CEOB: How much will Kent be able to shorten its delivery turnaround?
AK: Actually our lead time will not shorten in the short-term, as we are using mostly imported parts. In 2016, when we begin stamping, robotic welding and painting and also production by ourselves of several key component parts, our lead time should be reduced by about half.
CEOB: What challenges did you have overseas that will no longer be an issue?
AK: We have been purchasing all of our bicycles from Asia for more than 40 years now. In most countries in Asia and particularly China, working in a factory is considered a job with low esteem. People are quitting factory jobs in China and taking office jobs at lower salaries. As part of our long-term culture in the U.S., working in a factory is considered a fine way to make a living. Also, the cost of natural gas and electricity is three times higher in China and there are periodic shortages of electricity.
CEOB: What U.S. legislation/regulations do you now have to abide by that didn’t apply overseas?
AK: Things are changing very quickly in China with regard to emissions and our main customers have required our factories meet many different ethical standards, so this is really not an issue. Although the federal laws on emissions are not that difficult to meet with the modern technology of painting and preparation, the equipment we are buying will meet even the most stringent standards that exist in any state.
CEOB: What lessons did you learn overseas that you bring back with you?
AK: The main thing we have learned is to keep pushing the factory management for continual improvement and efficiency and be very quick to add new machinery that reduces labor content.