Midwest Cabinetmaker 'Hits the Jackpot'
Work on two major casino projects provided a big boost to John Pater Design & Fabrication, Aurora, IN.
BY HELEN KUHL
One could say that casino gambling paid off big for John Pater, owner of John Pater Design & Fabrication in Aurora, IN. Even though Pater has never so much as put a quarter into a slot machine, he "hit the jackpot" about three years ago when a gambling referendum was passed in Rising Sun, IN, a couple of miles down the road from his small woodworking shop. Pater received a major contract to work on a casino boat and entertainment complex there, a $160 million development, and subsequent work for a $200 million casino in nearby Lawrenceburg. Thanks in large part to those jobs, his company's annual sales grew from $170,000 in 1995 to $880,000 in 1997, which fueled major expansion of his shop as well.
While there may have been a little bit of luck involved in Pater's landing the big casino jobs, it was more his aggressiveness in pursuing the developers that helped him obtain the projects, he said.
"When the gambling referendum hit, I knew what it could mean for us, because there wasn't any other woodworker like me out here," he said. "We were pretty much knocking on the development company's door every day, saying, 'We're your company. We want to do this.'"
There was some reluctance from the developer and the contractor to turn the entire project over to "the local guy," Pater said. His shop, situated on his 70-acre farm, was around 5,000-square-feet and equipped with just the basics. But he was given a chance to prove himself with an initial contract to design and build a temporary pavilion in Rising Sun.
"We started negotiating with them and ended up getting that contract, which turned out to be about $325,000 -- more than we had ever made in one year," he said. "I'm pretty sure that they were very nervous about whether or not we could pull it off, because the first time they saw my shop it was about half the current size and didn't have much equipment in it. I was doing everything the hard way."
To complete the job, Pater said he rented a couple of tractor trailer vans, which became an oven for his spray room, and worked sometimes until 3:00 a.m. to get done on time. "But we did come through and really did an outstanding job," he said. "We got everyone's attention, and they were happy with how it turned out."
Pater said that he did some smaller interim projects for the development after that, until one day he received a phone call advising him to increase his insurance to a $2 million umbrella because he would be working on the big project. While he did not receive the entire contract, he shared the job with Art Woodworking Co. in nearby Cincinnati, OH, which was a partnership he had encouraged. "We did about $700,000 worth of the $1.8 million contract and the other company did the rest," he said.
The casino/entertainment complex included a hotel, pavilion, restaurants, bars and ticket counters. "The ticket window had some pretty sophisticated cabinetry," Pater said. "We also did a 20,000-square-foot buffet-style restaurant and a nice radiused maple bar. There was a lot of maple wainscotting, too."
The arrival of the casinos not only benefited Pater's business by being his largest project, but also helped him expand his company. With the promise of a major contract in hand, Pater was able to obtain significant loans for new equipment purchases and expansion of the shop. And, with the local economic boom created by the casinos, Pater's land increased in value, giving him additional equity that could be used to grow his company.
"Property values here more than quadrupled," he said. "So we were able to sit down and write a business plan and turn our equity into working capital. We started pursuing the favorite indoor sport of cabinetmakers, which is tool buying."
Pater made several acquisitions, starting out with a Timesavers 37-inch widebelt sander.
"I had my eye on an edgebander, but I did a time-and-motion study before I started buying equipment and I realized that 50 percent of what I did was sanding," he said. "I thought, 'I don't need a $60,000 edgebander, I need a $15,000 sander.'"
Pater also bought a rebuilt 20-inch Powermatic planer and had a three-phase electrical system installed in his shop. He rebuilt his old 36-inch Fay and Egan bandsaw, adding a 20-hp motor.
Once he obtained "the big contract," he contacted Mueller Machinery, his local distributor in Cincinnati, and bought an edgebander -- a Brandt KD83 from Stiles Machinery -- and a Putsch Meniconi vertical panel saw. Shortly after, he bought a Weinig Profimat 23E moulder and 934 grinder, plus an entry-level automatic sprayer from Advanced Technology Equipment Co. to do flatline finishing of mouldings. The casino job required about 60,000 lineal feet of moulding, Pater said.
His most recent purchases have been a Detel line boring machine from Adwood and a Baker resaw, which he uses to cut skins for stave-core doors and thin wood laminate pieces to be molded and glued for circular, one-piece woodwork.
Other shop equipment includes his original Powermatic tablesaw and jointer, a Diehl ESL-2011 straight line ripsaw, an Inca jigsaw from Garrett Wade, an SCMI TI10 shaper and a small Williams & Hussey moulder, used to do radius work. Pater also has a dust collection system from Torit Day.
"I put the saw and the edgebander on their own little dust system so that I keep my sawdust pure," he said. "The only thing going into the hopper is kiln-dried hardwood, and that way we can use it for animal bedding."
The shop itself, which began in an old school house that was disassembled and moved to the property, has grown to 10,000 square feet. There currently are seven employees, and Pater has outside contractors help with some of his installation. Pater's wife, Judy, handles much of the office work, plus sales and marketing duties.
While Pater's perseverance helped him obtain the casino work that resulted in a whirlwind of growth and new direction for his company, the same determination has always stood him in good stead, he said.
Pater's first career was as a rock and roll musician in Cincinnati. He had a recording contract and lots of potential when he started losing interest in music as a vocation because "I realized what a dog-eat-dog business it was," he said. "I took a job in construction out of necessity and they were throwing away a lot of plywood. So I started taking all that material and making stuff with it. I had always made things; I made my own amplifier cabinets when I was a teenager. Next thing I knew, I was making more money doing that than I was framing houses. So I eventually switched my focus."
The early years were not easy. Pater said he struggled in his first small shops building custom furniture, and he went back and forth doing houses and trim work as well. Then he met Judy and with her encouragement he decided to open another shop. For this venture, he would pursue commercial laminate work for a steadier income.
The Paters began contacting local restaurant suppliers and met a restaurant designer who did work on a chain of high-end chili parlors in Cincinnati. She gave them work on one of the restaurants, and that got the business started. Along with the steady commercial laminate work, Pater also pursued jobs with local interior designers for design/build projects.
In the course of doing the restaurant work, Pater invented a tool to keep laminate from sliding under the fence of a table saw when it is being cut. Called the Lamiguide, the tool was sold by Wilsonart and provided a financial windfall for the Paters, who decided to use the money to move to a rural area of Indiana not far from Cincinnati. It was 1988 when they purchased their 70-acre farm and relocated their home and shop there.
In doing so, however, John left behind the restaurant work to former employees and was back on his own during what turned out to be a tough recession. Once again, he persevered, this time pursuing high-end residential work through interior designers in Cincinnati. He had built a clientele and was doing steady business when the casino opportunities arose.
Even though the gambling complexes changed the local economies dramatically, Pater said that the Aurora area was ripe for development before that market evolved, which was one reason why he chose to move there.
"There hadn't been any development here for 200 years. I had worked around Cincinnati all my life and watched the patterns of redevelopment and this was the only place where it hadn't happened yet," he said. "So it was common sense to me that this area would be growing."
Plans for a new marina, yacht club and other entertainment-based development were happening before the gambling referendum even took place, and there were small, entrepreneurial businesses starting and renovation work being done. Pater helped remodel the Aurora library, which was about a $120,000 job, he said. He also did extensive remodeling at the main office of an Aurora bank, for about $160,000.
Pater himself bought an old building in downtown Aurora, which he just finished renovating. It houses an art gallery on the first floor and will contain a showroom for his furniture pieces on the second floor.
As a direction for the future, Pater said he is very interested in producing windows for renovations being done locally as well as in Cincinnati. "We recently put 142 windows in an old college in Morris Hill, IN, and it was a real laboratory of learning for us," he said. Pater added that at the recent IWF show in Atlanta he gathered a lot of information about window-production equipment to take him to the next level.
Pater said that he will continue to pursue commercial work, although he struggles with the challenges presented by that market. "I'm very idealistic. The hardest thing for me to deal with is that the commercial construction business really has a long way to go to shore up its integrity. There is not a whole lot of trust and honesty," he said. "I would hope that there are a lot more above-board honest people than not, so we are going to continue to pursue commercial work. But it's a tough business."
Pater added that he does miss being "a one-of-a-kind artist," which is why he is leaving space for a showroom of his furniture in his new retail building. "But I've been able to build some pretty serious equity in my life by growing the business the way I have," he said. "I can realistically dream about sending my kids to school, and I'm building something pretty neat that I can leave behind. So for that, I'm very grateful to the developers, because they gave me an opportunity.
"We are trying to constantly redefine our niche and do good work more than anything," he added. "I think it's important to constantly strive to do exactly what you say you are going to do, find out what it is you need to do to earn a living and just do that."
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