Entrepreneurs opening new electrocoating plant
The E-Coat Project LLC, an electrocoating job shop planned to open in Cascade Township several weeks from now to serve West Michigan industry, began forming "before the economy took its current dip," according to company president Gary Weaver.
But that hasn't derailed the plans.
"There's business out there," said Weaver.
"I'm not a defeatist and I'm not going to be defeated," he added.
Weaver and his partner, Ron Richards, recently signed a lease-with-option-to-buy for 46,000 square feet of space at 3800 Patterson Ave. SE in Kentwood, just south of the Kent County airport. The building had been vacant for about four years, according to Steve Marcusse of Grubb & Ellis|Paramount Commerce. The prior occupant was L&G Industrial Products, which moved to another location nearby.
Weaver said eight temporary employees have been hired — "whom we hope to make permanent." He said from 12 to 15 people will be working at the plant when they begin work in February or March.
Weaver and Richards have already purchased the machinery for an electrocoat painting line from a plant in Florida and it is being installing.
"We did the opposite of what everybody's doing. We moved something from the South to the North," said Weaver.
By mid-February, he said, they hope to be finished installing the Therma-Tron-X Inc. slide transfer electrocoat line, which had been used by a company in Orlando to coat parts for the Big Three automotive companies. That company sold its electrocoat line to The E-Coat Project because it had moved the rest of its operations to Costa Rica.
Weaver said the TTX equipment will make The E-Coat Project a state-of-the-art electrocoating job shop.
"New, this (equipment) line would cost near $2 million," said Weaver. "We will have invested much less than $1 million" in it.
"I really don’t want to reveal too much about our finances. We are investing a solid amount," he said. He added that The E-Coat Project has not received any governmental incentives in the form of tax credits or abatements.
Electrocoating (shortened to e-coating by many in the industry) is a water-based painting process in which parts are dipped in electrically charged paint. According to the Web site of Giering Metal Finishing Inc. in Connecticut, the e-coat paint, which can be resin or pigments such as epoxy or acrylic, covers the entire part or product, so that even corners, edges and recessed areas are completely protected.
Cathodic epoxy electrocoating reportedly provides very good corrosion resistance and is widely used in the automotive and automotive parts industries. The cathodic epoxy technologies generally require a top coat for protection from sunlight.
Cathodic acrylic electrocoatings are used as a one-coat finish in the agricultural, lawn and garden, appliance and air-conditioning industries. These coatings are typically used in applications where both UV durability and corrosion resistance on steel parts are desired.
The electrocoat process is also said to be more environmentally friendly than conventional painting technology because it uses organic chemical compounds that are low in VOCs. Because it is an immersion process, it wastes less paint than a manual or robotic painting process; most e-coat systems are automated.
Weaver, 55, has been involved in the power coating finish process since 1976 and is working as a sales rep for a powder coating company. Power coating, which is closely related to electrocoating, is a dry paint process that also uses an electrostatic charge to attach the paint to the surface. The coated parts or product are then placed in an oven for curing.
"Every automobile has parts in it that are e-coated," he said. Many of those are parts underneath or within the car body, such as window frames inside the door — "things that aren't seen but need a coating on them" to prevent corrosion.
Weaver said local companies such as Grand Rapids Spring & Stamping and Gill Manufacturing e-coat some of the parts they produce. The steel outdoor lawn furniture industry relies heavily on e-coating.
Weaver said an e-coating line like the one they are installing can generate more than a million dollars a year in revenue, running one shift a day.
The plant they have leased is very large for their intended use, which will give them room to maintain a very clean operation. Weaver said it will help them fill a niche for customers that require a high level of service and quick turnaround.
There is a great deal of commercial/industrial real estate on the market these days, and Weaver feels he and his partner "got a pretty good deal on the building." He did not divulge terms of the lease or the total investment they plan to make in their new business.
The E-Coat Project line will also be able to "coat big parts, and a lot of them. We can coat a part that is 60 (inches) by 42 by 30," he said.
Weaver said he and his partner have been able to arrange much of the financing themselves. They plan to start out fairly low-key, given the uncertain state of the economy today.
"We can pick up odds and ends and get started. Then the only way to go is up," he said.
In the long run, he said, he is not too worried about the economic future of America.
"All of us need to be a little bit worried, but on other hand, the reality is, this is an expanding world. As long as babies are born and kids graduate from high school and college, they're going to be buying cars, buying houses, moving into apartments and buying refrigerators and stoves. As long as the population grows in this country, there's no reason not to be optimistic."
Weaver noted that some economists would say that a down market is the best time to start a business because some of the key start-up costs are lower.