New technology on the old factory floor
Burlington Street operation targets sales of its insulated panels at $100 million next year. They’re the kind of numbers a CEO dreams of.
Sales up 700 per cent in five years, year-over-year increases of 40 per cent, new jobs and plants — all with more than 90 per cent of the potential market still untapped.
That rosy world is where Colin Osborne works today as president and CEO of Vicwest Income Fund of Oakville. It has turned a derelict Burlington Street factory into a hive of new technology, investment and jobs.
The local plant, operating under the new name of All Weather Insulated Panels, a Vicwest Company, manufactures insulated metal panels — two sheets of steel sandwiching a layer of foam. They’re intended primarily for the industrial-commercial-institutional buildings to keep heating and cooling costs under control. The panels are also produced at Vicwest plants in California and Arkansas.
Insulated metals are relatively new to North America, where they represent less than 10 per cent of the exterior building material market, but they are well established in more energy conscious markets such as Europe where they have up to 50 per cent market share.
Osborne said architects and builders are learning slowly that insulated panels are lighter, easier to handle than traditional materials and offer impressive energy savings — and that’s driving rising sales.
“I think our product is really a game-changer for North America,” Osborne said. “In Europe, it’s quite a mature product, but North America has been a little slower to adopt it.
“It takes time to convince architects to adopt a new technology, but it’s starting to happen. Over time, we think this will take an increasing share of the market.”
Vicwest came to Hamilton in 2006, leasing a former Massey Ferguson plant from the Hamilton Port Authority. The factory had been idle since the farm equipment maker slipped into bankruptcy in 1988.
One of the company’s first moves was to reclad the building in insulated panels.
The factory’s original stone block construction allowed temperatures to vary too much inside, which was unacceptable for Vicwest’s quality control.
Construction materials are the largest part of its business today but account for only 7 per cent of the North American market, while insulated panels have been 55 per cent of the business in Europe.
Since introducing the panels to the Canadian market, sales have been steadily rising from $8.2 million in 2007 to $57 million in 2012. The company expects to hit $75 million this year and targets $100 million for 2014.
As sales have grown, the company has expanded through acquisition, buying competitors in California and Arkansas to give itself an American presence. It was that Arkansas purchase that brought the company the All Weather Insulated Panels name. Since that brand was already known in the United States, the building products division has been renamed.
As well as reviving a disused factory building, Vicwest has also helped revive the working lives of people cast off from closed or downsized plants around the area, including Camco, Stelco, Dofasco and other names that once meant prosperity in Hamilton.
“A lot of the industries that have died around here have been our feeders,” Osborne said.
Vicwest represents one of the new facts of life for Hamilton’s economy — where Massey Ferguson employed hundreds, the new company employs only 30, with expansion possible.
“We’re getting close to adding a second shift that should mean another 10 jobs.”
Article courtesy of Steve Arnold, The Hamilton Spectator.