 500 companies. Since opening the plant in Franklin, Whitley has consistently employed at least 100 people for more than 20 years.

According to Ralph Bell with Whitley, business has slowed down some during the last couple of months, but this is normal for business this time of year. Sales forecasts show sales trending back up in September and October.

“I started in 1982 when the Franklin plant first started,” said Bell. “Our business has grown in sales by building quality parts and responding to our customer needs. Whitley has invested in new technology / equipment over the years to stay up with our competitors.”

The recession caused Whitley to see a decrease in sales. “Our sales have dropped some during the recession due to people being slow about buying farm and construction equipment,” said Bell. “Whitley Products has invested in new technology and equipment and started introducing lean manufacturing to the production floor to reduce cost, lead time and build a better quality part. Our customers are very encouraged that we are working towards lean manufacturing.”

Still in the recovery process after the recession, Whitley is working to move forward and obtain goals regarding expansion of the company. “Our goals are to grow sales, reduce cost and introduce lean manufacturing throughout the plant,” said Bell.

The Venture Local series will appear monthly beginning in September

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