Shop's diversification keeps cash flowing

Jeff Sturdevant Sr. isn't too concerned if his CNC router, the heart of his cabinet shop, is idle for days.

That's because one of his three revenue streams commercial construction, insurance repair work and custom cabinets is always funneling money into  JCS Construction Inc. 

"We're lucky that the cabinet shop division feeds off the construction side and vice versa," says Jeff Sturdevant Sr., owner of JCS Construction Inc.

"Our cabinet equipment can sit idle for days and still be productive. Right now business is slow. However, when commercial construction work dried up, the cabinet shop was booming."

Three revenue streams allow JCS to be more competitive with pricing.

"There are times that if we were strictly a cabinet shop and didn't make enough profit on a job, we wouldn't survive," says Sturdevant.

Before the slowdown, the Imperial, Calif., shop's revenue stream was 50 percent cabinets and 50 percent construction. Now the shop is 70 percent commercial and 30 residential.

The more you know

Working in the middle of the desert with the closest large city (San Diego) 120 miles away, diversification and adaptability are critical.

"Work here has shut down," says Sturdevant.

"I know contractors who had 115 employees 10 months ago who have trimmed down to 15 to 20. We're doing OK because the insurance repair portion of the construction business is prevailing."

Sturdevant never aspired to own a cabinet shop, but six years ago he saw it could be another revenue stream.

"We were remodeling a bank and the bids for cabinetry out of San Diego were outrageously high," says Sturdevant. "I decided we were going to build the cabinets and millwork in house."

The shop built all the cabinetry, teller lines, wrapped columns, check-write desks and display cases.

The project's architect was so impressed with JCS's work that he recommended them for two more bank branch remodels and a remodel of the bank's 22,000-square-foot operations center.

With just a vertical panel saw and edgebander, the shop produced more than 1,235 lineal feet of upper and lower boxes and 2,700 lineal feet of laminate tops.

After those jobs, the shop purchased a  Biesse CNC router and sander and a Casolin sliding table saw.

Cross training pays off

When asked what is the most important tool is in his shop, Sturdevant pauses and says it depends on the economy.

"I consider the router a necessary employee, one that doesn't show up late or call in sick. I also can't live without the edgebander, vertical panel saw, Planit software and sliding table saw. I couldn't have a cabinet business without these pieces of equipment."

Taking advantage of down time, JCS is investing in Biesse Works training so its operators will know what the CNC can do.

All JCS employees are cross-trained in the different revenue streams. "They can hang drywall, build boxes and install them the next day," he says.

Waiting for a turnaround

While the economy continues to challenge many industries, Sturdevant is making plans for the turnaround.

The shop has been approached by an architect to build custom components and ship them all over the United States.

Before starting a fourth revenue stream, JCS wants to buy the 30,000-square-foot building across the street and set up a laminating operation when the economy picks up.

"We would be able to produce post-formed tops and panels for our own use and for other shops," says Sturdevant.

"Getting the laminate shouldn't be an issue because most manufacturers ship direct (so rush jobs wouldn't be a problem). I would love to be only a cabinet shop with a little bit of commercial construction on the side. A good reputation is priceless. If we can't do it right, we don't do it."

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About the author
Kathleen McClaughlin

Kathleen McLaughlin was an associate editor and contributor to CabinetMaker and FDM magazines for a number of years. She is currently social media/SEO editor and custom publications editor at WATT Global Media.