Stamping Company's Customer Service is Key Differentiator from Overseas Suppliers
For one U.S. metal stamper, quick response customer service and fast turnarounds are the company's answer to overseas manufacturers whose customer service skills and turnaround times are often lacking. And unlike overseas suppliers that require large production runs to initiate work, HPL Stampings has no problem with small volume production runs and prototypes. HPL Stampings, headquartered in Lake Zurich, Illinois, an hour northwest of Chicago, is all too aware of the pitfalls of a quest to save money on per part costs, a quest that often lands OEMs in murky waters later in the production cycle.
"For our customers, everything is about volume," says Alison Oberkrieser, a customer service representative with HPL Stampings. "We are a short run stamper, so the projects that are a good volume for us to produce are too low to be worthwhile for overseas manufacture. I was just on the phone for 40 minutes with a prospective customer who was concerned about short run stamping. Personally, I find that 'short run' can be a bit of a misnomer because it doesn't mean that you only need 50 pieces; it's not just prototyping. You might only need 10 pieces now, but might need 40,000 pieces per month later. Either way, we're happy to help, depending on the part and the process involved."
Although responsiveness is not a constant in the overseas marketplace, it's found on a regular basis when working with American manufacturers, most of whom realize that it's a key differentiator of their service offerings. "For us, our focus is to remind our customers that we're here in the U.S.," says Oberkrieser. "We're less than a three hour drive from most of our customers. If there's ever an issue, you can call us and we'll be in the office. If we have an issue with a part or a design question, we can just walk over to our engineering department and get an answer. Sometimes, we're in those touchy situations where we need to be in contact with a customer multiple times a day for a couple of days. But we can get something done in a couple of days that might take weeks overseas."
HPL Stampings (www.hplstampings.com) offers a variety of manufacturing processes to its diverse range of customers. The company is primarily a short run metal stamper, with an extensive list of in-house equipment. But HPL also provides secondary processes in-house. "We have a turret press for more complex parts, and we also recently acquired a laser," states Oberkrieser. "We create and form parts for customers, we do welding, we make assemblies, and if a customer wants parts kitted, we will kit them. We also work with a number of local finishing houses and we make complete components for some people—for example, for different types of computer housings and panels. They get shipped out to our customer's subcontractor, and then the subcontractor takes our housing and puts the electronics into it. We have customers that have us manufacturing washers, but we also do parts for the automotive and aerospace and medical industries. So we make parts across the board, and our range is really very broad."
Language and time zone barriers present additional difficulties when dealing with overseas manufacturers. "When you're dealing with a company that has an eight hour time difference and a language barrier and perhaps does not have design knowledge, we can provide it," says Oberkrieser. "And the language barrier can be very difficult because you almost have to have a functional knowledge of speaking in translation. You have to find a way to say things in exact terms because there can be so much lost in multiple meanings."
A Different Mindset
However, the bigger issue, Oberkrieser states, is that when many companies went overseas, it was often because they projected very high volumes. "When you make something overseas, you need to fill a container," says Oberkrieser. "Filling a container can take six weeks, and then you have to get that container here, which can take six weeks. Now that's three full months that you're waiting for parts. Sometimes our customers need something in a month or three weeks, and they only need a handful of parts. Let's not fill a container; let's fill a box or a pallet. It's a totally different mindset, but we're happy to indulge that mindset."
HPL Stampings has seen a handful of customers who have brought back production from China. "I know that we've had customers who have taken things overseas, but they don't tell us that," Oberkrieser commented. "But we know their parent companies well enough to know that that's happening. When they come back, they say 'We were having a lot of bad luck with our other supplier.' We actually have a number of newer customers who said 'I was working with someone else overseas when we had a lot more volume, and we were having a lot of problems.' The problems they were having were things like a language barrier, a loss of time, and confusion when there were changes in a design. And there's a major loss of time when there is a design change. With a minor design change, they have to stop everything, take it apart, and figure out how to remake the tooling, and then come back to make more parts. So it can be cumbersome."
Quality issues with the overseas manufacturers pop up on a regular basis—often enough that many OEMs have changed their minds recently about doing business overseas. "I've experienced quality issues myself in a previous manufacturing environment," says Oberkrieser. "I would get parts from overseas, China specifically. Thailand and other Asian countries, typically, have a lot of the same quality issues. When you pay for a bottom line part, you get a bottom line part.
"I previously worked for a German company, and the parts we produced were of a very high quality," she continued. "The thing that the OEMs like about working with companies that are here at home is that when they're making changes or when they're building the part, you can get answers very quickly and you can see the product. If we make five prototype samples, we can ship those out right away. I think a lot of our customers are having reduced volumes when they bring back the work. On the low volume side, there's no comparison."
"The number one reason that our customers bring manufacturing back to the U.S. is that the Chinese parts they were receiving were lower quality than they had expected," Oberkrieser said in a recent e-mail response. "Add to it that we are in a recession, so everyone is trying to find ways to avoid over-producing. Ultimately, what I think most people are realizing is that when you add up all of the costs of buying parts from overseas manufacturers, the cost is pretty similar to buying parts here at home. And here you have the added benefit of high quality production, lower volumes, a wider range of options, and easy communication, especially when it comes to quality problems."
Oberkrieser was asked how HPL Stampings is able to meet a customer's needs better than its overseas suppliers had in the past. "First of all, at most, there is a two-hour time difference between our office and our customers' offices, so the likelihood is very high that we will be reachable if they have a question or a problem," she replied "Second of all, we are a short run stamper, so we are able to provide any quantity of parts, not just a full container on a short lead time. Finally, I think that U.S. manufacturers still have the strongest knowledge base when it comes to redesigning manufacturing processes."
HPL Stampings has a new customer that is bringing a great deal of work back from overseas, mostly from China. The customer was very clear with HPL from the beginning that they had grown unhappy with their overseas supplier. "Initially, the quality of the product was very good, but then they started noticing more and more issues," says Oberkrieser. "And they were getting increasingly frustrated with the way issues were being resolved. There are going to be mistakes sometimes when parts are made; we're human, and this happens. Sometimes it's due to a lack of information, so someone should have stopped and asked for clarification."
Oberkrieser says that many contracts with overseas suppliers require you to pay for the whole batch of parts, regardless of whether 100% of the parts are completed. "Basically, you sign a contract that says 'I acknowledge that there could be up to a 10% loss,'" she points out. "It's very scary to be in that situation. The overseas suppliers are not in a position to provide the 10% correction. The OEMs might be thinking 'I'm only paying 13 cents per piece as opposed to 45 cents, so a 10% loss still saves me money.'"
The staff at HPL Stampings puts a big emphasis on customer service, which helps expedite design and engineering changes to create a better part. "We have a new customer who wanted to bring one part to us to see how we would do," says Oberkrieser. "It's been a very social project for us: We've been on the phone with each other a lot coming up with solutions, clarifying things, and making slight design changes. It could feel tedious, but we're in a position to help them. And again, we can make multiple changes in one day—for example, if they want a different material, or to relocate some holes. Now that we've gotten over this first hump, they're going to start bringing more work to us; we're noticing it already. They also do a lot of one-off, custom types of work. These are stock parts, and they love that they can stamp 'Made in USA' on them. The benefit they're getting from us is the reassurance that our quality department is just down the hall, and these are people that we talk to throughout the day. Our customer service department understands what's going on and is willing to focus on any corrections."
The sting of intellectual property theft continues to be a problem when dealing with overseas manufacturers that don't feel obligated to adhere to international copyright and patent protection laws. "I was talking to a guy recently who was very concerned about the secrecy of his designs," says Oberkrieser. "We're here and we're making parts. We're not going to go to your competitor and talk to them about it; we don't know who they are anyway. We're just going to do what you ask us to do. This is a concern when you start to go international with your work. At least here at home, there are laws governing the sharing of proprietary information. A person here can sign a non-disclosure agreement and it's very clear. But you can't really enforce that internationally. Different countries have different laws on secrecy. From stories I've heard, I tend to think that China does not respect U.S. copyright laws, or anti-piracy acts."
One example of property theft became very evident to Oberkrieser. "I had a customer who designed a great part, a part unlike anything that was ever made before. A Chinese manufacturer sold the design to a competitor. It's a hard thing to reconcile, so it's not surprising that when I talk to people, they are very concerned about what we're going to do with their designs."
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