Scala doubles production capacity
When Scala Electronics occupied its new plant in 1990, president Ellis Feinstein figured it would be adequate for five or six years.
Sure enough, after 5 1/2 years we had to rent 25,000 square feet of warehouse space, he said.
Now the Medford company is investing $2.5 million to add another 43,000 square feet and double its manufacturing capacity. The building is nearing completion adjacent to the existing plant at 555 Airport Road in north Medford. A formal dedication and open house are scheduled in June.
We've been going through steady growth of 15 to 20 percent a year, he said. Some years we see explosive growth and some we don't -- one year was flat.
Sales of more than $20 million are anticipated this year, Feinstein said.
New markets, new products and changing technology are fueling Scala's expansion.
The company was built on the crafting of high-quality, custom antennas for broadcasting, still a mainstay of the business.
It has expanded into antennas for cellular telephones and has 30 percent of the PCS (personal communications systems) antenna market.
PCS was rolled out a few years ago in the major markets, but it's been given a rest, Feinstein said. Now we're getting ready for the next big wave.
That's one reason driving the plant expansion.
Another is a contract to manufacture an estimated 80,000 antennas a year for the new Mercedes American-made sport utility vehicles.
The company is producing coaxial cable connectors and expects business growth in digital television and radio frequency filters.
About 25 to 30 percent of Scala's business is overseas, often in concert with Kathrein, a German-based partner since 1985. Feinstein said that partnership has contributed greatly to the company's success abroad and in the transfer of technology.
Our main markets are in the Americas and parts of the Pacific Rim, Feinstein said. We do a tremendous amount of business in Taiwan, supplying almost all of the antennas for their cellular systems. The good news is that the Taiwan economy is strong.
Scala also does business -- primarily pager antennas -- in Thailand, where Feinstein expects a slowdown, and in the Philippines and Hong Kong.
We recently started to do a fair amount of business in India and we expect that to grow, he said.
The company has grown to about 105 employees. Feinstein said the payroll will continue to grow, but more slowly because many of the new products will require greater manufacturing efficiencies, shifting from custom work to automation.
Scala is seeking ISO 9001 certification for the plant, an international quality assurance process that helps land business abroad.
The company has a small sales staff, relying heavily on trade shows to generate sales.
That way customers can see the quality in our products, Feinstein said. We also give a lot of presentations to people in the field. Many of the people who buy our products are not engineers and they look to us for technical information. Of course our slides show Scala products.
The company has been adding to its engineering and sales force to prepare for further expansion.
And Feinstein has announced plans to retire later this year.
He'll be handing the reins to Manfred Munzell, 49, who joined Scala three years ago and is vice president and general manager. He has 20 years of experience in the field and previously ran a subsidiary of Kathrein in Canada.
He's a capable engineering and business guy, said Feinstein, who will continue with the company as a consultant.
It has been very interesting to sit in Medford with 100 to 200 faxes a day coming in from all over the world, he said. It's grown far more than I expected. We've gone from 11 people in 1978 and added about 100.
It's been a great ride.