Shifting gears: Industrial manufacturer turns green to survive recession

Consulting Point Inc., a small manufacturing firm at UTB-TSC’s ITEC business incubator, is a living testament to the virtues of rolling with it.

Founded by Joel Gonzalez in 2005, the company recently began producing super energy-efficient foam wall panels for K-Tect, a firm based in Las Vegas, Nev., to serve the green building industry in Texas. Consulting Point’s traditional mainstay, however, has been something very different: manufacturing and assembling components for industrial-sized electric motors. This, in turn, is different from the company’s original mission, which was producing electric bikes and electric bike motors for a Virginia-based company, WaveCrest.

In tough economic times, K-Tect basically gives Consulting Point another basket in which to put some of its eggs. Keith Heeman, director of operations, describes the company’s evolution:

"After a year and a half, (WaveCrest) had spent $168 million on R&D, decided to sell off and sold the electric bike line to a company called Mantra in France. That’s when manufacturing the bikes went out. Joel went back to his roots, which is the industrial motor industry, and started up doing the components, and farming out his skilled labor."

Before launching Consulting Point, Gonzalez had worked as plant manager for TECO Westinghouse in Roundrock and Orchid International in Tennessee, and also worked for GE. Heeman began his career with Underwriter Laboratories and has extensive experience in the "power electronics" industry. Supplying skilled labor meanwhile, has been an importantl source of revenue for Consulting Point since the recession put a damper on the in-house manufacture of motors and components at the ITEC plant, though the company was supplying skilled labor even before the recession. A case in point is a massive project Consulting Point did for GE Energy in 2007-08.

"We ‘flexed’ up to 38 employees into their facility, and we built a 45-foot-long, 90-ton rotor for a variable frequency transformer," Heeman said. "That’s a big rotor. We made three of these. GE Hydro made one in eight months. We did three in eight months. That was a very, very successful project for Consulting Point."

More rotors were on order, but the recession hit and the orders dried up. Before things started to slow down in 2008, Consulting Point typically had 45 to 50 employees on the floor of its 12,000-square-foot shop at ITEC. During a recent visit, there were just two employees, and they were working on K-Tect panels for houses going up in Brownsville. Nowadays the company usually has between 20 and 40 of its people in the field working for clients in the electric motor industry, and the firm has seized upon the lull at its own shop to make "pretty significant capital investments," mostly in equipment for producing electric motors and components, Heeman said.

"We’re smart enough to know, with Joel’s experience and mine, that when you’re busy you never have time to do that, and the time to do it is when it’s slow, because it is going to bounce back, and when it bounces back we want to be ready," he said.

Roughly $70,000 of that capital investment, however, has been for a Xydroid computerized, hot-wire foam-cutting machine to shape the K-Tect panels — which start as giant foam blocks — for assembly. Because it has made a science of eliminating waste in its manufacturing processes, Consulting Point can make things with remarkable speed — no matter what the project, Heeman said. For example, the company can put up a K-Tect home in three days with only two or three people, he said.

The firm just finished it’s third K-Tect home in Brownsville for an organization called Architecture for Charity, and Heeman is betting Consulting Point’s K-Tect business will take off once awareness spreads. K-Tect is no more expensive than traditional construction materials, is very wind-restistant and doesn’t have the same susceptibility to things like termites, rot, mold and fire.

"The real savings are you don’t bring in the extra contractor to do the insulation on site, there’s almost no waste at the job site, the speed of putting it up — and then the real savings is the energy efficiency," Heeman said. "If I could save $80 a month or $100 a month on my electric bill, what does that add up to after 10 years? It’s huge."

Consulting Point, meanwhile, has no intention of going anywhere just because the economy’s acting up.

"One of the advantages of being a small company with low overhead is being able to be more resilient," Heeman said. "We’re here to stay and we’re always looking at other opportunities."