BRENHAM, Texas—Longwood Industries Inc. prides itself on being a diverse company, producing rubber products for 17 different markets.
But it's the oil and gas sector that stands as the largest customer for the Greensboro, N.C.-based rubber product maker, and is easily its fastest growing, according to Curtis McClamrock, vice president of sales.
Along with this growth, Longwood has added new equipment and capabilities at its Brenham facility; improved efficiencies through lean manufacturing programs that have boosted capacity at Brenham and at the company's Wythe¬ville, Va., plant; and boosted its research and development efforts to offer customers more than just molded products.
In short, the firm wants to be able to offer whatever its customers need, be it for conventional oil rig platform drilling or for the opportunities created by the newer hydraulic fracturing methods now in full growth mode in North America, said Sherry Adams, energy industry manager for the firm's Longwood Elastomers Inc. unit.
She said the products offered range from items used in downhole drilling to oil platforms, and include all-rubber goods and rubber bonded to various substrates, such as its techniques for wrapping to size and bonding rubber to pipes up to 40 feet long.
McClamrock said Longwood is growing on both the traditional and newer unconventional oil and gas drilling sectors, but that the fracking business definitely has advanced faster the past two years. He also noted fracking is a method being used not just for natural gas production, but for oil, too.
"They're fracking both sides of that industry," he said.
Longwood has taken several steps to keep up with the growth, both officials said. At the Brenham plant it:
c added reclaim oven capabilities that have helped to bring in new business;
c installed a 54-inch by 54-inch press to add to its large press capability;
c implemented new patented manufacturing processes that maximize production efficiency and allow for additional growth;
c hired a new plant manager and production manager, and doubled the firm's work force to about 175 over the past two years; and
c utilized its R&D center located next to the Brenham site in 2010 to help boost its oil and gas business.
While the Wytheville location hasn't seen as much activity—it does have a new plant manager—McClamrock said the company is increasing interaction between the two facilities and is looking for the Virginia plant, which employs 200, to capitalize on more opportunities expected in the Marcellus shale areas.
"We're making a big push for Wytheville to go after more of the gas side of the industry in the Northeast with the Marcellus shale," he said. "It's perfectly located for us to capitalize on it just like we've capitalized on the oil at the Brenham location."
Longwood hasn't had to physically expand its facilities because its lean manufacturing programs have been able to boost efficiency and increase capacity, McClam¬¬¬rock said.
"We've got a lot of capacity left for growth and we continue to add as we need it for whatever parts we're making," he said. "We have enough capacity to probably double our size."
The manufacturer posted sales of $80 million in 2011, the most recent figures available.
Longwood historically has been a company built on acquisitions, according to McClamrock. But several years ago ownership decided it wanted to pursue organic growth and brought in Dana Waterman as CEO. McClamrock came on board a few months later.
"We refocused the sales team and hired some new sales people," McClamrock said. "At the same time we invested in the R&D center and engineering to support what the sales team was doing. We had absolutely lost focus of what the basics are."
From Longwood's perspective, he said getting back to the basics was fairly simple: sitting down with customers, asking questions and listening. Then it's producing a quality part and delivering it in a timely manner.
"We're very customer centric," he said. "We want to know from the customer what we can do to better serve them, and then we're going to do everything in our power to do that.
Adams said the addition of the reclaim oven capability was one example of something that followed a discussion with a customer. She asked the customer how they could get more of its oil and gas business, and was told Longwood didn't have reclaim capabilities.
So she went back and worked with the engineering staff, which came up with what Longwood needed for a burn-off oven and, consequently, business has risen substantially with the customer.
"It's been a larger benefit for them because it's been an area we can handle for them," Adams said. "There was a need there for them that wasn't just molding."
Quality is king
The term "value-added" almost is a cliche in business, but it really is true in the oil and gas market, McClamrock said. While you have to be competitive on price, quality is the No. 1 requirement and delivery usually is second. "There's not a lot out there for you to have if you're just going to try to take something with price," he said.
Longwood, for example, can mold a product, put it in a kit, package it and drop-ship it for the customers, McClamrock said.
Requirements in the oil and gas industry are probably the most stringent of any industry, according to the Longwood vice president. "If you deliver a sub-par part, they're going to take business somewhere else. They can't afford for (operations) to be down or to have quality issues in the field."
That is where Longwood's increased efforts in R&D and engineering are paying off, he said. The company works with the end user or distributor serving an account to determine what problems need to be solved. Then it can follow the issue from design through prototyping, quality testing and parts production.
"The lab is used for all aspect of different products and groups within the company, but it's been a big benefit for the oil and gas sector as it's increased over the last several years," Adams said.