Bringing Manufacturing Back to America

Evolve Manufacturing

Evolve Manufacturing is a contract manufacturer with innovative solutions for precision mechanical and electro-mechanical products. The company provides a turnkey service to a wide variety of industries, including medical and bio-technology, defence and aerospace, printing equipment, semi-conductors, mechanical and scientific equipment, and industrial automation robotics.

Evolve’s location is key. All of its operations take place in the heart of Silicon Valley, relatively close to clients. “The fact that we are local here in Silicon Valley is important,” Evolve Manufacturing President and CEO Noreen King shares. “People see a lot of value in that.” In fact, Evolve is leading a growing trend in which businesses are bringing manufacturing back to the United States in order to control costs and increase levels of precision and quality.

Many people, however, assume that domestic manufacturing is simply out of the question. “Our customers are always rather surprised that it is a financially viable thing to manufacture with us,” Ms. King admits. In fact, one of the company’s biggest challenges is changing common assumptions around domestic manufacturing. “People have a perception that you are expensive and that is the end of it,” Ms. King explains.

In reality, domestic manufacturing actually saves money – in certain circumstances. “If [the product] is not complex, then you can bang them out a thousand at a time in China,” Ms. King points out. “But, if it is a complex product that needs thorough testing, it makes more sense to build it here.” Evolve produces small to medium volumes of extremely complex product in its state of the art, 45,000 square foot facility in Mountain View, California. These products include everything from medical equipment and imaging systems to circuit boards. Ms. King says that when customers actually consider the product and analyse the numbers, the savings become clear. “On some products it makes total sense to go overseas. And on some products, when you look at it intelligently, it doesn’t. That is one thing that our customers have in common; they do a more thorough study on how the costs actually work.”

The key, Ms. King explains, is to consider all of the factors involved. For starters, when dealing with an overseas manufacturer, OEMs will need to send their own design engineers overseas in order to ensure that all goes smoothly. Travel expenses will add up, as does the time involved. Evolve, on the other hand, boasts a team of reliable experts who are always ready to troubleshoot. And, if the customer still wants to be heavily involved, the production facility is often just a short drive away from the customer’s own design engineers. This close proximity is especially important if something goes wrong. “We can quickly solve engineering problems,” Ms. King says. “It usually only takes us a couple of days, as opposed to a couple of weeks with overseas manufacturers.”

Manufacturing locally also gives customers incredible flexibility. “If you are manufacturing here with us, you don’t have to set your final configurations until very late in the process,” Ms. King points out. And because Evolve specializes in small and medium volumes, the company is a perfect fit for OEMs who simply don’t have a large enough order to justify overseas manufacturing.

Another scenario to consider is when a product contains a complex component that can only be procured in the U.S. The cost of shipping that component overseas, then shipping the completed product back again simply adds up. Shorter distances also ensure that the customer sees a profit sooner. “With us, there is no travel time,” Ms. King points out. Shipping is so fast, “customers keep virtually no inventory. In general, they collect their money before they have to pay us.” Evolve can also protect intellectual property more reliably than many overseas competitors. “You can’t just look at the labour rate,” Ms. King summarizes. “You have to factor in all of this.”

Manufacturing in America isn’t always easy, of course, and the team makes a tremendous effort to keep the costs down – and to pass this savings on to customers. “Our secret to being competitive in this area is that we keep our overhead very low,” Ms. King reports. “We are kind of obsessive about that.” Part of this strategy is not to use extremely expensive equipment. “Some of the people that we compete with have a lot of leased equipment,” Ms. King explains. “It is hard to make sure that it is utilized in an optimal way and to constantly have the pressure of having to make money on that equipment.” Overall, the company’s low overhead enables it to go toe to toe with larger manufacturers. “We are able to compete with the big guys,” Ms. King insists.

Evolve’s advantages go far beyond cost savings. The company provides a complete, end to end solution, from configuration management to after-sales service and strategic alliances with key suppliers. As a result, Evolve isn’t just a manufacturer; the team actually helps clients transform an idea into a winning product. Assistance is available at every level and includes design, manufacturing, reverse engineering and prototyping, integration and sub-assembly, testing, documenting, reporting, shipping, supply chain management, inventory and spares management, and after-sales service. This support is particularly helpful to customers who need to get a product to market fast. “New product introduction is important for our customers,” Ms. King says. “Getting things to market in a hurry and beating the competition is very important.”

To be sure, Evolve’s team has been key to its success. “Our number one value is our people,” Ms. King insists. The company’s industry experts are able to fully support customers and create the best possible product. “We are very knowledgeable in the industries that we work in, so we can understand what our customers’ needs are,” Ms. King explains. Again, location pays off. “There is a lot of expertise in this area. There is a lot of engineering and assembly in the Bay area because this is where the technology was developed initially. That knowledge base is still here and we are able to tap into that.” In fact, most team members “are from our customer pool, so they understand the requirements completely. That is a difference between us and a lot of other contract manufacturers.”

The company works hard to ensure that employees maintain their industry knowledge. “We do a lot of training; we invest a lot in people.” Employees invest a lot in the company as well. “We started in 1999, and we still have all the original team with us here,” Ms. King points out. “We have loyal people. It doesn’t matter how many head hunters call these guys, they’re not going to answer the phone.” Ms. King works hard to maintain this loyalty by promoting a positive company culture. “One of the biggest parts of my job is to make sure that the culture is one that is open and that everybody is able to make a mistake. I feel like that is the way that we get the best out of everybody.” Ms. King has spent plenty of time in the trenches herself, and she understands that a happy employee equals a productive employee. “My philosophy is that when people come to work every day they need to want to come to work – because I remember having jobs where I did not want to go to work.”

Her philosophy is paying off – the company has experienced tremendous growth and success over the past several years. From 2008 to 2010, the business grew a staggering 25 percent, and has been recognized both locally and nationally as one of America’s fastest growing private companies. Net revenue also increased dramatically in 2010, skyrocketing by a staggering 351 percent to reach $37.6 million.

And, Ms. King is happy to share, this is only the beginning; the team is already considering their next step, which will likely be to move into higher volume production. The company will still work within the lucrative niche of complex, high precision product but, with the use of increased automation, could take on higher quantities. Mass produced products that contain a reasonable degree of complexity, such as diabetes meters, would be an ideal fit. The move will mean that the team will have to convince more customers that domestic manufacturing makes better sense than offloading overseas. This shouldn’t be too difficult, however; a simple look at the numbers can quickly convince any sceptic. With high precision, complex product, manufacturing locally in Silicon Valley has far too many benefits to ignore.

October 17, 2017, 4:23 PM EDT

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