A Conversation With ... Trey Watts

In the past few years, you’ve purchased equipment to expand your technological capabilities. What has that allowed you to do, and are there new purchases coming?
Over the last couple years, we’ve really invested on the technology side. It gives us better capabilities, and with the labor issues, going to automation allows us to run more hours in a day unmanned. The first piece of equipment we purchased is called a fiber sheet laser. It can cut up to 5/8 inch steel, but it also cuts down to 0.032 [inch] aluminum sheets. The sheet laser itself is a very cool piece of equipment just from its capabilities, but the really game-changing thing for us was adding the automation inventory side. We partnered with a company based out of Chicago called Mazak for the machine, and then on the automation system, they partner with a company based out of Germany that came over here. Instead of manually having to load our material out of racking and load it on the machine, process it, and then take it off the machine, what that system allows us to do is take all of that flat stock sheet inventory, stack it up in the tower and then the machine itself, we can queue up what it needs and it will automatically take it out of storage, load it on the machine, process it, and then when it’s done, it offloads it and stacks it on a pallet. We can run it 24 hours a day, continuously unmanned. The second piece of equipment is another piece of automated technology that basically took out a lot of handwork. It still takes fabricators to deal with it after the parts are completed, but this took out a lot of the front-end side where all the parts and pieces are being fabricated by the machine. Then there’s another piece of equipment that is coming in April, which is another type of laser. It still cuts aluminum and steel, but it’s made to cut shapes.

How do these efficiencies affect workforce?
We’re very fortunate that with our local and international clients, the demand for our product has really risen over the last few years. It’s not so much that it has replaced anybody – it hasn’t done that – it’s just sped up our throughput and our capacity. The standard technology in the sign industry has always been CNC routers. We have two of them. When we were evaluating the sheet laser, the way it’s tooled up does the equivalent in a year of what eight CNC routers can do. A CNC router also has to constantly be manned, whereas the other one can run unmanned. When production staff comes in the next day, the parts are already cut, ready to go. All of our advances have not been to replace. We have 175 employees.

How has adding the new technology impacted revenue?
We’ve had double-digit sales growth year over year for about the last five running years. Percentage-wise, in excess of 15% growth year over year. The local market has played a huge part. We are very fortunate to have some very great clients here. But we also ship a lot of our product around the country, mainly the lower 48. We work with Culver’s; Braum’s; Scooter’s Coffee; First Watch restaurants; GoHealth, which is a national urgent care chain; Rural King, a hardware chain based out of Illinois; and of course, we do provide Walmart signs around the country. When we moved into this facility, we looked and said, we’re never going to fill this thing up. We’re actually looking at how we can add more square feet because of our client base and what they need from us. But in 2017, first day in here, I never would have thought we would have needed more square feet.

What are trends within the industry? Is sustainability a factor?
The biggest thing that everybody’s seen, and this has been ongoing for 10, 15 years, is a switch from incandescent lighting or fluorescent tube lighting (and) neon lighting to LED lighting. Digital has become very prominent on exterior signs and interior signs. Replacing TV screens or multiple TV screens and doing an interior digital wall. In the industry, we can generate a lot of plastic waste, which is not great for the environment just dumping that in a landfill. What we did when we started (Lexaform) in 2017, which is a sister company of Springfield Sign, we developed a recycling system where we take all of our scrap, we grind it up, we then bag it up and save it until we have a truckload, then our distribution partner comes in, picks it up, takes it out and they melt it down and reuse it. The trucks are usually about 50,000 pounds, and we usually send out anywhere between four and six full semitrucks a year of ground-up plastic.

You create signs for new businesses and locations and refurbish existing signs. New business slowed during the pandemic or was put on pause. How were you able to keep that growth?
We really diversified our client base. What I've seen change maybe over the last couple years is size of projects. There's not a lot of half-a-million-dollar projects out there that there were two, three years ago. But there are still plenty of projects to go after. In the last six months, I've added two sales reps. We have to listen to the noise, so to speak, of what the economy's doing, but at the end of the day, there's stuff out there to be had. You just got to go after it.