Morgan Hill, California
Machined parts, precision valves
Morgan Hill, California
Employees: 52 (plus more than 100 in Vietnam)
Industry: Contract Manufacturing
Products: Machined parts, precision valves
Banh came to the U.S. in 1979 as a refugee from Vietnam, and began working in the life sciences industry. For nearly 20 years he learned engineering and business skills from his employer. When the company was looking for an outside supplier for machining services, Banh thought it would be a perfect opportunity to start his own business and become a supplier.
"I didn't have the money," says Banh. "I had to look for someone I could partner with. I had the technology and the know-how, but not the capital."
Once he was able to find a partner willing to finance the venture, he succeeded in getting started, and began building parts to meet his customer's quality standards within a year.
Being a refugee, however, came with family issues that forced Banh to return to Vietnam, and he says he nearly lost the business because of it. "Fortunately my former employer, my only customer, was on my side," says Banh. "They wanted to continue to do business with me when I returned."
With his family issues resolved, he needed financing to restart the business. "No bank would lend me the money because I was a high risk," says Banh. "I was the new kid on the block, had only a single customer. I went to every bank I could, and it was the same answer." Comerica Bank ultimately agreed to finance him, and he was able to move forward.
Specializing in high-precision, multi-axis CNC machining, DC Precision now has more than 20 customers, mostly in the medical and life science industry, and more than 50 employees in its Morgan Hill facility. "We have also begun providing products to the semiconductor and laser optic industries too," says Banh.
Business was good and Banh expanded and added a facility in Vietnam in 2007 to help lower some of his manufacturing costs. "Big corporations were doing a lot of business in China, and they were moving production closer to that country in order to cut costs. I was thinking, 'If they can do it, why not me?'"
According to Banh, this decision helped the company grow even further, to the point where he recently added a second location there. "The company has more than 100 employees at those sites," he says. DC still has its headquarters and engineers in California, where it develops its products. Then it sends the work to its Vietnam manufacturing facilities in order to offer competitive pricing on high-volume orders.
The company maintains the same type of equipment in California and abroad in order to make the transition from design to production easy and to keep the quality consistent. This includes a variety of Zeiss and Micro-Vu inspection tools, Mazak turning centers, screw machines, and a combination of vertical and horizontal mills. "We've never had salespeople," says Banh. "Customers know us by our references, and people familiar with our quality and service commitment. So they introduce us to new businesses. They come to us."
DC sources all of its raw materials from the United States, including those used in the Vietnam facilities. He says he believes this helps maintain high quality standards. "We're doing medical equipment, so I'm afraid to put our customers at risk by buying something that is not reliable," says Banh. "Even though the foreign companies give us certification for what they want to sell to us, I don't trust it. I refuse to buy anything from Asia just yet."
Challenges: "I wish there was another me around, or that someone could clone me," says Banh. "I'm pretty much handling everything myself. I'm too picky. I'm not a designer, I'm also not formally educated in business, but everything I do, I do well. I want to do it perfectly, the best that I can."
Opportunities: DC has recently developed surface treatment processes at its second Vietnam facility that sets the company apart from of the competition in the region. This will allow the company to provide more finished products to their customers without relying on any outside assistance.
Needs: Banh believes he needs to continue expanding the customer base in order to reduce the risk of too much reliance on a small number of clients.
And finding workers with the right skills can be difficult, especially in an area of the state where tech jobs are prevalent. "We need good people and there are none available," says Banh. "Being a small company with less pay, it's very hard to compete with big companies with higher pay."
Automation has allowed the company to reduce the effect of a staffing problem. Banh believes adopting a high level of automation allows the company to turn out consistent, high-quality products while minimizing labor costs.