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Four years after the economic recession hit, questions remain about how well businesses are recovering.
For Majona Steel Corporation of Osceola the new year looks to be an exciting one, company President Bryan Hoffa told Second District Congressman Dave Loebsack (D-Iowa) last week during the congressman’s visit to Osceola
The second district will include Clarke County, with the new redistricting changes. Loebsack is touring the new areas of the district to learn more about the communities.
The steel fabrication company recently hired 30 people – doubling the size of its workforce. They have hopes to hire an additional 20 by this fall. The hiring is a result of new ventures the company is pursuing.
One venture, which the company said is currently driving much of their business, is building steel tanker trailers. The trailers are built to haul water for the oil and gas industry. Majona sells the trailers to dealers in states like Texas, New Mexico and North Dakota. The dealers then supply the trailers to drill sites.
Another endeavor the company expects to begin soon is building towers for mid-range wind turbines.
Impact of recession
However, the future hasn’t always looked so bright for the nearly 40-year-old company. When the recession hit in 2008, the plant took a hard hit. The company laid off 60 percent of its workforce and looked for other ways to cut costs. Company personnel did its own vehicle oil changes and janitorial service.
“We turned half the lights off in the plant to try and save money,” Hoffa said. “We were really on the brink of things. We didn’t know if we were going to make it or not.”
At that time the plant primarily built commercial building steel structures. One of their biggest customers had been ethanol and bio-diesel industry. But after the recession hit some of these commercial customers went from “super production to halting completely,” said Ryan Phillips, co-owner of Majona. Structural and miscellaneous steel projects were hard to find.
The company needed to find a new direction in order to survive.
"It forced us to change what we do," said Hoffa. "We went from a job shop to building commercial building steel, which we still do, to moving more into manufacturing, so now we manufacture our own products."
The company’s new ventures gives them a glimpse of the better days when they had just broke ground in Osceola in 2007.
Majona moved to Osceola after outgrowing its production facility in Waukee in 2008. The quality of the workforce, availability of land at a fair price and support of the community attracted the company to the area, said Hoffa. Some of Hoffa’s family members were also from the area.
When the company broke ground for the facility commercial construction was booming.
"We couldn't have been in a better spot," said Hoffa.
However, everything would change when the recession hit.
A look at new ventures
The company found the wind turbine industry and began working with Heartland Energy Solutions. Heartland was looking at developing mid-range towers for smaller farmers.
"They had a new product line they were researching and developing," said Phillips.
The process to get the work up and running has been a slow and evolving one for Majona.
However, they are in the process of building the necessary equipment needed to build the specific steel towers.
Phillips said the new venture is expected to be a reality soon.
In the meantime, Majona also found another need for steel tanker trailers, for areas including the Texas oil regions. Hoffa said more of the trailers are needed as the country tries to become less dependent on foreign oils.
The local officials said the trailer business has, and will, help the company create the funding needed to keep the wind turbine project moving along.
"At this point it appears that this trailer business has no end in sight for this year (because of the number of orders) and possibly for the foreseeable future. I don't know what that brings. A few steady years of this is a marked improvement from where we've been in the last few years," said Phillips.
The equipment will allow the company to build large tower structures with "extremely tight tolerances," and will open the company up to a national and international industry.
Hoffa said the company has been contacted about the towers because there aren't a lot of other manufacturers in the Midwest who have the newest equipment and capabilities to build these specific towers.
Moving forward
Phillips and Hoffa said, moving forward the company will continue to look for ways to grow and the entire workforce continues to stick to the motto, "we build anything steel."
"No job is too difficult, too large or too complex for us to figure out, design and build," said Hoffa. "We have yet to be stumped."
As the company grows, Hoffa said they are looking at future job candidates.
Discussions have been going on between Southwestern Community College officials and local high schools about a welding program. Hoffa said it is his hope the program will get off the ground and allow high-schoolers to get welding experience needed for local business like his.
"We'll be happy to donate steel materials for the students to practice on, send our key welders to either teach a class or give presentations," he said. "We're always willing to give tours and show the exciting employment opportunities."
Other growth opportunities could include a rail spur in the community, which would help manufacturers like Majona control input costs, said Hoffa.
The company currently buys from distributors and warehouses and has the steel shipped to them on flatbed semis. With a rail spur, the company could purchase directly from a steel mill.
"From operating a business, obviously, controlling input costs is key but I think that a rail spur would not only benefit Majona but be a huge advantage to Osceola," said Hoffa. "I think it would really spur, pun intended, interests of other potential business owners to do as I did and relocate to Osceola."
Thankful for the community
During the good times and bad, Majona has been thankful for the support of the community and said the community is what helped the business in the past and will help in the future.
"We're excited about the future," said Hoffa. "We're young, we're dynamic. We're not afraid to build. We're sitting on 20 acres here so we've got plenty of capacity to expand."