Q: Can you talk a little bit about the safety precautions you've put in place for your associates? What's the difference between the shop floor as opposed to the office?
Cavalco: With the shop floor, we have been very diligent about social distancing and making sure our associates are safely spaced from each other. We're also being very diligent about cleaning the equipment from shift to shift and making sure if there's anything that is handled between areas that we disinfect. We do everything we can to prevent any potential transmission of the virus. We haven't had any instances, but just in case.
In the office environment, we also have socially distanced and we try to always stay 6-10 feet apart when we're having our conversations. Our offices are set up so we can do that without really curtailing the communication.
Q: Some states are easing restrictions on travel and work. What's the situation in Wisconsin?
Cavalco: In Wisconsin, the governor has extended [restrictions] to May 26, I believe it is. So, that is adding some different challenges to us. We do have some of our associates in leadership positions who need to go between our two facilities. That has really been minimized, which has presented some issues. We do have a lot of shared resources between the two facilities. Hopefully, there will be more easing of the restrictions and we can start to kind of get back to whatever the new normal is going to be as the restrictions are starting to be lifted.
Q: What's the difference in time to travel between the Mountain and Jackson facilities?
Cavalco: It's a two-and-a-half-hour drive between the two facilities.
Q: Do you think there are opportunities out there right now for Nicolet? Or is it more of a time to weather this storm and push forward once this dark cloud blows past?
Cavalco: That's a great question. It has actually been a really interesting time over the last six weeks. We had an initial slowdown when I think people were just trying to figure out what was going on.
Some of our customers have quintupled — or more than that — their demand for the components we manufacture. But our quoting activity has actually gone through the roof. The sales team has been as busy as they have ever been. We have multiple new projects that we're recording, and we're working very closely with customers. There's a very high likelihood that we'll be winning those projects. We've been given some commitments for new projects. Once the construction industry in some of these other marketplaces really start to pick up again, we're expecting a large increase in projects and in revenue. From a quoting activity, we've never seen it this busy.
Q: Are you expecting to realize this revenue in 2020 or will that be more for next year?
Cavalco: Some of it will probably start in the fall of this year. Some of the projects and tooling orders will have to be cut pretty quickly because of the time frame of the projects. By the time you go through all the quality checks and everything else that you have to go through with a project, you're really talking about revenue for calendar 2021. We're on a fiscal year that ends March 31. So fiscal year is always one step ahead of our calendar year.
Q: It sounds like your team, especially your sales team, is adjusting quite well to this new normal despite this very stressful time. Is that your one of your takeaways?
Cavalco: Yeah, it is and we're really changing the way we're managing that, too. Every other week we're having our GoToMeetings so we can see each other in person. As salespeople, we like to see people and talk to people. My original background was sales and marketing, so I really work closely with the sales team. We get together as a team every other week and go through all the projects we're working on.
Q: That makes a lot of sense, especially when you realize that some people have a full house with their kids and spouse at home, and others are completely alone and really craving that one-on-one or group interaction.
Cavalco: Yes. One of our sales team members has kids at home, and he and his wife are trying to get their kids to do their homework while we're having meetings. It's just part of the reality today is I've gotten to see what his children look like. They like to walk behind him. That's all fine. Obviously, our families are the most important things that we have to take care of. And I think this also has really shown that ... our associates can work from their homes more often. They don't always have to come into the office when they have big projects to work on. So, I think that is going to help us be more efficient and effective going forward.
Q: What keeps you up at night, Tony?
Cavalco: It would be if we do have a COVID-19 incident at one of our facilities and how the associates react to that. We can take all the precautions we want, but if somebody picks it up at a store or wherever, just understanding how that affects our associates. How would that affect a fairly small manufacturing facility that's really, really busy right now and running 24/7?
The other thing that keeps you up at night is just the uncertainty of how businesses are going to be able to start back up. When are people going to be going to Lowe's or Menards? Quite a few of our customers make products that are sold in those types of an environment. The uncertainty of when business is going to start again, I think is keeping us all awake at night.
