"We don't care as much about sales growth as we do about profit growth. What good are sales if you're not profitable?" says Jim Bishop Jr., senior vice president of Jim Bishop Cabinets in Montgomery, Ala. The company produces a lot more volume with its 80,000 square feet than competitors with more square footage, he says.
The company works to make the most of what it has through lean manufacturing and refining production methods. It is also working to put in place a quality control system to ensure consistency in any future growth spurts.
JBC manufactures stock, custom and a semi-custom or hybrid line of cabinets. Bishop credits the almost 30 percent growth last year and the steady growth of the past 19 years with having the right mix. He says the company has the right combination of sales force (independent reps), sales mix, price positioning and customer service.
The only year the company didn't grow was the year it changed its focus from low-end, multi-unit cabinets to remodeling and new construction dealers. The product the company manufactures is continually upgraded and refined. "We have to stay focused and we have to grow. We want to stay trendy and we don't want to get out in left field. And we don't want to become too passive."
Expertise to computerization
When Bishop started at JBC the plant was staffed by experts. "They all knew their job. You put out one job copy and that's all that was required," he says. As you get larger and there are more people, you have to have better information, especially if you have less expertise, he says.
"The problem with less expertise is sustainability of a given system. You can put out a process, you can document the process and train somebody on it, but if you don't have a way of sustaining the process, three employees later, the process has changed because someone figured out a better way to do it, but didn't tell anyone," says Bishop.
"We're trying to put in an ISO-type quality system because we were basically a shop that grew and grew and now we are truly a manufacturer in our size and our approach. So we're trying to build a quality system that will allow us to grow," says Bishop.
The company needs a means of measuring requirements in production, he says. "Quality is conformance to requirements. If they comply with the requirements, they've done a quality job."
In the past, when JBC started the process to implement a quality system, it started without a manager and lowered the price of nonconformance by 30 percent in one year. "But we didn't have a way to sustain it, the document control side of it," says Bishop.
"I'm big on lean manufacturing. I love to see what we can do with the space we have," he says. But improving efficiencies does not exist in a vacuum for this company. "My goal is for my employees to work fewer hours, to make more, to spend more time with their families and love it here and never want to leave."
Bishop has done his own take on Kaizen, the Japanese method of improvement through small changes. JBC would study a department doing Takt time studies and every single department it revamped was outproducing itself, even though all the changes were new and done over a weekend.
When the company redid the door department, for example, the process changed from individual operators into a process cell where employees worked together. After the process had been adjusted, the company expected that each step would take 27 seconds for a process but the employees actually averaged 19.
JBC has its own software program for order processing. The dealer network that sells the product can do the design in any software. "The main software systems that are out there we've paid to link to our order software, Smart Pricing," says Bishop.
The order software quotes, generates the order and transmits it to the company. The majority of orders go directly into the system and need no modification. When there are modifications, they're handled through custom drawings.
Shifting product focus
The company continually refines and adds to its product lines. "I think the line between true high-end custom and what we do is the number of steps they probably take in their finishing process and the time they spend reviewing an order and working with a customer. They probably allow more custom items to be introduced into their plants for finishing," he says. "I really haven't developed a way to get it through the plant effectively, so I shy away from it."
But the company continues to add to its product lines, such as the recent addition of between 30 to 40 custom door styles. This added up to a big change since the company outsources the doors and had to work it in to the 10 working-day turnaround time it's had in place for quite a while.
JBC is seeing its strongest growth in the semi-custom area. "We're still stronger in new construction than remodeling, but that's changing," says Bishop. "I'd like to think we're going to have a better balance there."
Recently the company noticed that its truly low-end product was not making as much money as other products. "On the days that we make it, we see that our profit is not all that great, our labor figures are high," says Bishop. The decision was made to kill those product lines off and adapt the production space to handle the better stuff and it's been a good transition.
"I don't ever intend to be a high-end line, but I want to focus more on the upper end of the middle market. So we're trying to carve a really distinct niche," he says.
"We are nearing our finish capacity," says Bishop. "We're looking at a building expansion, probably about 33,000 square feet, the bulk of which would be a new finishing line. For a true serious growth year, we've got to have more finish capacity."
The outlook for the cabinet industry depends on the housing bubble, says Bishop. "Right now everything is tied to inflation and lending practices. Needless to say I'm concerned that we're going to pay later for this. Who would have thought it would last this long?"
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