Company insight
Ensuring critical tubing manufacture despite crisis
Medical tubing is critical for a plethora of hospital treatments, as well as in patient monitoring and life-supporting procedures like dialysis and mechanical breathing. But not all tubes are created equal, and it’s extrusion capabilities like those of Microspec Corporation that provide the right tubing for each job. Founder and CEO Tim Steele explains what sets his company apart from others in this segment of the market and what challenges he’s had to deal with during the pandemic.
What are Microspec Corporation’s core competencies in the medical market? Tim Steele: Microspec has a global reputation for producing high quality custom medical extrusions and the company, after 33 years, continues to innovate in producing challenging parts for the medical device industry. The company’s core competencies today are consistent with the four extrusion technologies it was created to develop and innovate: Thin wall tubing; Multi-lumen tubing; Co-extrusion tubing; and Bump tubing. Although the technologies are separate and distinct, Microspec has integrated the four technologies to produce tubing and parts for the emerging technologies and applications in the healthcare industry since its beginning. In integrating these technologies in many different ways, Microspec is very proud that a number of these tubes have become the industry standard around the world.
How do you set your company apart from the competition? Microspec, like everyone else in the industry, is limited in how fast we can turn new jobs around because of supply chain issues and the availability of raw materials. However, the company does have a strategic supply policy and in many cases for production as well as prototypes our inventory supports our extrusion services. Key to Microspec’s success in extrusion is our core extrusion team that includes nine members with over 188 years of combined medical extrusion experience. The team members do have specialisations and we all help one another in challenging jobs. The team’s success rate is near perfect,
which is one of the main reasons for Microspec’s reputation.
Another important part of the company is our state-of-the-art machine shop and the fact that we design and make all of our own extrusion tools. Our extrusion heads are custom and proprietary to the company. When a new custom part is ordered, the new tools to extrude that part are typically designed and fabricated in less than five business days. If the tool does not produce the part as desired, turnaround on modifying the tool is typically 48 hours or less and we are then ready to complete the job.
What has been your experience of doing business throughout the pandemic?
During the pandemic, demand for products used in elective surgery fell off by about 40% overall. However, demand for new product development boomed! Backlogs fell, but we remained in the black. Staffing suffered during the pandemic, but we raised our manufacturing entry level wages by over 19% in order to retain workers and attract new associates.
Are there staffing challenges you dealt with during the pandemic that have endured as cases have declined? We implemented referral bonuses and sign- on bonuses which have worked at the cost of having to increase both variable and fixed overhead cost. This coupled with inflation and other inefficiencies created by supply chain challenges and the pandemic has necessitated raising prices at unprecedented rates. Some increases have been as high as 30% on standard production items.
Medical Device Developments /
www.nsmedicaldevices.com
Have supply chain pressures and the cost of raw materials made it harder to operate in your industry? The supply chain is affecting nearly all aspects of operations. Lead times have gone from four weeks to 12–14 weeks. Materials are in short supply, creating inefficiencies by limiting the lengths of production runs and forcing us to perform multiple runs, in cases where a single run would usually be enough, as we wait for additional raw material to arrive. Supply chain inefficiencies have caused higher costs in production planning and burdened managers with additional tasks in order to keep up with daily supply chain challenges. All in all, the supply chain has made the entire company less efficient.
Have manufacturing lead times reduced since the pandemic began? We are endeavouring to keep stock and finished goods on hand when demand for products is growing by double digits. Through constant planning and communication with vendors and clients we are, for the most part, staying abreast of demand, but it is a struggle that worries us.
How are broader economic forces affecting your business, and what are you doing to manage the impact?
Inflation and energy costs are indeed out of our control and add considerable pressure to raise the price of everything we do. Margins have been slipping but we are doing what we must to raise prices. However, if we cannot keep up then we will be less profitable, and growth will slow or even stop! I see continued growth and am not seriously worried at this time. ●
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