Establishing a large-scale gangsaw plant

March 3, 2003
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Historically, the North American stone market has relied upon overseas fabricators for processing blocks into finished slabs. And while there are a few block processors located within the U.S. and Canada, there is certainly room for a new plant for block fabrication. Recognizing this need, James Radford established Epoch Rock, a large-scale gangsaw factory in Newfoundland, Canada, which is focused exclusively on the North American marketplace.

"We recognized an entrepreneurial opportunity," said Radford. "I have a diversified background, and the ability to put it together comes from a lifetime of business experience. The opportunity presented itself and we put together the right team to make it work."

Given the demand for slabs in the North American market - and the U.S. in particular - Radford said there were strong prospects for establishing Epoch Rock. "When we did the due diligence for this project, it became clear that there was a tremendous opportunity for a North America-based slab manufacturer, to supply just-in-time delivery and take advantage of NAFTA," he said. "One of the things driving me was a report by the multinational consulting firm KPMG, focused on the cost of doing business in the G7. The capital of Newfoundland was listed as the number one place to establish a manufacturing facility. With that in hand, it was very encouraging."

But even with the positive outlook for a gangsaw factory in North America, forming the company required a great deal of planning. "The plant was three years in the making," Radford said. "There was a lot of due diligence and making sure that the business plan was rock solid. I spent a lot of money - $250,000 - on the business plan, and I spent significant dollars on the financial plan and checking everything; modeling everything."

Selecting the equipment

Before investing in the machinery for the new plant, we carefully researched our options, a process that included visits to the various stone industry trade shows in Germany and Italy. Ultimately, Epoch Rock was equipped with machinery from Italy, including primary manufacturing from Breton and secondary processing from Pellegrini. "We developed a relationship with Breton, and learned of their excellent reputation fairly early in the game. I found them very helpful," he said

Epoch Rock has six Jumbo Breton gangsaws, and a 19-head Breton polisher. Additionally, it is equipped with a Pellegrini DF 2500 Diamond Wire saw and a Pellegrini 40-ton block rotator. To optimize water recovery, the company also invested in a complete water recycling plant.

Once they selected the machinery, implementing the equipment was relatively easy, according to Radford. "When we bought the equipment, we contracted for the technical people to come over and supervise the installation and commission the equipment," Radford explained, adding that the total investment in machinery totaled $9 million. "We had 13 technicians come over, including seven at one time."

Looking to ensure its long-term success, Epoch Rock was also careful to hire the right personnel to run the advanced machinery. "Breton recommended a technical director for us, and he is very experienced. He actually worked with Breton for 23 years," Radford said. "He comes to us with 30 years of experience. He moved with his wife from Italy for this job."

The plant capacity for slabs is 2.5 to 3 million square feet per year, and the company has a total of 35 employees. "It is a very efficient plant. Everything is computerized and networked," Radford said. "From a remote PC, you can actually look at the status of the saws and change the density of the cutting fluids and so on. There is an energy management package built into the computer as well, which limits your electrical demand to a pre-set maximum. It's like the McDonald's system, it can tell them exactly how many squirts of ketchup an employee put on a burger last night at 10 p.m. We can keep track of all of the production details as a result of the advanced technology of this equipment."

Shipping the product

Epoch Rock's location is not only close to its customer base in terms of mileage, but it is also advantageous for material transport. "Epoch Rock's oceanfront location, with its own 900-foot pier and 20 acres to store our blocks, ensures that blocks coming in and slabs going out never leave company property," said Christopher Johnson, vice president of sales and marketing for Epoch Rock. "Basically it's cheaper for us to store raw blocks in Newfoundland than it is for the wholesaler to store finished slabs in a major U.S. city, and the wholesaler can take advantage of our rapid shipping to minimize their inventory and order from our stock just in time".

The company's customer base is comprised primarily of wholesalers. "We've only been in the market for a short time," Radford said. "The bulk [of Epoch Rock's client base] is in the U.S., particularly the Eastern half of the country. We have had some discussions with people out West, and there is some potential there, but our greatest potential is the East Coast, Midwest and south central U.S., such as Texas.

Radford said that in addition to the elimination of duties for goods shipped to the U.S., "the greatest potential savings for our customers is in inventory management and materials handling; we cut shipping to a matter of days. If we were to send a truck to Naples, FL, for example, with slabs on A-Frames as opposed to bundles, it would take four days to arrive and is ready for lay down and sale without re-bundling in a lot of cases. Geographically, we're closer to New York than Miami is."

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