Completing the Circuit

photoby Julia Lynam

VEMAS’ customers are companies large enough to outsource component manufacture, but not yet large enough to send their business overseas

There’s an air of anticipation these days in the brightly lit offices and on the spacious assembly floor of VEMAS. After some difficult years during the industry’s economic downturn early in the decade, the last 12 months have been a time of growth for the Middlebury manufacturer of printed circuit boards. That growth has led company founders Jon and Lucia Leber to plan a move to larger, more flexible premises — a move that that will take them away from the town that’s been home to the company since it was founded in 1991.

 “Middlebury has been a wonderful home for VEMAS,” says Lucia, the company’s president and CEO. “The location — the services, the town itself — has been very warm and open to us. Our challenge is not only the cost of running a business in Middlebury, but also the availability of the labor pool. 

“There are quite a few large employers in this area,” Lucia continues. “We compete with Middlebury College, B.F. Goodrich, Nathaniel Electronics and Standard Register, and when we advertise new positions, we very seldom find that there are unemployed people in this area.” This is a major stumbling block for a business that, as Lucia explains, needs to be able to expand very quickly, bringing in and training new staff as new contracts are secured. 

These concerns led to the company’s July 2005 announcement that it will move before May 2007 to the Rutland County town of Poultney, where it has acquired premises formerly occupied by the Williams Machine Co. 

Jonas Rosenthal, Poultney’s town manager, is looking forward to the company’s arrival. “This represents a changing of the guard from the post–World War II machine shop into a new 21st-century manufacturing and assembly industry,” he says. “We already have a strong industrial sector here, but VEMAS is not like anything we’ve had before, and they will be adding new skills to the labor force.

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Becky Bishop (right), quoting coordinator, was VEMAS’ first employee in 1992. She and many of the 45 staff members will move to Poultney when the company moves in 2007. Lynn Gallagher is customer sales and service representative.

“I know that Jon and Lucy are also very interested in education, and I believe that the service learning programs at the high school will complement the business. It’s very important for kids to see [the manufacture] of components of larger products.” Printed circuit boards touch our everyday lives,” he says, “and when we see how they’re made, we look at the products that we use differently.”

The Lebers selected the Poultney premises after an extensive search in Addison County and in New York state, purchasing it through their two-year-old limited-liability company, “No Boundaries,” to be a permanent home for VEMAS. The large, rectangular footprint of the space lends itself to their open-floor style of manufacturing, and the new building promises to be more energy-efficient than the current premises on Exchange Street in Middlebury. 

That’s important, because printed circuit board components are inexpensive, so it’s a business in which pennies count and lean manufacturing is the name of the game. “We’re competing with offshore manufacturing operations, and we need to be able to reduce and eliminate waste wherever possible,” Lucia explains. “We’re in a state of continual process improvement. There’s a real downward pressure on prices, so we need to be able to minimize our electric requirement and eliminate redundancy in our product, thereby passing along cost reductions to our customers.”

VEMAS is no stranger to growth. The company was launched into a rapidly expanding market and soon outgrew its initial premises, moving to its current larger home two years later, expanding again in 1998. Between 1993 and 1997, according to Inc. magazine, VEMAS’ production increased 1,229 percent, earning it 225th place in that publication’s list of the 500 fastest growing companies of 1998. 

photoRob Hargett (left), is machine operator and maintenance technician, and Pete Maloy is a machine operator.

Then came the downturn. “The electronics industry as a whole struggled in the early 2000s,” recalls Lucy. “Because we were financially strong, we were able to weather the slowdown period at a time when a lot of our competition in New England closed their doors or moved offshore. Those of us that are left have tailored our business to satisfy the needs of our customers. 

“In the past 12 months, the industry has picked up dramatically. We’re very challenged to keep up with our quoting activity and to find good, qualified employees to fill positions. It’s a very exciting time right now in this industry.”  

When the Lebers, who live in Orwell, moved to Vermont from Connecticut in 1983, it wasn’t excitement they were seeking, but a desirable lifestyle for their family — they have two daughters, now 18 and 20 years old. 

Lucia, with a bachelor’s degree in textiles and marketing from the University of Rhode Island, found a position as the first manager of the Dress Barn franchise store in South Burlington. Jon continued to work as a contractor in the electronics industry, a career that he had entered in 1978 after graduating from West Liberty State College in West Virginia with a business management degree. “We moved in the middle of an ice storm,” Jon exclaims, “and we wondered what on Earth we were doing! But we made the right decision, and all I can say is that hard work does pay off.”

One person who recognized their capacity for hard work back in 1991 was Charlie Kireker, managing director of the $11 million venture capital fund Fresh Tracks Capital in Middlebury. Introduced to the Lebers by attorney Donald Powers, Kireker was one of the “angels” who made VEMAS’ startup possible, and he has a seat on the company’s board. 

“Then as now,” says Kireker, “I looked for individuals who had a good track record. Jon had an excellent background across multiple aspects of the electronic industry. There was a large and growing market, with a global trend toward outsourcing of production by companies who were not primarily in the business of manufacturing themselves, but in the business of selling an end product.” The Lebers’ plan seemed sound, he says, particularly because they were starting their business in a community that had recently seen the closure of a branch of Simmonds Precision, leaving a labor pool experienced in electronic assembly.

“The greatest attribute of both Jon and Lucy is tenacity,” Kireker continues. “They really are a customer-focused, make-it-happen couple.”

Outsourcing has steadily moved overseas in the 10 years since the passage of the North American Free Trade Agreement. In an industry worth over $200 billion annually, VEMAS’ market niche lies with small to medium enterprises, large enough to outsource component manufacture, but not yet large enough to send their business overseas to China or the countries of the former Soviet Union. Successful customers grow, however, and move beyond VEMAS’ capacity, so the search for new customers is continual. It is to this mission that Jon has devoted himself in recent years.

VEMAS products find homes in the construction industry, the medical industry and with the U.S. Department of Defense. The continuing market upturn has led the Lebers to add a lead-free assembly line in compliance with European standards. These standards are intended to limit the amount of lead and other undesirable substances released into the environment when electronic equipment is disposed of. 

This necessitated investment in new equipment and has led to an increased manufacturing capacity that they are confident of filling. “Our clients export their finished products all over the world and some of them go to Europe,” Lucia says. “We’ve positioned ourselves to take advantage of the opportunity to sell to clients who are selling into Europe.”

As well as circuit board manufacture, VEMAS offers mechanical assembly of cabling, and it’s particularly interested in increasing the amount of “final box” assembly — seeing the job through to the finished product. At present, this makes up about 20 percent of the company’s production, and Lucia says it’s especially satisfying to the staff to be handling the product their components go into.

VEMAS experiences low turnover of staff. Becky Bishop, quoting coordinator, was the company’s first employee in 1992. Many of the company’s 45 staff members are planning to make the move to Poultney, and the Lebers, now hiring, expect to take on a small number of new employees over the next three years.

Jon and Lucia expect to continue making things happen in their new quarters and are relishing the opportunity to design their new assembly floor and offices to be exactly what the business needs to meet the future. •