This is an unpaid, unprompted shout-out to the Precision Machined Products Association’s (PMPA) Listserve.

Every day, members jump on the association’s email forum with technical problems they encounter. It’s esoteric inside baseball stuff generally, far above my pay grade, yet invariably several folks quickly offer their unique experience in solving the tough machining challenges and other shop issues that come up for people living in cubicles of doubt.

A single company could never aggregate a fraction of the knowledge located in the heads of members of this small trade association.

One thing that makes the Listserve work so well is that it has a few very simple ground rules, some of which are not even articulated, yet are well understood by the group. One rule is that technical members who join the PMPA at significant cost, partly to gain access to the members at meetings, must never use the Listserve as a sales tool. Another is to always be helpful and never condescending when giving advice to other members.

A few years ago a particularly egocentric and bombastic PMPA member announced on the Listserve that he would never give out proprietary information that he had learned through hard experience. He mocked his peers for giving away the “family jewels” to potential competitors in the association. Previous to this incident he was already considered a bully by many members and eventually he was ostracized from the Listserve. Today he no longer is a PMPA member.

I know there are many other professional groups with wonderful collegial exchanges on the Web, but the PMPA cadre of dedicated online savants like Dan Murphy of Tsugami, Bob Drab of Corey Steel, and Miles Free of the PMPA staff seem unique in their willingness to be highly accessible resources, always willing to interrupt their workdays to give help to their struggling peers. The cool thing is to see competitors or possible future competitors jump into the colloquy to give valuable, hard-earned knowledge to help each other.

I am a member of the Machinery Dealers National Association (MDNA) and I cannot imagine my peers using a Listserve format to offer advice to one another on how to value machinery, though on a one on one basis I have experienced dealers sharing knowledge, but in a guarded way.

My one critique of the PMPA is that it has been only moderately successful in marketing the Listserve’s value to potential members in the machining universe. For the relatively modest price of admission to the PMPA organization, members get the cumulative knowledge of potentially thousands of seasoned pros, many of whom will unselfishly attempt to solve the most onerous of machining problems.

Question: Would you share hard-won expertise with a competitor in a trade group?

I’ve closely studied two recent auctions of screw machines and ancillary equipment – Anderson Fittings in Chicago and MTTM in the Twin Cities last week – for indications of market strength and customer preferences. This is not just “inside baseball” for people in the trade. These auctions, which from all appearances were actually honest sales with no observable price pumping (I tend to be cynical about this stuff), tell a clear story about the turned parts market, at least for the multi-spindle niche.

The buyers generally do not need more capacity. They have more than enough spindles turning. At the Anderson auction, nice rebuilt Davenports in the1980s and ’90s with threading and pickoff brought $5,000 or less. New Britain Model 52, 6-spindles with threading went for $3,000 to $10,000, with a 1981 62 New Britain fetching under $20,000 with buyer’s premium. The one machine that brought a fair price was a 1995 8-spindle model 81 New Britain that sold for a little under $60,000 with the BP. When I evaluated the deal last winter I had figured the automatics would bring higher prices than that, yet I significantly underestimated what the auction ultimately brought in total.

The wild card at Anderson was the peripheral equipment, such as a Mayfran chip handling system which brought almost $50,000 and Ransohoff parts washing machines which had been disconnected and pushed to the wall when I evaluated the deal. The parts cleaning machines brought in over $100,000, which surprised everybody at the sale except the people bidding on them, because it was a fraction of the replacement cost.

The tooling and spare parts exceeded expectations, and the underground auger for transporting chips to the crushers and spinners brought $10,000, to my surprise.

The auction in Minnesota last week told a similar story. It was a collection of old nondescript 6-spindle National Acmes, which I assessed would bring low prices at the sale–and they did. The only machine worth more than $20,000 was a mid-1970s 1-¼ RA-6 that sold for $26,000 including the buyer’s premium. A decent 3-½” RB-6 took in $6,000 and a mediocre 1” RAN-6 without a pickoff fetched under $10,000.

But bidding on the tooling and accessories rocked. A Winter thread rolling attachment sold for over $4,000 and Langolf shave tool holders fetched almost $1,000 each.

The takeaway from these recent auctions is that buyers in this field do not covet more capacity, they have enough spindles turning. What they need and will pay for are the complimentary tools and equipment that will make their operations better and more versatile. Attachments, tooling, chip equipment, washers and inspection items are what auction buyers will bid up the price for.

In the Graff-Pinkert machinery business we see a similar trend. Our clients often want to “trade in” their tired but still viable machinery for similar but rebuilt machines with productive attachments hung on them. The machine is seen as a platform for the attachments and tooling which give manufacturers an advantage with a relatively modest extra cost.

For people in the trade this is an important market shift from “more to better.”

Question: Is it easier to find good machinists today?

Tim Haendle was pleased with himself when I talked to him Wednesday. He had bought 100 carbide inserts – used of course – for a hundred bucks at a Hoff Online Auctions Internet sale of a screw machine shop in St. Paul, Minnesota. He’ll regrind them for use on one of the 22 National Acmes he runs in his shop, buried in a forest in Mendocino County, 125 miles north of San Francisco.

Tim is a customer of Graff-Pinkert, of sorts. He is a rugged individualist determined to live life and do business his own way. I never make any money selling to Tim, but he tells good stories and teaches me stuff when I talk to him, which is usually to remind him of obligations, because whenever I sell to him he pays in installments.

Tim runs two dozen multis and complimentary CNC machines, basically by himself and a couple helpers. His wife used to work with him, but now she’s occupied, working at a hospital in Willets, California.

Haendle’s factory is 3.5 miles deep on a gravel road in the pines and redwoods on 300 acres he owns. It is part of the ranch where the great racehorse, Seabiscuit, trained and lays buried. He paid heavily to bring power and phone to the property, though knowing Tim, he got a deal.

His machines are set up on specific jobs and he runs them when he gets an order. Lean manufacturing? Don’t be ridiculous, but extremely people efficient. His M.O. is to buy cheap but good machines, set them up infrequently, and put them in a big old barn of a building that seldom requires heating out in the “middle of the middle of nowhere.” He uses the Web to find the best deals, and can still breathe deep of the piney scents of nature.

I see Tim as the Davy Crockett of screw machines. He confirmed this view by telling me about a wilderness moment he had had on his land. He took two of his dogs, a dachshund and a lab, out for a walk. He often takes a handgun on such strolls, but he left it home this time. The little dog started growling, sensing danger. Tim stopped and turned around to see a fierce looking mountain lion a few feet away. “I couldn’t run, so I just froze and looked into his eyes,” he told me. Tim figured the mountain lion wanted his dachshund for breakfast, and hopefully not him for lunch. But he stared down the big cat and lived to tell the tale to a machinery peddler in Chicago.

Tim is not the only wilderness machinist I do business with. Chuck Fluharty runs seven Swiss CNCs in rural Pennsylvania since leaving the big company rat race at Exxon. I saw him at PMTS in Columbus in April. His shop is thriving and financially his ship has come in because his land is smack dab in the heart of the Marcellus shale oil and gas formation. Drillers want to shower him with money for mineral rights. Good news, bad news for him because he enjoys his bucolic setting to run his quiet Swiss lathes.

I like touching base with guys like Tim and Chuck who live amidst a simpler America, connected to the world but happily away from the chatter and clutter of civilization.

Question: Is it easier to run a business in the boonies?

Click below to watch a video of Davy Crockett

I love the used machinery business because it is a competitive treasure hunt every day. It asks us for impossible calculations about realizable values for illiquid, flawed, sometimes rickety, filthy objects that often have little tangible worth when we are asked to buy them.

Here’s an example of the type of situation we consider at my company Graff-Pinkert every day. A firm has a 25-year-old screw machine or rotary transfer machine that it does not need at the moment. It has long been written off the financial statements, yet the potential seller feels it still has value but doesn’t know how much. He calls dealers for comps, checks eBay for similar machines, and considers whether he may use it again soon himself. He advertises it or calls us and probes for an offer. We feel the piece may have enough potential value that would make it a worthwhile addition to our stock, but we need to determine whether it is badly worn and will require substantial expensive refurbishing, or if it can be sold in its present state, which usually means full of oily chips, a nasty appearance, and out of production.

If by chance the machine shows well and is still running good parts, it becomes inviting for our broker competition, which hopes to turn it quickly for a modest but quick profit, without doing any of the difficult work of returning it to its original state of productivity.

Our challenge is to find machines that can be reclaimed from 25 years of factory abuse, refurbish them and reconfigure them to meet our client’s imminent need, and do it for a price that will be competitive and provide us with a profit that will keep the doors open. How do we do this nutty alchemy? It ain’t easy.

We deal with clients who approach business from a distinctly different angle than ourselves. They are engineers or shop folk who are obsessed with precision and repeatability. While we both pray to the same god of “return on investment,” my company is focused on one machine at a time, while they may be looking at the profit on a million pieces.

We are selling reliability, hand holding and an understanding of the capability of the machine, while our machinery broker competitors may be selling primarily on price.

Turned parts people are extremely price oriented. They deal in pennies per part and fractions of seconds of idle time, so every expenditure is weighed and reweighed for its impact on the bottom line.

For me a deal is an art form, an intellectual and artistic challenge to shape the price, terms, and other variables to meet the customer’s needs and wants, even if they are unspoken.

How do we make a profit?

Another “art form.”

Naturally, it is crucial to acquire “raw material” right. If you buy machines for stock like we do, you need to find machines that are not so horrible that they defy reclamation. You need skilled machinists and electricians to refurbish them. You need a cleaning crew to suck the swarf out and return them to their original beauty, and you must be skilled at scrounging for the new and used parts these old workhorses require to regain their mojo.

Over the years, we have acquired thousands of viable parts, accessories and attachments for the kinds of machines we sell. They have been stripped off machines or salvaged from the flotsam and jetsam of pillaged factories. Many days all the greasy iron looks like pennies a pound scrap to me, and then a Wickman buyer needs just the shaft we’ve held for a decade and it turns into gold in my eyes.

Banks and accountants struggle with how to account for our inventory of reclaimed, exquisite crud. “What is it worth?” they ask. “How long have you had it?” they inquire. “What did you pay for it?” they want to know.

When asked these logical questions by well-meaning, but uninitiated outsiders I have to stifle my penchant for sarcasm and flippancy. They are good questions for regular businesses with inventories not comprised of cannibalized Acmes, half attachments, and renegade Hydromat flanges.

The bankers and accountants study our net worth numbers each year coming up with a verdict on our success or failure. I struggle to contain my cynicism, annoyance, sometimes triumph. Profit, net-worth, margins and ratios are the stuff numbers people obsess about, and I care about those things, because as the owner and boss I need to. But where my love of the used machinery business truly stems from is the constant challenge to do the impossible. We turn iron into gold, and do it steadily enough to pay the bills each month.

Question: Are good used machines a better value than new machines?

So many nights I go home discouraged and numb, with the sickening feeling that I accomplished nothing and wasted my workday reading emails and contemplating my navel. Recently, I read an article on productivity in business today. The piece decried the decline of work quality because of email, texting, Facebook and time-wasting games like Words with Friends. Technology has become an office curse and I see a trend in crackdowns to curb the time wasters.

I am working on my own habits to combat my personal drift. What I have found to be most useful is preparing an agenda for myself the night before and then writing a journal entry at the end of the day, putting on paper all that I have done during the workday.

This exercise of recounting how I spent my day lets me know I have actually done something meaningful with my minutes. Knowing that I will be honest in my journal is a check on ennui. It also gives me a sense of accomplishment and confidence that I am more than a lazy sloth. I find I am a lot more productive than I thought I was. I give myself credit if I worked out or had a caring conversation. If I had a cookie, or God forbid, an ice cream, I mention it. The world won’t come to an end for a few hundred dumb calories.

The curse of the driven person is thinking he constantly falls short. For the mildly driven, like me, the nagging feeling is that I spent the day in a daze.

I write this blog partly because advertisers pay for the privilege of hooking into Swarf’s fan base. It gives me an impetus to create, but I have found the secret of good prose for me is removing myself from the real hard trying. My best work comes when I allow the blog to “write itself.” The best book on the creative process of writing I’ve come across is Writing Down the Bones by Natalie Goldberg. Her view is that you must release yourself from your trying-so-hard self to allow the unconscious mind to take over the pencil. I often tell myself to let the pencil write the blog. While I’ve never set up a screw machine or written a computer program, I imagine the process is similar. Free yourself up so that your spark can ignite the project. I hope you go to sleep feeling fulfilled.

Question: How do you attain productivity in the Facebook world?