Blog

Sep 02, 2023

Hanswill Engineering: Forced into business ownership

The story behind every start-up or new business is unique, no matter what area

The story behind every start-up or new business is unique, no matter what area of the economy you are in. The owner or entrepreneur will always have dreams about starting a business with a brilliant idea. But whether they can fulfil that dream is another story. Not all are cut out to be successful business owners let alone cope with all the aspects that make the business successful. It is even more challenging if you have to invest in equipment before you have even earned your first cent.

Starting a new machine shop takes persistence and dedication. Once upon a time, the enterprising machinist would take a leap of faith and start a fledgling business in the garage. With any luck, the entrepreneur would connect with a few local manufacturers and build clientele until the new company was on solid ground. Past connections and friends would also be very valuable. The rules were simple, and the playing field was usually a 50km radius from the machine shop.

Joint owners of Hanswill Engineering Willem Lewis and Hansie Smit

Frequently this type of business would outgrow the garage and move into bigger under roof housing, employ staff and expand its manufacturing base, clientele and, depending on the individual and a favourable economy, continue to grow.

It is another story when you have been an employee all your life and suddenly, through no influencing circumstances of your own, you are ‘thrown’ out on the street and you are forced get up and get going or starve. In these times of the pandemic it is even more difficult to get back up on your feet.

This is the story of the unique establishment of Hanswill Engineering by Hansie Smit and Willem Lewis just over a year ago in April 2021.

The two had spent many years working for a well-known engineering company run by two brothers. Willem had been with the company for 24 years and held a senior managerial position. Hansie had been with the company for 18 years and was in the programming and setting department.

A shaft being machined on a Takisawa lathe

The company was an engineering business specialising in aluminium and stainless steel machining, welding, brazing, and general machining servicing many different industries and in general was in good shape. It also had 33 CNC machines on the floor.

But then one of the brothers fell ill and sadly passed away. As the surviving brother was in his 70s he decided to close the company and sell off all the equipment, rather than sell the company as a going concern.

"We went to the auction hoping to buy some equipment because we knew the CNC machines were in good order as they had been looked after and serviced. But it was a frenzy and prices were way above what they should have been," explained Hansie.

"Sadly this didn't help our cause to get our own business going. Willem and I had decided to start a machine shop of our own. The job loss hit us hard. We had both been very stable in our lives and suddenly we were in turmoil. It was hard to reason especially as the company was very successful and had many big clients. But as they say wherever there is a negative there is always a positive."

"Fortunately both Willem and I had had contact with many of the clients so we already had relationships. It was just a matter of convincing them that we were their new guys."

Tubes that have been machined on a Quaser machining center

The company has a Victor Vcenter-80 on the floor

"They say that many businesses started by individuals like ourselves, who are good at making components, are not necessarily good at running a business. They have little clue about how to manage a business, hire people, manage cash flow, market their services, analyse the market, differentiate themselves, service their customers, handle pricing, structure contracts and establish synergistic partnerships."

"We were all of these, to a certain extent, but we had determination and a mission. Today, what it takes to launch and succeed with a start-up machining business is arguably becoming a more important and relevant question. From a macro view, we need more machining businesses – we need more shops. Many decades-old job shops will close like our previous company or be acquired in the coming few years, as their baby-boomer founders reach retirement without successors. New shops founded by millennial entrepreneurs could be a partial answer and could take up opportunities these shops leave behind. Yet from a more micro-level view, realising this solution is challenging. New shops face high barriers to thriving. OEMs’ increased reliance on established and certified supplier networks keeps new shops from winning the kind of high-value work that can help them find stability and start to grow."

"Having lost out at the auction we began sourcing other equipment and this we acquired from all over the country. Clients had already promised us business so equipment purchase became a priority. At the moment we have only purchased used equipment, all of them CNC machines though. We have four lathes and two machining centers on the floor, as well as a bandsaw for cutting bar and solid. We have a number of jobs that require us to add threads, internal and external, to shafts and other bar type components."

"This all came together in April last year and fortunately we found a 860m² factory in Boksburg that could house all of our equipment and also leave some space for expansion."

One of the main clients of Hanswill Engineering is in the automotive industry

Components that have been machined on the Doosan Puma lathe

"Starting a business from scratch has its disadvantages but it also has many more advantages. A structured, disciplined approach will ensure that you eliminate as many negatives as possible. At the same time you, as an individual, will grow as a person. This has certainly been the case for both William and myself."

"We can't say that we wanted to own our own business. I think it's something that develops over time. But figuring out the right time to become a shop owner is not clear-cut. Hopefully going forward we will say that in retrospect we should have done it five or 10 years earlier. What we have achieved in our first year certainly points to these thoughts."

"We did not even consider the acquisition route."

First client"The first client that we acquired operates in the truck and trailer industry and he has gradually given us more work to do as we have proven ourselves to him. He supplies products for trailers, semi-trailers and similar. From an initial few components we are now machining over 200 components for him. They might not be production type quantities but more than enough to keep us busy."

"In total we now have five clients and four of these clients were clients that dealt with our previous company so we had a relationship with them. Fortunately, and we are very thankful, they believed in us and gave us the work. Acquiring our own machines did make a difference though."

An overhead view of the shopfloor

Hanswill Engineering are in the business of producing components and parts to customer specifications

"As both of us had started off on the machines and continued to operate them it was a forgone conclusion that we would initially run the machines ourselves before we even thought of employing somebody. We could take on the job title of CEO or Managing Director, but we would still have to wear many different hats each day, including delivery man, if we wanted to survive."

"This we did for the first seven months of the business. It was only then that we employed our first staff member. Subsequently we employed the second staff member in December last year and in March this year we took on another three employees. These numbers might not be impressive in the bigger scheme of things but we are proud that we were even able to take on one staff member."

"We are both hands-on and we expect our staff to be the same. We know that good operators or machinists are hard to find and it's even harder to find one that will hit the road running from day one. We are not unique in this situation. This is why we are constantly on the floor working and not in the office sipping coffee."

Hanswill Engineering machine components in many different types of materials

Hanswill Engineering will machine from block, bar, solid and tube

"We are there for the staff to learn from. And you never know we could probably learn from them. But at the same time if someone has a natural curiosity, specifically about how things work, we will encourage them."

"Our clients are not limited to the automotive industry. We have one that manufactures filtration and oil systems and another in the mining industry manufacturing diamond bits. Another manufactures core testing drills for the mining industry. This gives us the versatility we wanted to have."

"We will machine from block, bar, solid, tube, whatever is asked of us. With our array of machines we cover most of the processes. One component we machine requires eight different threading operations and milling."

"Because of our experience we do most of our programming manually but have recently installed Fusion 360, which will give us 3D, CAD, CAM and CAE tool software options to use."

"Our clients are not limited to the automotive industry. We have one that manufactures filtration and oil systems and another in the mining industry manufacturing diamond bits. Another manufactures core testing drills for the mining industry. This gives us the versatility we wanted to have."

"The first client that we acquired operates in the truck and trailer industry and he has gradually given us more work to do as we have proven ourselves to him. He supplies products for trailers, semi-trailers and similar. From an initial few components we are now machining over 200 components for him. They might not be production type quantities but more than enough to keep us busy."

"We are in the business of producing components and parts to customer specifications. We do not produce or sell a product ourselves. Our success depends wholly on the success of our customers, and the better job we do for them, the more likely they are to be successful. When our customers invite us to the room where decisions are made, we are in a great position to excel for them. We’ve formed partnerships with some customers where we both contribute to the part design and manufacturing process. We have a seat at their table, and they have a seat at ours. Our best partnerships are those where we can collaborate."

"We now have a much better appreciation of the challenges machine shop owners must confront. We will overcome all of the challenges that come our way. It takes time, dedication and perseverance but it works much better when we – ourselves and our client – both have a seat ‘in the room where it happens’."

"However, our expertise is in working out machining solutions and we are not afraid to raise our hand, ask for help and readily accept input."

For further information contact Hanswill Engineering on 082 579 4102 or email [email protected]