Today’s show is the first episode of a multi-part series about how machining companies acquire new work. 
Our guest is Federico Veneziano, CFO and COO of American Micro Products Inc., a precision machining company in Batavia, Ohio. Federico says one his key strategies for getting new customers is proving to them his company will minimize the problems that are bound to occur in most manufacturing jobs.
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Main Points
Federico talks about how the selling process in the machining business has changed in the last few years. He says there are fewer face-to-face meetings now, but he still prefers the traditional human touch. (3:20)
Federico gives an overview of American Micro. The company is located in Batavia, Ohio, just outside of Cincinnati, and it was founded in 1957. It mostly focuses on turning, but also does milling. It makes parts for the automotive, aerospace, and defense sectors, along with a little bit of industrial and medical. American Micro’s workforce fluctuates between 150 and 200 people. It has also had a factory in China since 2005, with around 100 employees. (4:20)
Federico came to the United States in 2004, working for the machine tool builder DMG. He did technical support and service, process engineering, and sales, which gained him a lot of knowledge of machining companies and cultures around the world. He worked on American Micro’s Gildemeister GMC35 CNC multi-spindles, which eventually led to him coming to work there. (6:40)
Federico hates to say it, but aerospace is one of American Micro’s most significant markets, so it has been hit hard by the current troubles of the commercial aerospace industry. The company has had success doing specialized automotive parts such as fuel diesel components and parts for steering pumps. Defense is becoming one of the company’s most important sectors. He says the medical industry has been harder to penetrate because it requires a company to have established contacts already in the business. (8:20)
Federico says one of American Micro’s strategies is to stay in markets it already knows well so it can provide good service to customers. The company uses databases and other resources to find potential customers and then contacts them via phone or email. If a job seems like it has potential, the company tries to set up a meeting to do a presentation, where sales representatives talk about the added value American Micro can provide beyond just price. Federico says he tries to identify potential customers’ pains and then come up with solutions to their problems. He says this is the key to getting new jobs. (10:30)
Federico reiterates that it’s important to make a value proposition beyond a good price per part. He says the constant emphasis today of customers choosing venders exclusively on the basis of price is diluting the value of manufacturing. He says price pressure causes work to go overs...