Manufacturing and Small Business & Startups

Equipment dealer turns shortage to advantage

Turner Industries finds manufacturing backlog perfect time to buy, sell and broker used industrial assets.

May 11, 2018
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A 61-year-old Grand Rapids small business is having a banner year, turning pre-owned machinery into profits.

Turner Industries, at 4670 36th St. SE in Grand Rapids, buys, sells and brokers used industrial assets out of a 20,000-square-foot warehouse 2 miles from Gerald R. Ford International Airport.

The company was founded by Robert Levy in 1957 and currently is led by Dave Hietikko, who has served as its president since 2015.

Hietikko said although Turner is a lean operation with just five employees, it’s a well-oiled machine.

“We work together as a team. We couldn’t accomplish what we do here individually,” he said.

Hietikko started working at Turner in 1998. In 2008, the Great Recession hit, and the price of machinery plummeted as companies downsized or went out of business and shuttered plants.

Today, Turner can hardly acquire, inspect and refurbish equipment fast enough, as West Michigan sees a manufacturing resurgence.

Anthony Neuman, sales manager at Turner, said demand for used machinery today is high because everyone needs equipment for their growing businesses and factories. As a result, equipment manufacturers have a backlog of orders waiting to be filled.

“There’s such a high demand for equipment, even something older, that people are forced into buying used. Sometimes, used will be available sooner as opposed to new,” he said.

Neuman scouts places to buy the equipment to resell at a profit. Some customers are both buyers and sellers at various points in the lifecycle of their connection to Turner.

The company has a database of 60,000-70,000 leads it sources from, as well as an active presence on its website, Craigslist and through word of mouth.

In addition to the roles of president, sales manager and vice president/controller, Turner employs a mechanical technician and an electrical technician to inspect and fix the machines in the brief time they are in the warehouse.

Neuman said sales happen rapidly — usually, the company can turn around each piece of equipment within a week depending on how much time it takes to get it up to speed.

Turner can take on one machine or an entire plant full of machinery at once, depending on the deal and the logistics. Neuman just got back from buying an entire plant’s worth of equipment in Oklahoma.

“We don’t get involved in real estate purchases, just the equipment,” he said. “When people call, you evaluate the best you can through the photos to determine, ‘Is it something resellable for us, or is it something like a boat anchor?’

“A 20-year-old machine has a lot of value to us — something non-CNC related. When we get into those (CNC machines), more or less after 10 years, they are obsolete.”

He said factors that affect equipment prices include age of the item, how well it has been maintained, how much wear and tear it exhibits, and whether it still runs fast.

Neuman said Turner doesn’t usually buy internationally because of the headache involved with import paperwork, but it does sell around the world.

It’s a logistical feat to move some of the equipment, which can fill up entire rooms and weigh hundreds of tons per piece.

Turner does not disclose names of customers, but Neuman said a Kentwood manufacturer recently consolidated facilities and looked to Turner to buy the remaining equipment it couldn’t use.

“There were several hundred-ton presses in there, and if it’s the size of this room, it takes a week to disassemble it to get it ready to transport it in three or four pieces the size of large cars,” he said.

“It costs $10,000 to $30,000 just to move them out of the building and get them on a truck.”

Turner uses flatbed trucks rather than box trucks for transport because the equipment is often oddly shaped and weighs more than a box truck can accommodate.

“There’s no shortage of details in this business, right down to trucking, where you have inches to work with as far as height. As I’m sure you know, the 100th Street bridge on U.S. 131 is constantly hit because of how low it is,” Neuman said.

“We constantly check and recheck everything.”

The automotive industry has historically been Turner’s largest customer, although the company has worked with suppliers in the furniture industry, as well as with entrepreneurs in the beverage industry.

“We’ll have end users who are individuals, larger companies, job shops, tool and die, and with the uptick in the economy, we’ll see hobbyists set up shop in their garage, buy a mill and make their own parts,” Neuman said.

He said at least one of the workers from a shop next door — which “soups up” sports vehicles so they can be used for competitive racing in Australia — has purchased equipment from Turner for use in hobby pursuits.

This has been “one of the better years” in Turner’s history as far as sales go, Neuman said.

“In my going on four years now (at Turner), this has been the strongest market I’ve seen, and it’s looking like it will continue for some time,” he said.

“It won’t last forever, it never does. But it’s to the point where stuff is coming in, and in a week or two, it goes right back out the door.”

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