(Editor’s note: This is the third installment in a monthly series highlighting some of the region’s unsung manufacturers that make products essential to the economy and, in many cases, our way of life. Other installments can be read here.)
On a recent morning, Joseph Matthews, CEO and president of Maxson Automatic Machinery Co., was dealing with a small detail with big implications.
The assembly of a specialty sheeter, a large machine that cuts rolls of material into specific lengths and widths, was almost complete and ready for shipment to a Maxson customer in Oklahoma. One problem: The $500,000 sheeter still needed a valve, a $75 part that remained in transit from a supplier in Arkansas.
Matthews was waiting. So was his customer. Welcome to the world of supply chain snags.
“Things used to take 10 weeks [to arrive],” Matthews said. “Now they take 18 weeks. And they cost more.”
The Westerly-based manufacturer has been making specialized precision sheeters, rotary cutters and converting equipment for the paper, board, printing and plastics industries for more than a century.
Inside the hangar-like Maxson building recently, three sheeters were being built on the 82,000-square-foot factory floor. Four more were in the planning stages. Matthews was filling in for the floor manager, who was out with COVID-19.
“As CEO, you wear a lot of hats,” he said.
As he moved through the building, Matthews spoke about running a company through the 2008 recession, and more recently the COVID-19 pandemic. And while the Great Recession was worse from a financial standpoint, the public health crisis brought different challenges.
“The worst recession is always the one you’re in right now,” he said, adding the quote from former British Prime Minister Winston Churchill: “If you’re going through hell, keep going.”
The company, which continued operations throughout the pandemic because of its categorization as an essential business, survived in part thanks to the federal government’s forgivable Paycheck Protection Program loans.
Then when the economy reopened and business returned, the company was inundated with orders, creating new challenges. That includes finding help to build and ship between 12 and 18 sheeters annually.
Maxson recently hired four people, bringing the company’s headcount to 35.
“We were very busy,” Matthews said. “But in the end, we came through it. We have been in overtime mode for two years.”
[caption id="attachment_423697" align="aligncenter" width="1200"]
ROLLING ALONG: Three sheeters, large machines that cut materials into specific lengths and widths, are being assembled on Maxson’s factory floor. The construction of another four sheeters is in the planning stages.
PBN PHOTO/MICHAEL SALERNO[/caption]
PATENTED PROCESS
Maxson was founded in 1912 after entrepreneur Charles B. Maxson noticed that industrial printing machines needed so-called “lay boys” to manually stack sheets as they ran off a production line, a tedious and at times dangerous job. Maxson secured a patent to revolutionize the process, modernizing sheeters so the machines would catch and stack the paper automatically, eliminating bottlenecks caused by stacking by hand.
“It was something that didn’t exist,” Matthews said.
Initially, Maxson contracted with a machine tool shop in Erie, Pa., to produce the machines that were dubbed “Erie Lay Boys.” Then he opened his first manufacturing shop on Granite Street in Westerly. The company moved to its Airport Road headquarters in 1977.
Soon after its start, the company hired Matthews’ grandfather, Louis Matthews. Both Matthews’ grandfather and father were Maxson executives. Joseph Matthews joined Maxson in 1983 to run sales and marketing and within a year was elected to the board of directors and named secretary. He was elevated to vice president in 1992 and, eight years later, succeeded his father, Merton, as president.
And now a new generation of Matthews is continuing the tradition. After a decade working at General Dynamics Electric Boat, Joseph Matthews’ son, John, a University of Rhode Island engineering graduate like his father and grandfather, will be joining the company.
Times have changed.
When Joseph Matthews joined Maxson nearly 40 years ago, the company had 25 competitors nationwide. Since then, like in many industries, the sector has been consolidated through bankruptcies and buyouts following financial crises.
“In every economic downturn, you would lose two or three competitors,” Matthews said. “They were weakened. Now there are two. And we are the only independent.”
Maxson has survived because of its ability to make specialized equipment for its customers, Matthews says.
“The industry has gotten smaller,” he said. “So, there are fewer suppliers needed. We had an engineering advantage in that we would customize our machine designs to suit the needs [of customers].”
One example of a tough-to-please customer: 3M, the multinational manufacturer based in Maplewood, Minn.
“They have some [unique] production requirements,” Matthews said. “We were always somebody that was willing to take offbeat specifications and build sheeting equipment for them. When everybody else was building the Model T, we were building the Studebaker.”
PRECISE CUTS
Over the years, Maxson has diversified its operations, creating a capital equipment servicing arm and providing consulting and after-sale services that make up about 20% of revenues. Matthews declined to disclose the company’s annual revenue.
All of the equipment manufactured by Maxson undergoes acceptance testing, with buyers from across the country visiting the plant to see their purchases in action before taking possession. Maxson recently closed a deal with a buyer in the Netherlands, though offshore purchases make up less than 10% of revenues.
“If something is not right, we want to know it here and not in the field,” Matthews said. “It all starts with engineering. If we do not get it right at first, we fight that battle the whole way through.”
A sheeter nearing completion for a customer in Massachusetts recently was undergoing the final touches at the factory. It will pump out precisely cut cardboard boxes that could be used for golf balls or high-end liquor bottles. Matthews says it’s a sophisticated process, utilizing microprocessors that make cuts with the precision of less than 1/64 of an inch, unloading single units at a pace of 1,000 feet of cardboard per minute.
In an upstairs corner office, Josh Jelley, who joined the company as a machinist before taking the lead in the engineering department, examines the computer-aided designs for the next customized machine to be built. For Jelley, ordering the parts needed for assembly at the right time is crucial considering supply chain problems. “It’s a delicate balance,” he said.
Matthews says an influx of new orders added a level of difficulty to the process.
“We have machines on our floor that for want of four or five parts, we would have ready to run. But we are having supply chain issues with some components,” he said. “People order machinery when they want to order machinery – not when we ask them to.”
[caption id="attachment_423698" align="aligncenter" width="1200"]
RIGHT ON THE BUTTONS: Mason Brouillette, a computer numeric control machinist, operates the manufacturing equipment at Maxson.
PBN PHOTO/MICHAEL SALERNO[/caption]
‘APTITUDE AND INCLINATION’
Maxson machinist Eli LaHoud has been with the company for seven months. He was recruited through the state-sponsored 13-week Fast Track to Manufacturing program at the Community College of Rhode Island.
LaHoud’s journey “really underscores what the state is trying to do in manufacturing,” Matthews said.
LaHoud uses computer numeric control – or CNC – machinery to create steel parts for the next sheeter. Watching LaHoud at work, Matthews says Maxson employees, who are cross-trained, need to be part traditional machinist and part technician these days.
“Any machinist must understand the part being made. He must monitor how it runs to prevent ‘shatter’ over time, where the tool bits start to wear down,” Matthews said.
LaHoud oversees the setup of the CNC equipment, which can take up to 90 minutes, before beginning the machining, which requires an additional half hour.
“If you have the aptitude and inclination,” Matthews said, “then you should have the qualifications to be successful.”
Finding employees such as LaHoud has been difficult, Matthews says.
“We are doing a lot of on-the-job training,” he said. “It has got to the point that when it comes to a machinist, we are prepared to take anyone who has gumption, shows up on time, has a mechanical aptitude and a willingness to learn. It takes time and effort and can be inefficient. But it is what you do when you take the long view.”
David M. Chenevert, executive director of the Rhode Island Manufacturers Association, says the state can play a leading role in keeping the Ocean State’s manufacturing base viable. The association works with the R.I. Department of Labor and Training and R.I. Commerce Corp. to match job seekers with manufacturers.
“Our issues right now are supply chain, labor shortage and training needs,” he said.
Andrea Palagi, communications director for Gov. Daniel J. McKee, says training is a top priority for the administration.
“We know finding qualified, well-trained talent is one of the most pressing issues in every sector of the economy, including manufacturing,” she said, pointing to entities such as the Governor’s Workforce Board, which offers Incumbent Worker Training Grants to help offset the cost of training existing employees, and Real Jobs RI, a DLT initiative that supports job training.
Matthews hopes elected leaders boost the resources aimed at helping the state’s manufacturing sector.
“Those programs need to be expanded,” he said. “And there needs to be a [greater] recognition of what a limited workforce we have.”
Nevertheless, Matthews says Maxson has no plans to uproot the company and move to an area of the country where the cost of doing business may be lower.
Relocating farther away would require finding and training qualified staff, something Maxson has worked hard to acquire and maintain in Westerly.
“This is a very niche market that we operate in,” he said. “The people that work for us, we can’t afford to lose. We have always been a Westerly company. This is where we are and where the people who have helped us be successful live. We cannot risk losing that talent and expertise.”
