Business

Winnipeg Free Press - PRINT EDITION

Metal shop closes doors

Precision was touted as local business star

By: Martin Cash

Posted: 01/27/2012 1:00 AM | Comments: 0 (including replies)

PHIL HOSSACK / WINNIPEG FREE PRESS Enlarge Image

Auctioneer James Carlson stands on the production floor of Precision Metalcraft. Century Services Inc. auctioned off Precision's equipment over the last two days.

ONE of the city's higher-profile metal-bashing shops has gone out of business, the victim of what may be a rising tide of renewed U.S. competition.

Precision Metalcraft, partly owned by Winnipeg author Sheldon Bowles, famous for inspirational business books like Raving Fans and Gung Ho!, is winding down its operations and has only a few people still employed.

Over the years the company was often held out as an example of how small local businesses can become more efficient and succeed in a global marketplace.

At its peak it had about 75 employees, but general manager Graham Moore said there were fewer than that when it was recently placed in receivership.

Over the last two days the company's equipment was auctioned off to the highest bidders, some as far away as India and Thailand.

Ron Victor, one of the auctioneers from Century Services Inc., said the auction netted a little less than $1 million.

He said it was 10 to 15 per cent more successful than his company had anticipated.

The most expensive piece of equipment, a large specialized metal bender that cost the company more than $1 million new, went to a southern Ontario company for about $200,000.

Precision Metalcraft touted its world-class manufacturing operation and boasted an extensive array of equipment.

But industry insiders say that a top-heavy management structure, born out of the fact that it had a large group of owners, might have bogged the company down at a time when the U.S. sector is being bolstered by a softer U.S. dollar and renewed competitiveness.

A recent report showed the purchase of new equipment by U.S. manufactures is up dramatically.

One industry official said, "Precision was a company that lost simply because they could not adapt as quickly as its customer business base dictated."

Ron Koslowsky head of the Manitoba division of the Canadian Manufacturers and Exporters (CME) said he believes it ran into some problems with some U.S. customers.

"It's unfortunate," Koslowsky said. "Precision Metalcraft was a relatively highly skilled operation.

"It could do things others couldn't when it came to the production of metal parts."

A year and half ago the CME used Precision Metalcraft's facility to announce a $4.2-million program to beef up its staff and become a one-stop shop for Manitoba manufacturing firms seeking best-in-class solutions for technology, trade and human resource development.

At the time Precision officials said that program would help it address some of the changes it was facing in the market.

But industry officials believe it was not able to adapt to the higher Canadian dollar and more determined competition from the U.S.

"It is an example of a company with the best intentions but due to changes in the market and the dollar differential it found itself in a position where some of its non-Manitoba-based customers found other sources of supply that were more competitive," an industry source said.

martin.cash@freepress.mb.ca

Republished from the Winnipeg Free Press print edition January 27, 2012 B4

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is register and/or login and you can join the conversation and give your feedback.

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010; View the changes. New to commenting? Check out our Frequently Asked Questions.