Manufacturing a Place for Your Stuff

Western Steel & Tube: Small shop, big robots, modular storage units

Western Steel & Tube

Duane Lucht, owner and president of Western Steel & TUBE (seated), and Rob Alcorn, shop manager, hold a finished bin, an accessory for the modular container in the background, and a flat ready for bending. Western’s containers and a full line of accessories are shipped across Canada and into the U.S.

Duane Lucht, president of Western Steel & Tube in Winnipeg, Manitoba, was too young and ambitious to retire when he sold his wire mesh fabricating business in 1998. So he started again, using his experience and mechanical engineering degree knowledge from the University of Toronto to establish a metal fabricating shop.

“I ran the wire mesh business for about 10 years then sold it, but I still had all the real estate,” Lucht said. “So I started with new products and built the business up from there. I purchased a used lathe and mill to setup a machine shop and started building some of the machines and tooling I would need—a cut-to-length line, a few specialty jigs, and some tooling for steel stamping got me started.”

The first product from the new company was a safety bar to prevent pallets from falling between pallet rack support beams. A line of ATV loading and utility ramps—some that fold, some with customizable width— closely followed. The success of the two product lines, which still comprise about 40 percent of Western’s product mix, garnered substantial competition from overseas companies.

“We sold loading ramps to just about every retailer in Canada. We were selling 30,000 pairs of ramps a year until the Chinese came into the market in 2006. We lost over half of the business. It was a time of reflection, and we decided to move forward by adding different products that couldn’t be as easily threatened by foreign competition. We felt that we had to go big or go home.”

Lucht found the “go big” opportunity in modular storage sheds. “Everybody seems to be a hoarder today. Baby boomers don’t want to give up their stuff. We saw an opening in the storage market. There were light-duty tin sheds and large, heavy-duty sea containers but nothing in between. So we started making affordable, quality containers for backyards, shops, wherever secure storage is needed.”

The galvanized steel containers were initially offered in a variety of sizes, but market needs led to standardization. Today four sizes are shipped from Western. The standard container measures 81 by 86 by 87.5 inches. Containers half that size provide secure storage in tight spaces, and larger versions, one and a half and two times as deep, as well as extension kits, are available for those with inordinate amounts of stuff to stash.

The containers knock down to ship on pallets that double as container floors. The loaded pallets fit in the bed of a pickup truck.

Customer assembly was taken into account in determining the size of the wall and ceiling panels. Individual components can be handled by two people, and all components fit through a man door so the sheds can be used inside or outside. Assembly takes two to three hours for the first time user, but only about half an hour the second time around. Units can be disassembled and reassembled and moved after assembly by a forklift or pallet jack.

As the residential storage sheds gained decorative options, the product line expanded into the industrial realm. “We started making a heavier gauge version for folks in the oilfields. Then we gave the residential versions some color and wood trim so something that looks like a sea container isn’t sitting in the backyard,” Lucht said. Matching planters joined the accessory line for the residential units.

Offshore competition does exist for the containers, Lucht said, but the quality, durability, and broad range of accessories, including support columns, steel pegboards, shelf arms, and entry ramps, keep his products at the top of the market.

CNC cutto-length line and trimming workstation

Blanks for ramps, storage racks, and safety bars are produced by a CNC cutto-length line and trimming workstation.

And then there are delivery, service, and face-to-face marketing.

Out-and-About Marketing

“We have our own showroom trailer that travels across the country to demo these units. We follow a route to provide service, delivery, and marketing,” said Lucht. The 30-foot-long trailer is used for presentations to retailers and industrial clients.

“We fill the trailer with product for delivery and use the rest of the space to showcase new products and accessories. A lot of times you can sell more effectively in person, so it is worth it to make the visit. It pushes us ahead of the foreign—and even domestic— competition.”

Lucht’s sales strategy varies depending on the product. Smaller items like the pallet safety bars and ramps are sold through retailers and distributors. Dealers handle rural and semi-industrial customers who want to purchase smaller quantities of storage units. The higher-value orders and industrial products are usually handled from the factory with a commission to the local dealer.

Shop Efficiency

All components are produced in Western’s 15,000-sq.-ft. facility with the exception of the container door bar locks.

“We try to work with similar materials,” said Lucht. “We use galvanized steel, some aluminum, and some hotrolled steel all in the 24- to 12-gauge range. That way we don’t have to duplicate equipment to handle various material thicknesses.” Prepainted materials are used for the colorful garden sheds and planters.

The equipment the company built in the early days is “still chugging away,” producing blanks and components for the safety bars and ramps. Two shears, six press brakes, two cutto- length lines, a CNC turret punch, two pneumatic clinching machines, and three robotic workcells are operated by Western’s dozen employees.

Robots Push New Product Line

Corrgate Flats

Duane Lucht, on right, and Jake Altares, robot technician, check programming for a robot that works with a press brake to corrugate flats.

In 2009 an unfortunate automotive plant liquidation provided a fortunate opportunity for Lucht to purchase robotic equipment. The automation helped propel him into storage unit production. He revisited his strategic plan; restructured his shop; and added nearly new, sophisticated robots to his shop floor.

“It was unbelievable what the equipment was going for. We took the opportunity to expand into the sheet goods and turn away from coil for our major product line,” Lucht said.

One robot feeds and unloads the CNC turret that was purchased in the same time frame. Another works with a press brake to corrugate material. Another positions components in the clinching machine for assembly.

No welding is involved in Western’s products. “We use a technology similar to welding but it doesn’t heat the steel,” said Lucht. “It mechanically deforms the material, clinching it together.”

Material handling posed challenges before the articulating arm of the robot took over positioning material in the stand-alone single-clinch machine.

“Either two people use an overhead crane to manipulate the components to the right position to clinch, or one robot does the whole thing with one operator. The operator loads the jig and pushes the component into the work envelope. The robot then picks up the component, completes 95 clinch joints, and stacks the completed component in an output cart. Labor is approximately one-third of what it would be if the job was handled manually,” said Lucht. The robots have a 10-ft. reach—long enough to handle an entire roof or side of a container.

Before going to assembly, the flats that become the walls and ceilings are corrugated. Forming the corrugated panels on the press brakes, probably the most time-consuming aspect of the container production, is also automated. “Two guys can do the corrugation almost as fast as the robot, but the robot does the same work with nobody there,” said Lucht.

More Automation

The future most likely holds more automation to assist with smaller-part production.

“Our first robots were purchased to handle the larger components that are hard to handle and have more potential for operator injury. When you get to parts that can be handled by one guy, the main advantage would be consistency. The labor savings wouldn’t be as drastic as 3-to-1 as with the larger parts, but it will certainly be 2-to-1.”

Assembly Robot

The assembly robot, with a 10-ft. reach, positions panels for assembly by pneumatic clinching machines.

When considering an equipment addition, Lucht asks two questions: Will it reduce manhours involved with production? and Will it increase output? What he doesn’t want to do is bulk up his staff roster.

“I want the staff I have to be well trained— to understand how to program and troubleshoot. I’d rather get the job done with fewer highly trained employees than use a larger contingent of unskilled labor. There are qualified people out there, and if you have the right equipment, you can afford to pay them fair wages and add very little to the cost of the product going out the door,” said Lucht.

Successful Strategies

Lucht’s business strategies have allowed Western Steel & Tube to change products and production capabilities to remain a viable, profitable company.

One conservative strategy is to fund his own purchases. “For at least a decade we have not used bank money. The banks have a different agenda that often does not make for a logical business decision. I once had a bank manager refuse to fund a large raw material purchase because it would take four months to consume the material. The savings would have been 20 percent.”

He doesn’t yearn for expansion.

“Sure, there are products that would fit with our processes and I could expand the company’s capabilities. But I am comfortable with our $3 million sales. It is a very profitable level for this facility. I have seen too many people get too big only to make the same or less at the end of the day. Then it’s no longer fun.”

With the exception of the pallet safety bar that was industry-driven, Lucht has produced products that fulfill a personal need. “I needed a ramp for my own pickup truck and could not believe the money that was wanted for what I considered subpar ramps. That got us started on that product line. The same thing on the container side. I was looking for something for outside storage and costs were either prohibitive or the containers were just tin sheds. So we entered into the storage container business.

“I consider myself a boomer, so I felt that my needs are pretty much in line with a good chunk of the population’s needs. Chances are my products will have a good customer base.”

Solving the Delivery Puzzle

Duane Lucht, president of Western Steel & Tube, Winnipeg, Manitoba, gave his employees a challenge: Find a way to package the components of an 81- by 86- by 87.5-in. storage shed so they are easy to ship. Use cost-effective and environmentally friendly packaging. Be sure the components are on some type of stand to protect them from the environment. And, as an added piece to the puzzle, make the entire package fit in the back of a pickup.

Pallet Safety Bar

Brake operator Cindy Arsenault checks quality on a pallet safety bar, Western’s first product that remains a key contributor to company profits today.

“We took all the components of the container and all the trim—for example, we included any leftover pieces that would typically be thrown out after cutting down a 2-by-4. We laid them all out on the floor and said we had to figure out a way to use only these pieces.”

Employees stepped up to the challenge. The shipping platform for a kit becomes part of the container floor. Wall and ceiling panels and the door are angled on the shipping base, forming an inverted “V” that is stabilized by leftover pieces from the composite wood flooring. The only “extra” is the shrinkwrap that secures the components and provides protection from the elements. And it all fits snugly in the bed of a pickup.

www.weststeel.com