When a young Dan Nguyen took the $800 he had in the bank and started R1 Concepts 12 years ago, he had no idea his company that manufactures and sells every component in an automotive brake system would grow as fast as it has.
As a teenager, he worked for his father who owned a machine shop in Garden Grove, Calif. where he began as a machine operator, customizing brake products for his father’s customers. Before he knew it, many of his friends heard about the work he was doing and Nguyen quickly formed R1 Concepts to fulfill a need from auto enthusiasts and others who wanted quality, high-performance brake products for their cars.
At first they rented machine time from Nguyen’s father, and used the $800 to buy parts.
“At the time, I had a lot of friends who were auto enthusiasts,” he said. “They saw the products that I was manufacturing and asked if they could buy directly from us, bypassing the exorbitantly high markup prices in the market. We began buying raw unfinished products from our automotive customers, customized them to our specifications and sold them under our own private label.
“Since establishing our company in 2004, we’ve experienced double to triple-digit growth every year,” said Nguyen.
To handle the rapid growth, R1 Concepts, which sells worldwide directly to the consumer via online retail channels such as Amazon, eBay, Craigslist, Sears and its own website, www.R1Concepts.com, has had to move six times in its relatively short history, expanding from its original 400-square feet space to the current 106,000 square-foot facility in Cerritos, Calif. From the original three employees, it now has close to 100.
As the company began acquiring more products to fill the growing demand by its customers, its “pick” and “pallet storage” requirements increased significantly. For instance, its average daily inventory just a year ago was 12,000 SKUs. Today it is more than 100,000.
Along with the need for additional space for storage and safe forklift maneuverability, R1 Concepts had to decide on which warehouse racking system would be the most efficient, most flexible and most economical. Through a friend’s referral, the company turned to Baltin Rack Systems in Calabasas, Calif., a long-time distributor of Hannibal Industries’ products that include the patent-pending TubeRack systems.
“We have been working with Baltin Rack and its founder, Brent Baltin, for about five years,” Nguyen added. “We receive the best service and pricing; there’s no comparison.”
While visiting the new Cerritos facility, Baltin determined that the primary considerations for a new racking system would be load capacity and – particularly important in California — compliance with local, state and federal seismic regulations. “Our products are extremely heavy,” said Nguyen. “For instance, each brake rotor weighs 15 pounds and there are at least 100 rotors on each pallet.”
Brent turned to Hannibal and Andrew Kirby, Hannibal’s long-time engineering consultant and TubeRack inventor, to help design the racking system. Hannibal is one of the largest manufacturers of industrial and retail steel storage systems in the U.S. and well known for its patented TubeRack system. Kirby is an expert on the federal, state and municipal seismic safety code requirements as they apply to steel pallet storage racks. Based on his design, the TubeRack systems meet and surpass all existing safety standards.
Baltin said the R1 Concepts TubeRack installation features unique structural engineering design elements not found in previous large and tall metal storage racks used inside or outside buildings. Each rack’s flexible dual-moment frame can flex or drift laterally during an earthquake, reducing the potential of the frame collapsing and damage to stored goods and greatly improving safety to persons in the area next to the structure. He said other advantages are:
• All connections are visible; there are no hidden bolts or welds.
• All frame components are interchangeable and can be built to various heights. The length and width of the racks can be easily increased when additional storage is required.
• HSS structural tubing posts provide more stringent straightness tolerances, far superior impact resistance, increased flexibility and decreased costs of ownership.
• A “flexible moment frame” allows access for loaded pallets and flexes or “floats” in a lateral motion during seismic activity in all directions.
• TubeRack can be mounted on existing slabs and provide greater storage capacity than conventional racks.
• Using TubeRack higher capacity pallet loads – up to 3,500 pounds – pallets are easily and safely accommodated in Hannibal’s various storage solutions – Pushback, Double Wide Drive-in, Structural, Hybrid, Cantilever, Archive and Retail systems.
“This combination of strength, flexibility, ease of installation and reassembly is ideal for growth,” Baltin said. “As the customer requires higher (sometimes floor to ceiling) and larger racks with heavier wall sections, TubeRack frames can be made in 3 by 3-inch, 3 by 4-inch and 3 by 5-inch configurations and up to a quarter-inch wall thickness to accommodate these demands.”
When R1 Concepts was in its previous location in La Habra, Calif., Baltin installed a rack and catwalk system using TubeRack “because of the high design loads in a high seismic zone. However, due to the lower warehouse ceiling we were only able to go 168 inches high with the deck level height at 96 inches.
“Fortunately, because of TubeRack’s modular design, we were able to use all the components from the La Habra facility. And, using a splice kit, we increased the height from the system from 168 inches to 240 inches, a 43 percent increase in shelf space in the same footprint,” he added.
“Hannibal’s Selective Rack system in the new Cerritos warehouse now has a top of storage height of 24 feet and a load capacity of 30,000 pounds per bay. TubeRack is the only racking system that can safely handle these pallet loads in a high seismic zone.”
Nguyen said the first four levels of the expanded racking system are used for order “picking” while the top four levels are for pallet storage.
He especially likes the modularity of his TubeRack installation because he anticipates another move within the next year or two as he and his partners eye further expansion into the wholesale auto parts market as well as possible brick and mortar retail operations.
“The automotive aftermarket continues to experience enormous growth each year as buying online continues to get easier and easier,” said Nguyen. “Although many shoppers are price conscious, the demand for quality performance or replacement parts still remain a priority for many people. We want to be able to satisfy all of our customers according to their needs, driving habits and requirements, whether it is normal driving, racing, towing or off-roading, etc.
“We just want to be ready with the quickest, most efficient order fulfillment system anywhere.”