January 26, 2010 Holding Tight

Volume 13 | Issue 1

Established in 1968, Semblex Corporation evolved from a basic screw manufacturer into a leading supplier of sophisticated industrial fasteni

Small and elemental components, industrial fasteners have enormous, compounding impact: These seemingly unassuming screws are what hold together products and, in turn, the manufacturer. Taking this to the logical extreme, they comprise the yolk of the U.S. manufacturing economy.

No one understands this better then Semblex Corporation, a leading producer of the most sophisticated industrial fasteners. To underscore their importance, Mark Quebbeman, vice president of sales and marketing for the Elmhurst, Ill.-based company, uses the familiar nail/shoe fable. “Lack of a nail can lose a war,” he reminds.

Here’s how the progressive scenario plays out: For want of a nail, the shoe was lost; for want of a shoe, the horse was lost; for want of a horse, the rider was lost; for want of a rider, the battle was lost; for want of the battle, the war – and the kingdom – was lost.

Substitute a screw for the nail and a business for the theoretical kingdom, and then place the cautionary root-cause narrative into modern manufacturing context, and you get the picture. Quebbeman references a recent, real-world situation: “A buyer from Ford recently told me that while fasteners may be one of the smallest and least expensive items that goes into automobile production, they prevent enormous production and cost-related problems. Lack of proper screws can potentially shut down every Ford plant, he told me. Also, fasteners that fail in application create significant warranty issues. With our effective and sophisticated fasteners, we potentially save customers millions of dollars in warranty related costs.”

Essentially, Semblex sweats the small stuff, freeing customers to focus on more important issues. The company enhances this benefit through its unique engineering services. “As we evolved, that became a large part of our business focus, as many customers no longer have the resources to support that in house,” says Quebbeman. “Through our value added/value engineering [VA/VE] expertise, we help customers reduce costs and eliminate problems. So, we’re more than just a parts provider. We’ve established ourselves as an engineering resource and solutions provider.”

FOUR-DECADE DEVELOPMENT
Semblex assumed that role in gradual fashion during its 40-year history. Initially, when Daniel Haerther and three partners established the business in 1968, Semblex was your basic screw manufacturer. “We were a ‘me too’ company that followed the pack,” recalls Director of Engineering Services Gene Simpson. “We provided standard parts and competed largely on the basis of competitive pricing.”

But the company developed a passion for screws that bordered on the obsessive, and it progressed into an organization that produces high-end engineered fasteners. The first evolutionary stages occurred in the 1970s and 1980s, when Semblex began manufacturing the slightly more complex SEMS parts and deepened its automotive market penetration. But the company’s quantum leap came in the 1990s. “During the decade we gained greater momentum by investing in intellectual property for things like tread-rolling screws, which eventually became our Rolok product,” relates Simpson. “Increased investments in licensed products and technology led us into product development. Subsequently, our engineered products provided customers greater value in terms of their own performance and design.”

The evolution goes on. “We continue developing new products and technology to meet increased demand for more sophisticated fasteners and for aluminum, magnesium and engineered plastic materials,” says Quebbeman. “Our development involves addressing customers’ expressed needs, which we combine with our insight and intuition about market direction.”

In that way, Semblex managed to separate itself from the herd mentality and positioned itself at the head of the fastener pack, he adds. One of the elements that propelled it to this vanguard position is its expansion into cold-form specialty parts. As its name implies, the cold-forming process involves molding of materials without elevated temperatures, Quebbeman explains, adding that it involves altering the initial steel “blank” through strategically applied force. Specifically, a series of tools and dies transforms the steel into a finished product. Throughout this process, steel volume remains unchanged. “There’s no excess material and the tensile strength is enhanced,” points out Quebbeman.

MULTI-DIMENSIONAL DIFFERENTIATION
Obviously, the company as it currently exists (it’s now owned by the Daniel P. Haerther Charitable Trust) has moved well beyond competitive pricing to differentiate itself. “At least four things set us apart,” indicates Quebbeman. “The first is our broad, unbiased product line. We don’t steer customers toward a standard product.”

Indeed, along with cold-formed fasteners, Semblex provides specially threaded fasteners, drive systems, under-head features, washer-and-screw assemblies and miniatures, among other offerings. “Our broad array reduces customer costs while addressing their specific needs,” says Quebbeman.

Second, and also from a product standpoint, Semblex recently ventured into specialty components, a new direction that capitalizes on its cold-forming capabilities. “We’ve taken that core competency and are now applying it to parts different from fasteners,” informs Quebbeman. “We envision that this direction will provide customers an alternate method of manufacturing that further enhances their design flexibility and cost savings.”

The third significant differentiator is the relationships that Semblex forged with its industry supply base, such as plating applicators and other suppliers of integrated services or components related to core products. “We work closely with the supply base and our customers to develop the most appropriate solutions for specific situations in a timely fashion,” explains Quebbeman.

Adds Simpson: “This allows us to be more resourceful and creative when confronting client challenges, particularly related to problems such as recess fill and the inherent risks that accompany given processes and products. It also enables us to better communicate with our customers. This is one of our greatest strengths, as we operate in an industry that constantly narrows and reshapes itself. It has been critical to our success.”

The fourth substantial differentiator involves engineering services. “Many competitors pulled away from such value-added services at the same time that many Semblex customers reduced their own focus in this area,” says Quebbeman.

Filling the resulting void, Semblex assembled a team of expert engineers that supports customers with the highest levels of technical support, particularly focused on affecting cost-efficient, innovative solutions that enable customers to better manage expenses while improving quality and increasing process stability. The team accomplishes this via VA/VE projects applied at design conception and carried through to final production and assembly. Specific services include production and application design support and Semblex’s Applications Laboratory testing. “Testing focuses on comparative analysis, new development support and, in some cases, troubleshooting customer concerns.”

Semblex engineers also provide product teardowns that lead to design recommendations that foster even more cost savings, says Simpson. “It starts with customers showing us what and how they produce. We take apart the processes to come up with effective recommendations.”

QUALITY CONTROLLED QUINTET
As far as its own production, Semblex works from five locations (250,000 square feet of total space) all located in Elmhurst and staffed by 160 employees. Fasteners range from a half-millimeter up to three-quarter-inch in diameter.

Within these plants, demonstrated capabilities, furthered by continued capital investments, include advanced manufacturing processes such as single and multi-die heading, rolling (SEMS and non-SEMS), roll forming, slotting (shank and head), trimming, shaving, grinding, pointing, drilling, tapping, turning, broaching and burnishing. Secondary processes including heat treatment, plating (electroplate, mechanical), coatings/paints, adhesives, patches, thread sealers, retention features and designs, over-mold designs and component assemblies. Moreover, Semblex offers fastening solutions for a wide range of mating materials including thermoplastics, thermosets, composites, aluminum, zinc, magnesium, sheet metal and steel.

Quality control efforts are measured by the company’s earned certifications, which include TS 16949, ISO 14001 and ISO 9001:2000. “On the engineering services side, our quality laboratory and applications laboratory have both achieved ISO/IEC 17025-2005 accreditation, which is unique in the industry,” informs Simpson.

Specific products include cold-formed fasteners, threaded fasteners, drive systems, under-head features, SEMS assembly, miniature (or small diameter) products and value-added fasteners. With these products, Semblex serves traditional and emerging markets including automotive and transportation, logistics providers, recreational vehicles, appliances, power tools, agriculture, lawn and garden equipment, medical and electronics.

As far as growth, from 2001 to 2007, Semblex averaged a compounded annual growth rate in the 5.5- to 6-percent range. “Starting in 2007, we downsized a bit to remove some low-profit parts,” says Quebbeman. “But as we move forward, we’re projecting a compounded annual growth rate of 16.5 through 2010 to 2014.” In clearing its path for future success, Semblex has also established global partnerships to enhance its international position. Specifically, the company developed alliances with ESKA Automotive GmbH in Germany, an industry leader in coldformed specialty products, and with EJOT, another German-based company.

But when you turn the screw to get at the essence of the company portrait, Semblex supplies a product that is typically the last thing a manufacturer thinks about, as Simpson indicates. Further, manufacturers expend less than adequate time in considering the value of the small but critical components. That’s one of the challenges that Semblex addresses. It has responded by positioning itself a resource that customers can access, even at the earliest stages of their processes.

Subscribe to Industry Today