LeSueur Inc.

Photo illustration by Kris Kathmann

If you’d asked Mueller and Prevot in 1990, Will you ever see the day when you’ll have to turn away business because of a labor shortage? they would have answered, Never.

Yet today 550-employee strong LeSueur Incorporated sits with land in Le Sueur ready for expansion, cash waiting, booming sales, so many potential customers you couldn’t swing a dead cat without hitting one, yet it can’t expand because workers are in such short supply.

Mueller is Mark Mueller, 44, chief executive officer and co-owner of LeSueur Inc. along with his sister and mother. Henry Prevot (pronounced pre-voh), 55, president and chief operating officer, was enlisted back in 1986 to help move the now $60 million die caster/foundry/thermoplastic injection molder to the next level. Both wish they had a simple solution to the labor shortage. “If we had a solution to [the labor shortage],” Mueller smiled, “we wouldn’t want to say what it was. Then everybody else would be doing it.”

“Frankly, the employment shortage puts terrific pressure on wage rates,” Prevot said while looking out the window from a Vine St. headquarters conference room, “because we have to try to make this an attractive place financially for people to work. But it’s not easy. This is hard work, make no mistake about it. It’s hot, it’s difficult, it’s noisy. The work is hard, and can be very exhausting. All this makes hiring more challenging.”

At the same time, LeSueur Inc.’s mostly skilled employees must produce very high-quality work on a consistent basis for the 53-year-old company to maintain its reputation, which is an exceptionally good one according to Prevot. “It’s extremely important for us to have good, well-trained and dedicated people because they are our core,” he said.

If fifty qualified people applied today, could they hire them all? “Yes.” How about a hundred? “With a few phone calls and over a month’s time, we could take a hundred new employees,” admitted Mueller after thinking through the question only three or four seconds. “If we had enough people we could increase sales many millions more at least.”

The company has turned away “a lot” of business the last few years, Prevot said, because workers were in such short supply. “And they were good customers, too,” he added, “the kind you want to get and keep. We turned them down because we didn’t want to jeopardize the business with current customers.”

A look of mild frustration crossed Mueller’s face. “Right now we have everything but labor,” he said. “We have the capital for growth, the land, the space. Everything else is there. But there’s no use in building a building, filling it with equipment, and then having no one to run it.” In addition to an historically low unemployment rate, competition for Le Sueur area workers has been especially intense with neighboring ADC Telecommunications adding on 200 the past year.

If anything, Mueller said, the company’s current booming sales level is a testimony to the loyal and knowledgeable people they’ve attracted and retained over the years. Mueller smiled. “We’re going to just stick at it. We’re going to make sure we watch our wages, costs and do the best we can. There’s no reason that we can’t be very successful even with the labor shortage.”

The History And Process

“After WWII, in 1946, my grandfather and uncle started an aluminum sand foundry in downtown Le Sueur,” said Mark Mueller while looking out the conference room window and into the distance. “They made very simple sand castings. In the early ’50s they bought this land we have today. After the sand foundry, permanent-mold was added, then die castings. My father, Erv, was Chairman until February, 1998.”

Mark Mueller literally grew up in and around the business. He has worked at LeSueur Inc. for twenty years and remembered playing at the plant as a child and rummaging around the scrap heap for “toys.”

Sand casting is one of the oldest manufacturing technologies in the world, according to Prevot. “It starts with a pattern,” he said while forming his hands into a shape, “and then sand is formed around it to make a mold. Then you take it apart, remove the pattern and put it back together again. You pour aluminum into the cavity. After the aluminum solidifies you can take it apart and have your basic product.” Permanent-mold works like sand casting, except a reusable iron or steel mold is made instead of a temporary sand one. Often a customer will prototype a product in sand, and then move up to die casting or permanent-mold when production levels increase.

“Some places are just sand foundries,” Prevot explained, “and others are permanent-mold. We do both. Rarely do you see a sand and permanent-mold foundry, and a die caster, let alone a thermoplastic injection molder all under one roof.”

In the late ’50s, LeSueur Inc.’s business stepped into die casting, which involves a steel mold, or “tool,” and the forced injection of aluminum into the tool at extremely high pressures. The tool alone can be a rather large financial investment and take months to produce. LeSueur Inc. currently has 250-ton to 1,600-ton die casting molding machines in its 275,000 sq. ft. facility.

“Each of the processes has its strengths,” said Mueller. “For instance, if cost is a factor, then die casting might be the way to go.” At present, the sand casting and permanent molding processes each represent one-fourth of sales, die casting, one-third, and thermoplastic injection molding about one-sixth. Having all four processes under one roof gives them an advantage over competitors. “If a customer wants a part engineered, then produced, they can stay here with their product,” he said. “They don’t have to start with a prototype shop and then switch companies. It’s all very smooth with us the same players, the same people.”

Back in the ’50s, an early customer was hand tool maker Sioux Tools, of Sioux City, Iowa. LeSueur Inc. also manufactured parts for barbeque grills. The big volume account though was a company who marketed the miniature tractors they made ­ tractors children could pedal. “We made hundreds of thousands of those,” Mueller grinned. “It was all pretty basic stuff.” Then in the late ’60s and early ’70s the Defense Department drove business with orders for tank engine cylinder heads.

But what “really changed this company,” Mueller said, was a flood of orders from mainly Minneapolis-based computer companies in the early ’80s. “We literally made millions of different types of disc drive housings, covers, and control panels for Control Data, Digital Equipment, MPI, IBM, and Hewlett Packard. We became very good at controlling internal defects within the aluminum. All this gave us a lot of attention from businesses all over the world.”

Even though their computer business eventually fizzled because of miniaturization and offshore competition, LeSueur Inc. used what they learned about “controlling the process” and applied it to other industries. In 1984, the company entered thermoplastic injection molding in an effort to diversify out of aluminum, and today makes plastic products for Johnson Worldwide, Itron, Graco, Varitronics and others. The company has thirty-one 25-ton to 500-ton thermoplastic injection molding machines.

LeSueur Inc. has never had its own product line, but makes products for others. Currently big customers are Thermo King, which makes refrigeration units for the transportation industry, Graco and Linex. “We also make lots of parts for Yamaha,” said Prevot, “and we ship right to their assembly lines.” LeSueur Inc. earned the Yamaha business five years ago during a period when the dollar was weak against the yen. Yamaha wanted a U.S. parts source to avoid high export costs, and to be nearer its Georgia assembly plant that makes watercraft, ATVs, and golf carts.

Yamaha’s pre-selection process was extremely tough. First, they surveyed die casters throughout the U.S. before paring the list down to a select few. “They visited us, literally, dozens of man-day visits, evaluating every bit of our quality procedures and technical capabilities,” said Prevot. “And they did this with extraordinary detail. They even brought teams in time after time before selecting us as their principal die casters for parts that go into their watercraft and ATVs. Yamaha is very, very exceedingly demanding. Their product has to be perfect and delivered on time. And if you can’t truck it on time you better hire an airplane and have it flown in.”

Selling LeSueur Inc.

When LeSueur Inc.’s seven direct sales people comb the globe for new business, they’re not targeting one particular market, industry or customer. Corporate strategy can best be summed up in one word: diversification. No one customer accounts for more than fifteen percent of business, a fact which makes sleeping at night a whole lot easier for Prevot and Mueller. “Losing any one customer would hurt,” admitted Prevot, president and chief operating officer, “but it wouldn’t cripple us. If we lost a customer we’re confident we could find someone to fill the void.”

He explained how LeSueur Inc.’s defense-related business dominated sales in the late ’60s and early ’70s, the computer-related in the early ’80s, but both eventually faded away only to be replaced by other customers and industries. The products they manufacture often have a very short life cycle of only a year or two.

In an effort to corral new customers, LeSueur Inc. has advertised in airport display cases throughout the U.S. for fifteen years with the idea that purchasing and engineering groups frequent airports quite often. It is their main advertising vehicle for finding employees and attracting new business. The display booth in Minneapolis has been around longest. Depending on the airport, costs range from $500 to $1200 per month.

When their sales people walk into potential accounts, they stress LeSueur Inc.’s ISO Registration that was earned “before it was fashionable to do so,” said Mueller. The company achieved ISO 9002 certification in 1995, graduated to QS 9000 last year, and the end result, according to Mueller, is “a very high-quality product.” Mueller said: “We were only the second die caster in the United States to be ISO certified. We gained an advantage with ISO because it forced us to formalize what we were already doing right. It has helped us with product consistency. And then finally, of course, it became a big sales advantage for us, too.”

The yellow brick road to ISO certification was laid by a committed upper management team, and then paved by an all-out sales pitch to employees. Mueller explained they didn’t “shuck ISO off onto some outside group” to make that group in charge of implementation. Prevot and the rest of upper management actually oversaw the project and wrote the ISO proposal themselves. “What we did helped us a lot in selling ISO to the employees,” said Prevot. “In addition, we had a big meeting in downtown Le Sueur. We rented out the mall and brought all the employees down. We even put together a theatrical act, a stage play, to help explain why customers buy from us. From there, employees made commitments and we tacked our quality policy to company bulletin boards.”

And it seems to have paid off. Mueller claimed the company has helped some customers who literally could not find anybody else to manufacture its parts. “Before they came in here,” he said of one company in particular who had sought their aid, “they were desperate.”

©1999 Connect Business Magazine