Scarlett adapts to a change in conditions

Scarlett Inc., a woodworking industry distributor of new and used machinery based in Grand Rapids, Mich., is currently celebrating its 45th year in business. Company president Jim Scarlett attributes the company’s success to selling what he calls “higher level solutions,” such as CNC machinery and other automated equipment.

“In our day and age, successful vendors have to be specialists,” says Scarlett, whose father founded the company, formerly known as Scarlett Machinery, in 1966. “The days of being a multiple-line distributor may, in some cases, be a thing of the past. Relatively small companies like ours can’t be everything to everybody. The key is to focus on specific market sectors and key on problem solving, service and training.”

This narrow focus didn’t happen overnight. Through the years, the company’s business model has shifted from a broad-based, all-inclusive supplier offering entry-level inventory to its current state. That’s because the woodworking industry has changed drastically. As the company grew, adding services and accessories was the natural thing to do, he says.

“But at the same time, other specialized providers of those supply items and accessories came on the scene and provided a better service. We moved away from being a secondary supplier of these redundant products and back to the heavier equipment side. Analyzing the needs of each shop independently and providing modern solutions is our mission.”

The company currently represents large automated machinery manufacturers such as Weinig, which now includes Holz-Her, and offers a broad line of both solid-wood and panel-processing machinery. It also represents CR Onsrud, a producer of high-end CNC routers.

Clients are mainly comprised of medium to high-end manufacturers of furniture, cabinets, millwork and other wood-based products; as well as the plastic and metal industries. The company’s service area includes Michigan, northern Indiana, Illinois and northern Ohio, and it hopes to expand in the future.

In effort to handle the challenges of the current economy, Scarlett has explained to clients how automated technology will give them an advantage over competitors.

“I tell them that I think one of the things that have made certain shops more successful than others is that they look at these automated machines as investments, rather than costs. The difficulty that a lot of manufacturers have — especially in the woodworking industry for some reason — is that they’re resistant to automating,” says Scarlett.

Scarlett says many clients believe a boost in revenue comes from a reduction in costs. So he and his management team make a point to analyze and see where other clients might be losing money. Scarlett says manpower can be a wasteful expense and that such expenses can be reduced by implementing the right machinery.

“The cost of the employee is just going up and up, and so people have to really take a hard look at their operation to see if there are places that don’t have a high skill level where they can put a piece of capital equipment in there and avoid the addition of another person. Or they might want to shift a highly skilled worker to an area that’s difficult to automate.”

He adds that many woodworking industry professionals don’t bend that easily. He says many tend to have the mentality that they can hire when they want and, when economic conditions worsen, they can just lay the people off and the cost goes away. Scarlett says whatever philosophy his clients have, he is committed to being a valuable resource to his customers, particularly in learning both the features offered by products and their relative benefits to clients.

“With the emphasis shifting to leaner production methods, it will be more important than ever to understand the goals of each customer. We intend to be the guys who understand getting the most out of each capital investment all day, every day.”

Contact: Scarlett Inc., 4390 Airwest Dr. S.E. Ste. A, Grand Rapids, MI 49512. Tel: 616-871-9889. www.scarlettinc.com

This article originally appeared in the August 2011 issue.