Growing Small Industrial Businesses with Technology Investments

The manufacturing industry has a rich history of small family-owned businesses. While many have longevity, those with growth have one thing in common: a commitment to technology investments. The advancements in equipment, automation, and other processes as well as in digital marketing can expand your reach from local markets to regional, national, or even global markets. Pierce Steel Fabricators in Olean, New York is a perfect example.

Founded in 1887, this family-owned and operated company offers various custom-fabricated products for customers across various industries. Current customers include Fortune 500 companies and government agencies like Tesla Motors, Rolls Royce, Boeing, Caterpillar, NASA, and the US Army.

That’s where Mike DeRose comes in. He took over the company in 2001, right as the industry started seeing a technology boom. Digital marketing was also on the rise, which he strategically took advantage of to grow the business. We look at his investment approach, which includes:

• Looking beyond equipment replacement to find additional capabilities
• Creating and hiring technology enthusiasts
• Applying technology to sales and marketing strategies

About Mike DeRose and Pierce Steel Fabricators

Pierce Steel Fabricators started as a residential and commercial roofing company, but in 1967, a group of eight guys in a bar decided to buy the business. These individuals included DeRose’s father and two of his uncles. At the time DeRose’s uncle owned a sheet metal company, Mazza Sheet Metal (now Mazza Mechanical), at which his father worked. Mazza Mechanical is still in business and is run by DeRose’s brothers.

Growing up, DeRose would do grunt work in the summers and on the weekends at the business. He worked hard in school, excelled at math, and knew the potential a career in engineering could bring. He earned his engineering degree and started at Lockheed Martin shortly after graduating. When his father passed and the then-president of Pierce looked to retire, his older brothers at Mazza needed help with the second business. After several years at Lockheed, the idea of becoming his own boss was too good to pass up.

What he learned at Lockheed could be taken home to grow the business, and he could do it without getting tangled in big-company red tape. DeRose became President of the company in 2001 and felt the magnitude between the two experiences, with one project at Lockheed exceeding what the small shop made in a year. Modernization was one of his first priorities.

Growing the Business through Technology

At the time, the general ledger was kept on paper and the company didn’t have a computer. Additionally, they had no CNC machines, and the equipment was old. He began to turn things around by getting control of the inventory and cleaning up the shop. Then he dug into contracts losing money to discover efficiencies. They were a small and agile shop that could turn projects around quickly and he didn’t want to lose that.

With efficiencies found, he knew just replacing old equipment wasn’t enough—each investment should make things safer, more efficient, and add capabilities for projects they couldn’t chase before.

The technology investments were gradual and project-driven. For example, a CNC tubing cutter was added that automatically cuts tubes more quickly versus manual cutting, allowing the team to gain time in other areas. It was his team that brought him the idea. Another example was when an opportunity to do large, stainless-steel ductwork came in and it had to be food grade. His team suggested laser welders, and he sent a few to a supplier nearby to check it out. Impressed by the efficiency, they invested and have since acquired more.

Investment in technology should also include investment in a tech-savvy team. DeRose respects his team and trusts their daily hands-on experience to determine what technology will make a difference. Encouraging technological engagement from tradeshows to TikTok means internal buy-in is easier. This is an investment in a future workforce, as this enthusiasm aids in the recruitment and training challenges the industry faces. Pierce hosts Dream It, Do It events and high school summer interns who are often hired after graduating, promoting manufacturing to the next generation.

At the time of this interview, the company was moving to a larger facility after 50 years. Now with twice the square footage, they plan to hire more and continue investing in technologies that will help them work smarter. How do they fund these investments? That’s where digital marketing comes in.

Investing in Digital Marketing Technology

In 2001, the top three customers for Pierce made up 50% of sales, and 100% of sales came from companies within 50 miles of Olean. To grow, DeRose hired a sales team member who spent a lot of time driving to potential customers and cold calling. He was getting traction, but not the growth he was looking for. He had considered hiring more for sales, but then he went to a tradeshow and signed up for a marketing seminar. He was looking to learn more about another up-and-coming technology – digital marketing. He decided to try it, specifically SEO and paid search.

While there is a time investment in updating a website and working with a digital marketing agency, the time saved on the sales front allows for more productivity, better customer service, and the ability to be more selective.

Before working with a strategic digital marketing program, they had a static website that included a picture of a sawhorse, and a month later they got a lead to fabricate one. They then built a responsive website using SEO content strategies and made the product a focus. The calls rolled in, and it became a reliant revenue driver. This is a great example of the power of websites and amplifying them with user-intent content for SEO. The information from their digital marketing program has helped them define and understand their customers to better accommodate them.

DeRose’s advice to companies considering investing in digital marketing is that the internet can be a level playing field, but only if you show up. A small-town company can serve many industries and companies they’d never dreamed of, like Tesla and NASA. DeRose notes, “I don’t know how we would have gotten here without this.”

Without the quality leads and revenue driven by digital marketing, the investments made to his shop, processes, and team would have been harder to come by. DeRose’s investment approach has come full circle thanks to digital marketing, which brings in the funds to invest in new technology, equipment, and capabilities—all driven by a team excited to find solutions to invest in.