Soldering equipment concern sees big uptick in sales
RPS Automation expects to double revenue, largely due to aerospace workJune 21st, 2012
As the domestic aerospace-manufacturing sector continues to grow, Spokane Valley-based soldering equipment maker RPS Automation LLC is seeing its sales shoot upward and is attributing much of that increase to aerospace-related fabrication.
RPS Automation, based in a 16,000-square-foot warehouse at 3808 N. Sullivan in the Spokane Business & Industrial Park, makes a line of machines used to solder components onto electronic circuit boards.
Reid Henry, the company's executive vice president, says that because most of RPS Automation's customers are contract manufacturers that specialize in circuit board production, it's hard to say what the end products made with the company's machines are used for. However, he estimates that up to 75 percent of the uses are aerospace related.
Henry says some end users of the circuit boards soldered with the company's equipment include Boeing Co., Lockheed Martin Corp., NASA, and Raytheon Corp.
RPS Automation is owned by Palo Alto, Calif.-based Gaither Capital Management Co., which bought its assets in 2007 from the two founding owners who left the company and went in separate directions, Henry says.
He says the company recorded its highest revenues in 2008, but it's on pace this year to outperform that by a significant amount.
RPS Automation's revenues grew by 190 percent during the first five months of this year compared with the same period in 2011, he says. He declines to disclose actual revenue figures.
"We are projecting to double this year what we did last year," he says. "We are getting so busy we need more technicians."
Henry says that between 2009 and 2010, and again from 2010 to 2011, RPS Automation's sales increased just over 15 percent. Last year, he says, the company sold the most individual units in its history, though the sales of those units didn't outpace its record revenues seen in 2008.
He adds that the company expects to fill two or three new manufacturing positions before the end of this year. Currently RPS Automation has 21 employees, quadruple the five people it employed in 2009 after the recession had set in.
One of the main factors the company credits for its spike in sales so far this year is an increased focus on service and support for its customers.
"We have created a dedicated customer support center, and historically that was something the company was lacking," Henry says.
That change, he adds, "has increased positive references that have helped generate new orders. The business is based a lot on new reference accounts."
Earlier this year, he says, the company also hired a global sales manager, Cory Jacobs, and Henry says that new position has helped establish international brand recognition for RPS Automation. One of Jacobs' jobs is to expand the company's sales representation and hire private sales representatives to market and sell RPS Automation's equipment.
Another reason for the sales increase, Henry says, is the recent launch of a new piece of equipment. Called the Rhythm Slide, the new machine uses technology referred to in the industry as selective soldering, meaning that it can be programmed to apply solder to specific places on a circuit board.
The Rhythm Slide is faster and more efficient than past models of the selective soldering machines RPS Automation has manufactured, Henry asserts. He claims that it also costs less than similar machines made by the company's competitors, of which there are around six worldwide.
Henry says the purpose of selective soldering is to ensure other parts of the circuit board aren't damaged by heat or the molten metal solder used to mount various electronic components onto the board.
In many cases, more complex circuit boards have components soldered onto each side of the board that could be damaged if the molten solder was applied all at once through a process called bulk wave soldering, Henry says. That older method can be used for less-complex, high-volume circuit board construction, he says.
The components that often are mounted to circuit boards using metal solder include transistors, processors, chips, diodes, and USB hubs, among others.
Henry says the various components being soldered onto a circuit board using RPS Automation's Rhythm Slide are attached at a point called a "through-hole," which refers to the tiny holes on the board where components are secured.
RPS Automation's selective soldering machines, including the Rhythm Slide, are its biggest revenue generators, Henry says.
The company makes two other types of equipment at its facility here. One of those is solderability test equipment, which ensures that the components to be placed onto a circuit board will successfully adhere to the board, Henry says. Pieces can fail to adhere if there is a contamination on the metal parts, such as oxidation, he says.
"If there is a contamination of the components we're trying to solder, it might look like it's there, but it could fall out, and on an airplane, that is a big deal," Henry says.
The company also makes what's called lead tinning machines, which applies lead-based solder to the components that are later to be soldered onto the board.
Henry says aerospace and defense clients require the use of lead-based solder, which is stronger and more reliable than tin-based solder.
"Lead-free is fine for consumer products, but we are talking about life-critical applicationsplanes or missile guidance systems," he says. "Aerospace applications need the longevity out of the circuit boards and it has to be reliable and last."
Henry says some of the applications of them are in aircraft radar systems. Forward-looking infrared radar is an example of that, which provides information to pilots to tell them of obstructions in the air space such as land forms or other aircraft.
Military aircraft also use ground-sensing radar systems to do night landings, he says.
RPS Automation was founded in 1985 in California under the name Robotic Process Systems Inc. and moved to Liberty Lake in 1993.
Jacobs says that in the company's early years, it was a big supplier of equipment to Tyco International Inc., a big diverse manufacturing company with U.S. operations based in Princeton, N.J.
In the early 2000s, Jacobs says RPS lost its contract with Tyco and took a big hit. RPS twice filed for Chapter 11 bankruptcy protection, the first time in the late 1990s and again in 2002.