ORLANDO, Fla.—Germany's Masterflex Group is looking to more fully integrate its two U.S. operating companies, a process that likely will include the consolidation of three facilities in Houston into two.
The Masterduct unit is the more veteran of the two U.S. businesses, being in the country since 2000, using such materials as polyurethanes and silicone elastomers to produce technical hose and ducting products for industrial uses, including high-heat abrasive materials conveyance, vehicular exhaust source capture and environments where chemical fumes are present.
Flexmaster USA has a shorter tenure in the U.S., and specializes in making ducting for heating, ventilation and air conditioning units in buildings such as hospitals. Its products typically are made of metal, polyvinyl chloride, fiberglass and some lighter-weight films, but some do utilize an elastomer coating.
“The goal is by 2012 to have the two sides consolidated,” said Darren Scott, Masterduct director of sales. He talked about the project, which he said is in the initial stages, during NAHAD's recent annual convention in Orlando.
Despite the differences in the two businesses—Masterduct does most of its sales through distributors and original equipment manufacturer accounts, with Flexmaster targeting building engineers and architects—Scott said there still are synergies between the two.
The first part of the process started earlier this year and focused on the sales staffs, working on getting them to learn about both businesses and customers. “The learning curve is going well,” he said. “There has been a lot of cross-training on products, learning the benefits and features of both. We're also learning how to reach the engineering departments on (the Flexmaster) side of the business.
The company eventually will work on the manufacturing process and down the line combine customer service functions. “We already have a lot of our engineering staff cross-training on both products,” Scott said.
Masterduct and Flexmaster currently operate three facilities in Houston—one for the Masterduct products, one for metals and one for other Flexmaster HVAC ducting. The plants are close to each other, located about 1.5 miles apart.
Scott said the Masterduct facility has about 32,000 square feet and is pretty full, having recently added its fourth silicone mandrel manufacturing line. “We keep growing and we're running out of room,” he said. “We're bulging at the seams.”
One possibility for the consolidation, he said, is to expand one of the facilities out the back, bringing the buildings closer together and allowing the firms to have a central shipping point.
“It's a little spread out and we want to make it more efficient,” he said. “The goal is hopefully to get down to two facilities. By expanding out you can do a lot of different things.”
Masterduct employs about 30, with the total work force between it and Flexmaster USA around 80 to 90.
Scott said Masterduct's business is fairly well split between distribution and OEMs, with the latter leaning heavily toward vehicle exhaust usages. Sales to distribution, though, have grown roughly 15 percent in the last 18 months as the firm becomes better known and has more success in teaching its distributors how to access aftermarket business in the vehicle exhaust market.
“We teach them new places to go and new applications that they're not looking at or thinking about,” he said.
And being a smaller, niche player, Masterduct tries to target one or two strong distributors in any given area. “We don't want to go out and sell to everybody and their brother,” he said. “We want some good, powerhouse people we can work with.”