Thanks to the purchase of a high-capacity laser cutting tool, a manufacturing business in Beatrice is going to see a jump in its ability to turn out its products, and create some new jobs in the process.
Precise Fabrication turns raw sheet metal into component parts for its customers, which demand exacting effort. Once the laser slices the sheet metal, the process includes press brakes for bending sheets, a fabricator, shearing, and cold saws. There's a welding department, and powder coating and plating subcontractors to finish the jobs.
The company's owner, LeRoy Janzen, who was born and raised in Beatrice, recognized the company eventually would need room to grow, and broke ground on Precise Fabrication's current 41,250-square foot facility in the Gage County Industrial Park about 4-1/2 years ago. That project was financed in Feb. 2007 through Pinnacle Bank's Beatrice Branch using the SBA's 504 program, offering fixed-rate interest over 20 years, and sales tax proceeds used for economic development and tax-increment financing to pay for infrastructure improvements at the site
Customers depend upon Precise Fabrication's solid products
Janzen built the business on a reputation of producing good products in a timely fashion, and boasts relationships with local firms such as Lincoln-based GT Exhaust, supplying parts for mufflers, silencers and catalysts for dredging machines and large trucks.
"The CEO of GT told us they do business with us because we can supply quality parts, and we get them the parts when they need them," said Dave Smith, the company's business manager.
The company also provides kiosk equipment and store fixtures for Store Kraft, a nationwide firm which has called Beatrice home for nearly a century.
Another Precise Fabrication customer, Industrial Maid of Cortland, even notes on its web site its commitment to dealing with local manufacturers," Smith said. "In the local paper they identified us as a key supplier, because they want to do business in the Midwest, and we enable them to do that."
The company also provides parts to Toro's plant in Beatrice, which manufactures walk-behind and riding mowers for landscape professionals; and, parts to nearby Plymouth Industries, which offers products for agriculture-based businesses.
And, with Encore Manufacturing in Beatrice selling its assets in March to China-based Worldlawn Power Equipment Inc., a move which also brought the company's headquarters from California to the southeast Nebraska town, Precise Fabrication will find a new customer for its work.
Success did have a cost, though. Since the company was founded 10 years ago, the work inexorably caught up to the firm's capacity. Their existing 1,500-watt laser had been running 24 hours a day, seven days a week to keep up with customer demand, said Smith. The new 4,000-watt laser will be a big help, and the company will expand its current staff of 23.
"This is a state-of-the-art laser cutter we're having shipped from Japan that we'll receive in June," Smith explained. "Our current laser is our bottleneck. So in some ways, we're adding more than double the capacity of our current laser. We'll be able to make more parts, hire more people in fabrication and hire welders. In the last two years we’ve had tremendous growth which gave us the confidence that this was the right move for us."
Turning to SBA to finance the deal
To finance the purchase of the laser cutter, the company again turned to Pinnacle Bank, and the bank again turned to the SBA to mitigate its risk.
"This was a specialized piece of equipment," said Beatrice branch president Stan Wirth. "It's something that if we had to sell, it would be tough to market."
In early May, Wirth visited with Suzanne Stearman, a lender relations specialist in the Nebraska District Office, who directed the bank president to the SBA Express program, which offers a temporary increase to the program's loan limit from $500,000 to $1 million through the end of September, and a 50 percent SBA-backed guarantee.
"They're a business that's viable with a definitive plan on handling the debt," Wirth explained. "Just by adding this machine, it'll add jobs to their workforce, something in this day and age is important, because every job counts."
Stearman reviewed the SBA Express application forms with Wirth, offering a few suggestions before the banker submitted the deal to the Sacramento loan processing center. As a result of her help, with the except of a couple of minor additions the center requested, Pinnacle had its approval within three or four days.
"Part of the comfort level working with the SBA is that we've seen an increase in communication between the SBA and the lender, and it's much better than it's ever been" Wirth said. "Suzanne has been in my office, I know who she is, and we're happy to have them as a partner."
Without the SBA's help, Smith added, Precise Fabrication's customers would have looked elsewhere for their needs, and likely outside the Beatrice area.
Keeping much-needed jobs in the area
“Beatrice and Gage County has some of the highest unemployment in the state because of the downsizing of the lawn mower industry," said Smith, who has lived in the area for 23 years. "So for businesses like ours to do well and thrive, and adding people, to me is a plus in a town the size of Beatrice. And we have a couple of vendors who we do a lot of businesses with, and they’d be greatly affected if we were not around."
The company also is committed to growing the Beatrice economy; Janzen participates in Beatrice First, an organization encouraging retention and growth with local firms collaborating on marketing ideas and brainstorming other ways to promote the area's commercial environment.
"I’ve had the chance to move to the big cities, but this gives me the chance to stay in this community and raise my family," Smith said.
And thanks to the new laser cutter, Precise Fabrication will be able to create jobs, helping more families to stay in Beatrice.