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Post-pandemic, plagued by supply chain disruptions, soaring fuel and steel costs, and economic uncertainty, the management team of Newberry Tanks vowed not to stagnate but forge ahead into a time of unprecedented growth, achieved from the implementation of their Entrepreneurial Operating System (EOS). This revolutionary business model allowed President and COO Matt Kohnke to step out of working in the business to focusing on the business, an approach that enabled the management team to establish a comprehensive and prioritized vision for the future by creating “rocks” that set forth concrete and attainable goals.
This entrepreneurial process found legs in 2022 with an aligning of the company vision into a unified plan for expansion and growth.
This cohesive vision netted significant investments in facilities and infrastructure, customer demand fulfillment, and corporate culture, culminating in increased revenue of 27% and 36% in 2021 and 2022, respectively, a 100% “Very Satisfied” customer rating, and very low turnover rates (11%).
A Vision for Infrastructure Growth
With production of rectangular tanks at its Memphis facility maxed out, Newberry expanded by purchasing land and another building nearby, doubling the square footage to 40,000sqft, resulting in a 35% increase in units produced from Q4 2021 to Q4 2022 while realizing a 20% reduction in hours per unit. “Our old facility wouldn’t have accommodated the number of tanks being produced and the amount of inventory we’re carrying to help our customers grow,” said Kohnke. “This expansion was an important precursor in allowing us to secure a significant amount of new business.”
The Newberry team also acted in response to a 2021 customer survey that showed 50% of respondents favored an online option for orders and delivery status, creating its e-commerce site with a customer portal, featuring an online dashboard with one-click access to quotes, orders, and delivery information.
A Vision for Customer Satisfaction
Another 2022 management-derived “rock” involved engaging the customer base and understanding their level of satisfaction, a necessary task for preserving their commitment to the 100% Perfect Order in the face of incredible growth. They implemented a net promoter score (NPS), creating a valuable touch point multiple times per year to gauge quality and performance while proactively identifying and resolving any issues. “It is critical to understand how we are performing, especially as we look to double the size of the business again in the next decade,” says James Fischer, VP of Sales and Marketing
Additionally, the management team focused on expanding their Preferred Customer Program (PCP), Newberry’s proprietary fulfillment and delivery management program that allows enrolled customers to preplan and receive tanks over time while slashing standard industry lead times of 8-24 weeks to 24-48 hours and locking in competitive pricing. Eight companies signed in 2022, quadrupling the program’s size. Four were new business that culminated in $2M and $4M contracts. One, a national oil change company whose initial projections called for 55 locations per year, doubled to more than 100 locations after an exemplary trial run.
“By shipping within hours, not weeks, we’re enabling our customers to answer their demand without disrupting their workflow and revenue streams while also generating lucrative new business for Newberry,” said Fischer.
A Vision for Positive Company Culture
The Newberry management team understands that the company’s greatest assets reside in their office spaces and on production floors. They seek to empower employees by soliciting their feedback in department-level EOS weekly meetings, cross-training welders, and investing in the local community. By establishing a pipeline of diverse talent and creating an incentivized program where welders take ownership for each tank throughout the manufacturing process, productivity increased an astounding 30%.
“It’s important to have employees that feel valued,” said Kohnke. “Giving them insight on where the company is going and a voice in the process gives them a sense of pride and belonging, that translates to extremely low turnover rates and tenures averaging 10+ years.”
Nomination Title: Newberry Tanks and Equipment - Visions
