Connect Business Magazine

Since 1994: The Magazine for Growing Businesses in Southern Minnesota

Powder Werks

By • Sep 2012 • Category: Feature Story

Photo: Kris Kathmann

Powder Tuff

Former juvenile delinquent kicks his way through life to build a Lake Crystal powder coating business.

You could make a classic movie about his life.

In it, he could be like tough-and-rough Riff of the Jets in West Side Story or maybe combative Billy riding a chopper to New Orleans in Easy Rider.

He definitely would be a juvenile delinquent, a broken-home misfit, an angry malcontent, always swinging at the world but never able to land a punch.

Then a judge would offer him the choice of 90 days in jail or four years in the military. In this movie, he would reform his ways with the latter and chin his way up to being in a top military unit. In time, he would become a wildly successful stock car racer, start powder coating in his garage as a hobby, and in 2003 begin Lake Crystal-based Powder Werks, now a five-employee provider of environmentally friendly powder coating services to more than 100 manufacturers in the Upper Midwest. Powder coating involves the electrostatic application of dry paint to create a hard and colorful surface on metal.

The plot line to this cult classic would have an inspiring ending, of course, with 47-year-old, Madison Lake native Damon Haslip seen riding his Harley Davidson toward a prairie sunset while credits roll.

As for this Connect Business Magazine story, you can’t truly appreciate Powder Werks and Damon Haslip without first hearing his gripping life story—one that coats every square inch of his business and work ethic. Listen in.

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Said Damon Haslip in a Connect Business Magazine interview, “I grew up in Madison Lake, and as kids we didn’t have much to do. There were more than 15 of us all the same age in a town of 300 and we ran around as a gang. Fighting was just part of life there. It was what you would call a ‘rough neighborhood’ during my whole childhood from the mid-‘70s to early ‘80s.”

Back then, Haslip and his buddies fought most every summer weekend at the drive-in theater off Third Avenue in Mankato, with teens from opposing towns—Elysian, Waterville, Janesville—often pairing up against them for fisticuffs on the theater playground area.

“It was just like in the gang movies,” said Haslip.

Similar to some of his friends, Haslip didn’t have many positive role models. He was only eight years old when his parents divorced and his father and his seven siblings went one way—Mankato—and he and his mother went another—east to Madison Lake. He had been the youngest child and for some reason was paired up alone with his mother, who had some challenging personal issues to conquer. All his siblings attended Mankato West, while he went to Mankato East.

He said, “I resent the fact I didn’t get to go to school with my siblings. I lost touch with them. I think things would have been different if I hadn’t grown up in Madison Lake.” He and his gang friends became emotionally hardened, he said, and were rarely disciplined by non-law enforcement adults. They played unchallenged on and around Madison Lake’s water tower as if it were their own personal monkey bars. From age 11, he was like a nocturnal animal running the streets undisciplined, often arriving home three or four in the morning on school nights.

“At age 15, I began working part-time at a body shop and driving a car without a license,” he said. “I got my car looking nice and by the time I was 16 it was a fast, show quality ’72 Nova SS. I got a lot of speeding tickets and into many driving-related problems. I once got caught doing more than 100 mph in a 30.”

Throughout most of high school, he trapped muskrat, beaver, and fox, and he and a friend worked for a Madison Lake fur trader skinning animals until early morning on many school nights.

In today’s parlance, Haslip was a bully, and Mankato East kids were terrified of “The Lakers.” At night, they made “hydrogen bombs” out of various gases fed into trash bags that ignited into mushroom clouds on Main Street. The small town didn’t have policemen. They ran unfettered. Two positive role models in his teen years were the parents of his best friend Donny Neirman, who today owns Foundry Services in Mankato. They allowed him to live with them a while after he was forced out of his own home. They disciplined him and gave him boundaries, which he appreciated. His senior year, for the most part, he slept nights in his car in the school parking lot.

Then at 18, after yet another brush with law enforcement, he had to face a local judge, who gave him a choice of spending 90 days in jail or entering the military. He joined the Air Force.

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He said, “We got off the bus at basic training. I had long blond hair, zero respect for authority, and the training instructor was screaming and swearing at me right away. He was a rather large man and trying to intimidate. He said something to the effect he had so and so’d my mother. I said, ‘Well, I finally found my dad then.’ Right then they made me a flight leader for nearly 150 recruits.”

Immediately, his life began changing for the better. Suddenly, he was responsible for almost 150 others. In tip-top physical condition, he eventually was selected to join a crack Air Force division and ended up working in more than 15 countries, mostly in Central and South America. All throughout, he never shied away from telling people exactly what he thought or felt.

Even though they had separated, he did learn a great deal from his father, who sometimes asked Haslip for help working on weekend home projects. His work ethic emerged from working alongside his father, who Haslip claimed was the hardest worker he had ever known. He also gained a work ethic from being in the Air Force, which had asked him to do physical and mental tasks he never thought possible. After a circuitous career path, his father became a City of Mankato official and eventually a building inspector for Minnesota Valley Action Council.

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Out of the military, he found immediate night employment in 1987 cleaning parts at Mankato-based Associated Finishing, a powder coating company. A quick year later, he began a stint with Petersen Construction in Waseca before landing a job at Lager’s in Mankato, where he started in the car wash and worked his way up in the early ‘90s to shop foreman in charge of 18 mechanics.

“While at Lager’s, I came to the conclusion that to get somewhere in life, I needed to make sure I listened and paid attention to people who were already on their way somewhere. At Lager’s, I met Randy Hoffman, a service writer. He taught me how to talk with people, communicate with respect, and not be overbearing. I had been pretty rough-cut. Randy is still a big part of my life—probably the biggest part right now. He’s the manager of First Line in the Cities, a distributor of food and beverage equipment.”

In 1995, after his dad suggested joining his brothers in a family-owned construction company, Haslip Contracting, Haslip earned his contractor’s license. The business had plenty of work building and remodeling just about anything from barns needing fixing to buildings at the Minnesota Zoo. He liked working with three of his older brothers, yet at the same time wanted to run his own show.

In 1998, he took what he remembered from Associated Finishing and began doing powder coating as a hobby in his garage using a kitchen oven. He had begun stock car racing a few years before and seen how the wealthier racers used powder coating to spray paint racecar exteriors and chassis. Soon, his six-car garage was inundated with powder coating work for friends and others. Finally, in 2003, after doing years of research, he brought along an employee from Haslip Contracting to start Powder Werks after the City of Lake Crystal offered industrial park land for just $1. He built the building himself. His older brother Darin was building inspector for the City of Lake Crystal.

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Since debuting in 2003, the plant size of Powder Werks has been growing at a manageable pace, initially with a basic 50×60 building, then 40×70 and later 30×40 additions, and now Powder Werks is in the process of adding on another 45×60 to occupy three adjacent buildings in the same industrial park.

“Manageable growth” to Haslip equates to having a firm grip on overhead costs, which “is the first thing to take a business down when the economy struggles,” he said. “Many powder coaters fell to the wayside the last couple years mainly because of their overhead while our business flourished. Efficiency in every aspect of business is key. For instance, I won’t go buy a sticky note pad if I have scratch paper to cut up. People don’t believe I run my business that way, but I do. I turn the lights off when I’m not in a room. And I teach my employees—five really good employees—exactly the way I was taught. From the first day I opened until now, I have refused to be wasteful. And I won’t build and add on space until I absolutely must.”

In this arena, he attributed much to his father, who grew up with conservative values during the Great Depression and to his long-time friend from his Lager’s days, Randy Hoffman, who still consults with him nearly every week. Hoffman has been not just a business mentor, but also one for life.

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The powder coating process is a form of electrostatic coating in which a metal part able to conduct electricity is grounded and placed in contact with the powder—a colored plastic polyester mix—that shoots through a paint gun at 100 kilovolts. The process is similar to two magnets of opposite poles bonding. The powder shoots from the gun and bonds to the metal before being cured through heating.

“Powder coating is more environmentally friendly (than wet painting), which is one main reason I chose it,” he said. “I worked in a body shop and knew the chemicals and sprays were all hazardous. The plastic polyester blend I use isn’t. It’s something you can sweep up and place in a dumpster. We don’t have vapors and fumes. All chemicals used within the building are organic and can go down a drain without hurting the environment. That’s important to me.”

Currently, agriculture-related manufacturers account for 85 percent of revenue, automotive and motorcycle customers about five percent, and industrial/commercial equipment manufacturers the last 10 percent. Powder Werks has 130 regular customers ranging in size from a smaller customer bringing in perhaps one item for painting a couple times a year to a larger manufacturer hauling in three semi loads in a day. Their market niche has been their painting of 7,000-pound, fifth-wheel, seed cart frames.

Though living in Waseca, Haslip has no plans on moving his business anywhere. Lake Crystal and his employees have been very good to him. He has exceeded his original business plan sales projections by 70 percent and would like to own at least two more powder coating facilities in other regions of Minnesota, but nowhere else. “I don’t plan on leaving Minnesota for any reason,” he said.

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Associated Finishing

Haslip has a good relationship with and lots of respect for his first employer, Associated Finishing of Mankato, another powder coating business. He said, “They are geared more toward powder coating smaller parts and we are geared more toward the larger, heavier parts. When they have a customer with a product that doesn’t efficiently work for them, they have had the customer call me directly or they ask me to call the customer. And it works the other way. For example, they are set up for powder coating 5,000 bolts. We’re not efficient doing that and would send that job to Associated Finishing. That’s how you keep a good relationship. As for people to deal with, you won’t find better.”

VROOM. VROOM.

Damon Haslip began stock car racing after leaving the military in the late 1980s. His father, who quit racing himself in the late ‘70s after 28 years and 300 victories, bought his first stock car for him. Said Haslip, “My dad sent me to the track by myself and I didn’t know anything other than I had to go in circles and chase people. I have been racing 22 years and have had a good career. I’ve always said I’ll quit the day I think I can’t win anymore and I’m not at that point yet at age 47.”

He has driven IMCA dirt-modified stock cars to 70 victories. His best racing experience occurred last year during a three-day period when he won an “all-star” race in Owatonna at the Steele County Free Fair, a race he had been trying to win for 15 years, and a major race at Arlington Raceway, which came with a six-foot trophy.
Besides racing, he has been involved in helping manage Chateau Speedway in Lansing, Minnesota. Of managing a racetrack, he said, “I guess it would take $3 million to put up a basic racetrack from scratch these days—and I mean basic, including a non-covered grandstand and no asphalt. There is so much dirt involved and that dirt is so expensive—it’s not the kind of dirt you find in a field. It’s formulated out of clay, and you have to haul it in to form the track, and most tracks in southern Minnesota are one-half mile. At Chateau Speedway, it took 65 loads of this dirt just to resurface the track. Of course, if you’re going to start a speedway, this doesn’t include the cost of land, and utilities and lights, and you aren’t guaranteed a profit.”

Several years ago, some investors tried starting a racetrack adjacent to the ethanol plant west of Lake Crystal, which would have been the only racetrack within 50 miles of Mankato. Haslip said he had been “neutral” on the proposal, seeing both the positive and negative aspects. But then again, he would have loved having a racetrack so close to work—and much closer than Arlington or Fairmont.

THE ESSENTIALS

Powder Werks
Location: 486 Scott Street
Lake Crystal, MN 56055
Telephone: 507-726-6513

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