Manufacturing E-Commerce at Falconer Electronics

Steve Melito: Hey, welcome to New York State Manufacturing Now, the podcast that’s powered by Fuzehub. I’m your host, Steve Melito, and today we are here with Falconer Electronics, which is located near Jamestown in beautiful Falconer New York. And we’re with Roger Hall, president and CEO and Kurt Anderson e- commerce consultant. And I daresay an expert. Welcome, gentlemen.

Kurt Anderson: Thank you. We really appreciate it.

Roger Hall: Yes, appreciate it very much. Thank you.

Steve Melito: You got it. Many thanks for your time this morning. So Roger, what’s the Falconer electronic story? What do you do? How long have you been around and what kind of markets do you serve?

Roger Hall: Well, we’ve been around since 1985. I started the company starting a small office that was touch all four walls with my hands if I stood in the middle. And I used to work for a distributor back before that but then I started coming doing industrial sales and then we started doing contract manufacturing in ’85. And my very first customer was AT& T, small customer. And we started making outlet trips for them. And then at that time, how small I was, I didn’t even have my own garage, I had to use the neighbor’s garage. So I set up in his garage and he actually helped me build it to get this thing started. And then having sell my trucks back up to his garage every day to load and unload stuff became a little bit too much for even them, but we weren’t there for probably a good six, seven months in this garage and then I started doing other contract work, worked with engineers and then we built something, I’m sure probably not many people even know what this is anymore, but telephone booths. We actually built the lighting for telephone booths for about a year and then they became really unpopular. But that was one of our early on projects. Then we actually moved into a location and we started building, working… I had another friend, okay, real short story on this, another friend, because I didn’t have a basement, I putting machine shop in his basement and we actually started doing metal forming fabrication, small stuff in his basement. And we did that for about, was it a year or two? And that worked out well for a short time too. And then I got smart and I had to go my own location. And then we started building. Going from there, we went into circuit boards that we started working and again, I know this common theme, the guy was actually making circuit boards for me in his basement. I’ll tell you what, at that time there wasn’t anybody making circuit boards. I mean you had to… We’re talking in the mid ’80s. So he was making them in his house because we were making a few boards here and there. So he made them in his basement until we started buying too many. And then he couldn’t keep up, so we had to go to a actual fabrication house after a few years and they started doing boards for us. So we went from metal fabrication to circuit boards and then we stayed in circuit boards for quite a while, still doing a little bit of metal fabrication as far as assembly, but not that much and then we went into doing… One of our early on was the stop turn tail lights that you see all the time for semi trucks now. Back when we were doing, we were one of the first ones working with a company down here, company called Truck Light. And we actually were doing all their circuit boards and assembly down here for as far as the stop turn, tail lights, marker license like that. And if I remember correctly, they actually presented the first one at a show, I think it was in California at the time. And then again, that was kind of in the later ’80s. And it was the first ones that were ever seen. And we actually helped work with them on that to build them. And that’s when the whole thing started with the circuit board and the LED business. And we went into that and we’ve been doing that. We’re still doing it today for different customers. We do contract manufacturing for the boards and like that. But then in between all that, we actually ended up working with a small company called Walmart back in, I think it was probably in ’90s. I’m trying to think exactly when it was. And we started doing back in the metal fabrication, electrical wiring again. And as it turns out, we’ve done every single Walmart in north and South America, including Hawaii and Alaska, the big electronics department. We actually do all that metal fabrication for all the Walmart, the sole source for the past almost 20 years. Anybody wants to see it. Any Walmart, you look at you, we make all those panels, electrics all done right here in Falconer. And we still do that today.

Steve Melito: That’s amazing, Steve. So there’s a couple things in your story that really strike me. One, you got some really good friends, they let you use their garage and their basement and you also know how to shift gears, metal fab to circuit boards. But the Walmart thing obviously that really, really caught my ear as well. And it sort of leads me to another question and what makes Falconer unique is your commitment to e- commerce and e- commerce and manufacturing are things that don’t always seem to go hand in hand. So how did you get started on that journey, Roger, and certainly Kurt, feel free to chime in here. How’d you get started? And then how do you not go off course you’re a manufacturer, how do you not get too into e- commerce?

Roger Hall: Well that actually a similar story. We actually do assembly work for, again, a company, Kohls. I’m sure everybody’s heard of them. And we actually started making custom outlet trips for them several years ago, well almost 20 years ago. I don’t know, it was several years ago. But anyway, and what had happened was their customer started turning the outlet strips over and our names on the bottom ’cause it’s all UL listed and everything. And we started getting phone calls from their customers saying, ” Hey, can we buy your outlet strips?” And at that point we weren’t really selling them to the consumer that, ’cause we were building in bulk for industrial accounts and big box stores. So we started looking at it and Kurt, I think we were just starting to get together at that point and we’re starting to get phone calls from people saying, ” Hey, can we buy this?” So me and Kurt sat down and we started talking about how can we start selling these things? How do we switch over to doing this or incorporate it or parallel what we’re doing? And that’s when Kurt came into how are we doing manufacturing online.

Steve Melito: Kurt, what’s your perspective on this? I mean this is quite a journey that the company has made, and how did you get started with this? Because I think that’s something other manufacturers will be curious about.

Kurt Anderson: Yeah. I had an e- commerce company 100 years ago, had a nice run, started it in ’95, so I’m kind of a dinosaur in e- commerce and was blessed fortunate, sold it in like 2010. So then my passion became trying to help digital immigrants. Folks said our manufacturing were not noted for being tech savvy. And actually after I sold my business, I became a business advisor at the Small Business Development Center. And any listeners, what manufacturer, I don’t care what size you are, there’s going to say a myth, but a lot of folks think, oh, Small Business Development Center isn’t for me. It is an amazing, incredible resource just like Fuzehub. You guys offer so many resources for entrepreneurs to take advantage of. So my passion became helping manufacturers trying to figure out this whole e- commerce thing. And again, another myth to dispel, it’s like we’re not trying to sell a pair of socks on Amazon an e- commerce for manufacturer can be a nice call to action button. How can we get that RFQ as fast as possible? That’s e- commerce. So in Roger’s case, here he’s supplying power strips to Lowe’s. Every Lowe’s in all of North America. And if you go into Lowe’s at Christmas time, you’ll see their Christmas trees are plugged into a fixture made right here at Falconer Electronics. And as Roger said, consumers are flipping them over calling. I’m like hey, well let’s make it easy. The market’s telling us what they want. We’re not creating a market, they’re telling us what we want. So we’re like, hey, let’s just create a proprietary product line out of something that we already do. It was our design, our material, our UL listing, everything was ours. The problem is what I call, we were the best kept secret. Every manufacturer that I used to call on, I’m like, ” Hey, what’s your story you just did with Roger?” And they’re like, ” Ah, we’re the best kept secret.” Well, the challenge is now with COVID or even pre COVID, that was really a dangerous place to be. COVID you just can’t be the best kept secret. So the SPDC, Small Business Development Center has this amazing program of working with manufacturers on content creation, exactly what you do with your company. And we came into Falconer, we went through a whole process of helping them create a content strategy. And with that then we incorporated the e- commerce strategy with the power strips. So it was just a real nice segue. So now folks can come on by manufacturer direct, they’re made in USA, heavy duty. These are high quality power strips for OCIA compliance situations, industrial situations. So that’s how that was our first step into e- commerce.

Steve Melito: And then how long between the time that you said we want to do this until you were able to begin selling products online? Was it six months? Was it a year?

Kurt Anderson: Yeah. Great. Fantastic question. So here’s a nugget that I’d love to share with your audience on the content side. And again, this is your expertise, Steve. So the great thing about e- commerce for a custom manufacturer, so if you’re an OEM, Original Equipment Manufacturer, e- commerce is fantastic because you can put your products, your widgets online, and whether marketplace, Amazon, Alibaba’s now in the United States, or you can tip your toe into an e- commerce strategy for yourself. Okay, so I’ll answer your question this way. We brought in this project to Falconer Electronics and we’ve teamed up with another content marketing firm, and we’re like, what do we do? We’re a content man contract manufacturer. We do a bunch of different things. However, as Roger said, he was a wire harness manufacturer. So what we decided to do, we came up with this, it sounded like a goofy, wacky idea and is that ever going to pay off? But we started, we came up with, he’s a wire harness manufacturer. So we’re like, let’s narrow your focus. Instead of contract manufacturing, custom manufacturing, let’s focus on one thing. We started focusing on wire harness manufacturing. And what we did was every Wednesday we came up with wire harness Wednesdays. So every single Wednesday, and we created a persona, we had our avatar, like our ideal dream customer, whether it’s a buyer at Walmart, Lowe’s, an engineer at Boeing. And we tried to create content every single Wednesday consistently religiously on wire harness manufacturing. Once we did that, all of a sudden we realized months into it, we had a whole arsenal of content. We’re like, man, we have a whole library. And I picked up this phenomenal tip. What we did is we took a bunch of our blog posts, we put it together and we created a guide and we call it the Official Wire Harness Manufacturing Guide and the great thing is Google decided they were on board with what we were doing. So if you Google wire harness manufacturing right now, you’re going to see Falconer Electronics has what’s called the Google snippet. It’s the first position. We’re actually above the Wire Harness Association. So from that, we started receiving leads and all sorts of RFQs. We’ve had several this week and quality companies, our avatar, our ideal customer. And so that was a process that took months. It took months, and we were just relentless with it. Now if you Google commercial power strips, power strips made in USA, we have first page rankings. So that it’s hard to have the e- commerce conversation without what you’re an expert at without that content creation strategy. And it is a marathon. It can take months. It’s a long play. You know what I’m saying? So to answer your question, it took us a good two to three years to really narrow our focus and then get that content creation and really create a footprint. But it’s been a great process we’ve seen just keeps and bounce through the whole time.

Steve Melito: It’s great. It sounds like some silos were torn down, I think.

Kurt Anderson: Yep.

Steve Melito: As you hear this story, it’s easy to say, well, manufacturing was here, e- commerce was here and traditional marketing content was here. But that’s not the case. They really all had to work together. Would you say that’s true?

Kurt Anderson: Absolutely. And, so can I do a shameless plug? So we wrote a book, it’s called Stop Being the Best Kept Secret.

Steve Melito: Okay.

Kurt Anderson: Stop Being the Best Kept Secret. And the tagline is manufacturing e- commerce strategies. How do we manufacture e- commerce strategies? Every manufacturer that I would talk to, they would say, ” Oh, we’re the best kept secret. We’re the best kept secret.” And it’s a very dangerous strategy. If you relied on trade shows, what are you doing today? If you were relying on the sales rep pounding the pavement, the road warrior, a lot of manufacturers aren’t allowing sales reps in it. So if you don’t have a digital footprint, if you don’t have that strategy in place, it can be very challenging. What I’d like to share is what we call it, particularly for your custom manufacturers that are listening today, how do you scale your proprietary process? So the thing is, so many custom manufacturers, unfortunately they have 50, 60% of their sales with that one customer. And they that they don’t have a proprietary product, but they have that proprietary process, meaning they have the machinery, the equipment, the raw material they have skill set, everything is in place, they are experts in this particular field or that particular process. The challenge is they’re the best kept secret that one customer knows what they do, but other companies don’t. And the thing is, typically that’s not the only customer that needs that process, or not only the only customer. There’s other competitors, there’s other industries. And every time I talk to a manufacturer, if it’s almost like three questions, what do you do? Oh, I’m a contract manufacturer. Well, one step further, what do you know? Well, I’m CNC or I bend metal, I cut steel. Okay, well who do you do it for? Well, you know, ask three questions and all of a sudden you finally find out that they’re an expert at this one little process. And if they use e- commerce, again, whether it’s a online marketplace, Alibaba, mfg. com, Zorro, we use Digikey. We’re very bullish on the marketplaces, which are very advantageous to, for a starting point on e- commerce if you don’t want to make the big investment. So with what we did here at Falconer, Falconer was making an item called a ground strap. And I should have brought one with me, but a ground strap is a device that goes in any electrical, anything that draws a current has to be grounded, otherwise you’re going to end up looking to have a haircut like me. So Roger produces thousands upon thousands of ground straps, basically for one or two companies in the auto field in auto manufacturing. So he’s providing it to the OEM. Where as when the power strip came through to us like, Hey, we could put up an e- commerce store. It costs us virtually nothing. He has a WordPress website, we put it on WooCommerce. We just created a webpage. That was our investment and we started selling power strips. So he sells this little thing called a ground strap. He has everything in place, he has that proprietary process, equipment, machinery, everything’s in place. So once again, we’re like, hey, let’s create a webpage just with almost a fictitious product line. We never even produced one, we had never even put one in stock. And we just start, we did the same process on our content strategy we did with Wire Harness Wednesdays. We started doing ground straps, consistent ground strap content. And sure enough, we have not only first page rankings, we have number one ranking for ground straps. Then we started using Google Paperclip, then we started using Google Shopping, then we put our ground straps on Amazon. And Roger now is the number one seller of ground straps. If you do a search on Amazon for ground straps, he has the first position. We’ve never paid a penny for advertising. He has five of the top 10 positions organically on Amazon. And we have the little Amazon’s choice. And we’re looking to do significant numbers for a small nice little family business here. This is game changing. So again, to wrap up, it’s how do you scale your proprietary process and utilize e- commerce, which is extremely inexpensive, ineffective means to get your product to market.

Steve Melito: So I have to tell you, I’m on board a 100%. I bet there are some manufacturers out there who are skeptical and say, you’ve been very successful in creating demand for these ground strips and to you had to produce them, you have to produce them still. Did you face challenges like finding workforce, getting equipment, finding new space? What are some of the things you had to overcome on the manufacturing side to meet all this fantastic demand that e- commerce brought?

Roger Hall: Well, the first thing was, again, like you said, the demand was going up. So we had to adjust our purchasing because normally when we would with manufacturers, it’s like, okay, you’re going to buy bulk of this, you put it together, you sell it, it’s gone. You start all over again next week or whatever, next month. Whereas this thing here is continuous. When you’re receiving orders daily, like you said, Amazon, they’re shipping what? Probably 20 plus orders, 20 how many a day? We’re getting demand now on our website, on our e- commerce website to ship other ones ’cause we also do custom ones. We’ll get that in a second, but now it’s a continual flow of getting, and then the manpower is, like Kurt said, we have the equipment. The big thing is like you’re saying, is to get the manpower to do it and during these times, I’ll tell you what, that has been the biggest struggle to get people who can sit there and will do it because at this point in time, as most ground straps are, they’re more manual because what we’re using is a braid. It’s not really a wire, it’s a braid and there’s not a machine out there yet who’s putting this together that way. And maybe down the road, but not right now. So it’s a very manual process, three steps to it. So it’s anything you want to do the increase your manufacturing, it’s just, okay, we need another person here who knows how to do it because the equipment’s here. So the equipment was the easy part, the manpower to run the equipment to keep up with it and then also to shift. And I don’t know, one of our big things is we’re doing custom ground straps. Obviously they’re all custom to our OEMs, but now we’re actually doing custom ground straps online. You can actually design your own pick from a choice of product that’s on there. And then we manufacture them. And that’s a challenge too because we’re literally changing it every single day. And we’ll have 20, 30 different ones going through here, if not more. And then the volume, they’re looking for anywhere from one, which is a minimum we have, to we have people that order two or 300 at a time and they still want them within a day or two. As long as we stay consistent and we’re always building it’s easier. But when you got to stop and start, which right now between the Amazon, the custom orders and the other people we’re dealing with at marketplaces, it’s every day the processes are running. It’s just a question of are you running 12 inches, six inches are what terminals you on it? The width on it. But it’s a constant process now. So it’s settling down even during these times here. And we’ve got that pretty much down to a science exactly how that works so we can turn things around. You order a product eight o’clock in the morning and generally we’re shipping it before three o’clock in the afternoon. And it’s been made, again, depending on volume, when you’ll obviously special orders. But in the most cases we’re shipping stuff hot off the press you want to call it. We have a minimal inventory. So someone says, ” Hey listen, a standard product that we do make, but with the custom in there, we’re able to turn around extremely quickly.

Kurt Anderson: Just if I could add real quick, the great thing would I feel with e- commerce and… Hey, did I tell you we wrote a book and it’s in the book? Sorry about that. My mom made me do that. So in the book we talk… I’ve been in e- commerce since 1995 and I found that there’s no greater means. That’s more effective, efficient, inexpensive way to test the market. I love this process for the custom manufacturer because as Roger just said, he, there’s no CapEx, he had all the equipment, we didn’t have to buy another… It’s an operating expense, not a capital expense. So if you have a laid machine, if you have this and you have capacity, e- commerce can help you fill that capacity. Now again, he’s selling an item, it’s a $ 3 item. So I mean it’s tough to get this, we need volume. But this week alone, Johnson Johnson ordered on Monday, Northrop Grumman and Boeing. So those three companies ordered from Falconer Electronics just this week through either an online marketplace or directly on our e- commerce store. Just to add, just if I could just add super quick what we did. So we created this fictitious product line on the website of these ground straps, maybe like 20, 30 SKUs, just kind of randomly pick sizes. Let’s see what the market wants. They’ll tell us whether it’s a good idea or a bad idea. And people were coming on and like, hey, the item, the price, however we need a different size. Like Roger was saying, we need a different configuration. So what we did, we sat down with our web designer, a guy that I’ve worked with for 15 years, great guy, Jason Deering’s his name, and he’s an e- commerce guy. We said, “We can’t come up with an infinite number of skews. Could you create just a little custom thing just like somebody’s creating in a t- shirt.” And sure enough, man, he knocked it out of the park. We have this thing, we call it the instant ground strap quote builder. It takes 60 seconds. It’s five steps. It is so easy. Our avatar is an engineer at Boeing and they have or per a buyer at Johnson and Johnson say, and they have 30 things that they need to buy today. They are looking for a ground strap they find us on, we’re top ranking on Google. They come to our website, they say, ” Hey, wait a minute, I can build my own ground strap.” It takes 60 seconds. They build it, done. It’s here in the United States. And like Roger said, if it comes in the morning, we can make it and turn around that same day. It’s such a competitive advantage. Now we’ve put a manufacturing advantage for ourselves here in the United States as opposed to a low cost import opportunity.

Steve Melito: Here in the US and here in New York. Now, how many employees do you have now out there?

Roger Hall: Currently due to the pandemic got about 25 right now. Our normal employment is around 35. And we’re bringing back people back as quick as we can, but our we’re in the neighborhood between 25 and 35 people we are.

Steve Melito: That’s great. And so Roger and Kurt, have you had any help from any New York State resources? I know you had mentioned SBDC. Have you reached out to anybody along the way for advice or gotten any type of help?

Kurt Anderson: Again, we’re just huge fans of the Small Business Development Center. I’m biased because I was an advisor for the SPDC for a number of years and I saw firsthand what they’ve done for the community folks at the SBA have been wonderful with anybody going through the PPP process and all that. So those are I would say our two biggest resources. Mainly the Small Business Development Center. And of course now we’re very excited with our relationship with Fuzehub. The more I dig in and webinars and that you guys offer, this podcast, you have a whole all- star list of experts on the Fuzehub website that if you’re looking for an expert in some subject and can’t, a lot of rural areas throughout New York state and you can’t have that local expert, boy go to Fuzehub and Steve and his team, they have great people to fall on.

Steve Melito: Thanks. I think what you said about SBDC and SBA is really important. We usually have them as resources at our solutions forums and I think sometimes manufacturers may believe, well, I go to see them when I first start out. I go to the SBDC when I need a business plan. After that, I don’t need them. Or I go to SBA when I need loan free equipment to start out, afterwards we don’t talk. Sounds like you have a more mature, ongoing relationship.

Kurt Anderson: And I’m curious what your opinion is Roger. Had I not first off gone there, I didn’t even know what the SPDC was when I started working there. And the more I got in, I mean these people are just so passionate about helping entrepreneurs and that their services are completely free. They’re completely confidential. That is the perception that, oh, I’m going to start a business in my living room and not go to the SBDC. That’s not the case. They certainly help those folks, but they help season entrepreneurs like Roger. It’s so hard for an entrepreneur. You’ve got to throw on so many hats throughout the day. You can’t be an expert in HR and finance and marketing and everything. Having that trusted resource again, like Fuzehub, yourself, the Small Business Development Center, they are truly a gift and blessing to have out there.

Steve Melito: That’s great to hear. So listen, before we go, is there anything else people should know about Falconer Electronics?

Kurt Anderson: It’s an honor and privilege to be on Fuzehub, and it’s an honor and privilege to be surrounded by entrepreneurs like Roger, where a lot of entrepreneurs maybe either chose to get out of manufacturing, couldn’t compete with low cost imports, or maybe there’s a lot of challenges here in New York state. And for 35 years, a guy like Roger Hall, and you know these folks, I know these folks, there’s thousands of entrepreneurs throughout our great state of New York that just fight relentlessly every day, whether it’s been through, we had a devastating hurricane or 9/ 11 or the pandemic. And these people just show up every day keeping their people working. And the staff here are just, I’m sure at every manufacturer, we just have loyal, wonderful, amazing, dedicated people that put out great product day in and day out. And such an inspiration to watch these people work. What a gift that you have talking to people on a daily basis, doing what they do. It’s really wonderful.

Steve Melito: It’s a lot of fun. And really thank you for what you do when you say you have 35 people working there, or you did, I’m sure you’ll get back to there after COVID. That’s 35 families that have a good paying manufacturing job. So it really is the backbone of the economy in so many ways. So Roger Hall and Kurt Anderson from Falconer Electronics, thank you. You have been listening to New York State Manufacturing Now, the podcast that’s powered by Fuzehub. Fuzehub is the Statewide Manufacturing Extension Partnership Center for New York. Our mission is to help. So while the media manufacturers, inventors and entrepreneurs, people like you who are listening, build and grow, if you need assistance, the place to look is fuzehub.com. When you go to our website, go to the solutions program link and you can submit a request for assistance online anytime. And then the first step afterwards will be that you and I will have a conversation by phone. We’ll talk about what’s going on, and we’ll see if there are programs out there like the SBDC, the SBA, many other things that are available to serve you and to help you solve your challenges and to grow. So again, on behalf of New York State Manufacturing, now I’m your host, Steve Melito, signing off.