For Sarmad Malik, being an experienced technical person with a PhD in mechanical engineering from the United States, owner and CEO of Weldflow Metal Products in Brampton, it’s all about adding value. A passion for taking a company and turning it around is what brought Dr. Malik into the marketplace for a business . . . and to Sunbelt Business Brokers.
Before he immigrated to Canada, Dr. Malik already had extensive experience as the CEO of manufacturing businesses in the Middle East and in the Far East. In Canada, Malik worked in the field of manufacturing, heading operations and being part of a top management team. His goal then became to become an owner in the manufacturing or distribution industry.
Research is key
In 2008 and after doing research, Malik started looking for possibilities. In the process, he met Rob Mitchell, regional vice-president of Sunbelt Business Brokers and the broker/owner of the Sunbelt office serving the Kitchener, Waterloo, Guelph, Brampton, and surrounding communities. Because Rob is also an engineer, Malik related well to him and the two men established a good business relationship.
Among a few other properties, Sunbelt uncovered Weldflow Metal Products. For Malik, the property fit the bill for a good opportunity to add value. Founded in 1975 as a precision sheet metal manufacturer, Weldflow was run by a hands-on owner/operator with just a couple of other technicians, making it the right size for Malik’s vision.
Prior to Dr. Malik’s buying Weldflow, the company had both good and bad points. One bad point was that it had not transitioned into the era of the Internet and social media and their associated technologies. As a result, Malik initiated a path of growth by implementing lean manufacturing practices and by creating new systems and business processes. These changes allow a manufacturing unit of Weldflow’s size to provide a professional, customer-centric approach to doing business.
The size of Weldflow and the evidence that more value could be added were signs of potential opportunities that Dr. Malik believed he could seize. Despite the economic confusion of 2008, he took the plunge and purchased Weldflow. He then proceeded to turn a small operation into a much more productive and profitable one.
The Sunbelt factor
“Sunbelt was very informative. No fluff; very straight forward.” Malik said. He adds, “Rob Mitchell and his team were very well prepared with a presentation, and the entire process was professionally handled.”
Mr. Malik praises Sunbelt’s strong portfolio of available businesses. He also recognizes that Sunbelt also has the systems and processes in place to take a buyer through all the steps leading to a purchase. “Sunbelt does its homework,” Malik said.
Weldflow marches to success
After Sarmad Malik took over Weldflow, he implemented many changes. After first learning the business and meeting the customers, he created an online presence for the company and introduced updated technology and computerized techniques.
Malik took a proactive approach by adopting the role of salesperson and marketing the company. The result was new accounts for Weldflow and an increase in the quality of customer relationships.
Malik also hired an office manager, eliminating the previous situation where in-coming calls would often go to voice mail. Malik’s aim was to turn Weldflow into a professionally run company that works with customers to produce quality products.
The results speak for themselves
Since 2008, staff numbers increased from 3 to 10 and sales have more than doubled. By diversifying its customer base and specializing in large-volume runs (although it can do runs of any size) for components, Weldflow has carved out a successful niche in the sheet metal business.
The company’s service lines include the manufacturing of sheet metal components, sub-assemblies, and complete assemblies. Today, Weldflow touches all categories of industries that need to outsource the production of sheet metal components.
Weldflow also offers services in engineering and product development. After approval by the customer, Weldflow can turn a concept into a design and eventually into production drawings for any size run. The company’s facility has the capacity to perform general fabrication using a wide variety of materials
Weldflow is now widely recognized for its engineering capabilities and management expertise.
This approach has made it far more desirable for customers to turn to Weldflow rather than to overseas companies.
The future for Weldflow
But Malik’s work is not yet done with Weldflow. He’s currently working with the Business Development Bank of Canada to take Weldflow to the next level by planning for expansion, improving the processes, and creating new opportunities.
What suggestions can Malik make to other entrepreneurs looking to purchase a manufacturing business? “Look beyond the sales,” Malik advises. “Look for profitability.” Remember, for Sarmad Malik, it’s all about adding value.
He also cautions buyers to go line by line through the company’s books. “Weigh factors such as the cost of goods and the discretionary income of the current owner. Don’t rush into a purchase. Work through the process until you feel comfortable,” Malik adds.