Today we’re running a podcast that I guested on in September of 2024 called “Networking and Marketing Made Simple.” The show focuses on how LinkedIn can be used to grow your business. It’s hosted by Scott Aaron, who for the last seven months was my LinkedIn coach, an experience that is already paying dividends in our businesses. On his show I focused on one of my favorite topics, harnessing the power of serendipity to be successful in business and life.

It often takes a bit of luck to accomplish extraordinary things, and that luck almost never happens on its own. You have to do specific things to cause it to happen, and that’s what I talk about in the episode.

Scott also guested on Swarfcast in episode 221 and shared some eye opening LinkedIn strategies.

*************

Listen on your favorite podcast app using pod.link.

View the podcast at the bottom of this post or on our YouTube Channel

Facebook: https://www.facebook.com/swarfcast

*************

Link to Graff-Pinkert’s Acquisitions and Sales promotion!

*************

The more people or “dots” you have in your network the greater the chance you will get lucky. I’m always trying to meet new people because you never know who is going to become someone who brings you business deals or becomes a friend—or both.

Also, whenever I meet new people I find interesting, I try to think about who else I know who could benefit from knowing this person, and then I try to introduce the two of them. Doing this makes the bonds between me and all the parties greater. More possibilities for new magic are created. It also just feels great for me to get to be the serendipity that helps others find success.

Using serendipity hooks means introducing multiple conversation topics to increase the chances of making connections. I used to think that just being a great listener enabled you to make great contacts and learn important stuff. But eventually I learned that it’s important for YOU to talk in a conversation to make it more worthwhile. The information you tell about yourself and the specific questions you ask your counterpart can determine if a conversation leads to an interesting and significant outcome or is a waste of time. Some serendipity hooks I like to use when I’m getting to know a new person is to tell them I have podcast, I’m a fairly new father, or I work with my dad. I also tell people I’m a used machine tool dealer, but the more interesting topics you bring up, the likelier chance you will find a common interest between you and your conversation partner.

When I speak to new potential customers who contact us about a machine, I always try to look their company up first to give myself ideas for interesting serendipity hooks. If I can find out what machines they have on their website or what industries they serve, I will be armed with more things to discuss in the conversation that may turn out to be more important than the original thing they contacted us about. For instance, a customer might contact Graff-Pinkert about a Citizen we have for sale, and before I call them back I go to their site and see they own Acme-Gridleys, which Graff-Pinkert also buys and sells. I then will know to ask if they want to buy or sell an Acme when I make the call. They might then say to me, “really, you would buy my old Acme machine that I’m trying to get rid of?” I came to discuss one type of machine and finished by talking about an entirely different machine of which there could be a bigger opportunity.

Instead of focusing on one dream client or opportunity I try to connect with multiple prospects to increase my chances of success. It’s like dropping a big bomb. It’s going to blow up a lot of stuff all around it, not just the space it falls on. For instance, if I have an INDEX CNC machine for sale, I try to contact as many INDEX customers that I can find—not just the few customers who I’ve sold machines to in the past. Like many of these principles, it’s a strategy that seems obvious, but it’s important to identify it. I need to be mindful of the strategy so I remember to use it.

In the morning I want to prepare my brain to be ready to see the potential opportunities for serendipity floating all around me, so I start my day repeating the following affirmation:

“I am a serendipity magnet. I create, I see, I seize opportunity everywhere.”

This keeps my eyes and ears open and reminds me to keep thinking about the serendipity creation strategies that I have at my arsonel.

Also, at night before I go to bed, I always write down one serendipitous occurrence that happened to me that day. They’re usually pretty simple, like learning something useful in a conversation that may help in a future machinery deal, or discovering an interesting used machine for sale while searching the web looking for something unrelated, or meeting a new person who will be an important resource.

The more I write about serendipity, the more I think about it, and then the more I notice it all around me.

Question: Can you share a time when something that seemed like bad luck actually led to something great?

Have you ever dreamed about combining your expertise and passions to become an entrepreneur?

My guess on today’s podcast did just that. Erez Speiser is the creator of machiningdoctor.com, a site for professionals in the machining industry to get technical information to simplify their work. The site offers resources such as a sophisticated feeds and speeds calculator for six types of machining processes. It even contains a machining encyclopedia.

Before creating Machining Doctor, Erez worked for cutting tools giant ISCAR for over 20 years and managed a Swiss machine shop. But serendipitous elements, namely a love of hiking in his home country of Israel and a global pandemic, led him on an entrepreneurial path.

Listen to the podcast on all podcast apps.

Listen on your favorite podcast app using pod.link.

View the podcast our YouTube Channel.

Facebook: https://www.facebook.com/swarfcast

*************

Link to Graff-Pinkert’s Acquisitions and Sales promotion!

*************

In 2018, Erez built his first website for a side business called Israel By Foot that provided advice to vacationers hiking in Israel. The company helped people plan for self-guided hikes throughout Israel, providing maps and explanations, booking lodgings, and even dropping tourists’ baggage at hotels.

When COVID-19 hit, the hiking tourism business turned non-existent. At the same time, Erez found himself working at home with a smaller workload for his day job at ISCAR Cutting Tools. The new skills Erez had developed while building the website for Israel By Foot gave him the idea to build a new website devoted to machining, the field he had based his career on.

Erez says the most popular features on Machining Doctor are calculators that help people assess the correct cutting speed, surface finish, and power consumption for machining jobs. The feeds and speeds calculator works for a number of applications such as turning, milling, parting, grooving, drilling, and threading. It takes into account material groups, types of units, and other variables.

Machiningdoctor.com gets around 250,000 page views and 100,000 unique visitors per month. Erez monetizes Machining Doctor with Google Display Ads on the site, but he wants to change his business model to a subscription based one without annoying ads, in which users pay $1.50 per month. I asked him how he could make money charging users such a low price and he explained that if 100,000 users paid $1.50 per month it would mean $150,000 per month.

Erez has a lot of ideas to boost the value of the site. He is now posting original educational videos about machining. He also plans to use the site to generate clients who want assistance in their machining jobs. He plans to provide complete solutions to jobs, including tooling layout, CNC programming, and simulation tools like VERICUT.

Erez lives in Rakefet, a town in northern Israel, so I decided to ask him a few questions about what it’s like to be an Israeli during such a dark time. His son is a reserve paratrooper and has saw combat for three months. He said the manufacturing sector hasn’t been affected that much by the war in Gaza, though the workforce is somewhat thinner due to workers who are military reservists.

I asked Erez if he thought that Hamas got the result they wanted when they committed the atrocities on October 7. My personal and depressing perspective is that Hamas was hoping for a severe reaction from Israel that would start a destructive chain of events throughout the Middle East. Erez responded that it’s impossible to know how people like Hamas think and that whenever people have tried to understand or predict how they think they have been wrong. Hard to argue with that statement.

We ended the interview discussing Israel’s incredible number of successful startup tech companies. Though I’m not Israeli, I am Jewish, so I think I have some feel for why Israel has so many great entrepreneurs. Jewish culture encourages education, creativity, and courage. Just living in a country surrounded by neighbors who want to blow you up takes chutzpa. Erez claims if it weren’t for a love of hiking and building websites, as well as a global pandemic, there wouldn’t be Machining Doctor. Maybe true, but the added factor of him being Israeli definitely didn’t hurt either.

You can contact Erez on LinkedIn at linkedin.com/in/erez-speiser-a9444b160

When Trump was elected President for a second term, I expected there would be a lot of talk about tariffs, but I didn’t anticipate all the attention on the Panama Canal and Greenland.

So, it seemed like the perfect time for Lloyd and I to talk to one of our favorite geopolitics experts, Dr. Andrew R. Thomas, best selling author and Professor of Business at the University of Akron. It also just so happens that Thomas is a part-time resident of Panama and he recently wrote a book about the Panama Canal.

It was a fun interview. We explored how the latest politics are reshaping international trade and why the current administration seems so interested in Greenland and the Panama Canal.

Quick note: we recorded this conversation on February 3rd, when there was serious talk about 25% tariffs on Canadian and Mexican imports potentially taking effect the very next day.

Listen to our other interviews with Andrew R. Thomas on the subject of reshoring and China, and the fracking revolution (Part 1 and Part 2).

*************

Listen on your favorite podcast app using pod.link.

View the podcast at the bottom of this post or on our YouTube Channel

Facebook: https://www.facebook.com/swarfcast

*************

Link to Graff-Pinkert’s Acquisitions and Sales promotion!

*************

Thomas shared a compelling narrative about the Panama Canal’s transformation. World War II marked a turning point – modern warships had grown too large for the locks, while America’s new interstate highway system and thriving west coast economy diminished its commercial importance. In 2000, critics compared the U.S. handover of control to “giving a Ferrari’s keys to a 16-year-old.” The Panamanians proved them wrong. They achieved ISO 9001 certification within a year, modernized booking systems, and transformed the money-losing operation into a profitable enterprise that generates billions in annual revenue.

This success story has taken a geopolitical turn. China has established growing influence in Panama by managing ports on both sides of the canal, launching infrastructure projects, and strengthening diplomatic ties. This expansion has drawn intense scrutiny from U.S. policymakers, especially President Trump.

Thomas outlined how the American shale revolution has transformed international relations. America’s private property rights system differs from other nations where governments control mineral rights. This distinction enabled an energy renaissance that has transformed global dynamics and given the U.S. unprecedented leverage in foreign policy decisions.

The Panama Canal serves as a crucial link in this new energy landscape by facilitating American LNG exports to Asian markets. This demonstrates how infrastructure, energy policy, and international trade interconnect in today’s complex global environment.

The recent announcements of 25% tariffs on Mexico and Canada and 10% on China mark a dramatic shift in American foreign policy. Thomas argues these moves extend beyond trade – they leverage economic power to combat fentanyl trafficking and illegal immigration. This approach signals a shift from maintaining global order to prioritizing domestic interests, creating unprecedented uncertainty in international business.

Thomas highlighted a pivotal moment when the Secretary of State acknowledged a “multipolar world” – a revolutionary admission from American leadership. This marks a fundamental shift from post-World War II American hegemony to a more complex international system.

Thomas emphasized that the Ukraine conflict tops the list of global concerns. Russia sees the situation as an existential threat, given its history of invasions through Ukrainian territory. The rising nuclear risks and military escalations demand a diplomatic solution for global stability.

The U.S. continues to redefine its global role by prioritizing domestic interests while wielding economic power in new ways. These changes from Panama to Ukraine reshape international relations and will impact businesses and nations for years to come.

Key takeaway: We watch a historic transformation unfold in the global order, where economic leverage, energy independence, and infrastructure control drive international politics. These dynamics affect everyone involved in international business or policy-making in today’s complex world.

Question: How has unpredictable trade policy affected your manufacturing business in the past year?

Dave Polito is my Star CNC guru.

He’s always been there when I’ve had questions, whether I was asking about a 1999 Star SA12, or a sweet SV38R located in Asia, or the ever flummoxing Siemens control on an ECAS-20.

Dave is the owner of Quality Machine Tool Services, the Star distributor for Illinois and southern Wisconsin. He has been servicing and selling Star Swiss screw machines for over 35 years. For much of his career he did technical service and applications. Quality Machine Tool Services started as strictly a service center and then in 2009 began selling Star machines.

*************

Listen on your favorite podcast app using pod.link.

View the podcast at the bottom of this post or on our YouTube Channel

Facebook: https://www.facebook.com/swarfcast

*************

Link to Graff-Pinkert’s Acquisitions and Sales promotion!

*************

Star’s Distinction from other Swiss CNC Brands

Dave says that several top Swiss CNC screw machine producers make quality products, but Star’s service and the durability of its machines make it one of the best choices on the market. The machines have dovetail construction and their Fanuc control make them easy for operators of other machines with Fanuc control to adopt them. It’s not uncommon for 20-year-old Star machines to still be making good parts, so Star has continued to service all of the machines, and Star’s live tools can be used on all different generations of the brand.

A Refresher on Swiss Machining

Swiss style machines originated in the 1800s in Switzerland for the watch industry that needed to be able to produce parts with a long length to diameter ratio. Swiss style machines are able to produce precise long parts because the bar is supported by a guide bushing that prevents deflection. Swiss style machines are also known as sliding headstock machines because the headstock is what feeds the material through the guide bushing. Today’s Swiss technology is still important for making long parts, but it’s also significant because it enables users to produce complex complete parts. Typically, Swiss machines are used for runs of at least thousands. They aren’t nearly as fast as multi-spindles but are a lot faster than single spindle CNC lathes.

Machining with Ground Bar Stock vs. Unground Bar Stock

Swiss machining is generally associated with using bar stock that is ground to the desired tolerance of parts. Quality ground stock takes some of the variables away that could produce poor parts, so it’s usually advisable to use it when machining unattended.

However, Dave says only around 50% of Swiss work uses ground stock. Some improvements in technology such as Star’s rotary magic guide bushing have made it easier to machine cheaper unground stock. One of the benefits of the rotary magic guide bushing is that it creates air pressure to make sure it is not too loose nor too tight around the bar. 

Machining with Guide Bushing (Swiss Style) vs Without Guide Bushing (Chucking Mode)

Using Swiss Style lathes without the guide bushing, also called chucking mode, has been growing more popular. Without a guide bushing, the machines cannot produce parts quite as long or precise, but the parts can still be high quality and machined complete. Using no guide bushing enables smaller bar remnants when a bar has been used up because the bar doesn’t have to travel over the added space of the guide bushing.

Turret Swiss Lathes vs. Gang Style 

Turret style Swiss Lathes, often used for medical work can produce far more complex parts than gang style machines because they can hold 50 live tools at a time, while a gang style machine holds only a fraction of that. People also like the turret style machines because with so many live tools on the turret they can limit setup changeovers by producing families of parts. However, turret style machines have larger footprints than gang style machines and much larger price tags. An entry level 5-axis gang style machine starts around $100,000 without a bar feed. A 6-axis SR gang style machine starts at around $200,000 without bar feed. Turret style machines can cost more than $500,000 depending on how they are tooled up.

Current Market for CNC Swiss

Dave says Star still has a backlog of orders for its machines. A popular model like an SR20 will take about 6-8 weeks to arrive at a customer. Earlier in the year it might have taken several months to get a machine. The lead time has been reduced by supply chain bottlenecks lessening.

Dave says customers he talks to still seem confident they will continue to get a lot of Swiss work going forward, despite the nervousness in the current economy. 

Star sells more machines to China than anywhere else in the world. Dave says he has heard that Chinese companies buy the same number of machines in one month that U.S. companies might buy in a year.

Question: What is the most lucrative part you have machined?

My guest on today’s podcast, Anthony Davis, told me that since age 10 he and his brother knew they wanted to join their family business, Global CNC, a tooling manufacturer for CNC lathes and mills.

Today at age 23, Anthony runs the company alongside his 25-year-old brother, Alexander, and their 84-year-old grandfather who founded the company 40 years ago.

What I love about Anthony is how ALL-IN he is in his work. He values carrying on his grandfather’s legacy, but he is also driven to innovate into new products and marketing techniques. He glows as he talks about how he loves to work with family members, which I’m grateful to say that I can relate to as well, working alongside my father who just turned 80.

*************

Listen on your favorite podcast app using pod.link.

View the podcast at the bottom of this post or on our YouTube Channel

Facebook: https://www.facebook.com/swarfcast

*************

Link to Graff-Pinkert’s Acquisitions and Sales promotion!

*************

Global CNC distinguishes itself as one of the few remaining US-based manufacturers in their sector, producing high-quality tool holders for major machine builders including Mazak, DMG-MORI, Nakamura, Haas, and Doosan.

While some competitors use DuraBar, a softer material that wears down more quickly, Global CNC insists on high-quality steel with specific heat treating specifications. They also take the extra step of grinding all critical surfaces—a process many competitors skip in favor of machine finishing.

Global CNC’s facility is composed of a variety of brands of machine tools in order to understand their customers’ needs. ”Since we make our own product line, we have to really please everyone,” Anthony explains. This hands-on experience with different machines allows them to experiment with new tool holder technologies and find ways to decrease cycle times and improve finishes.

The COVID-19 accelerated Anthony’s role in his family company. When his college, University of Michigan-Dearborn, shifted to online classes and his hockey season was canceled (his team was ranked fourth nationally in their division), Anthony began working full-time while completing his degree. He managed a schedule that included early morning hockey practice, work during the day, and evening classes, all while learning the business from the ground up.

Looking to the future, Global CNC is expanding into new markets. They’re developing tool holders for Swiss-style machines, with plans to launch within the next year and a half. The company is also eyeing HSK and CAPTO tool holders for milling and mill-turn applications, seeing these as crucial growth areas in the industry.

The company balances the wisdom of experience with fresh perspectives. While there can be differences in approach between traditional methods and newer ideas, the family works through these differences through open discussion and mutual respect. They hold regular strategic discussions about advancing their manufacturing capabilities, recently exploring new technologies to produce products faster and more efficiently.

This combination of traditional manufacturing values and forward-thinking innovation positions Global CNC well for continued growth in the precision tool holder market.

Question: What is the best thing about working in your family’s business?

Spinner is a German CNC machine tool brand that’s been around for 73 years. The company sold 1,200 CNC mills turning centers, and automation systems in Europe last year, yet in the United States, a large amount of people in the machining industry have never even heard of them.

At the 2023 Precision Machining Technology Show, I stumbled upon Spinner’s booth, stopping there to ask if I could borrow a box cutter. Then I met Salim Awad, President and CEO of Spinner North America, who graciously agreed on the spot to be interviewed.

Salim has a fascinating personal story. He’s from Colombia, he was an army diver in Iraq, and he founded his own law firm. He worked for the prominent Italian machine tool company Bucci. And, since 2022, he’s been entrusted with bringing a German machine tool brand to the United States.

From my experience as used machine tool dealer at Graff-Pinkert, it often seems as though machine tool brands are like religions for machining companies. Once a company has experience and success with one, it’s hard to convert them to something different—let alone to one they’ve never heard of.

On today’s show, we’re going to talk about how you penetrate a crowded B2B market. How do you get customers to pay a half a million dollars to try a new machine? How do you market yourself? How do you earn people’s trust?

Listen with the player at the bottom of the page or at your favorite podcast app.

                                                            View the podcast our YouTube Channel.

Facebook: https://lnkd.in/dB_nzFzt

Noah Graff:  Give me a few examples of the types of machines Spinner makes. What would be the cost of a triple turret lathe, for example?

Salim Awad  (We make) CNC machine tools, from lathes, to mills. We’ve got some very special machines, like a mill-turn with capabilities for grinding. Hard turning machines that are able to hold sub-micron precision. 

In terms of price, we are very competitive. When a lot of people think about German machines, they think, oh yeah, they look great. They probably do a great job, but my God, I don’t want to pay that that much.

But we’ve found we are able to provide a very high quality product at a price that regular shops, not only the huge companies, are able to afford.

The (triple turret machine) you saw the today, we’re probably (asking) around $550,000.

Graff: Right now you are at PMTS (the Precision Machining Technology Show) getting the word out, showing the world who Spinner is. How long have you been distributing spinner in the US?

Awad: I joined the company right before IMTS 2022, August of last year. There was really no presence (before then). Like you said, their brand wasn’t known. Nobody knew what type of machines they could offer, where they came from or what capabilities they had.

Graff: What was your first step for bringing a machine tool brand into a new country, particularly the United States? 

Awad: The first step was to identify who we want to be and what resources we have to accomplish that.

We didn’t want to tell the market the business we’re going to do. We wanted to listen for a little while and understand what works and doesn’t work. Understand what type of customers were the right customers for us and get their feedback about best way to approach the market.

We have been fortunate to bring on a fantastic group of people. We’re not to the level where we want to be as far as the team that we want to have. But I think we have a very strong foundation with the people we’ve brought on already.

Graff:  What’s the next step?

Awad: The next step is to continue to capitalize on the relationships that we already have. We call that the “low hanging fruit.”

In this case, we call the shops that we’ve already done business with. The people who have become friends, who trust you and know that you’re going to do what you say you’re going to do.

Graff: So you call them and what do you say? “We’ve got this awesome machine. Come check it out”?

Awad: (We ask) “Are you happy?” And many times you find a point of unhappiness that can result in an opportunity for us.

We want to find their real pain. almost like a doctor would.

Start asking the real questions and find the core of the problem.

Graff: To me, machine tools seem like religions. It’s hard to convert people to try a new one.

Awad: I don’t try to convert anybody. We try to keep it solution based.

“Do you have a part that you that you feel you could do better?”

“Alright, let me try it. Let me see if we can do it better for you.”

Graff: What strategies are you focusing on to get new customers?

Awad: I try to focus on the elements that will make them feel comfortable.

What I’ve learned over years in manufacturing is that doesn’t matter how good the machine is if it doesn’t have the support. What the customers tell me is, “I don’t care how good your machine is, if you’re not going to support it.”

Graff: You guys are headquartered in Minneapolis?

Awad: (Minneapolis). We have some people in Texas, some people in Michigan. 

We have to do that because otherwise we’re unable to provide the support that’s required.

Graff: At the 2023 PMTS, many of the big European machine tool builders aren’t there. DMG is not there. Index is not there. But you chose to come.

Awad:  We don’t see (the show) as an expense. We see it as an investment and also a show of commitment to the precision machining community.

We make this investment because we care. Because we want to be part of this group of people who are there every day, figuring out how to do machining better, more efficiently, more automated, and competitive in the world.

It takes tremendous balls to start a machining company from scratch. And, maybe a little extra chutzpa to start a shop that primarily runs cam screw machines making millions of parts for automotive.

After 23 years working in job shops and running a small farm, Karl Drasgow cashed out his 401K to found Drasgow Inc., a Wickman job shop in Gainesville, New York, in 2003.

In the interview we talk about how he made this happen–from running his first screw machines in a barn, to taking local entrepreneurship classes, to fixing up cam machines built in the ‘70s, and waking up at 2 AM to shovel

***********

Listen on your favorite podcast app using pod.link.

View the podcast at the bottom of this post or on our YouTube Channel

Facebook: https://www.facebook.com/swarfcast

*************

Link to Graff-Pinkert’s Acquisitions and Sales promotion!

*************

Karl Drasgow’s professional journey began in high school when he attended a vocational technical school, initially studying automotive repair before discovering his aptitude for machining.

After high school in the 1980s, he gained diverse manufacturing experience across four different shops, developing expertise in NC mills, CNC lathes, and tool room work. His pivotal career moment came when he began working with Wickman multi-spindle screw machines, which he operated for 16 years at one company. During this time, they needed someone to manufacture a specific key body part, and Karl saw an opportunity.

While working full-time, Karl had already developed his entrepreneurial instincts by running a small farm business, raising and selling pigs and beef to his coworkers. He had built several barns and set up a small machine shop where he made custom parts for agricultural and motorcycle applications. This early business experience proved invaluable in Karl’s subsequent business ventures.

In 2003, Karl cashed in his 401k and purchased two Wickman multi-spindles from Graff-Pinkert, which helped to finance part of the purchase. He initially operated those machines in his agricultural repair building, later expanding to four machines across multiple buildings.

Five to seven years into running his business, Karl recognized he needed to evolve from being a technician in business to becoming a true business owner. A local acquaintance recommended the Center for Entrepreneurial Leadership program at the University of Buffalo, which proved to be transformative for Drasgow Inc. The program is designed specifically for hands-on business owners with about five years of experience. Karl describes it as a mini-MBA education covering financial reports, human resources, and general business management.

The program’s second semester paired Karl with a mentor and required him to present his business to the class, facing questions that helped identify areas for improvement. He says the experience not only enhanced his business acumen but also taught him how to evaluate other businesses critically. He supplemented this education with additional community college courses in HR and business management, and participated in Rochester’s TEND program, which encouraged bigger business aspirations.

Today, Drasgow Inc. is an ISO-certified tier-two automotive parts supplier. Karl has found his niche in high-volume production using Wickman cam operated screw machines that can produce parts with cycle times 10X the speed of a CNC lathe that can cost hundreds of thousands of dollars more.

Rather than investing in new multi-spindles, which can cost hundreds of thousands or even millions of dollars, Karl purchases used Wickmans for $20,000-$50,000 and invests $50,000-$80,000 in rebuilding them. This gives him a huge cost advantage over competitors with more expensive machines.

When I asked Karl if he had advice for aspiring entrepreneurs, he emphasized the importance of understanding the lifestyle commitment of a business owner. Using the example of plowing snow at 2 AM before employees arrive, he explained that small business owners must be willing to handle everything themselves, from maintenance to lawn care. He stressed that entrepreneurship isn’t for those seeking a predictable 8-to-5 schedule—it requires flexibility, dedication, and the ability to handle significant stress and uncertainty.

Karl’s career journey exemplifies how technical expertise combined with business education and work ethic can lead to entrepreneurial success in manufacturing. His story demonstrates the importance of being willing to learn, adapt, and take calculated risks while maintaining a practical, hands-on approach to business growth.

Question: What was the first machine you ever purchased?

Click for more information on Drasgow Inc. or to contact Karl.

This summary was aided by Claude.ai

Our guest on the podcast today is Rogério Mezadri, Director of SAMOT Mexico, a 200-employee automotive machining company in Guanajuato, Mexico.

Rogério and I discussed the challenges running a machining company in Mexico. We talked about Mexican manufacturers upgrading technology. We also talked about the difficulty to find enough skilled manufacturing workers in Mexico. Yes, they have that problem too.

Facebook: https://lnkd.in/dB_nzFzt

Background on SAMOT Mexico

SAMOT Industria Mecanica, a large automotive supplier based in Brazil, opened its plant in Mexico in 2009. 

Rogério worked at SAMOT’s São Paolo, Brazil, headquarters for many years, following in the footsteps of his father who also worked there. In 2014, he came on to lead the company’s Guanajuato, Mexico, plant.

The state of Guanajuato, Mexico, assembles more cars than anywhere else in the country. General Motors assembles its trucks and SUVs at its Silao plant there.

SAMOT Mexico runs a lot of cam operated multi-spindle screw machines, such as Wickman and ZPS, as well as INDEX CNC Multi-Spindles. The company also has its own in-house anodizing line.

Gradually, SAMOT has been decreasing its use of cam screw machines, to focus on more complex parts.

Labor Market in Mexico

Rogério says that Mexico has a decent skilled labor force. He says that Mexicans on the whole have good manual skills, and they like to work with their hands. Nevertheless, he is still dealing with a skills shortage.

SAMOT Mexico’s industrial park has 120 companies with over 30,000 workers. Currently, there are 1,000 open positions throughout the industrial park, including 10 vacancies at SAMOT.

Japanese Workers Imported to Mexico

Toyota, Honda, and Mazda assemble cars in Guanajuato. They have elected to bring over a lot of workers from Japan at all different levels, not just upper management. According to Rogério the Japanese working culture is so different than the local culture that Japanese firms would rather import their own people.

Salaries for Manufacturing Workers in Mexico. 

Rogério broke down manufacturing labor costs in Mexico into US dollars. For a machine operator, the labor cost is around $1,000 per month. Skilled technicians cost $1,000 to $1,500 per month, and managers cost around $5,000 per month. 

Meanwhile, the salary of a doctor in Mexico averages around $1,000 per month. Rogerio’s wife studied to become a doctor when she moved with him to Mexico. He says the country has high quality medical schools available for a very reasonable price.

Mexican Machining Companies Upgrading Equipment and Automating

Rogério says he sees a lot of companies in Mexico bringing in more sophisticated machines such as INDEX CNC Multi-Spindles.

He also is seeing a lot of automation implemented. SAMOT recently bought Universal Robots. He says Universal Robots was the only brand available with short lead-times. 

SAMOT is trying to diversify its product line in addition to traditional automotive. The company is purchasing new types of CNC machines for making lower volume, more complex parts for the industrial sector and electric cars.

Question: Does it bother you less if manufacturing work is outsourced to Mexico rather than China?

Damn. It’s already 2025? I was just getting used to the idea that it was 2024.

Today, Lloyd and I are reflecting on what worked and didn’t work in our used machinery business and our personal lives over the last year. We’re also discussing our intentions and predictions for the new year.

Will we sell more old multi-spindles in 2025 like we did this year? Will our incoming president be good for precision machining?

And how does it feel to turn 80?

Question: What are your greatest hopes and fears in 2025?

***********

Listen on your favorite podcast app using pod.link.

View the podcast at the bottom of this post or on our YouTube Channel

Facebook: https://www.facebook.com/swarfcast

*************

Link to Graff-Pinkert’s Acquisitions and Sales promotion!

*************

NOAH: It’s December 15th, 2024, and I am very honored to be with Lloyd Graff, my dad, my occasional co-host, and just a wonderful guy. It’s great to do this episode with you at the end of the year. We like to do this every year, sort of sum things up and look forward to the next year.

LLOYD: It’s a pleasure to be here. And I look forward to being here next year more than once.

NOAH: Tomorrow is Lloyd’s 80th birthday (Dec. 16). Happy birthday. So, how does it feel?

LLOYD: It feels great. It feels like a relief also, because in a way I’ve been dreading reaching this date and being decrepit. But I don’t feel decrepit. I feel lively and I feel like I still am capable of making a contribution in this business. And I am so grateful for a wonderful family.

NOAH: I think it’s wonderful that you’re still so engaged in the business still.

LLOYD: I’m engaged as much as ever. I do not work as many hours as I once did. I find that I can be effective working four or five hours a day at the office and working at home. At 4:00 AM, at times.

NOAH: I feel like it’s just not as fun if you’re not there, so I’m grateful that you still come in.

LLOYD: Oh, thank you.

NOAH: There’s just a different energy. Even if I talk to you on the phone frequently, it’s definitely a different energy when we’re not talking in person.

NOAH: So where has Graff-Pinkert found the most success this year? It’s been a decent year for us in the end. Is it because of what we’ve done? Is it because of what the economy is doing? Is it because of luck? Probably a little bit of all three.

LLOYD: I would agree with that. I would say that the success of Graf Pinkert has been in machinery deals selling multiple machines, of various types. INDEX multi-spindles, and various other types of CNC equipment.

We also sold seven Davenports to India, and they’re talking about buying five more. And we liquidated a dozen old multi-spindles out of Sioux Falls, South Dakota—Acmes and New Britains.

NOAH: If you can buy those old machines for very cheap and sell a whole bunch, you can do well. But few people are paying top dollar for cam machines.

LLOYD: Yes. But, we have a Wickman Spare Parts Department, and that’s done quite well.

NOAH: So, they’re keeping their machines. It’s not like they’re throwing out their Wickmans. They’re just choosing to fix them and not doubling down on them.

NOAH: Another topic we’ve been discussing lately is Europe’s difficulty in it’s machining sector.

LLOYD: It’s dismal because particularly because European automotive is very weak, very weak. Mercedes, BMW, and especially Volkswagen. Volkswagen, whatever decision they make, seems to be the wrong one. Their efforts to manufacture in the United States have been feeble and misguided and they keep going right and left on the cars that they manufacture. So, basically, as far as an American market for VW, it’s been very weak, and now they are doubling down on the electric cars. That appears to be a dubious decision, particularly as far as the American market is concerned.

NOAH: Why do you say that?

LLOYD: Well, the only American manufacturer who’s been successful selling electric cars is Tesla. And a lot of our clients are doing work for Tesla. But Ford, GM, they have been unsuccessful with electric cars. They’re now cutting back and slowing down on electric. They have also not been successful in developing self-driving cars. Now Tesla says they are going to. But it’s so far it’s just smoke and mirrors. The only people who’ve been truly successful, at least in the United States, is Waymo.

NOAH: Tell people who Waymo is for the people who don’t know. Because I think a lot of people don’t know. And what our connection is.

LLOYD: My son in law, Scott, works for Waymo. Waymo is 92 percent owned by Google. Google has the money to implement the research. They have the people who have the knowledge to make the research work. And they are willing to be patient and develop the market slowly and wait for the regulations to be covered.

NOAH: Let’s just do a little predicting about what 2025 will be like. And of course it’s impossible to tell.

LLOYD: We have a new president coming in. We have a world situation, which is chaotic. It is difficult. But on the other hand, we have low inflation, although we’re coming off a period of fairly high inflation post-Biden early years.

There’s hesitancy amongst consumers because of the past history of high inflation and it makes people reluctant to spend. But they are starting to spend. Automotive looks like it could be a better year because the automotive companies are not obsessed with building electric cars anymore.

I think the American builders have basically given up on the idea of building electric cars in the United States, at least temporarily. They’ve abandoned that market to Tesla.

The Korean companies have their share, the Japanese companies have their share. And they have manufacturing plants in the US, at least assembly plants.

What we do see is military is strong. And I anticipate that will continue. Medical continues to bounce along and be moderately strong.

Aerospace has been very difficult in the United States because Boeing is your biggest customer other than the Air Force.

The firearms business, it’s up and down.

NOAH: So it seems like most of our customers are excited about the new President.

LLOYD: The only thing that is a negative sign, at least in my opinion, is the tariffs as a possibility. While I think it’s mostly a bluff by Trump, we don’t know.

NOAH: What was something interesting you learned in the business this year?

LLOYD: Graff-Pinkert cannot do all deals by itself. First of all, we don’t have enough money. But secondly, more than the money, the money we could obtain if we want to, but what we need are the contacts, the connections, the specialized knowledge, this is what is essential often in making the deals that really count.

NOAH: One thing I’ve really tried to embrace recently is that although goals are great, it’s vital to take a step back and say, “take a breath and enjoy this process.” There’s so many interesting, good things going on. And I’m going to keep looking to the future, but I’m going to just ride this wave, because before you know it…

LLOYD: You’ll be 80.

NOAH: All right. Well, happy 2024.

LLOYD: Happy 2025.

Do you ever ask yourself why the majority of businesses out there are struggling to survive while an elite handful are crushing it? On today’s podcast we are discussing that question.

Our guest is Steve Preda, founder of Steve Preda Business Growth. He is also an author of three books and the host of the Management Blueprint Podcast.

Steve coaches business owners to help them reach their ambitions, which often means scaling and maximizing their companies’ profitability or making business ownership a more pleasurable, fulfilling experience.

Steve’s life mission is to eradicate what he calls “Business Covid.” He says 180,000 businesses in the U.S. disappear each year because their owners don’t have the knowledge and tools that are essential to be successful.

Steve himself is an entrepreneur. He founded investment banking firms in his native country of Hungry and later in the United States.

If you you’re looking for insight to help your business reach its potential I suggest you have a listen.

Question: What do you think you need to improve on in your business? 

Listen on your favorite podcast app using pod.link, or:

                                                            View the podcast our YouTube Channel.

Facebook: https://www.facebook.com/swarfcast

*************

Link to Graff-Pinkert’s Acquisitions and Sales promotion!

*************

Noah Graff: Steve, give me an overview of your business.

Steve Preda: My business is called Steve Preda Business Growth. We grow businesses by systemizing, simplifying, and conceptualizing methods to increase profitability and create engaged workforces.

There are 1.7 million small and medium businesses in the US alone. Many suffer from what I call Business COVID – they lack the skills to scale up. Our mission is to eradicate “Business COVID” and help owners achieve their ideal life by building great companies.

As Michael Gerber’s The E-Myth explains, technicians start businesses but don’t know how to build them. We simplify concepts and tools to grow businesses more methodically.

Steve: Yes, they need things simplified and tailored so they can stay focused on their expertise. We bring them proven systems and make it easy to implement.

Steve: I was born in Budapest to professional parents. My idol was my entrepreneur great-grandfather who built a successful bakery business between the World Wars. I thought I’d be an entrepreneur after college.

But I got scholarships and corporate jobs that delayed my entrepreneurial journey. At 35, after getting “pushed out” during bank downsizing, I finally started my own investment banking firm in Budapest. I acquired and prepared small-medium companies for sale, like I did for larger public corporations at the bank.

Steve: No, I opened a US affiliate of my firm easily on a business visa. But America’s competitive landscape was totally different than Europe’s. I ultimately pivoted to join Vistage, a coaching organization, to learn sales, marketing and recruitment in this new environment.

Steve: Vistage facilitates peer advisory groups for high-level executives. I saw it as running a mastermind group. The concept is: none of us is as smart as all of us. A group can access collective knowledge through conversation, brainstorming and networking.

I had run a mastermind group in Budapest and implemented coaching concepts from Michael Gerber’s book The E-Myth. So Vistage felt like a logical step, though my revenues were much smaller than peers. I wanted to “fly with eagles” and absorb their entrepreneurial experience.

Steve: After two years of facilitating, I needed a scalable coaching model to afford four kids’ college (tuition). I devised a plan to speak at Vistage events to attract clients. I began facilitating leadership team sessions focused on business viability.

I implemented Traction’s operating system and wrote some books. When Vistage franchised, I started an independent firm teaching the five Pinnacle principles: Purpose, People, Playbooks, Performance, Profit.

Steve: You align people to a powerful purpose through playbooks that create consistency. You coach employees and clarify roles. With an exciting vision, strategy and aligned team, performance improves. Profit is the byproduct.

We also set goals, metrics and processes to weed out unproductive activities. I help clients build a business machine and then make it unassailable through strategic differentiation.

Steve: The owner. They want to control everything even as it bottlenecks growth. I push clients to delegate and get uncomfortable. With the right plan and team, the founder can be replaced operationally. My mission is helping committed entrepreneurs build an organization that scales.

Steve: My client selection has improved, so now over 90% of clients achieve change and growth. The key is picking people truly willing to get uncomfortable and listen to new approaches. 

Their business also needs to solve a market need and have leadership team support.

Steve: View your company as a vehicle for growth, not a static entity. With the right systems and team, you can build an organization that empowers you to achieve your ideal life. But you must take risks and step outside your comfort zone. There’s no greater adventure!

Note: This transcript excerpt is a condensed depiction of the interview, created with the assistance of AI. Various sentences and paragraphs have been combined or paraphrased to improve readability.