Company's Success Spurs Building Purchase
WYOMING — While much of the building supply industry is in an awful slump, at least one local player is doing so well that it recently bought and moved into a bigger and better building.
Michigan PreStain purchased a 65,000-square-foot building at 3903 Roger B. Chaffee Memorial Drive from Word Ministries in January and moved in last March. The company had been leasing space for most of the past decade in the former Kelvinator plant on Clyde Park Avenue, also in Wyoming.
“They are one of the few manufacturers in the Grand Rapids area that has moved to a new facility in the last year,” said Pete Colvin, a senior advisor for Sperry Van Ness Silvari Co., who brokered the sales transaction.
“We looked at the whole market and looked at the tax advantages, and that was the best building for the money in the market that fit them,” he added.
Michigan PreStain treats interior and exterior lumber products mostly for the residential construction industry, although the firm also has had commercial customers. The company, which has been in business since 1989, offers a wide array of pre-stained cedar siding and shingles, log siding, fiber cement siding and interior wall products.
Michigan PreStain is one of the largest pre-finishing companies in the nation, having sold its products throughout the country, with one of its strongest sales sectors in New England.
Michigan PreStain ships its finished products directly to a building site.
“It’s much more environmentally friendly to do the staining inside a warehouse than it is to have people sloshing stain on sawhorses on the grass. They are one of the few doing good in the building supply industry, which has taken a big hit,” said Colvin.
Michigan PreStain President and Principal Gregory Troutt said the new building meets all the company’s needs and at exactly the right time.
“Our business is exploding and it seems the worse things get, the better we do,” he said.
A big reason behind the firm’s growth is a new agreement that Michigan PreStain recently signed with Sherwin Williams, a company that Troutt called “one of the big guys.” He said the national firm was getting out of its comfort zone and would help Michigan PreStain develop some new products for the building industry.
“When times get tough like this, the bigger companies look for new ways to enter the business, and we approached them with an idea. We said to them, ‘If you think we’re a leader in our industry, then why don’t you make us your poster child on how to grow these businesses?’ They’ve got a portfolio of about 100 companies like us, and they’re struggling to get into our niche,” said Troutt.
Normally, a builder puts up one shingle at a time. But Troutt said Michigan PreStain has developed a system that allows 15 shingles to go up at one time, which speeds up the process and cuts a buyer’s cost on a project. The new shingle system also allows a building company to employ fewer skilled workers.
“We have people in New York, California and upper Michigan calling and saying we want a shingled house but we don’t want all that labor,” Troutt said.
“It just seems our ideas like that are flowing. Cedar Valley (a California manufacturer) was looking for answers to the housing crisis. They needed new distribution, and here we are. We can give it to them. We can finish it. We’ve got that value-added story. And in our new facility, we can do rapid shipment right out of here, common carrier, throughout the U.S.”
Troutt said his firm has a lucrative contract with Cedar Valley to pre-stain and finish its raw building products.
Michigan PreStain puts much of its focus on the second home and the high-end markets, which, despite the current economy, Troutt said are still strong for the company.
“We’re just trying to save that step in the construction process and save that time and add curb appeal. So when somebody is trying to sell cottages, they can make it look like it’s near completion instead of it looking like it’s largely unfinished,” he said.
“We’re doing a lot of second homes in Michigan and doing a lot of high-end homes, like at the million-dollar level. The high spot in the market is still pretty busy, and the second home is busy, but the rest of the market is down 41 percent nationwide. It’s devastating, but we’re not feeling it.”
Troutt, though, said the products, the delivery system and the new ideas weren’t the only reasons Michigan PreStain has done so well. He said much of the credit for the firm’s success over its 19 years belongs to its 32 employees.
“Every single employee here is somebody we are proud of. I don’t know if too many companies can say that, and we’re just extremely proud of that. It allows us to push down through the organization and everybody can grow,” he said.
“I was looking at our production facility the other day and I realized that almost everybody here has been here for at least five years. That’s amazing in our niche. In the lumber business and the finishing business, people turn over every year or two. As I was standing there and looking at them, I thought, ‘Wow, what a group.’”