Many companies that chase offshore savings through foreign manufacturing operations lose this support because the US domestic distributors that supply their domestic plants do not have the capability of shipping offshore.
Enter Industrial Motion Inc (IMI), a company founded in 1994 by Eric Kozlowski and Brian Pfeifer. At that time, scores of US companies began relocating manufacturing overseas, primarily to Mexico – due largely to the North American Free Trade agreement. Despite the benefits of cheap manufacturing and labour costs that offshore locations provided, these manufacturers found that they still needed parts and services to keep their machinery running. The problem was that nobody offered overseas support.
Wanting to jump into the industrial supply business, the pair discovered that the domestic industrial supply market was already saturated by large distribution companies who had local markets virtually sewn up.
“Because we had very little capital and no market share to speak of, finding a manufacturer that would allow us to represent their products directly was not a possibility,” says Mr Kozlowski. “But because of this concentration on the US domestic market, the overseas markets were being largely ignored. Support for the overseas operations of US manufacturers took a back seat to those facilities operating domestically.”
The pair decided to reverse engineer the traditional industrial distribution model and service manufacturers globally with an expansive product offering, cross-industry expertise and efficient logistics networks that would yield measurable cost savings for customers.
The goal was to help enterprises to reduce sourcing costs for maintenance, repair and operations and raw material needs, and consequently maximise cash-flow management and logistics by offering blanket order management, scheduled release orders, and consignment ordering. And importantly, Mr Kozlowski says: “IMI asks the customer what they need rather than telling them what they can sell them.”
The model worked. Today IMI is a multi-million-dollar business servicing more than 615 customers in more than 30 countries. IMI’s foreign locations are staffed with engineers that regularly visit customer plants to identify requirements and offer application solutions. Its founders regularly travel worldwide looking for new customers and potential new markets. On their radar screen for new office locations are Vietnam, the Philippines and countries in Africa and eastern Europe.
The business offers customised, flexible and on-demand solutions for its clients’ purchasing processes. Due to its relationships with large domestic distribution companies, IMI can negotiate competitive prices for material sourcing and provide repairs, calibrations and procurement services.
Mr Kozlowski says: “It is difficult enough for a purchaser in China, who doesn’t speak English, to try and obtain a quote from a company in Ohio for a plant requirement, let alone facilitate the entire procurement transaction from start to finish.”
Efficiency of logistics is essential. “We touch 100% of the products we sell,” says Mr Kozlowski. So is proper documentation. Because of the global nature of the business, the accuracy of all shipments is critical. Supporting worldwide manufacturing with US products is at the heart of IMI. Keeping offshore US manufacturers fit and well oiled is a company passion.
INDUSTRIAL MOTION INC
Mooresville, North Carolina
Additional offices: Singapore, China and India
Established: 1994 in Orange County, California