Oct 04 2016

What are your sheet metal fabricators doing with their profits?


Vernon Cancer Center at Newton Wellsley

Last weekend my family and I had the pleasure of walking in the rain to support the Vernon Cancer Center at Newton Wellesley Hospital.  My wife works there and I have heard so much about all the great work they do to help patients recover or treat their cancer.  Every year, the hospital hosts an event, Hope Walks, as a fundraiser for the Cancer Center and it is a great way for patients and caregivers to support something so dear to all of us.  Sunday’s keynote speaker, Melody Tortosa, originally help fund the Cancer Center and has recently been a patient at the Center.  This year alone, we raised over $225,000!  As the owner of a Boston sheet metal fabricator, I couldn’t help wonder “What do they do with all that money?”

We’ve all heard about the expense of American medical treatment, so I was really thinking, “Aren’t they charging more than enough to cover their expenses?” I learned on my walk that, “No”, they really aren’t able to cover their expenses.  The why was very interesting to me.  It turns out that Medicaid/Medicare reimburses a fixed amount for a certain diagnosis.  Supplemental health insurance covers more but maybe not all of the expenses for a diagnosis.  Beyond numbers, every visitor to the Vernon Center Center is human – with different pain thresholds, different reactions to their treatment and different effects on other illnesses the visitor might have.  The fixed amount may be more than enough for the visitor with a high pain threshold and no complications, but less than enough for the visitor with a low pain threshold and many complications.  What do you do in that case?  What if YOU were that case?

For the Vernon Cancer Center, they use the Hope Walks funds to provide non-covered services for the visitor that needs more support than the fixed reimbursement amount allows. Examples include a Patient Navigator to help the visitor understand where and when to go for help, assistance for parents that are faced with a cancer diagnosis in their children, as well as tons of psychological, physical, social and educational support for folks struggling with a potential life taking illness.  Who knew that wasn’t covered?

In sheet metal fabrication, believe it or not we are faced with the same thing. The appearance of clean looking engineering drawings and standard costs give us all the impression that our standard pricing and lead time will be good enough for every part.  The truth of it is that some parts are more difficult than others to make (i.e., some parts require grain direction a certain way, but that is never called out on the drawing) and some parts have more complicated supply chain paths than others (i.e., parts that require a special anodizing process and then laser etching with another supplier).  As a sheet metal buyer with hundreds if not thousands of parts being sourced, how do you know which part is going to cause your heartburn and which one will end your career?  You don’t; you need someone who has the extra resources to get you out of jam even though no one expected any problems on that part.

At ETM Manufacturing, we have our own version of Hope Walks – it’s called our annual profit. Every day we give that profit back to our customers who got in a jam because none of us knew there would be an issue.  At the end of the year, if there is any left over, we buy equipment to help our customers grow, we reward our employees so they stay to help our customers, or we pay down our debt so we can be around for a long time to help our customers.  No golf club memberships, no second home at the Cape, no amazing vacations, no filet mignon dinners and caviar wishes.  All of it goes back to you, one way or another.

So, what are your sheet metal fabricators doing with their profits?

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