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Tuesday, July 29, 2014

Seeking a market for an adapting company in Wichita

By Dan Voorhis
The Wichita Eagle

Robi Lorik has searched for a new market, but so far has found only frustration.

Lorik is president of PWI, a contract maker of electronic assemblies and lighting for aircraft that employs 35 people. His company, like so many others, has suffered from the sharp downturn in general aviation.

After attending a local conference called “From FAA to FDA” last year, where aircraft subcontractors were encouraged to get into the medical device industry, he was sold. At the conference, 30 or 40 local manufacturers were told that, from a manufacturing perspective, they were already most of the way to being able to supply medical device companies.

“That’s why I got into this,” Lorik said.

He is one of very few local companies to try to break into the medical devices, according to a local economic development official.

But it’s turned out to be more difficult than he expected to get into the supply chains of medical device original equipment manufacturers.

He’s attended a number of conferences, made a ton of contacts and gathered reams of information. He now has the processes documented for FDA-approved Good Manufacturing Processes for Class I and II, for non-invasive medical devices.

The basic problem, he said, is that he still hasn’t been able to identify his potential customers or figure out how to get in their doors and meet their needs. He has met a lot of people with startups who are looking for help making prototypes, but the big companies with established supply chains have proved elusive.

He had expected that state and local agencies interested in helping local manufacturers diversify would do some of the groundwork, making connections with big manufacturers in Kansas and nearby states. But much of the state effort appears to focus on incubating new companies, such as with the Kansas Bioscience Authority, he said, rather than helping existing companies get into existing supply chains.

“The biggest bang for your buck when it comes to jobs is helping existing manufacturers,” he said.

He said he will have to spend $45,000 to $50,000 for the kind of marketing study that will give him the real answers and access he needs.

David Bossemeyer, managing director of the Greater Wichita Economic Development Coalition, is sympathetic.

Penetrating a new market is extremely difficult, he said. There are already established suppliers and PWI doesn’t have relationships with them or an established product. It offers a service — contract manufacturing — rather than a product. That’s harder for a director of purchasing to visualize or take a risk on.

But, Bossemeyer said, the GWEDC, at this point, promotes local companies and their capabilities on an industry-wide basis. It goes to industry shows, offering local companies a chance to travel with them — Lorik went with them to the big medical device makers’ show in Dallas — but neither GWEDC nor any other governmental group assists in the actual marketing for a particular company.

“It’s really not our mission,” he said.

Unless, Bossemeyer said, a manufacturer calls and asks if there is somebody in Wichita who can do a particular thing. He said that happened just last week and may mean a significant contract for that company, but it’s pretty infrequent.

However, there many be assistance that is limited, but still helpful to businesses such as PWI.

When JR Custom Metal Products, a Wichita contract steel fabricator and parts maker, decided to chase work in the wind turbine manufacturing industry, the state had several sessions in which it brought executives from the manufacturers face to face with interested local suppliers. But there wasn’t much hand-holding, said president Patty Koehler.

It was up to JR Custom Metal to follow up and convince the wind turbine executives to give it a try. Company officials had to fly to Siemens’ national headquarters in Florida and to its turbine plant in Denmark several times.

“We as business owners have to do the work,” Koehler said. “The doors were opened as far giving you names and contacts, but it was up to us to market the products.”

The Kansas Department of Commerce is interested in helping companies such as PWI, as it did with companies interested in wind energy.

Spokesman Dan Lara said he couldn’t discuss any contact with PWI, but that generally the effort to facilitate the development of medical device manufacturing in Kansas appears to have fallen between several state or state-funded groups that have a piece of state’s efforts to develop a biological/medical based industry.

“Unfortunately it looks as if he’s paying the price for being first out of the gate, but it’s not for lack of trying on our part,” Lara said.

Lorik said he’s not a complainer, he understands that he has to market his own products, but he had hoped someone would at least ease the way. He doesn’t want Wichita and the state to miss out on what everyone sees as a good economic opportunity.

“There are a whole host of small manufacturers tied to aircraft who can do this work,” he said. “Why not seize the opportunity?”

Reach Dan Voorhis at 316-268-6577 or dvoorhis@wichitaeagle.com

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