Four partners running a start-up company, HighCraft Cabinets of Ferndale, Wash., just north of Bellingham, are busy finessing their sales strategies, customer relations and employee development procedures. The company opened in June 2018 and has reached many of its initial goals.
The partners, who oversee 12 employees, include two brothers who formerly operated their family’s small cabinet shop, production manager Eric Van Hofwegen and sales manager Jason Van Hofwegen. They teamed up with Brad Kuik, in charge of business development, and operations manager Brian Hendricks. Together, they have 60 years of experience in lean manufacturing and operations management. Kuik says a key goal is building strong, lasting relationships with clients.
“We don’t want to be a vendor and the person that buys from us to be a customer. We want a partnership with them and to have a long-term relationship with all the people that we serve, whether it’s working on a home for ‘Mrs. Jones’ and 12 years later doing it again, or if it’s finding a contractor that we service and they call us again, so that we can focus on deepening relationships and not be just a transactional business,” says Kuik.
HighCraft surpassed its first-year projections by grossing over $1.2 million in 2019. It’s slightly under the $2.5 million goal in 2020, mostly due to a three-week shutdown in the spring from the Covid-19 pandemic. Next year’s goal is about $3.5 million.
“The trick is to grow in a scalable, profitable way. When you’re a start-up, you’re just happy the bills are getting paid a little bit,” says Kuik.
In the beginning
Eric and Jason’s father, Bob Van Hofwegen, started Van’s Cabinets in the Dutch farming town of Lynden, Wash. in 1978. The sons joined in the late 90s and learned the business, then started talking with Brad and Brian about taking it to the next level.
“We were kind of at the point where we really couldn’t grow or change in the existing shop that my dad had started. We couldn’t get employees and we weren’t in the right selling area. Once it became apparent that our father was going to retire and that we wanted to keep going with this business, Eric had his first meeting with Brad in January 2018 and on June 1, 2018 we incorporated, had a building rented, had equipment in place and an initial staff hire,” says Jason.
“We’ve been aggressive in following goals we set up early and so far, have been able to meet those goals which has been great.”
“What we tried to do early on, just because the vast majority of partnerships fail, is define what our roles would be and be respectful of each other’s area of influence,” adds Kuik. “My primary role is business development. So, I’m here to try to help grow the company and put business processes in place and train people so we can grow. Wherever I need to do to help. I if need to run a piece of equipment, it’s been a while, but I’ll do what needs to be done, that’s my primary thing,” says Kuik.
A big change
The difference between Van’s Cabinets and HighCraft is night and day. HighCraft has considerably more space (13,000 sq. ft.), manpower and production equipment, which opens up more markets. Residential is still king, accounting for about half of the work, but new construction and multi-family dwellings have emerged.
“We have good relationships with commercial contractors and multi-family building-grade contractors, but we have our bread and butter in the residential sector. Eric and Jason always had a lot of residential contacts,” says Kuik. “We started on a road to discovery learning our market and are now feeling more certain about the type of work we want to do that balances the financial curves of life as well as what our sweet spot is. It’s a learning journey.”
The shop’s specialty is building custom cabinetry packages for kitchens, baths, living rooms and laundry areas. Most of its customers are in Washington, especially near Seattle, and Vancouver. Contemporary is the dominate style.
“We do a lot of white painted Shaker cabinetry; that’s still pretty hot out here. But we’re also doing a lot more with high-gloss laminate TFL or matte finish with a flat slab door. The customers want sleek looks,” says Kuik.
Investing in employees
Early on, the partners agreed that employees would be highly engaged in all aspects of the business.
“We’re constantly trying to scale their professional development and their growth beyond what the current need is so that when we grow, they fit those roles so we’re not on the back foot, we’re on the front foot,” says Kuik.
“If we don’t teach and provide opportunities for the people in the business to grow and develop and add skills, then all the pressure will forever be on the ownership. We try to involve them in lots of the problem solving, share where we’re at and where we’re headed.”
The shop is running two shifts. Eight workers and the partners cover the day shift, completing custom fabrication and associated tasks. The remaining employees, including some part-time college students, focus on assembly, maintenance, and finishing in the evening. The schedule coincides with lean manufacturing and efficiency goals.
“We want to sweat the assets and get enough work in per month. There are 24 hours in the day so there’s no sense in working eight if you can work more than that. Our business model lets us stretch our expenses based on how much we have the shop open,” says Kuik, a veteran of the printing industry that often operates around the clock.
Jason points to the shop’s extensive use of high-tech machinery, which includes a Homag Vantech 480 CNC machining center; Homag Ambition 1230 FC edgebander; Altendorf WA 8 sliding table saw; TigerStop fence system; Ritter pocket hole machine and face frame table; Grizzly wide-belt sander; Blum hinge drill and insert machine; Belfab dust collection system; Rohner Industrial Spray booth; DV Systems compressor, and Cabinet Vision software.
“We came from an old school, antiquated, small custom shop so when we decided to start HighCraft, we started building cabinets in a different way, investing in the latest and greatest,” says Jason.
Full speed ahead
Kuik says the goal in the next five years is to do over $10 million per year, and that anything less would be disappointing. He has faith it can happen.
“We probably have some processes in place that we don’t need now as much as we do in the future. We’re very religions about doing our internal build CRM (customer relationship management) and how we manage our sales pipeline. We’re very dogmatic about how we use it, so we have visibility.
Another plan is to decrease the demands of a fast-growing start-up.
“Somewhere there’s a life balance and I’m not sure we’ve discovered it,” says Kuik. “We all did what had to happen in the first two years and there’s a few more years of that coming. But I’d say that probably more of the focus in 2021 is how we will grow in a scalable way and not lose our growth mindset, but still also stay married and enjoy our families.
“There’s been a fair amount of legitimate stress with people keeping up with our plans. We are looking at how we can get staffed to help share more of that and how we can do it in a way that we don’t chicken out, but we can do it in a way that we can still keep life more important than work.”
Contact: HighCraft Cabinets, 5245 Industrial Place, Ferndale, WA 98248. Tel: 360-354-5845. www.highcraftcabinets.com