Forward Focus I MPROVING THE C OMPETITIVENESS OF ......MSU TechLink (406) 994-7732...

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Forward Focus I MPROVING THE C OMPETITIVENESS OF M ONTANA M ANUFACTURERS U NIVERSITY T ECHNICAL A SSISTANCE P ROGRAM Montana Manufacturing Extension Center SUMMER 2002 By Deborah Nash For Bud and Jean Clem, owners of Western Trails Cowboy Foods in Bozeman, Montana, contracting with Montana’s Mission Mountain Market (MMMM) in Ronan ful- filled a long dream. They finally put the Made in Montana label on their specialty Rustler’s Bean Sauce, a flavor enhancer for mak- ing baked beans and delicious barbeque sauce. The Clems are long time Montana residents. They created the recipe here and have sold it primarily in Montana for 10 years. But because the sauce required special cook- ing equipment, it has been made in a commercial kitchen outside Montana -- until now. See www.cowboyfoods.com When I stopped by the new MMMM commercial kitchen to visit with Lora Poirier, the kitchen manager, about a cost analysis performed by MMEC, I found Jean in the kitchen, her eyes just twinkling beneath the protective hair bonnet at the prospect of now marketing the sauce as Montana Made. I found Bud stirring a huge simmering pot of sauce, after he and Lora made adjustments to the recipe. From garlic to grains, sauces to syrups, specialty food manufactur- ers find just this kind of personal- ized help introducing foods into the marketplace, getting assistance in preparing their product in quantity, and learning to grow fledgling HOME OFFICE: 313 Roberts Hall P.O. Box 173800 Montana State University Bozeman, MT 59717 (800) MEP-4MFG (406) 994-3812 Fax: (406) 994-3391 [email protected] BILLINGS Dale Detrick Big Sky Economic Development Authority Billings, MT 59101 (406) 256-6871 Fax: (406) 256-6877 [email protected] BOZEMAN Mark Shyne UTAP–MSU Bozeman, MT 59717 (406) 994-3812 Fax: (406) 994-3391 [email protected] Al Deibert MSU TechLink (406) 994-7732 [email protected] HELENA Todd Daniels MMEC Engineer MT Dept. of Commerce Helena, MT 59620 (406) 444-9739 Fax: (406) 444-1872 [email protected] KALISPELL Paddy Fleming The Northwest Business Center Kalispell, MT 59901 (406) 758-5478 Fax: (406) 257-7283 [email protected] MISSOULA Kreg Worrest School of Business Administration University of Montana Missoula, MT 59812 (406) 243-6615 Fax: (406) 243-4030 [email protected] "With health and food safety regula- tions, especially since Sept. 11, you really cannot process foods for resale in your own kitchen. Setting up a separate commercial kitchen is difficult because of reg- ulations imposed by USDA, FDA, state and county governments, not to mention costly." In addition to kitchen use, clients can get help with food labeling requirements, barcoding that vendors may require, and sanita- tion standards. They have access to a wide assortment of commer- cial size equipment that would be cost prohibitive for small processors. For instance, the Market’s 40- gallon steam cooker costs $6-7,000. That’s a pretty large investment for a small producer and occasional use. The steamer’s ability to do a high volume and its efficient bottom mount piston filler for bottling also cuts processing time significantly, she noted. (Cont. on page 6) specialty foods businesses at Mission Mountain Market. The well-equipped, certified com- mercial kitchen and food lab com- plement other direct assistance and great resources at this unique food processing business incubator and cooperative marketing center. The facility is operated through Lake County Community Development Corporation in western Montana and recently celebrated its first anniversary. See web site www.mtmountainmarket.org Why Come? Clients have come from all across Montana from as far away as Colstrip in eastern Montana for help processing, packaging and labeling. Poirier explains why. MMMM Using Cost Analysis… Helping Montana Specialty Foods Makers Bud and Jean Clem stir up good eats at Mission Mountain Market. ONLINE REGISTRATION WWW. MTMANUFACTURINGCENTER. COM

Transcript of Forward Focus I MPROVING THE C OMPETITIVENESS OF ......MSU TechLink (406) 994-7732...

Page 1: Forward Focus I MPROVING THE C OMPETITIVENESS OF ......MSU TechLink (406) 994-7732 aldeibert@coe.montana.edu HELENA Todd Daniels MMEC Engineer MT Dept. of Commerce Helena, MT 59620

Forward FocusI M P R O V I N G T H E C O M P E T I T I V E N E S S O F M O N T A N A M A N U F A C T U R E R S

U N I V E R S I T Y T E C H N I C A L A S S I S T A N C E P R O G R A M

Montana Manufacturing Extension Center SUMMER 2002

By Deborah Nash

For Bud and Jean Clem, owners ofWestern Trails Cowboy Foods inBozeman, Montana, contractingwith Montana’s Mission MountainMarket (MMMM) in Ronan ful-filled a long dream. They finallyput the Made in Montana label ontheir specialty Rustler’s BeanSauce, a flavor enhancer for mak-ing baked beans and deliciousbarbeque sauce.

The Clems are long time Montanaresidents. They created the recipehere and have sold it primarily inMontana for 10 years. But becausethe sauce required special cook-ing equipment, it has been madein a commercial kitchen outsideMontana -- until now. Seewww.cowboyfoods.com

When I stopped by the new MMMMcommercial kitchen to visit withLora Poirier, the kitchen manager,about a cost analysis performed byMMEC, I found Jean in the kitchen,her eyes just twinkling beneath theprotective hair bonnet at theprospect of now marketing thesauce as Montana Made. I foundBud stirring a huge simmering potof sauce, after he and Lora madeadjustments to the recipe.

From garlic to grains, sauces tosyrups, specialty food manufactur-ers find just this kind of personal-ized help introducing foods into themarketplace, getting assistance inpreparing their product in quantity,and learning to grow fledgling

HOME OFFICE:313 Roberts HallP.O. Box 173800

Montana State UniversityBozeman, MT 59717

(800) MEP-4MFG(406) 994-3812

Fax: (406) [email protected]

BILLINGSDale Detrick

Big Sky EconomicDevelopment Authority

Billings, MT 59101(406) 256-6871

Fax: (406) [email protected]

BOZEMANMark ShyneUTAP–MSU

Bozeman, MT 59717(406) 994-3812

Fax: (406) [email protected]

Al DeibertMSU TechLink(406) 994-7732

[email protected]

HELENATodd Daniels

MMEC EngineerMT Dept. of Commerce

Helena, MT 59620(406) 444-9739

Fax: (406) [email protected]

KALISPELLPaddy FlemingThe Northwest

Business CenterKalispell, MT 59901

(406) 758-5478Fax: (406) 257-7283

[email protected]

MISSOULAKreg Worrest

School of Business Administration

University of MontanaMissoula, MT 59812

(406) 243-6615Fax: (406) 243-4030

[email protected]

"With health and food safety regula-tions, especially since Sept. 11, you

really cannot process foods forresale in your own kitchen.Setting up a separate commercialkitchen is difficult because of reg-ulations imposed by USDA, FDA,state and county governments,not to mention costly."

In addition to kitchen use, clientscan get help with food labelingrequirements, barcoding that vendors may require, and sanita-tion standards. They have accessto a wide assortment of commer-cial size equipment that wouldbe cost prohibitive for small

processors.

For instance, the Market’s 40-gallon steam cooker costs $6-7,000.That’s a pretty large investment for asmall producer and occasional use.The steamer’s ability to do a highvolume and its efficient bottommount piston filler for bottling alsocuts processing time significantly,she noted. (Cont. on page 6)

specialty foods businesses at MissionMountain Market.

The well-equipped, certified com-mercial kitchen and food lab com-plement other direct assistance andgreat resources at this unique foodprocessing business incubator andcooperative marketing center. Thefacility is operated through LakeCounty Community DevelopmentCorporation in western Montanaand recently celebrated its firstanniversary. See web site www.mtmountainmarket.org

Why Come?Clients have come from all acrossMontana from as far away asColstrip in eastern Montana for helpprocessing, packaging and labeling.Poirier explains why.

MMMM Using Cost Analysis…

Helping Montana Specialty Foods Makers

Bud and Jean Clem stir up good eatsat Mission Mountain Market.

ONLINEREGISTRATION

WWW.MTMANUFACTURINGCENTER.COM

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I M P R O V I N G T H E C O M P E T I T I V E N E S S O F M O N T A N A M A N U F A C T U R E R S

ADVISORY BOARDMEMBERS

MIKE BAUGHPresident

Dragon Mfg./DarcovaBillings, MT

AL BEUTEManager

General Electric Co.Havre, MT

ROY BROWNState Representative

Billings, MT

ANDRE GILESPresident

Montana Flour & GrainFort Benton, MT

KIM GILLANState Representative

Billings, MT

LARRY HALLPresident

S&K IndustriesRonan, MT

BRAD HECKERMANCEO

American Eagle Inst.Missoula, MT

CHUCK KEEGANDirector of Forest Industry ResearchBBER/School of

Business AdministrationMissoula, MT

STEVE MASSEYProduction Manager

Wheat MontanaThree Forks, MT

JOE MCCLUREExecutive DirectorBig Sky Economic

Development Authority

Billings, MT

WALTER MCNUTTState Senator

Sidney, MT

P A G E 2

Director’s Comment…

Crucial Issues & “The New Way Of Life”

We are facing a new world whereinternational and national eventswill affect us more than ever.Manufacturers are facing a very dif-ferent business climate that willrequire different technologies, pro-cedures, and strategies. In a relat-ed article in this issue, "CriticalIssues Facing MontanaManufacturers," I described severalkey observations from the latestUM Bureau of Business &Economic Research survey ofMontana’s largest manufacturers.After a year of significant economicdownturn, the news was mixed.The year was further complicatedby a topsy-turvy energy situationhere in the West and the shocking

events in the fall that caused a significant drop in fourth quarterbusiness.

Nothing, it seems, is quite as pre-dictable. Most are optimistic for2002, yet the business climate isnow different. Manufacturers aremore concerned about potentialshortages of qualified, skilled labor;energy availability and cost; stiffinternational competition; andshifting national priorities.

A few manufacturers will invest innew equipment and/or expansionsover the next year or two, however,most will look for ways to improveefficiency and productivity to getmore out of what they currentlyhave. The issues you face are notunlike that of other manufacturers;manufacturers can learn from eachother today more than ever.

Networking with other manufac-turers, staying abreast of currentand emerging technologies, andfocused strategic thinking havebecome a way of life -- the new wayof life for manufacturers. Here inMontana there are opportunities tohave your voice heard and shareyour experience. The stateChamber of Commerce has three

Steve HollandMMEC Director

regional meetings of the MontanaManufacturing Council planned tobuild membership and goals forthat important organization. GreatFalls will host the first on June 25;Kalispell on July 15; and Bozemanon August 13. The potential fromthis organization is huge to presenta united voice in areas like legisla-tion, transportation, workforce andinsurance issues, but your partici-pation is paramount to its success.Afterall, it is your organization.

Our biennial, statewide manufac-turing conference Compete Smart,is planned for Missoula this year onOctober 3 and 4. It will be a blendof learning, sharing, and network-ing with fellow manufacturers andservice providers. The Council isone of its co-sponsors. Ourkeynote speaker promises to be arefreshing surprise, and our break-out sessions will offer some ideasfor your next step. I hope you willset aside some time to attend, getsome new ideas, and build newcontacts. Join the new way of life.

UTAP During a spring visit, Tony Preite( far right), Regional Director,EDA/Denver Regional Office, andJohn Rogers ( far left), Montana’sEconomic DevelopmentRepresentative, Helena, listen toUTAP Supervisor Mark Shynedescribing some of the productsand activities involving the UTAPengineers. MMEC’s Steve Hollandand Al Deibert look on.

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I M P R O V I N G T H E C O M P E T I T I V E N E S S O F M O N T A N A M A N U F A C T U R E R S

P A G E 3

DAVID GIBSONChief Business

OfficerGovernor’s Office of

Econ.Opportunity

DAVID OIENPresident

Timeless SeedsConrad, MT

JOHN PICKERING, SR.Telecommunications

Missoula, MT

ANDY POOLEDeputy Director

Montana Department of CommerceHelena, MT

LAMAR RASEVP OperationsImperial MeatsMissoula, MT

DOUG RAUTHEDirector

NW HumanResource Council

Kalispell, MT

NICK SAVKOPresident

Tele-Tech Corp.Bozeman, MT

JON TESTERState SenatorBig Sandy, MT

WILL WEAVERMSU-Great Falls

College ofTechnology

Great Falls, MT

SPENCER WILLIAMSPresident

West Paw DesignBozeman, MT

MIKE “WOODY”WOODARDPresident

R.L. Winston RodsTwin Bridges, MT

LARRY YUNGManufacturerBillings, MT

by Steve Holland

The Bureau of Business &Economic Research at TheUniversity of Montana-Missoulabegan an annual survey ofMontana’s largest manufacturers in1999 and recently released theresults of the 2001-2002 Survey.The report notes, "According tolast year’s survey, 2001 was notexpected to be a particularly goodone, and results from the 2001manufacturers survey indicate theyear was, indeed, a difficult one bymost measures." The report con-cludes that the news was mixed.

"In the face of this downturn, itwas interesting that more than 30percent of the firms contactedreported experiencing a significantshortage of workers at some timeduring the year," the report says.However, "more than 50 percent ofthem reported making major capital expenditures during the

year. In addition, 25 percent ofthem introduced major new product lines."

Based on statistically valid meth-ods, the Bureau’s survey fits withwhat Montana’s manufacturers aretelling us here at the Center.Generally, Montana’s manufactur-ers experienced a significant dropin business in fourth quarter 2001.A few report that the weakness inQ4 made 2001 equal to 2000, orno growth. Most, however, reportthat 2001 was lower than 2000.Most also report that 2002 is backup, but the business climate is nowdifferent. Customers are carryinglower inventories while forecasting2002 will be equal to or better than2001. The result is shorter leadtimes for manufacturers, more diffi-culty planning capacity and pro-duction, and higher in-processinventories for manufacturers. In

the other extreme, some manufac-turers report much higher busi-ness this year, while a few contin-ue to struggle with Q1 lookinglike Q4 2001. Merger and acquisi-tion has been hard on the com-munications and food manufac-turing industries. Still, mostremain optimistic about 2002.

A few manufacturers report thatthey will invest in new equipmentand/or expansions over the nextyear or two; however, most willlook for ways to improve efficien-cy and productivity to get moreout of what they currently have.They will need to invest in theirworkforce because new skills willbe required, new procedures andexpectations must be taught, andskilled labor will continue to bescarce. The news for manufactur-ing is mixed; the business climatehas changed.

Crucial Issues Facing Montana’sManufacturers

More From Quality ProductsLooking over vigilance proce-

dures, Kent Ferguson (right) of

Quality Products in Missoula

had more to say about MMEC’s

Kreg Worrest (left) who helped

the company locate special

polypropylene film for the

Marathon Sterilization Pouch.

"Kreg provided us with invalu-

able knowledge in CE Marking

and FDA regulations. Without

it, we’d be dead in the water."

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I M P R O V I N G T H E C O M P E T I T I V E N E S S O F M O N T A N A M A N U F A C T U R E R S

P A G E 4

Manufacturers Participate in Center’sFirst-Ever Videoconference Training

MMEC’s first-ever VideoconferenceTraining Series, "ManufacturingEssentials for Profitability," was well-attended by Montana manufacturingcompanies in May and June. More than 70 manufacturing par-ticipants attended multiple live,interactive, two-hour manufactur-ing-oriented training sessions.

Participants attended the trainingvia eight statewide METNET satel-lite videoconference sites, allow-ing them to view the presenta-tion, the speaker, and those ask-ing questions or commenting. Voice-activated microphones enabled eachparticipant to interact with thegroup, most of whom were hun-dreds of miles away. In all, MMECdelivered six training sessions.

As part of the new LEAP (Learn-Evolve-Act-Profit) training initiative,

this new delivery method gaveMMEC an opportunity to expand itsofferings across the state to reachmore manufacturers with each pre-sentation and gain additional feed-back on training needs. In addition,this first series allowed MMEC toexplore the value of using METNETtechnology as another option fordelivering training to Montana manufacturers.

The videoconference series focusedon manufacturing principles andpractices and delivered valuablefoundational manufacturing man-agement information to existing andstart-up manufacturers. The seriesincluded financial models and ratioanalysis, setup reduction, lean man-ufacturing, repeatable quality sys-tems, value stream mapping, andproject management. Field engi-neers from MMEC presented thematerial and were available for live,interactive Q&A with those attend-

ing at the presenter site and distantlocations. Special METNET technol-ogy enabled participants to workstep by step on worksheets relatedto each topic while hearing and see

ing the instructor and the progres-sion of each example via screens inthe classroom. Advancements in thetechnology give this type of learningtool much the same feel as in aclassroom where the instructor isphysically present and places activitysheets on an overhead projector.

The videoconference format mini-mized travel obstacles for manymanufacturers and allowed MMECto deliver each topic to a broaderarray of manufacturers statewide atone time. According to videoconfer-ence feedback, 77% of attendeesindicated that distance traveledplayed a "significant role" in theirdecision whether to attend a train-ing event.

Some of the inherent challengeswith this form of delivery wereaddressed and improved upon asthe series progressed.Improvements included greatercoordination between the sites dur-ing questions and answers andmaking sure that the main cameraalternated appropriately betweenthe presenter and the visual presen-tation. After the first session, a clos-ing Q&A period was added for

questions that may have beenmissed during the presentation.

Because this is the first time MMEChas offered this training in a video-

conference format, we want toassess its viability as a future training delivery option.Attendees were encouraged tooffer feedback on the format andthe topics presented. Feedbackindicated that…1. The presentations met and/or

exceeded expectations 94% ofthe time; 52% exceeding expectations.

2. On a value scale of 1 to 5 (5being the greatest), presentationswere given a score of 3.8 overall.

3. Over 80% of attendees felt theycould apply the training directlyto their business.

4. A total of 70% would be morelikely to attend future videocon-ferences based on this experience.

5. Nearly 60% indicated interest inadditional in-depth training ontopics presented.

Eight participating videoconferencesite cities included Billings,Bozeman, Butte, Great Falls, Havre,Helena, Kalispell, and Missoula. The videoconference sites atGlasgow, Sidney and Miles Citywere initially offered, but becauseno registration activity occurred forthose sites, they were cancelled.

If you have any comments or questions about manufacturingvideoconference training, pleasecontact Kate Bryan at 406-994-3812or [email protected].

Think About It…

Small manufacturers

make upapproximately

one-third ofthe defense

supply chain.

Think About It…

Mark Shyne & Kate Bryan prep for session

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I M P R O V I N G T H E C O M P E T I T I V E N E S S O F M O N T A N A M A N U F A C T U R E R S

P A G E 5

by Kate Bryan

Employee turnover at any level ofthe organization can be disruptiveto your business. Lost productivityand additional training can be verycostly. So when you’re training anemployee, it’s also important tokeep an eye out for retaining thatemployee, thereby protecting yourinvestment.

This is especially true for small tomedium size manufacturers in ruralstates like Montana, where findingreplacements can be time-consum-ing and costly. You know thatturnover is a real cost to your business, but have you ever won-dered just how costly?

The Industrial TechnologyInstitute’s Network forManufacturing Excellence analyzedturnover cost from a variety of studies, and developed baseline statistics on expected turnover costby manufacturing job type. The results are eye-opening.

The statistics took into accountturnover costs in the following cost categories:

• Exit Cost of Previous Employee• Lost Productivity• Recruiting Costs• Quality Problems• Employee Cost• Customer Dissatisfaction• Orientation Cost• Lost Expertise/Knowledge• Training Cost• Supervisor’s Time for Turnover• Wages and Salary While Training• Temporary Replacement Cost

The combined statistical ranges areintended to reflect what has beengenerally reported when turnovercosts are analyzed. This informa-tion is meant to be used for bench-marking purposes, with the under-standing that the costs for a specificjob in a specific organization mayvary from these statistics.

So as you develop and train youremployees, investing in them andyour company, it’s important thatemployee retention be an impor-tant part of your company’semployee relations strategy.

Train and RetainTurnover is More Costly Than You Think!

MMEC HOME

OFFICE STAFF:

•••••••••••••••••••••

STEVE HOLLAND

Director

•••••••••••••••••••••

MARGIE JENSEN

Administrative Asst.

•••••••••••••••••••••

DEBORAH NASH

Writer

•••••••••••••••••••••

KATE BRYAN

Training DevelopmentEngineer

•••••••••••••••••••••

GLORIA ZIMMER

Business Manager

Manufacturing Job Type/ Turnover Cost as % of Category Annual Wage or Salary

Hourly Nonskilled, Hourly Production 30-50%Line Workers, Clerical/Administrative

Skilled Hourly, Professional 75%(sales representative, accountant)

Technical, Supervisors/Team Leaders, 100-125%Middle Managers

Engineer, Specialist 200%

Filling out thecomplementof 22 MMECAdvisoryBoard mem-bers is JohnD. Pickering,Sr., serving as

telecommunications representative.He currently serves as VicePresident of Professional Servicesfor the Seaquiam Corp., a print-on-demand company out ofAmsterdam, Holland. He is a certi-fied Novell Network Engineer, aMicrosoft Certified SystemsEngineer and has extensive educa-

tion in business, education andcomputer science, holding a Ph.D.in Education Administration.

Pickering is an executive with a history of success in designing andimplementing technology projectsand project management in a largeschool system, Marietta CitySchools, and for Delta Airlines. His26-year background of technicalknowledge and sales experiencealso includes projects for Oracle,Peoplesoft, JD Edwards, and others.

Our admittedly large board helpskeep the Center focused on doingwhat it does best -- helping

manufacturers to succeed and becompetitive today. Half the mem-bership are Montana manufacturerswho provide real-world insightsinto issues and interests from themanufacturer’s point of view. Anumber are economic developmentpartners hosting the outlyingMMEC field engineer offices. Each is committed to building manufacturing. Three are legislatorswho value the business community,and another represents theGovernor’s Office and building theMontana economy.

Meet the MMEC Board

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I M P R O V I N G T H E C O M P E T I T I V E N E S S O F M O N T A N A M A N U F A C T U R E R S

P A G E 6

Specialty Foods Makers(continued from page one)

The selection of processing equip-ment includes mixers ranging insize from 5 to 60 quarts, a doughcutter, roller, proofer and convec-tion ovens, both the 40-gallon anda 30-quart steam kettle, a brasiercooker, mixer cutter, dehydra-tor, pasteurizer, cider press,cherry pitter, meat slicer,grinder and sausage stuffer.The packaging area has a bagsealer, shrink wrap system, vac-uum pack machine and augerfiller. Clients often processtheir own product in thekitchen, but a growing kitchenstaff can also process foodsfrom client recipes, freeing uptime for owners to pursueother business necessities. As anadded benefit, raw ingredients andpacking supplies can be orderedand sent directly to the Market,reducing storage requirements andtransport hassles.

Additional HelpIn the food lab, measures of mois-ture content and nutritional analy-ses are performed. A cooperativeagreement with Washington StateUniversity food testing laboratoriesprovides testing from one conve-nient resource. WSA is a processcontrol authority for safe process-ing of low acid and high acid foodsand extremely dense items like gar-lic. It can test food safety.

Poirier is very familiar with thekinds of equipment needed andissues and hurdles encountered inspecialty foods manufacturing. Sheoperated a commercial kitchen inIdaho for 20 years before comingto MMMM. She has attended exten-sive regulatory schooling andbrings a knowledge base to clientsthat might otherwise discourageeven the most creative cook frommoving into the commercial arena.

Staying abreast of the health and

food safety regulations requires amajor time investment. Her exper-tise is another draw to using theMMMM facility as well as a hugetime saver. She estimates that shespends half of her time with regula-tory searches and training, theother 50 percent with clients.

What Poirier doesn’t mention is herextreme delight in sharing herexpertise to help clients with regu-latory issues, recipe problems, andthe many time saving secrets thatmake a difference for small andfledgling companies.

"Lora does such a good job," saysJean Clem. "She knows so muchabout food safety and regulations."

Jan Tusick, the CooperativeDevelopment Specialist at MMMMagrees, "Lora is a tremendousresource."

What to Charge CustomersJust how does the facility knowwhat to charge for diverse kitchenservices to a wide client base rang-ing from Big Sky Teas to MontanaNatural Beef? The Market followedthe same type of good businesspractice they recommend to clients.They had a cost analysis of thekitchen facility prepared to deter-mine what to charge customers forequipment use and/or space rental.

The analysis was developed withthe help of MMEC/UTAP whichoffers costing and hourly rate assis-

tance across Montana. NikkiErickson, a University TechnicalAssistance Program engineer, visitedthe facility and gathered cost datato put into a model that would generate a benchmark against customer use.

The first step was a walk through tosee the equipment. Overheadcosts were then calculated onthe horsepower, wattageand/or gas used by each itemalong with square footagerequired by the equipment.Combining this data with esti-mated use time, depreciationand actual machine costs,Erickson derived a generalizedcost breakdown by machine.

The analysis didn’t stop there.Next, monthly facility overhead,payroll/benefits, and lease costswere entered to derive a basehourly rate for kitchen use of $10.A fee rate sheet has since beendeveloped that reflects the hourlyrates plus costs for specific servicessuch as nutritional analysis, lockerrental and other storage, any specialized cleaning, and labelingservices.

Cowboy Foods prepared 40 casesof their sauce and found the priceof services "very reasonable."

“The analysis is a great tool fordeveloping our co-packing fees. Wecan explore changes in revenueflow and baseline costs. In use, it’sbeen pretty realistic," Tusick said.

MMMM went one step further forits clients by having Paddy Fleming,MMEC field engineer for northwest-ern Montana, add a customer com-ponent to the model. According toPoirier, it allows customers to addexternal costs like materials, ship-ping, distribution, and desired prof-it margin into the mix to assistthem in final pricing of their prod-uct. For more information aboutthe Market, call 406-676-0676.

FORWARD

FOCUS IS A

NEWSLETTER

FOR

MONTANA

MANUFACTURERS

PUBLISHED

QUARTERLY

C H E C K I T

O U T

Feel free to call

MMEC about

manufacturing

topics or

issues that

concern you.

Call us at:

1-800-MEP-

4 M F G

Lora Poirier and Debbie Fahlgren processing Rustler’s bean sauce.

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Com

pete

S

mar

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I M P R O V I N G T H E C O M P E T I T I V E N E S S O F M O N T A N A M A N U F A C T U R E R S

Montana consumers supportMontana products. Most of us arefamiliar with the Made inMontana logo, but have youseen the latest logo,"Montana’s Choice," identi-fying products on the gro-cery shelf? This logo is partof a promotion by the MontanaDepartment of Agriculture and agroup of independent food proces-sors to heighten consumer awareness

P A G E 7

Growth through TechnologyTransfer, a panel discussion duringthe Compete Smart manufacturing conference Oct. 3 & 4, will feature panelists here in Montana who facil-itate tech transfer. This breakoutsession will help you to understandthe power of tech transfer and howyou can use it to position your com-pany for new markets and strongalliances. You will hear tips on fund-ing sources, surviving the applica-tion process, and the importance ofmarketing strategies. Come exploretech transfer and how it works righthere in Montana. Questions will bewelcomed.

Panelist Todd Johnson, Directorof Technology & Commercializa-tion at MSU TechLink Center,Bozeman, has experience in busi-ness and technical fields whichenable him to position each tech-nology to specific licensee needs.He works with Global 500 andother companies to build competi-tive edge by analyzing cost struc-tures, existing production technol-ogy strengths and weaknesses, pro-duction methodologies, supply-chain constraints and developmenttimelines. Panelist Barry Roose isinvolved in tech transfer as SpecialProjects Director at American Eagle

Instruments, Missoula, andArcomac Surface Engineering, LLC.He originates and closes on tech-nology activities and works start-upand spin off technology projects atthese companies. He is a life-longMontana resident and, as a formerRegional Development Officer forthe Montana Department ofCommerce, has helped steer anumber of Montana companiesthrough securing funds and loanclosing. Marti Elder, Marti ElderLLC Marketing & ManagementServices, Bozeman, specializes intechnology project conception,licensing, and marketing of newproducts. She helps companiesmanage intellectual propertyincluding trademarks, copyright,patents, and trade secrets. She is amember of the LicensingExecutives Society and NationalInventor Fraud Center.

Each of these panelists will offer apractical piece of the tech transferpuzzle and help that is available.Plan to attend Compete Smart andtake advantage of this and otherinformation packed breakout ses-sions in Missoula at the DoubleTreeEdgwater Hotel.

For more information, see mtmanufacturingcenter.com

Irish Markets Opportunity

The Montana World Trade Centerannounces an innovative new pro-gram for preliminary test market-ing and limited product placementinto Ireland for items fromMontana and other RockyMountain/ Plains region states.Four categories of products will beconsidered initially including spe-cialty food/beverage, art, outdoor,and home furnishing. See criteriain greater detail on the website atwww.rockymountainmarket.com.Due to program restrictions, noalcoholic beverages, perishable,refrigerated, and frozen productsare eligible.

Interested manufacturers shouldcontact Brigitta Freer at [email protected] or406.243.6982 immediately to allowfor participant selection, presenta-tion to Irish buyers, and anticipat-ed 3-month retail launch inSeptember 2002. Manufacturersneed not have prior exportingexperience. Closing date for con-sideration is Friday, June 28.

This unique opportunity has beenfunded in part by a grant from the Market DevelopmentCooperator Program of the USDepartment of Commerce andother generous sponsors.

Consumers Supportof the availability of food products

made by Montana businesses.According to a Dept. of

Agriculture news release,there are close to 400 foodcompanies in Montana.They produce meat prod-

ucts, bottled sauces, fudge,condiments, bottled bever-

ages, and lots more. TheMontana’s Choicelogo points theseproducts out to shoppers.

Panel to Explore Tech Transfer

COMPETE SMART

MANUFACTURING

CONFERENCE

2002

Network w/ other manufacturers

Hear what world class

companies do✦

Choose tools that work

Get energized✦

Compete more effectively

October 3 & 4in Missoula

Watch for details!

800-MEP-4MFG

Page 8: Forward Focus I MPROVING THE C OMPETITIVENESS OF ......MSU TechLink (406) 994-7732 aldeibert@coe.montana.edu HELENA Todd Daniels MMEC Engineer MT Dept. of Commerce Helena, MT 59620

You can grow your business inMontana. The message was clearfrom industry leaders from threeMontana companies addressingparticipants at the last CompeteSmart conference. You said youwanted to hear more stories fromMontana companies.We listened.

Montana company leaders willagain be featured during thebreakfast presentation duringthe Oct. 3 & 4 event in Missoula.In fact, we’ve packed the 2002Compete Smart ManufacturingConference with speakers and presenters who have been in thetrenches. They know what works.

You will hear Larry Hall, CEO ofS&K Electronics, a tribally ownedfirm in the Mission Valley, tell aboutfollowing a different vision andhow his company makes it work inthis neighborhood we callMontana. S&K Electronics, a fullservice EMS company, was recentlyfeatured in the Wall Street Journalas a model company.

Lori Rydberg, Director ofOperations at Gibson Guitar –Montana, Acoustic Division inBozeman, inspired a companytransformation that continuestoday. Find out what Gibson isdoing and why. Hear how she andher support teams are makingchange work.

Gerald McConnell, CEO, at JoreCorporation and business owner ofPrecision Sawmill Systems, Inc. inSuperior, deals with the obstaclesand opportunities of doing business in Montana every day. Adynamic corporate leader, he hasmanagement expertise in rapidgrowth and turn around environ-ments forglobal business expan-sions, consolidations, strategicplanning and corporate restructur-ing. Come hear his take on growingyour business in Montana.

Breakout sessions will include apanel discussion on Growththrough Technology Transfer andthree presentations to help youwith the "next step" in marketingand sales strategies.

NorthWestern Energy, one of thegenerous co-sponsors for CompeteSmart, will present an information-packed session on managing energy. And Idaho TechHelp,

an MEP network partner withMMEC, will share strategies forchange.

Check out our three-hour pre-conference sessions on Oct. 3, one on Effective Cash FlowManagement and another onUnlocking the Key Elements toLean Manufacturing with Legotm.

Exhibitors will be on hand to sharethe tools and services they have for manufacturers. You will partakein a special vendor-hosted recep-tion complete with drawings anddoor prizes.

Call MMEC at 406-994-3812 formore information or for costs,details and Online Registration seemtmanufacturingcenter.com

You Are Invited

I M P R O V I N G T H E C O M P E T I T I V E N E S S O F M O N T A N A M A N U F A C T U R E R S

Montana State University313 Roberts HallP.O. Box 173800Bozeman, MT 59717-3800RETURN SERVICE REQUESTED

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PAIDPermit No. 69

Bozeman, MT 59715

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