The Exchanges

Q Was there ever a moment where you felt like the business was done?

A Not this time around, but in 2019, yeah, there was. Um, I think this was March 2019, and I was very much contemplating, I've been doing this six, maybe seven years at the time, and it was my first time through the ringer. It was my first time seeing my supplier who I relied on and who had been reasonably good up until then, just fall to pieces. And to give you an example of how bad things got, on, on one trip over there, I had to go around with With my engineer, and with another guy, and we went to all the suppliers, and I paid them cash. I was running to an ATM taking out cash to pay these suppliers in Eastern Europe. So that we could bring back the materials, the raw materials needed, the wood, the glass, the steel, the locks, bring it back to the factory so that they could complete orders because the suppliers weren't willing to deliver anything to them anymore because bills hadn't been paid in months. That time around, I very much thought, okay, maybe this is the end. What flipped the light switch for me is in the midst of this, I had a call from a, uh, a security agency for a foreign government, and we started a G seven country, and we started talking about projects for government, for their government residences. And that was a wake up call to me, because just at the time where you're at, Your lowest of lows in terms of not knowing what the future is going to be. All of a…

AI assessment note: “Not this time around, but in 2019, yeah, there was.”

Q my team? And, and I had the same frustration with people that I was mentoring or advising. But as I've gotten older, I've realized that people are just mentally at different places. So maybe you were too afraid to make the move, or maybe you were too lazy to make the move. I don't know. What, what do you think was going on that made you kind of ignore that?

A So I think it touches on two different aspects. One, like you experienced, the messenger matters. You can receive the exact same message from two different people. It's going to resonate coming from one, but not necessarily the other. So one, the messenger matters. Two, the timing matters. Uh, when, when my dad first told me this in 2019, I was not yet at a place confidence wise to think I can do this on my own. I wasn't there yet. Uh, in my, my father passed in 2020, but so fast forward to 20 24, and I still had that advice that he had given me four years earlier, that I was, I was at a place in 2024 where doing this wasn't as daunting anymore. It wasn't as intimidating. So it was a combination of, of those factors. Um, I guess for you, it's, it was the messenger really mattering. For me, my father was the best messenger. Just the timing of it wasn't there, uh, the first time around. But the advice still resonated five years later when, when it did matter and when I was ready to take that big step.

AI assessment note: “in 2019, I was not yet at a place confidence wise to think I can do this”

Q Do you think it was a mistake to try to push that fast, or did you, or did something bad happen in the process of making this move?

A No, it was, it wasn't a mistake to push as quickly. If anything, Uh, with more foresight, I would have started the process earlier and done it somewhat more gradually. Um, but the, the reality with my supplier overseas is that they were just no longer reliable and the things, orders weren't getting produced anywhere nearly on time. Uh, employees weren't getting paid. Uh, taxes weren't getting paid. It was a complete collapse, and I was having to prop them up financially. So I was having to take on all of the financial responsibilities, making sure that Uh, giving them an unsecured line of credit to make sure that employees were getting paid or back pay something so that they wouldn't walk out. Because if they did walk out, well, then I'm really up. Because then there's no one, no one left to produce anything, and I wasn't ready yet. I wasn't at the stage yet where I could start producing myself in North Carolina. So there was an interim period there where it was cheaper for me to take a big financial risk by giving them a blank check, effectively, rather than rolling the dice and them potentially collapsing, and then I don't have A supplier. Until I could bring my own factory online.

AI assessment note: “No, it was, it wasn't a mistake to push as quickly.”

Q it, honestly. Cause I'm like, what? It's like a few hundred euros every year. Like, do I really want to put the, you have to keep the receipts and then you have to show them the receipts. Like, I don't want to deal with that. So what has been the most rewarding part of having your company in the U S being able to say we're made in the USA?

A Over the years, we would, whenever I was on a sales call, a new project, about 50% of the time, maybe even more, customers would say, where's this stuff made? And I would always open with, oh, it's made in Europe. Sounds pretty good. And then if they ask more, okay, where's the, it's made in Lithuania. Doesn't sound as, uh, as appealing as made in Europe, but nevertheless, uh, for a lot of people, for a lot of American customers, it really mattered where it was being made and not necessarily that it being made in Europe was a deal breaker. For some, it was. But at the time there was, there were no alternatives. No one else was going to answer the same call for the same type of product, custom product that they were looking for and say, oh yeah, our doors and windows are made in the US. Didn't, it didn't exist. There weren't any alternatives that could meet that criteria. So, uh, the most, the most exciting parts of it, being able to answer that and being able to answer that, um, with, A lot of pride, uh, because these types of doors and windows that we make have never been made in the U.S. This is a very European-style product, and as you know, most apartments in Europe, whether you're in Eastern Europe, Western Europe, is a steel door With a multi-point lock on it and decorative skins to make them look like nice wooden doors, whether it's painted or stained wood, whatever. Thi…

AI assessment note: “being able to answer that... with, A lot of pride”

Q What are some of the other soft costs besides VAT, tariffs, exchange rates?

A So for manufacturing overseas, one, and this is less even a soft cost, but lack of control. If you don't own The factory overseas where your product is being produced, and 95% of the time, uh, you don't, they may have other interests. You may have, uh, intellectual property issues down the road. Uh, so not being in control of what goes on day to day. That's a huge one, and one that I struggled with a lot over the years. Um, freight. Freight volatility, and we saw this a lot during COVID. Pre-COVID, we, so we brought everything in by air freight, and somehow I earned the title of being the largest air freight exporter out of Lithuania. Never a title I thought I was going to have, but got it, got there. Um, and we paid about a euro a kilo In air freight costs, which pre-COVID was pretty good. At the peak of COVID, that went up to 10 euros a kilo. That was no longer, uh, commercially viable. Couldn't do it when you're transporting doors and windows, each one of which weighs hundreds of kilos. So, That was one of the soft costs that the, the volatility therein, and we also saw that in ocean freight. Um, that was something that you needed to pad your prices because you didn't know where things would be on the day you needed to ship. Time change. When you're working with a supplier overseas, whether it's in Europe, whether it's in Asia, it upends your day. You're waking up early, or …

AI assessment note: “one, and this is less even a soft cost, but lack of control.”

Q Are you still getting calls from these foreign countries? Cause you were saying to manufacture where you sell, but if you have demand outside of the U S and you're only producing in the U S then shouldn't you be manufacturing outside of the U S as well? To meet that demand?

A So yes, we still do work for foreign governments, um, whether we were producing in Eastern Europe or we were producing in the U S oftentimes there's still foreign governments because there are. 179 other countries in the world. And there we, there we here, we're only talking about two. Uh, so the export opportunities, however, that you're touching on, Um, are, are more complicated right now manufacturing in the US in the current tariff environment that is much less of an issue manufacturing in Eastern Europe where tariffs are not being imposed. So that's a, a, a big question as well, and it is hurting. Um, the, the tariffs that, uh, the US government has imposed on foreign countries, and foreign countries have imposed reciprocally on us as well, that's very much hurting export. Uh, but there's a little bit of it, um, anywhere you go, um, right now from the US. If we were still manufacturing in Eastern Europe, we'd be getting murdered on tariffs right now, and the volatility of tariffs, and how that changes almost on a daily basis.

AI assessment note: “So yes, we still do work for foreign governments”