March/April 1998
Specializing in emergency breakdown repairs, Femco Machine Co. brings its machining, repair, installation, and inspection services—to name a few—to customer sites east of the Mississippi.
By Kristina Rundquist
Kristina Rundquist is an associate editor of Scrap.
They’ve manufactured parts for Polaris submarines and military tanks, rebuilt 1,000-ton presses for the likes of Toyota, General Motors, and General Electric, and performed line-boring work on nuclear reactors. They’ll even make a house call to fix your shear.
They are Femco Machine Co., a full-service heavy equipment repair and machining company based in Punxsutawney, Pa.
From its headquarters a few miles down the road from the home of America’s favorite groundhog—Punxsutawney Phil—Femco oversees 200 employees, a second 50-man operation in Pompano Beach, Fla., and a fleet of 31 field-service trucks that act as mobile machine shops, ready to perform on-site repairs for customers anywhere east of the Mississippi. It’s an impressive reach, one that the company has steadily expanded in its 38-plus years in business. And according to Femco’s principals, the company has the potential to develop an even more impressive reach in the future.
Expanding Under New Management
Femco was born more than 38 years ago when Frank Amundson Sr. and sons Frank Jr. and Eric set up shop in their Punxsutawney garage. The three launched Femco—whose name incorporates each of Frank Sr.’s three children: Frank, Eric, and Madeleine—“with a couple of small machines,” recounts Leo Johnston, Femco’s sales manager. “They’d go up to the coal mines and pick up a piece that needed repairing, repair it, and take it back.”
For its first 25 years, Femco focused primarily on repairing drag lines in the nearby coal and strip mines of western Pennsylvania and Ohio. Then, when the U.S. coal industry began to wane, the company realized it had to take a proactive approach if it was to survive. “We had to diversify,” says Johnston, who joined the company in 1976. “The first thing we did was open a service facility in Pompano Beach, Fla. A few years later, we opened a branch in Tuscaloosa, Ala.” Femco serviced scrap dealers and coal-related customers. It also did government-type work and third-party machining for engineering companies.
Today, although the Alabama plant has since been sold and the coal business constitutes only 10 percent of the firm’s work, Femco is a thriving business with more than $25 million in sales last year. The seeds of this success are fivefold, representing the firm’s five business segments: scrap, press or metal forming, heavy industrial, field service, and crane parts inventory and field service.
“Most of the work we do today is emergency breakdown work and spare parts,” Johnston says, noting, “we repair, we fabricate, we turn, we manufacture. It’s always been that way.” And perhaps because it’s always been that way, Femco has developed a reputation as one of the best in the business.
In 1994, Manitowoc Co. (Manitowoc, Wis.), a manufacturer of cranes and food service and ship repair equipment, bought Femco, and the Amundson family exited the business.
Being owned by a large corporation gave Femco new options and enabled it to expand its business. As Johnston asserts, “being acquired by Manitowoc was one of the best things to happen to us.”
Have Trucks, Will Travel
Under Manitowoc’s direction, Femco has worked to focus its core strengths in each of its five major segments, notes Bob Stein, administrative assistant to the vice president.
That’s especially true when it comes to the company’s fleet of field-service trucks. “The goal with this fleet is to take the services of a machine shop into the field rather than disassembling a piece of equipment and bringing the parts back here to Femco’s shop,” says Stein. “Our primary goal here is to reduce the customer’s downtime. We fully understand that time is money and that’s why we always strive for responsiveness.”
Johnston echoes that point, asserting that “the single most important benefit we offer scrap processors is our quick response to their downtime—that’s where our emergency breakdown service comes into play. When our field-service personnel are on location, their question to the client is, ‘Can we work 23-hour shifts?’ They know they have a job to do.”
On-time repairs and deliveries do more than just make customers happy, though. They also please Femco’s owners. “We’re not only governed by ourselves to do a good job,” Johnston says, “but every month Femco must report on-time deliveries to Manitowoc. So you can see, it’s a very important focus for us.”
To make sure jobs get completed with minimal disruption, each truck in the Femco fleet can perform a broad array of services, including milling, drilling, line boring, shooting optics, and more, thanks to nearly $300,000 in equipment per vehicle. And each technician is a true “jack-of-all-trades,” able to act as a machinist, welder, mechanic, and diagnostician, among other roles.
“We offer the most complete machining services available—what we call a turnkey operation,” Johnston points out. “We have lead men who will go on-site and oversee a job from start to finish. If it’s pouring the concrete or doing the electrical wiring, it’s done. They work on the hydraulics and the complete installation of the machines, be they shredders, balers, or shears.” Taking a moment to boast, Femco’s principals say their team can install a shredder in as little as four weeks, depending on the job and the availability of parts and supplies.
This January, Femco had three of its 31 trucks and six men assigned to the installation of a supershredder at one customer, while the remaining trucks—nine of which are based in Florida—remained on-call 24 hours a day, seven days a week, ready to install new equipment, conduct repairs in the field, or even disassemble a piece of machinery and arrange for its delivery to the nearest Femco operation for further repair or refurbishing.
This level of service makes work easy for Femco’s sales team, says Johnston. “It’s the easiest thing for our salesmen to sell because there’s not a manufacturing service today that can’t use Femco’s field service.”
Coal, Cranes, and Scrap
Oftentimes, Femco’s work for one type of customer intersects with another key business area. For instance, the company’s work in the coal industry made it an expert in cranes and crane repair. “Our crane business is rapidly growing and will continue to grow both domestically and internationally,” Stein says. In 1997, he notes, Femco sold more than $4 million in crane parts to places as far away as Saudi Arabia, while at any given time it has on-hand approximately $2 million of inventoried parts in its Punxsutawney warehouse along with another $1 million worth in Florida.
Femco supplies repair services and parts to operators of both lattice boom and hydraulic cranes, though “the bread and butter for Femco has always been the lattice work because of their use in the coal fields,” Johnston says.
But as the coal industry has declined, Femco’s work for scrap companies has grown. “Scrap is a very important segment of our business and a natural fit because it’s a crane-related business,” Johnston says, noting that “practically every scrap operation has a crane.”
Today, the scrap industry receives much of Femco’s attention for services such as installing, repairing, or machining equipment, or manufacturing spare parts. A scrap company, for instance, may call on Femco to manufacture a spare part or send out a field-service truck for an on-site repair. “On shears, we have replacement liner plates and bolts that we manufacture here,” says Johnston, adding, “we’ll bring them the cross-head or knife seat or whatever. Sometimes the parts can be repaired in the field, but mostly they’ll need to come into the shop to be machined.”
To take care of those more difficult in-house repairs, Femco relies on some heavy-duty, high-tech equipment. That’s a change from the old days, notes Larry Marteney, who came on as executive vice president and general manager two years ago. When Femco was an independent, family-owned business, he explains, it did not invest in a lot of state-of-the-art equipment. So modernizing the company was—and continues to be—a key goal under the new management.
“We’ve set out to rebuild our equipment and get it to where it should be as far as digital readings and numeric controls go,” Marteney says. Femco’s arsenal of equipment now includes a 100-ton overhead crane with 38 feet under the hook to allow for the handling of large gears, housings, and shafts. Large boring mills enable the company to take up to 100,000 pounds of steel and drill and mill it, while CNC equipment such as the Mazak Integrex 60—which can perform work from six different axes—helps produce small shafts, pins, and other close-tolerance work.
“We were one of the first in the United States to have this piece of equipment,” Johnston claims, “and today we’re still one of the few companies that can recut laggings for cranes.”
Femco’s ability to handle gear-cutting needs also puts the company ahead of its competitors, Johnston asserts. “Most companies don’t have in-house gear cutting. We can build a new gear or we can bring one in, remove the teeth, install a new ring, and cut new teeth.”
The company also offers equipment inspection services. “We go into a location and inspect, say, a press or a line of presses,” says Johnston. “We’ll give the company a detailed written report of what we find. We’ll also do that for the scrap industry. We’ll go into a location and do that for a baler or a shear. The owner gets a detailed report and a suggested course of action relating to the equipment.”
Trained for Success
The ability to provide quality service in such diverse fields doesn’t come easy.
And while Femco’s services may be in hot demand, it pales to Femco’s demand for highly skilled personnel. “We’re a growing company and one of our main challenges is to develop the kind of employee that has the skills, abilities, and commitment to continue the quality of work that’s made us the company we are,” says Stein. In his view, the company’s employees are the “most important ingredient of the business. They’re all machinists by background and they understand what to do when they look at a machine—what kind of steel it’s made of, roughly what a repair will cost. They need to be able to look at a component and quickly assess whether that component will or won’t need to be repaired or replaced.”
To meet the demand for highly trained field-service personnel, Femco has started its own training center. “We plan to spend an enormous amount of time, effort, and energy on our apprenticeship training,” Stein says. “Two new programs—field service technician and machinist—will require four years of company-sponsored academic and hands-on training.” To get into Femco’s apprenticeship program, candidates must be in the top of their class from one of the local vocational-tech schools, Stein notes.
Femco’s insistence on quality extends past its employees to its products. According to Johnston, the company has built and will continue to build repair equipment tailored to specific jobs, and each part manufactured by Femco comes with a six-month guarantee. A production control engineer monitors the entire production process.
And as far as internal quality control goes, each step of a job is inspected and signed off by the employee performing the operation. Not only does this hold employees responsible for their own work, but “it saves an awful lot of money,” Johnston says. “Instead of hiring people to do inspections only, going from department to department to inspect a part, here the operator is doing his own inspecting. His name is on it, and he’s responsible.” This reflects the firm’s philosophy that quality is a product of pride and craftsmanship and, as such, is the responsibility of each employee.
The goal of this quality control, of course, is customer satisfaction, which is paramount to Femco’s operations. After all, says Marteney, “there aren’t many businesses that survive without customers. Understanding our customers’ needs and providing solutions to their problems is the driving force behind Femco.” This market-driven approach, he asserts, has positioned Femco to achieve even greater success. “Considering the marketplace that we’re in, the future is what we want to make of it. Our potential growth is limited only by our ability to manage it.” •
Specializing in emergency breakdown repairs, Femco Machine Co. brings its machining, repair, installation, and inspection services—to name a few—to customer sites east of the Mississippi.