Mike Beacom, VP of Industrial Metals at John W. McDougall Company

The past couple of years for John W. McDougall Company have been challenging, to say the least. The bread and butter of our Industrial Metals Division, the U.S. Automotive and Glass Furnace Industries, spiraled toward near extinction as we watched in amazement. Just when we thought the industries had hit bottom, daily reminders of closing dealerships and record losses for manufacturers kept rolling in. On the local front, two of our biggest automotive customers, Nissan’s Smyrna plant and Saturn’s Spring Hill plant, drastically reduced projects, limiting the amount of work available to us. But through the mess and muck of a constant economic battlefield, we’re still here. Recently, I sat down with John W. McDougall Company’s VP of Industrial Metals, Mike Beacom, to ask some questions about the industry and our place in it.

Kim Taylor: Your division, the Industrial Metals Division, is the foundation of John W. McDougall Company. How have you seen the industry and McDougall’s part in it change over the time that you’ve been with the company?

Mike Beacom: The Industrial Metals Division has remained fairly consistent over my 18 years. The Glass Furnace and Automotive Paint Shop Industries have always been a big part of our annual sales. Of course, we have ventured out on several occasions to see if other industries could support our type of custom metal fabrication and installation capabilities, such as dust collection systems, paper mill industry, environmental systems, foundry industry, and so on – as with most ventures, some were successful and others were not so successful. One of the biggest challenges in our industry is in meeting increasingly challenging customer requirements. We are constantly faced with trying to reduce costs, improve quality and decrease turnaround time. In that regard, I think John W. McDougall Co. is a valuable asset on any project.

KT: What are some of the catalysts of change that you’ve witnessed in the slowing of the metals market?

MB: Wylie McDougall [former President of McDougall] cautioned us when the Housing market took a big down turn, that our Industry typically followed suit. He was correct. As the economy has gone downhill, so has our Industry. When consumers aren’t spending money on new cars, houses, etc., the industries we serve get really conservative with their projects. Our customers aren’t willing to spend their money when the end consumer isn’t investing it in their products. Projects have been put on hold or cancelled out right, which in turn limits the opportunities we have. We are looking for the Housing and Automotive markets to rebound as a potential sign that our industry is starting to fight its way back.

KT: How has the drastic rise in material prices during the last few years affected McDougall?

MB: It presents a challenge, but fortunately it presents the same challenge to our competitors. Unfortunately, the end user is the one that is most affected by increases in material costs. The only way to combat that is to look at alternative or less expensive materials than what might have been originally specified. In some instances though, that’s just not an option. We are always more than willing to work with our customers to ensure we are giving them the most cost effective options when they are available.

KT: A big part of McDougall’s business is repeat customers, some of whom have been working with us for decades. How do you maintain such good relationships with customers over that span of time?

MB: That’s the easy part. Do it right the first time. The customers that have been with us the longest know what we are capable of and the level of quality we adhere to. They also understand the value of our experience in the industry. We know what to do and how to do it, and for our customers, that’s one less thing they have to worry about.

KT: How do you find your new customers? Is the social aspect of acquiring customers/jobs as big now as it was in the days of the founder, John McDougall, Sr.?

MB: That may be our biggest challenge we face today. We are well known in our market, but outside of that the demand for our capabilities drops off pretty quick. It is out there and we have to find new ways to bring them to us or take ourselves to them. The company has evolved so much in the 70 plus years since Mr. McDougall, Sr. founded it, that it’s hard to say how they brought in work. But with the way every competitor is fighting for work these days, we have to take full advantage of any opportunity to get our name in front of customers. Social networks, multimedia, word of mouth, door to door sales, etc. are all valuable tools to be used to generate the much needed opportunities for work.

With our current economic volatility, 2009 has been a very challenging year. With a large portion of our “niche” products related to the automotive market, we have seen a slow-down in production. As the credit markets experienced setbacks, we saw jobs delayed and even cancelled. After experiencing a strong and productive year in 2008, our 2009 has been quite humbling. However, it has given us a chance to evaluate our business and make changes where needed.

We are leaner and more versatile as we prepare for the economy to get some upward momentum. We feel strongly that Aluminum Composite Material is more popular and readily used in the architectural community more than ever before and will continue to grow. ACM is now a prime product in Corporate Identity Programs and ever so popular in institutional applications.

Through three generations and over 70 years of our family-owned business, McDougall has a strong history of ebbing and flowing with the changing markets and economy. While continuing to grow with the ever-evolving ACM, we will be announcing new products and systems in the coming few months and are excited about the possibilities those will bring. Whatever the future holds we are well positioned and ready for growth.

–Alec McDougall, President