David Peacock, President of Hytrol Conveyor Company, returns to the Executive Series to share what's changed in one year after the pandemic.
Danny:
- Well hello and welcome to today's IndustialSage Executive Series. I'm Danny Gonzales, and I am joined with Hytrol Conveyor Company, the president David Peacock of Hytrol. David, thank you so much for joining me today on the Executive Series for the second time.
David:
- Yeah, it's a pleasure being here, Danny. Thank you.
Danny:
- Absolutely. Well I'm excited to get into it. It's been a little bit. I think it's been about a year or so since we spoke last. Obviously a lot of things have changed since then and continue to change. Before we get into all of that, I would like to, for those who aren't familiar with Hytrol Conveyor Company, if you could just tell me and our audience for those who aren't familiar what you guys do.
David:
- We're a manufacturer of conveyor systems, whether it's high-speed sortation or even basic gravity. Anything in between that is what we're building. It's the systems themselves, the solutions that we're deploying. Primarily retail distribution; ecommerce is a big part of it. But it's the systems that go into those warehouses.
Danny:
- Yeah, obviously that has had a massive impact over the last 12 to 18 months. When we spoke last, a couple big things that jumped out to me is one, you had a great—talking about how to make decisions when you don't have a whole lot of information. That certainly was a huge piece of last year, and even now. You talked about how there was a lot of changes that had happened in the industry, obviously a lot of work from home and just trying to battle the supply chain and labor and trying to dodge around shutdowns and keep operations rolling. How has your business changed since the last time that we have spoken?
David:
- We were in the middle of a lot of change when we spoke last year. I think we've worked through a lot of those issues. We now have work from home as a standard practice, but it's really a hybrid system now as people started to come back to work on July 1st of this year. As an example, our engineering team now works, published 60% from the office and 40% from home, and that varies from person to person. We've stabilized that a little bit. Probably the biggest change is, as disruptive as last year was, our supply chain was fairly solid. This year it's much more fragile, and we have to spend a lot more time trying to figure out how to get the basic components that we need in to build our systems. That's a big change for us this year.
Danny:
- Yeah, we're hearing that across the board. It's interesting that you say that last year, you felt like it was impacted, but this year seems to be significantly—what are some of the drivers that you're seeing that are impacting that negatively?
David:
- One of them is, steel prices have gone up remarkably. If you look back historically over the last three years, steel has been just slightly north of $600 a ton, and right now it's $1800 a ton. So it's three times what it was this time last year. It's not just the price; it's availability. We're in a pretty good position. We have a great partner that we work with. But a lot of our component suppliers have struggled. We have actually supplied steel to some of our component suppliers so that they can get us what we need to build products. That's one of the big changes. I think it's a result of the extended nature of the pandemic. Everybody had supply chains in place that would allow them to work through short-term disruptions. But we've been at this now for close to 18 months, and so a lot of those supply chains have really...