Integrated Manufacturing Solutions: an EMS, ODM, CM, and OEM!
Integrated Manufacturing Solutions (IMS) is a contract manufacturer in San Diego, California, where exciting things are happening. IMS has grown at a rapid pace, having expanded from 15 employees to 75 within three months, and from two production lines to five within the past year. With every new addition to the shop floor, VP Business Development Robbin Thompson further creates a space where IMS can surround their customers, and themselves, with all the necessary tools and solutions to bring their ideas and creations to life. IMS continues to expand their capabilities by making their own customized battery packs as well as an impressive new line of microscopes. Judy Warner and I sat down with Robbin recently and had a thorough discussion on how all of this works at IMS.
Barry Matties: First, would you please tell us a little bit about IMS?
Robbin Thompson: To begin with, the reason for the “integrated” in our name is because we don’t want to be situated where we’re just building printed circuit boards. We want to offer customers some varied solutions. We have our own line of microscopes that we’ve created and developed and designed here on site. The purpose behind that is because we found a need on our production floor for a microscope that required better stability, better articulating norms, and something that could better the production workers by giving them a good tool to use. Chris Nguyen created a new company call Innovative Microscopes in order to bring these new Microscopes to other contract manufacturers and to market.
Matties: Is IMS a contract manufacturer first and foremost?
Thompson: First and foremost, yes; we started off that way. Then we decided just to offer more solutions to our customers and build up a new product development department. This started with engineering and from there we went into box builds. From box builds, we went into various testing equipment and programming, and now we’re into battery power management, so we’re offering that solution for lithium-ion batteries for customers who need customized battery packs instead of off-the-shelf. We felt the need to not just concentrate on being one type of company. We wanted to open it up and truly have a one-stop shop.
Matties: People can come in and if they want you to just load their board, assemble a box, you do that?
Matties: But you’re also developing your own products as well that you sell under your brand name out to the marketplace? So you're an OEM as well.
Thompson: Yes, were not limiting ourselves. We don’t want to do that because we don’t want to be in the same situation year after year. We want to give our customers an option.
Matties: I know it probably becomes more like an original design manufacturer, right?
Thompson: Yes, that moves into the ODMs and the CMs.
Matties: You’re just moving all the way through this (laughs).
Thompson: We get bored sometimes; we always want to continue.
Matties: My first thought is how do you manage that? That’s a lot of bandwidth and a lot of different disciplines that for a lot of companies would be terribly difficult and maybe even take them off their core mission.
Thompson: You’re absolutely correct, and that’s why we want to make sure we’ve taken steps. This has been a growing process; it’s not all at once. We’ve been able to identify and organize it in a way to say, “Okay, we’re at this point. Now, we’re able to move in this direction,” and have the right people in place. Our core team here is so important, and having the right people here to oversee the various elements that we provide is key for us. We want to make sure that we continue with that.
Matties: On the CM side, what sort of market do you pursue?
Thompson: We are in every market right now. I would say we’re in the defense department, military, consumers, etc.
Matties: Of course, military is always a big area, but is there a sweet spot for you in the other markets where you say, “This is where we’re going to really focus our growth”?
Thompson: Military is a big area; defense is a big area for us. We have a couple very big contracts with some of the big defense departments here. It’s funny because we’re building these cat boxes out there, and at the same time another customer came in and says, “I need a board that can identify rat tattoos.” Then we’re also building rat cages for another customer. We build vapes, and we build anywhere from tags or online banking products that you see in all of the gas stations and such. We’re literally all over the map.
Matties: We’re here at your facility, and you’re expanding. How many square feet do you currently have?
Matties: It sounds like you're kind of bursting at the seams already.
Thompson: Yeah, what we were able to identify was five production lines. Three of those productions are strictly for volume production. We get a lot of engineers in here and I’ve wanted to have an R&D line just strictly for them. So we created two prototype lines just strictly for engineers.
Matties: So engineers can come in and test their product.
Thompson: Yes, and that's the thing— we open our doors up to engineers. They’re welcome to come in anytime. We’ll give them a bench if they want to test their stuff, just to try and help move it along for them.
Matties: You’re really about educating your customers as much as servicing them.
Thompson: That’s key because customers will come in and they really don’t understand how the process works. We want to be able to build that partnership and build that relationship with them.
Matties: I’m guessing that there’s a lot of longevity here in your customer relationships.
Thompson: There is. We’re building a volume product right now for the Bank of Denmark. We’ve been building this product’s prototypes for the past two and a half years and now they’re finally going into the marketplace to be used all over Finland and Denmark, for consumers. You want to build up that relationship because they could take this offshore, but they decided to stay with us because we’re so involved with it.
Matties: From the beginning, you have an intimate knowledge of their strategies and their product development.
Thompson: Exactly. They’ve flown in numerous times. We understand where they’re going and what’s driving this product to the market.
Matties: What’s your background, Robbin?
Thompson: Well, I’ve been doing this about 20-something years.
Matties: Your title here is business development. When you say you’ve been doing this, do you mean business development?
Thompson: I’ve been working in the electronics field for quite a while. I started off working for Power One on the semiconductor side of it. I went and worked with Taiyo Yuden and then started working in various CMs, building up, learning every aspect of the business and working from department to department because I wanted to understand and I just didn't want to be working, say, in accounting. I wanted to know, “Okay this goes into operations. This goes on the production floor.” I wanted to understand everything.
Matties: That really gives you a great depth of knowledge to draw from.
Thompson: Yeah, a broad aspect of everything about the business. From there I just started my own business. I actually had my own CM for a while. We had a customer that we were contracting with, a medical device company, which we now build a lot here. From there, when they closed that division, Chris, the owner here at IMS, came to me and said, “I really could use your help. Why don't you come on board and let's build this up together?” It’s been really great working with him because he’s allowed me to have the freedom to go visit my customers, to go to the various trade shows and really kind of build up IMS, because we both have the same ideas of where we want to take this, and that’s very helpful.
Matties: You were talking about the number of employees and how it kind of exploded. Tell us a little bit about that.
Thompson: When I first got here almost two years ago, we had 15, and we had two lines not really working full capacity. Within three months, we had to order a couple more lines. We ordered some really nice pick and place machines. We went from two lines to five lines within the past year, and we went from 15 employees to 75 within a three-month period.
Matties: Wow, you’re good for the economy and good for the world, right?
Thompson: San Diego loves us.
Matties: Yeah, that’s a great success story. That’s rapid growth. How do you get that much growth and manage it effectively?
Thompson: People, our employees, are key. We have some really great core people here that have worked in this industry in the CM side for a number of years and are well known in the industry in this area. They heard about our growth and they approached us. We felt that they’d be a great asset to our team. We went through our ISO audits. We’re now going through our ISO 13485 and then going back into the ISO 2015. We brought in a really great team of quality managers here just to make sure that all of our documentation is transparent and up to date and up to speed so we don't fall behind on that and create a better business environment. What’s great about IMS is that employees want to come here and they want to work here.
Matties: It’s nice when you have that environment.
Thompson: It is. It’s a comfortable feeling and a family feeling. This Saturday, we’re having our company summer picnic down at Mission Bay. We do that every year, and we try to do a barbecue for them every few months. It’s really great that the employees are so passionate about coming to work.
Matties: When customers come in, what sort of challenges or demands do they put on you guys?
Thompson: Oh, the same thing every time.
Thompson: Price, but more so, “How fast can I get it?” Everything, especially with a lot of the product development is, “I really want to get this to market.” Especially now is the time of year they want to push it to the Christmas market. Lead time is a big key for us here. When they ask for quotes from our PMs, our customers want quotes within three days. We work day and night to try to build and help them.
Matties: Pricing is an issue though, too?
Thompson: It is, and I’m really good with working with the customers on that. Of course, like everybody, we do have our markups. But if it’s going to affect the customer from moving their product further along, and I see what this product can be and what they’re looking at, I will work with them on the pricing just to make sure that we get moving forward with them. For example, if I'm going to build 100 boards for them, but in six months they’re going to want 1,000 or 2,000.
Matties: When you say “build the boards,” are you actually producing their boards or do you contract and manage that process for them as well?
Thompson: We contract out, yes.
Matties: You’re a buyer of printed circuit boards as well. I’m interested in what sort of demands you put on those suppliers, because it’s a supply chain and you have to be a buyer and a seller in this case, right?
Thompson: Yes. We have really good relationships with our suppliers. I’ve been working with these board houses for 20 years. They understand if I call in a favor and say, “I need this favor. I need this in two to three days. Can you make it?” They’re like “Okay.” At the same time, I’m giving them business or I’m pushing business to them as well. It’s a give and take type of situation, but we do put a lot of demands on them because we have to meet our timeline.
Matties: It sounds like that the thing that’s really resonating with me from what I'm hearing you say is it’s all about the relationships, whether it’s customer, employee, or vendor. You get back what you give out, right?
Thompson: It is. For me, that’s everything—customer support is everything. I’m really big on that, and our PMs here are as well. They do the same thing and they feel the same way. They’re very passionate. If a board is not going to be delivered on time or if we’re a day late, they take it to heart, because we want to do everything that we can for our customer. Repeat orders are big in this industry.
Matties: Your passion comes through, there’s no doubt about it. Dare I say you love what you do?
Thompson: I do!
Matties: I think it’s that love that’s part of the culture here because it starts at the top. It starts with you, and if that’s what you’re spreading in your company, it’s a lot easier to do business that way.
Thompson: It is. The customers are great and you get some customers that are a challenge, that’s in every place you go to, but for me, it’s like “Okay, game on. Let me see if I can turn this customer around.” I take it as a challenge.
Matties: Good for you. Aside from the customer challenge, being in this sort of business, what do you think the greatest challenge is?
Thompson: Right now for us, it’s being so close to San Diego and outsourcing to China. We actually have some companies in China that we are building for. They actually brought over companies in India that are taking their product from offshore and bringing it back, which is really unusual. One of the companies hasn’t built in the U.S. in 25 years. Now, they’ve come to us and we’re building their product. Because we are so close to the border down here, another challenge that we see happening is a lot of the bigger companies in this area going to Mexico. I reached out to various companies in Mexico and the Chamber of Commerce down there in Tijuana to try to form a partnership with them as well. If our customers are adamant about going there, I can make introductions and try to help them out in that direction. This industry is up and down continuously and right now our challenge is working around pricing with our customers to match what’s going on down in Mexico. That’s a big challenge.
Matties: That’s on the contract side. Now on your retail product side, how is that working?
Thompson: Right now, what we’re doing is we’re going to trade shows like Geek-A-Palooza. We’ve gone to the Del Mar Electronics Show. We’re hitting some other ones here next month. Every customer that comes in to visit us, we show our microscopes to them and they are just so unbelievably thrilled about these. Because one of the big things for us was that there are scopes that you could bring in from offshore that are pretty reasonable, but it’s still expensive, especially if you’re a new startup and money is tight for you. How can you afford to buy a $2,500 scope?
We wanted to make the articulating arm stronger so the production workers weren’t constantly bending over and hurting themselves and being uncomfortable while they’re at work. We wanted the price to be a big difference. We basically started building and designing the various elements on the scope, worked with a lens company, and with our design engineers got the price cut in half. That alone is interesting to a lot of CMs.
Matties: It started out as a tool for your own people and then it evolved into a retail product?
Thompson: It did, and some of the customers said, “Where did you get that scope? Where can I buy it from?” I said, “Come on over to my side of the building and let me show you.” Then they just started ballooning from there. We’ve only been building it up for the past six months.
Matties: Wow, how are sales?
Thompson: Really good.
Matties: Just looking ahead, what do you see for the future of the market? Is it a strong market going forward?
Thompson: The past two years have been kind of on the up. Right now I kind of see that it’s stabling off a little bit, but there’re certain markets that are really hitting it right now. SpaceX is really doing crazy things right now. We were approached by Tesla to build a product for them. That’s really going crazy. Medical is huge. So I think that there’s going to be a lot of changes, but as far as the overall, I see it’s kind of leveling out a little bit.
Matties: In the specialty areas, you’re going to see some growth, probably some R&D growth as well.
Thompson: R&D is really big right now.
Matties: You mentioned onshoring, let’s go back to that for just a minute. We see this perhaps as a growing trend. Did they give you a reason why they were coming back?
Thompson: It was cost. If you get product in and it's not the right product and you've got to send it back. A lot of problems that I see happening in China is the workforce is just not covering all of the companies over there. That’s causing delays and now you’ve got the shipping cost back and forth. Companies want to send their employees and engineers over there, so the back and forth of that is costly. That’s what we’ve been told from customers, that it’s just becoming too much of an expense and the quality is just not what it used to be.
Matties: Culturally, it’s just a different language.
Thompson: It’s difficult.
Judy Warner: Tell us a little bit about your 3D printing capabilities. That’s something you haven’t touched on and I know it’s your favorite toy.
Thompson: It’s my toy, especially with the new products that we’re building for customers. In fact, one of the really cool things that we’re building is for the police departments in Orange County and LA, where some officers came to us and said, “We have an idea for a product.” When there are car accidents—I didn’t know this—but it takes like two-and-a-half cases of those flares that they have to keep them lit up for a certain period of time. They have literally warehouses full of these flares, and the expense is enormous. They came up with building an LED strip which would take away all of the flares.
That’s what we’re doing right now. We wanted to give them better cost advantage on that, so we went ahead and we started our 3D printing side, we have an SLR printer in here as well, to try to give them a product without having the expense of sending it out and doing the small run prototypes. It’s been great. We’ve used it on so many various products here.
Matties: It really opens up a lot of opportunities, doesn’t it?
Thompson: It does. We saw the need and said, “Okay, let’s fix this and let’s bring it in.”
Matties: Where are they at in their product development cycle? Is this a product that they are currently using then?
Thompson: We’re finishing up. We’ve gone through a couple of phases already and we’re ready to actually start pre-production. It’s really cool, and the first run that we’re building for them is actually going to be for a consumer. They want to see how that works out. Not only will the police departments be using it, but you’re going to be able to go to say Pep Boys and buy one for your car. It’s really cool because I got to hear about some of the things that they require on this.
Matties: Robbin, is there anything that we haven't talked about that you would like to discuss?
Thompson: I just feel that, again, we’re not your typical CM.
Matties: I’m getting that (laughs).
Thompson: Yeah! Like our name implies, we want to be able to have an open door policy with our customers and have them come in. If they have a situation where they can’t come up with a solution, let us try. If we can build something, or if they want us to build a fixture, whatever it takes. We’ve got a small CNC shop back here as well, so whatever it takes to help customers troubleshoot their product or come up with a solution.
Matties: Well, great. Robbin, on behalf of Judy and myself, thank you very much!
Thompson: Thank you.