Implementation Plan
Facility
The newly constructed facility will consist of 265,000 square feet of office, manufacturing, warehouse and retail space. Information concerning preliminary construction plans is located in the Supporting Documents section. An environmental impact assessment has been conducted and the property received a cleanbill of health from Greene Fields, Consulting Environmental Engineer, 1224 E St., Getty, TN 37290. The analysis and results are available from this office upon request.
The building is designed in accordance with standards set forth in the Americans With Disabilities Act and other laws and regulations pertinent to government contractors, local zoning requirements and pollution (air, noise, and water) abatement programs.
Equipment
The firm uses a mixture of high technology equipment and routine machine tools. A list of equipment to be purchased is available upon request. Approximately $850,000 of equipment has been provided by the Department of Defense. This equipment remains the property of the U.S. Government and is not pledged as collateral for this loan. The firm currently owns $250,000 in fully depreciated, paid-in-full equipment. A list of this equipment is also available upon request.
Inventory
The firm maintains an approximate 45 day supply of raw materials inventory for manufactured military aircraft component parts. These parts are manufactured under the Just-In-Time inventory system of the prime contractor. A 60 day supply of raw materials is maintained to comply with the Just-In-Time inventory system of the major airline manufacturers. The firm maintains an approximate 15 day finished goods inventory for the aircraft after-market.
Raw materials inventory is accounted for using the LIFO method, while finished goods inventory is accounted for using the FIFO method. The firm uses a fully integrated accounting package which permits a perpetual inventory. A physical inventory is taken at the end of each government contract, with appropriate adjustments made at that time. For non-government contract inventory items, a physical inventory is taken semi-annually in April and October.
Quality Control
The firm is implementing ISO 9000 standards for all non-government work. For government contracts, Military Inspection Requirements MIL-I-45208A and Military Quality Program Requirements MIL-Q-9858A continue to apply as quality standards.
The firm has implemented a Quality Control/Zero Defects program. Floor employees are provided financial and non-financial incentives for exceeding goals set for reducing rejects and re-works. Administrative employees are offered cost reduction incentives equal to 25 percent of cost savings for suggestions resulting in savings of $25,000 or more.
Labor Force
Employment at this firm falls into five categories. Table 1 shows current employment and the three year projection of employment increases due to expansion. The source of skilled employees is area high school vocational education and community college graduates from two-year programs. Professional and technical employees require a four year college degree. Local colleges and universities offer some, but not all, of the required degree programs. All educational specialties are to be found in Tennessee's university system.
| Employment Trends | ||||
| Employment Category | Current | Year1 | Year2 | Year3 |
| Management | 2 | 2 | 2 | 3 |
| Professional/Technical | 5 | 6 | 6 | 8 |
| Skilled | 15 | 20 | 23 | 27 |
| Unskilled | 27 | 25 | 23 | 21 |
| Clerical | 3 | 3 | 4 | 4 |
| Total | 52 | 56 | 58 | 63 |
Training
This firm uses a variety of training methods. New skilled and unskilled laborers are trained as needed using Job Training Partnership Act programs. These training programs are available through the Alliance For Business and Training. This includes both classroom training and OJT. Newly hired professional and technical employees are tested at the time of employment with the expectation that they are fully trained and competent at the time of their employment.
The firm also offers a variety of continuing skill improvement programs. Managerial, professional, and technical employees are expected to attend at least one seminar, conference, or continuing education program per year. A tuition reimbursement program is offered to all employees. The firm pays 100 percent of tuition for employees receiving an "A", 80 percent for a "B", 50 percent for a "C", and 20 percent for a "D". No reimbursement is received for a failing grade.
