Walker Corp., a subsidiary of Millenia Products Group, fabricates and assembles car-charging stations for Volta Industries.
This marked the beginning of Millenia’s growth in the manufacturing business, both organically and through acquisitions. In 2005 Millenia purchased a family-owned roll forming company. “The model is really simple. The distributor buys metal from the mill and marks it up and sells it to the roll former, which marks it up and sells it to somebody else,” San Roman said. “We eliminated the margin between the distributor and roll former and fed that downstream. We had one profit margin under one umbrella that made that [roll forming] company more competitive in a marketplace that was getting squeezed.”
Growth continued over the next few years. Millenia opened distribution centers in El Paso, Texas, and Riverside, Calif. It bought a fabrication company, bought another small stamper, and purchased more fabrication equipment, all with the goal of vertical integration. Today the organization has purchased or launched 11 companies and has brought them under the Millenia Products Group umbrella.
“This allows us to do any step a customer requires, be it raw metal, a bent angle or channel, to a punched part, to a complete assembly,” San Roman said. “It really depends on what the customer wants.”
San Roman conceded that some distribution customers started to view Millenia as a competitor. “Here we are selling steel to a fabricator, then we buy a turret, a laser, and a brake press. But if you look at the footprint of [a distributor], some have been fabricating, plating, bending, and welding parts for 30 or 40 years. People just haven’t recognized this as a vertical business model. We basically took the European, Asian, and South American models and mimicked that.
“The model exists; it just hasn’t existed in the U.S., because the U.S. has been built on that family, self-starter business model,” he continued. “So we’re now looking at these second- and third-generation family businesses, and asking, ‘What if we put them together? Can we be competitive?’ Now, 14 years later, the marketplace is starting to embrace what we’ve put together.”
Today Millenia’s salespeople are given training in all areas of the company. They can choose where they best fit, or they can sell the entire vertical platform, from metal distribution to full product assembly. If sales works with a custom fabricator, they approach that company as, of course, a metal distributor. But if the salesperson visits a product line manufacturer, the conversation can end with anything from an order for a bent part to a fully coated and assembled product, packaged and drop-shipped to the customer’s customer.
“We’ve found that every customer needs something that we provide, and they’re embracing the [vertical integration] concept,” San Roman said, “because they don’t want to call 13 different companies to order a part.”
San Roman described Millenia Products’ experience with Snap-on Inc. At first Millenia provided only raw flat metal. Now it manufactures an entire product line, packages it, and drop-ships it. “Snap-on never touches it,” San Roman said.
Millenia has consolidated its Chicagoland operations into one plant in Itasca. It has another facility in Ontario, Calif. —the home of stamper and fabricator Walker Corp., which Millenia purchased in 2013. It also has two facilities in Mexico and partnerships with other entities for warehouses and metal distribution around the country.
“Our goal eventually is for each facility we own to have the same capability,” San Roman said. For instance, two years ago Walker was known mainly as a stamping operation (hence its name), a progressive one, in fact, with a mature lean manufacturing program. Walker, which started venturing into metal fabrication in 2000, has since added more turret punch presses, press brakes, additional welding, and other fabrication capabilities. At the same time, the Itasca plant is expanding its automotive stamping capabilities, learning from Walker’s longtime expertise in the business.
Vertical integration has its technical merits. Millenia cuts its coils to the lengths it needs for the application—no need to work with standard sizes and deal with sheet remnants. And if there’s a problem with the material, be it in a stamping die, in a roll forming system, on a laser cutting machine, or under a press brake punch, managers can trace the problem upstream to the initial leveling, slitting, and cut-to-length machines. Or they may work directly with the mill to correct a material problem.
“There’s no finger-pointing,” San Roman said. “We control the whole process. A big portion of our distribution is internal. We’re buying our own material for internal use on the manufacturing side of the business.”
At the same time, distributors often have issues with scrap, which includes fall-offs from the master coil. Instead of selling it for scrap, Millenia uses that material for its own manufacturing processes. “We try to consume all the scrap to minimize the loss,” San Roman said.