The Next Step_feature - Window Film

Volume 14, Issue 2- March/April 2010

feature

The Next Step
The Industry’s Newest Film Manufacturer Says it’s Taking a New Approach to Business
By Ellen Rogers

At a time when so many businesses are shutting down or cutting back, you might wonder why anyone would even think about starting a new company. After all, given the state of the current economy, the odds of succeeding don’t necessarily seem favorable. But perhaps even more unusual than simply opening a new business, is launching a brand new manufacturing company and, in this particular case, a window film manufacturing company. With the overall economy down, some may wonder if the industry needs another film manufacturer? For one particular company, the answer is yes.

Erickson International is a new window film manufacturing company that opened last September in Las Vegas. According to principals Pierre Chraghchian and Alexander Sardarian, the downturn in the economy has made many window film retailers look for alternative options to be able to remain competitive.

“This created an amazing opportunity for us to introduce our American Standard Window Film (ASWF) product line,” says Chraghchian.

Just as it takes a different approach to open a new business when so many others are shutting their doors, Erickson, too, is taking a different approach to the way it’s doing business. Take, for instance, the SEMA show last November. With the event in Las Vegas, Erickson officials used the opportunity to bring customers and potential customers into their new 60,000-square-foot facility and show them firsthand exactly what their operations are like—operations that include what they call a “first-of-its-kind machine” that aligns, cleans, controls the tension of the product and builds a completely finished product in one machine pass.

It is this approach to market that Chraghchian and Sardarian say will help see them through these challenging times.

“Having structured the mission and goals of the company around the ideas of better quality and better service, we are uniquely positioned to meet those needs,” Chraghchian says.

Starting Off
Erickson International may be new to the market, but the members of its management team are veterans of the film industry. The history, in fact, can even be traced back about 15 years to a tint shop in St. Petersburg, Russia.

“The founding members of Erickson International have been involved in distribution of window film in the international and California markets,” says Chraghchian. “As the territories of distribution expanded and sales volume increased, the necessity to have a more dependable, consistent and unrestricted source of supply became more and more critical. Without our own manufacturing facility, our distribution company’s growth was restricted by existing suppliers, limited sales territories and product supply.”

In 2007 the decision was made to start a manufacturing facility. Mike Martin, who had worked for Solar Gard for ten years, was brought on board to run the manufacturing operation.

“Together, we selected a machine design and went forward with the purchase of the equipment, the building, the testing, the installation and now we are at the manufacturing phase,” says Martin, who serves as the president of the company.

The economy has changed drastically since those initial plans were laid out and even companies with a long history in business are struggling. The Erickson team was ready for the challenge.

“When we began planning to build a window film manufacturing facility, we had to account for financially challenging days. Whether caused by a downturn in the economy or challenges by other market forces and competitors, we knew we had to anticipate and strategically plan for tough times,” says Chraghchian.

According to Martin, the fact that the economy is down can also be viewed as an advantage.

“There are a lot of people selling film looking for a better deal. Sales are down, people need to cut costs, improve margins and they want a quality product at a lower cost,” says Martin. “With our equipment we have the ability to compress manufacturing into a very efficient process with lower waste so we can afford to sell the product at a lower cost while still using quality materials.”

And it’s the production process that company officials say will help to differentiate the business. Martin explains that most film manufacturers use tandem coaters that allow them to put two coatings on two films and then wind them up, creating a work-in-process roll or a finished goods roll.

“We’ve designed and installed a three-head coater. What we do is take three raw material rolls, three coatings, and then coat and laminate the product to a finished goods stage,” says Martin. “We then go a step further and convert the finished goods stage into a sellable product by slitting and rewinding to the final core.”

He continues, “You only have to handle the material once—you unwind the large master roll once and you rewind it into a final finished product. This also helps reduce scrap and waste.” He says the machine provides the company with the capability to run 800 to 1,000 rolls a day.

Raw materials used for the company’s window film products, both film and coatings, are sourced from domestic suppliers.
“We do not purchase or repackage any foreign-made finished window film products,” Chraghchian adds.

As far as shipping and receiving, each territory or market utilizes various delivery methods. |

“We are not committed to any one carrier and will use the one that provides the best available service for our customers. In most cases the customers will have the opportunity to choose from available carrier companies,” says Chraghchian. “We have no immediate plans to have delivery trucks, although we may decide to incorporate this method of delivery for specific markets.”

Careful Considerations
There were a number of initial challenges in getting the new company off the ground.

“The biggest challenge was secrecy because, at the time [Chraghchian and Sardarian] were also buying film from manufacturers and the fact that they were going to become a manufacturer could have created a problem,” says Martin. “We could not reveal that to anyone in the current manufacturing community or to any suppliers the existence of the project without risking their current supply of film,” Martin says, explaining that if the partners’ suppliers knew of their plans to start a manufacturing company they could have chosen to not sell them film anymore. “Then, for all those months that it would take to get the machine in place, started up, etc., the well would be dry,” says Martin.

“We recognize that being a new company that’s offering a new product, we will be competing with companies that have significant brand name recognition and customer loyalty. In today’s free global economy, consumers have the option to choose what and from whom they purchase,” Chraghchian says. “These decisions are usually based on factors such as quality, service, price and convenience. This is how an open market economy operates. As a result of this, free competition products and services benefit the end user.”

Another early challenge was dealing with raw materials suppliers because, as Martin explains, the company essentially just “popped up” on the map.

“Being a brand new company, we had no credit background and it was hard to believe that a window film company would appear out of nowhere,” says Martin. “So lining up the supply agreements to get raw materials was a challenge. It helped that I knew a lot of them from my old working days so they gave us some trust there, but it was still a challenge.”

Chraghchian adds, “Starting-up a new manufacturing facility is certainly not without challenges. We take it one day at time working through issues as we encounter them, looking ahead to anticipate any problems as best we can, and learning from our mistakes.”

"Starting-up a new manufacturing facility is certainly not without challenges.
We take it one day at time working through issues as we encounter them, looking ahead to
anticipate any problems as best we can,and learning from our mistakes."
– Pierre Chraghchian

What’s Next?
The company is focusing its efforts on the automotive market and offers 60 different products. Plans for other new products, growth and expansion, are in the works.

“Currently we are focused on expanding our distribution network both domestically and internationally,” says Chraghchian who explains that the ASWF products are distributed both factory direct and also through independent distributors. The company’s only factory-direct distribution center is in Las Vegas, but Chraghchian says they have plans to open several additional factory-direct distribution centers.

“California and Colorado (and surrounding states) are being serviced by independent distributors,” he adds. “We are not much different from most other manufacturers. We will sell direct in certain territories and we will sell through distributors in others. There are many factors associated with deciding on factory direct, factory-owned distributor or independent distributor distribution infrastructure. We will take it state by state and decide how best to distribute: factory direct, factory-owned distributor or independent distributor.”

Several trends have influenced product developments, including non-reflective products that don’t interfere with electronics such as global positioning systems, cell phones and radio signals.

The company is also prepared to take on this anticipated growth. Martin points out, “If we run out of capacity on this machine we’ll likely put in another next to it. This building has a lot of room for expansion and we’re only taking up about 25 percent of the building and the rest of it is available if we need it,” says Miller.

Different Company, Different Thinking
Having been in operation for less than a year, Chraghchian is optimistic about the company’s future.

“We came from a window film sales and distribution background. We understand the needs of the distributor, sales personnel and installer,” Chraghchian says. “Having been on the opposite side of manufacturing, we are committed to raising the standard on customer service.”

Likewise, the company is being extremely open about who it is and what it does, and that includes bringing people in to see and tour the facility.

“Most window film companies will never show their equipment,” says Martin of the tours they conducted around the SEMA show. “We also made a YouTube video and put it out the day of our grand opening. We’re saying, ‘here’s what we have—come see it and try it.’”

And Chraghchian adds that their launch efforts helped generate a huge amount of interest from potential distributors and buyers.

“We learned very quickly that the window film market was starving for a new supplier that understood their needs and requirements,” he says. “Having structured [our] mission and goals around the ideas of quality and service, we are uniquely positioned to meet those needs.”

And going forward, Chraghchian says they have a very simple business philosophy: treat customers and employees the way they would like to be treated.

“The success of any company is greatly dependent on the performance of its employees and the success and satisfaction of its customers,” he says. “We are dedicated to creating a healthy and pleasant work environment, attracting the most qualified and talented employees and translating that same culture to our customers to help ensure their success.”

Ellen Rogers is the editor of Window Film magazine.