Dave Keck likes to simplify things when he talks about his business, Komponents Laminated Products, which makes casegoods, furniture and components in Oconomowoc, Wisconsin.
“At the end of the day,” Keck said during a recent interview, “we make laminated rectangles.”
“Some of them are tabletops. Some of them get built into cabinets. Some of them are store fixtures. To us, they are all just laminated panels.”
While there is some truth to Keck’s stripped-down description, it hardly does justice to the company, which is celebrating 50 years in business in 2019 after experiencing 30 percent growth in 2018. Clearly, Keck and his 20 or so employees are doing many things right while making those laminated rectangles.
Komponents manufactures cabinets, desks, tabletops and components for a range of customers. The medical industry accounts for about a third of the company’s business, while multi-family and single-family housing is another third. Office furniture and other segments make up the rest.
“We’re just going gangbusters again in cabinets,” Keck said, noting that the company has come full circle after starting in cabinets five decades ago and later moving more into components. “We do cabinets for medical clinics, lots of multi-family, and now we’re even doing individual kitchens for homeowners.”
Komponents was founded by Keck’s father, William, and has steadily grown into the company that now occupies 25,000 square feet—with another 10,000 square feet in a warehouse down the street—and serves customers from Madison to Milwaukee in Wisconsin to California, New York and even Mexico.
Dave always knew he wanted to work for his dad’s company, but he took a route that included a degree in marketing and finance at the University of Wisconsin-Madison and a few years in the computer business. He joined Komponents in 1989.
“I knew at some point I wanted to be part of this … to run the show. So I jumped on board, and at that time, the company needed a shot of marketing badly, and I was able to help with that,” he said.
Under Dave Keck’s leadership, the company aggressively went after new business, especially in the medical industry and the store fixture segment. From the beginning, the company has taken pride in being relatively automated, Dave said, and it has continually added new machinery.
“We just had simple equipment in the early days. We bought our first CNCs back in the ‘80s. We got a couple of Motionmaster routers. We definitely kept taking bigger steps into automation,” he said.
Back in 1998, for example, the company was the second components manufacturer in the U.S. to buy a Homag BAZ contour edgebander. It was a $400,000 investment, and the machine is still running.
“To this day, it’s still an incredible machine. People see it running, and they are just blown away,” Keck said.
While Keck and Komponents have steadily invested in automation, they are on the verge of making a big leap designed to significantly improve efficiency. In 2020, Keck plans to invest about $600,000 in a material handling system and other machinery that will bring better order to his plant. He considered a building addition but decided he could make do if he condensed his operation.
“We’re just going to bring everything that is scattered around the plant into this one area,” Keck said as he viewed the space that will hold the material handling system. “I bet we spend 40 percent of our time moving material to and from the saw and other equipment. And every time you handle material, it can get damaged.”
If he’s committed to investing that much, Keck clearly is confident in his business plan. Komponents continues to evolve to become more streamlined and to meet customer demand. Its move from selling mostly components to providing assembled cabinets is a prime example.
“We were leaving a lot of projects on the table because we weren’t doing assembly. So we got back into doing assembly of both store fixtures and then back into cabinets,” he said.
Now, Komponents is looking to ship more of its products unassembled because that’s what some customers want and shipping is more efficient, Keck said.
While multi-family has been good to Komponents, Keck has seen statistics and projections that indicate apartment construction has peaked. He believes condominiums will be “the next big thing.”
Like many manufacturers, Keck is watching the China trade skirmish closely but doesn’t pretend to know how things will turn out. He believes Chinese cabinet manufacturers are taking a hit on their margins to offset tariffs, while at the same time, machinery manufacturers are busy selling equipment to U.S. companies gearing up to make more of their products domestically.
Regardless of the specifics of how the trade dispute is settled, Keck hopes U.S. manufacturers come away with a larger share of the market.
“Here’s the thing. Cabinets and components of cabinets are an $8 billion market. China supplies $4 million of that. Let’s get 20 percent of that back. That’s all we need.”
While Keck would love to get some of that business, he doesn’t expect many new domestic companies to come onto the scene to compete with him and other established businesses. Between the cost of machinery and software, reduced lead times and the enhanced sophistication of operations such as his, the barrier to entry is getting higher every year, he said.
“To compete, it takes a lot more dollars these days. And for the most part, it’s a low-margin business. If you’re going to invest big dollars, there are other places to go,” he said. “I had an 18-year-old in here saying he wanted to run a cabinet shop someday. I thought to myself, ‘Good luck.’ It’s not like the old days. Everything has just ratcheted way up.”
As for lead times, Keck said Komponents is competitive. A custom kitchen that might have taken eight weeks in the past, for example, is now made and out the door in three or four weeks. Components, which still make up about 50 percent of the company’s business, can be ready and shipped within a week of the first conversation, he added.
As his business grows and evolves, Keck is especially excited about the innovations in laminated surfaces. Synchronized textures have taken the quality and realism of HPL and TFL to new levels, he said, while super matte finishes offer an attractive look and a practical, fingerprint-resistant feel. Customers are noticing.
“They are saying, ‘Why bother with wood when laminates look like this?’ They are also realizing that after 10 years, their laminate kitchen can look the same. Wood wears. Laminate can look the same after years of use as it did when it first went in.”
Brian Hospel, who prepares designs and bids for Komponents, said people are looking for a change from the old wooden cabinet boxes, and laminates fit the bill. “Customers go on the internet, start digging around and see all of the pictures, and they say, ‘Where can I get that?’ There is just a wide world of colors. They can pick anything and get it on their cabinets. It doesn’t have to be a maple door or a cherry door or Wisconsin Oak.”
Keck added: “We’re getting people calling us directly and saying, ‘I want a laminate kitchen.’ We never had that before.”
Komponents offers laminates from many suppliers, including Wilsonart, Panolam, Formica, Cleaf, Arauco, Uniboard and Egger. Keck had special praise for Wilsonart and the job its spec reps do selling its products to architects, designers and others. He also singled out Egger, saying the company is “going after the industry strong and doing a heck of a job” in both HPL and TFL, and he said Arauco’s big new plant in Grayling, Michigan, is likely to provide more raw and laminated board going forward.
Komponents has a Midwest Automation laminating line and lays up HPL two or three times a week, including for some of its competitors, Keck explained. The company sets itself apart from distributors by being willing to cut down panels and laminates before laminating, producing thicker panels and offering any brand of HPL, including imports.
Much of the hardware used in the cabinets and other furniture comes from Salice, while Richelieu and Wurth also are key suppliers, Keck said.
Joel Weber, operations manager, took a page from Keck’s book when he described Komponents in relatively simple terms to several visitors during a recent plant tour.
“It’s a unique operation. There’s a lot of variety, a lot of interesting products. We’re always doing something different,” Weber said.
Ultimately, though, it all comes down to those laminated rectangles, which are generating more excitement than ever among customers. Keck is happy that after 50 years, his company is ready and able to meet the growing demand.