Oregon Shop Changes with the Times

After almost 30 years in business, Mike’s Custom Cabinets adopted new automation to boost productivity.

By Renee Stern

     
Mike’s Custom Cabinets

Cornelius, OR

Year Founded: 1974

Employees: 17

Shop Size: 7,200-square-foot shop, plus separate storage, showroom and office space

FYI: With a new CNC router and a switch to nested base manufacturing, the company is able to pursue more high-end clients.

 
   
     

As Mike’s Custom Cabinets approaches its third decade in business, the pace of change at the Cornelius, OR, company is accelerating.

Owner Mike Schoen Sr. set up the business in 1974 after learning the trade from a cousin. Today, a second generation of Schoens helps run the shop with 17 employees, and new equipment is changing the way the company builds cabinets.

Health problems in the past few years provided a wake-up call, Schoen says, which prompted him to hand over more management responsibility to his sons. Mike Schoen Jr. and Royce Schoen now handle client meetings and oversee production. Youngest son Rex takes charge of installing the finished orders.

On the production side, a big change last year was the company’s purchase of a CNC router, which is boosting production capacity and opening new opportunities. The shop can produce higher-end cabinetry more cost-effectively, and the average cost of a kitchen increased to between $15,000 and $20,000. Schoen Sr. says he expects a 20 percent to 25 percent increase in sales for 2003 from higher productivity with the new equipment.

In addition, somewhere in the not-too-distant future is a long-planned expansion to bring what is now three buildings — a 7,200-square-foot shop, a combined showroom and office, and a 3,000-square-foot storage facility — under one roof. It will be yet another transformation for the building that houses the main shop, which since the 1930s has been a dance hall, a cannery, an automotive shop and other small businesses. Schoen moved his operation there in 1979. Ten years later he began acquiring adjoining lots for the eventual expansion.

Steady Referrals Create a Healthy Backlog

The company focuses almost entirely on residential casework, from kitchens and baths to entertainment centers or anything else clients request. About 75 percent of its business comes from contractors, with individual homeowners providing the rest.

     
 
Mike Schoen Sr. says that this is a “typical” residential wall unit/mantle project for Mike’s Custom Cabinets. This unit is in alder.  
     

When Schoen started out, jobs came in through referrals. Apart from some early advertising efforts, he continues to rely on word-of-mouth. “It just seems to be that the referral work we get is steady,” he says.

The company maintains a four- to six-week backlog of orders. “I feel real fortunate to be able to do that,” he says, “especially in the flat economy that we have.” (Oregon’s unemployment rate has topped the country’s rankings in recent years, making it especially hard-hit.)

Schoen’s business, while originally centered around Portland, has spread to the coast and central state areas. “I don’t see things slowing down around here any,” he says. “Contractors are our bread-and-butter. But we don’t turn anything down.”

Working with contractors means that scheduling can be a complicated juggling act, especially when projects fall behind, Schoen says. The shop builds a little cushion into its schedules, but he also will pick up the phone to see if other customers are running ahead of schedule and make adjustments to keep operations at a steady hum.

Automation Adds Flexibility and ‘Fun’

Adding more automation to the shop helps accommodate schedule changes and also has added job flexibility for shop employees. Instead of spending all their time on laborious tasks, such as cutting parts, workers are now free to “use their natural abilities” and do more challenging work, Schoen says.

For example, the new router, a Busellato Jet 3006, “has put some of the fun back in the work” by allowing the company to take on more complex cabinetry jobs than were previously feasible, he says. (See sidebar for details.) Fluted columns, arches and angled cabinets are quicker and easier with the new equipment.

In a competitive market, every edge counts, Schoen adds. “We had plenty of work, but it was tougher to make money during the past year.” Increasing competition and changing demand put extra pressure on the bottom line. In addition, greater flexibility is required these days because customers today are seeking a wide range of different looks. “Two to four years

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