By Nathan Peck | MiBiz
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BANGOR — Southwest Michigan admittedly doesn’t jump to mind when one thinks of a major player in the mining industry.

Getman Corporation, a third-generation family business, is seeing green as global commodity prices rise and mining companies look to increasingly far-flung locales in the pursuit of raw materials for the global economy. The company takes raw steel and produces customized trucks for the mining industry.

The Southwest Michigan manufacturer is seeing strong growth as worldwide commodity prices for metals reach historic highs, said Derek Getman, sales director at Getman Corporation and the third-generation of the family to work at the business. The company builds support vehicles for the mining operations, trucks capable of hauling fuel, explosives and gear deep into the heart of mines around the globe. Demand for rare-earth and precious metals is skyrocketing and helped the company achieve 30-percent growth in 2010, reaching $30 million in global sales. Prices for copper, gold and silver are reaching historic highs.

Getman Corporation began in 1950 as a manufacturer of small, motorized concrete hauling machines — known as Scoot-crete — when Getman Brothers Construction company purchased the assets of North Lake Machine Works. The Scoot-crete haulers were used to carry concrete on job sites and were used in the construction of the Mackinac Bridge. The company was quick to jump on an alternative use of the equipment after a customer modified the Scoot-crete hauler, changing out the gasoline engine for a diesel, and hauling uranium ore out of mines in Colorado. Prior to using Getman’s hauler, uranium ore was hauled out of mines in much the same way as it had for centuries before: by teams of mules and horses. Getman saw the opportunity and started manufacturing diesel versions of the haulers, adding bore drilling and explosives charging trucks in the 1960s.

What planned obsolescence?

The company has carved out a niche in the mining industry, leaving the manufacture of production equipment to the larger players such as Caterpillar. The company has built a reputation for longevity and quality. During a trip last year, Getman saw the first truck the company sold some 30 years ago to a Mexican silver mine was still in service.

“These are the pit crews of the mining industry. We support the stars to help them do what they do best,” Getman said. The company operates its own machine and press shop, allowing it to service vehicles with replacement parts from decades ago. “It creates challenges for us to supply to a truck we built 30 years ago, but we made the commitment to provide equipment that lasts. It was a conscious decision we made. We don’t want to sell a truck every five years.”

While it may be counterintuitive to build something so well it doesn’t need to be replaced, Getman points to the fact that the aforementioned Mexican silver mine has ordered another 10 trucks as its operations have grown. Many mining operations keep a 6- or 7-year replacement schedule for equipment.

Growth produces its own challenges. Backlogs on orders are rising, and the company is constantly looking for cost-effective solutions to balance the needs of customers while keeping an eye on the downside risks of adding too much capacity too quickly. The company found that by adding a finishing bay, throughput could be increased.

“We don’t necessarily need to double capacity, but we found we could get 5 to 10 percent more capacity with the bay. Our business is very cyclical. In 2007 and 2008 we were experiencing a boom, fueled by growing demand from the BRIC countries,” Getman told MiBiz, referring to Brazil, Russia, India and China. “In 2009 we were feeling the effects of the Lehman Brothers collapse and the global recession and saw a slowdown in orders.”

Made to order

The company prides itself on making custom trucks that meet the needs of their customers and takes a hybrid approach to the manufacture of equipment. The assembly of trucks is done by a small group of people, sometimes only a master assembler and an apprentice, which can be a costly endeavor. Getman employs a prototyping engineer to help drive innovation at the company, developing new applications for customers.

“We shoot for as much homogeneity as possible. If you’re operating a business that focuses on customized solutions, you have to understand that when you are developing products,” Getman said.

The company looks to find the specifications that meet the majority of customers’ needs, while keeping the engineering and manufacturing expertise necessary to find custom solutions when needed.

“That being said, you want to design for as many possibilities as possible. If we know customers are asking for a 10, 12 and 14 PSI pump, we’ll go with the 14 psi pump,” he said.” You want to hit that 80 percent number as much as possible, but we’ve built our business around the other 20 percent.”

Sometimes, however, it is key to know when to say no.

“At the end of the day, you have to have a good decision-making process in place. You need to know you’re providing the right competency to the project,” Getman said.

Getman Corporation is in the midst of determining how to manage its growth going forward, trying to manage costs while looking to draw down lead times. The company now employs 150 people and has brought on 12 employees since late 2010, adding a second shift in its manufacturing department.

“We are constantly looking at that high-level strategic question — it’s something you have to pay constant attention to,” he said. “We stay close to our customers because it is the same challenge as any business. When is the best time to pull the trigger on adding equipment and staffing? What can we do with what we have?”