Anderson Industries Takes New Track With Iron Castings
The Fargo-based manufacturing and machining company purchased Dakota Foundry to expand into railroad and energy industries while supporting existing business in agricultural and construction markets.
Nicholas Leider, Associate Editor
(Click here to see the story as it appears in the November issue of Modern Casting.)
When Kory Anderson graduated from North Dakota State University, Fargo, N.D., in 2006, the 22-year-old didn’t waste time putting his mechanical engineering education to work. What is now Anderson Industries, a collection of three businesses with 180 employees, began in his garage, where Anderson aimed to provide solutions working in heavy equipment repair and onsite welding. Three years later, in 2009, he was able to move his business to a facility in Aberdeen, S.D., and added cutting, welding, and machining capabilities.
The son of a farmer, Anderson had built a business that provided weldments, fabrications, machining services and repair to the agricultural industry. In 2014, he heard that the employee-owners of Dakota Foundry, Webster, S.D., were interested in selling the iron casting facility. A decade ago, a dozen of the Dakota Foundry’s employees had purchased the gray and ductile iron casting operation that would have otherwise been shut down. By this time, the company’s primary shareholder was looking to sell his stake in the casting operation and retire.
“We had a number of interested buyers, mostly overseas companies that wanted to have a U.S. storefront,” said Josh Bartos, vice president of operations, Dakota Foundry. “I had known Kory for years and thought he would be interested, so I gave him a call.”
The two had known one another for more than eight years, since Anderson began working with Dakota Foundry in 2006 after seeing a need for local patternmakers. With Anderson focused on engineering and machining and Bartos plenty familiar with metal castings, the two developed a business relationship that led to that conversation in 2014.
Serving customers with a wide variety of manufacturing needs in steel and iron alloys, Anderson saw the metalcasting facility as a way to enter the railroad industry—which consumes roughly a third of Dakota’s production—while supporting other work in the construction and agriculture markets. The customers who needed his machining and fabrication services, Anderson’s thinking went, just may need castings. Conversely, metal casting end-users definitely require the value-added services provided by Anderson Industries.
“What initially interested me in buying Dakota Foundry was how it could broaden our services to customers on both sides,” Anderson said. “We could, as one company, offer so many solutions, whether it’s iron or steel.”
Anderson Industries is a group of four companies that includes the metalcasting operation, a nearby welding and laser-cutting operation and a 100,000-sq.-ft. plant in Mapleton, N.D., for engineering, machining and fabricating steel components. The company also designs and manufactures products for the agricultural industry, including disk levers and row openers.
“Basically, with Dakota, we expanded our manufacturing methods, which can be matched with our value-added services in a single company,” Anderson said. “A customer doesn’t have to worry about shipping a casting for machining or powder coating. If we can ship it a finished part so it’s ready for the assembly line, that’s a way to simplify the supply chain.”
The acquisition of the metalcasting facility in 2014 coincided with Anderson Industries moving its operations from Aberdeen to a vacant facility in Webster. Anderson planned the move to the Webster location, a quick drive from Dakota Foundry, before the topic of a potential sale ever came up. While timing and locations worked themselves out perfectly, Anderson Industries was able to add a metalcasting operation to its fabrication, welding and machining capabilities. The symbiotic relationship between Anderson Industries and Dakota Foundry diversified the markets and offerings of both companies.
Dakota Foundry, with 45 employees working two shifts, specializes in castings between 100-5,000 lbs. Its automated nobake line produces approximately 90% of all castings, while a manual green sand line handles specific parts when volume and size allow. The metalcasting facility services customers in industries such as railroad, construction and agriculture.
A job shop that routinely deals with quick lead times for small and medium volume orders, Dakota Foundry is able to leverage the value-added capabilities of Anderson Industries to operate as a one-stop shop for customers looking to quickly source components. The addition of metalcasting operations is just another capability that can help customers receive finished or nearly finished parts to improve efficiency.
“In many cases, customers want to reduce the amount of suppliers they are working with,” Anderson said. “It’s easier, especially in value-added services, to offer customers a wider variety of services.”
Dakota Foundry receives most of its engineering support from Anderson’s Mapleton, N.D., location, just outside of Fargo, with designers and engineers often making the two-hour trip to the South Dakota location for a day or two as necessary. Anderson Industries has explored a number of conversions to cast parts from other manufacturing methods when it makes sense logistically, financially and design-wise.
“With a foundry, we are able to provide another method of manufacturing to our customers,” Anderson said. “Cast parts have the potential to help our customers in specific situations. It’s up to us to recognize those situations and let them know castings may provide benefits that they otherwise wouldn’t realize.”
Onsite, Anderson has eyed a number of tweaks to the metalcasting operations since assuming control of the metalcasting facility in September 2014.
“Since we’ve taken control of the foundry, we want to improve efficiencies and safety,” Anderson said. “Our initial goals are to improve the facility’s processes. We want to continue what Dakota Foundry had been doing, only faster, simpler and safer.”
Anderson also wants to expand Dakota Foundry’s patternmaking abilities. Dakota Foundry has a shop for repair, maintenance and retooling, and a warehouse that stores more than 1,000 patterns. Relocating the cleaning department is another potential way of increasing capacity.
“We have longer term plans for expansion,” Anderson said. “We are laying out plans to move our cleaning room away from the pouring area. We would have more space to pour. Cleaning is our bottleneck at the moment, so a new cleaning room would also help increase efficiency and throughput.”
According to company officials, Dakota is approximately 15% ahead of last year in terms of sales. With sales expected to top $8 million this year, Anderson aims to double that figure in the coming years as Dakota Foundry becomes a more integrated part of Anderson Industries.