Salvo Technologies Inc. was created in 2006 to fund and develop manufacturing companies in the defense market with a strong focus on soldier safety. Initially, it functioned as a value added reseller of optics, coatings, and industrial equipment. Very early on, however, leadership began looking to the future. Their goal was to create an organization with a philosophy of developing products that offered better performance, functionality, and quality than those currently available.
They began by building upon their core competencies with the launch of Salvo Coatings LLC, a separate division dedicated to thin- and thick-film design and manufacturing. The new business unit started out serving the defense market, but Salvo Technologies established it with the specific purpose of advancing coating technologies across multiple markets.
To form the new division, Salvo Technologies purchased the assets and customer list of Georgia-based supplier MK Coatings in 2008. Launched in the 1990s, MK Coatings started in the area of low-VOC marine coatings but subsequently broadened to specialty offerings like epoxies, enamels, and optical thin films for niche customers. Those custom capabilities made its IP and personnel a good fit for the larger Salvo Technologies strategy. Although the initial plan called for selling off MK’s commercial coatings business, the economic downturn of 2008/2009 demonstrated the value of diversification. As a result, the Salvo Technologies leadership team added another prong to its strategy diversification to ensure that its performance remained strong in even in the face of economic fluctuation.
The new division did well, developing innovative products like a direct-to-metal colored paint for conduit manufacturing and a family of unique corrosion-blocking lubricants for the metal forming industry. Meanwhile, it inked a supply agreement with DaeHwa Paints in South Korea to enable it to fulfill large thick-film orders and a separate reseller deal with PPG that gave it the freedom to customize PPG coatings for specialty applications. Salvo Technologies leadership’s vision of a company that produced what others couldn’t was beginning to take shape.
The next step was to move up the value chain by adding another division, Salvo Electro-Optics. Salvo Technologies developed the organization by combining its in-house expertise with another acquisition, this time buying the equipment and facility of Global Systems Inc. (GSI). Specializing in optical components like those used in rifle sights and lasers, GSI provided Salvo Technologies with the right fabrication capabilities to act as a supplier to tier-one defense contractors.
With the assets and core engineering talent of GSI, Salvo EO progressed from fabricating discrete components, which were finished by Salvo Coatings, to producing value-added subassemblies. The company added another accomplishment organizing its operations to achieve ISO-9001 compliance. This introduced the third prong of the Salvo Technologies growth strategy: focusing on quality and on lean manufacturing as well as Six Sigma principles.
Adding a class 1000 cleanroom gave Salvo EO the space it needed to pursue electro-optic assembly contracts. The Salvo Technologies portfolio now included equipment and personnel to fabricate, coat, and assemble optics, but the organization was missing one essential element—a design team to develop products at the systems level. To address this issue, Salvo Technologies established a new venture, Salvo Defense, to act as the engineering group for the rest of the organization.
With the addition of Salvo Defense, Salvo Technologies was positioned to design and manufacture systems-level products from start to finish. The combination of products and services created a whole greater than the sum of the parts.
Around this time, Salvo Defense team members began collaborating with Shepherd Enterprises, which specialized in high-performance firearms, rifle scopes, and other fire-control optics. Early on, it became clear that Salvo Defense and Shepherd could bring their combined skills and experience to bear on key industry problems. The hunting market is a demanding one with highly specialized, often conflicting, requirements. Balancing effectiveness with yield and cost leads most vendors to compromise on performance in the name of manufacturability. The Salvo/Shepherd team was unwilling to accept this.
By combining their technical insights, the two companies managed to improve the performance of rifle scope assemblies while increasing yield on a difficult component from 10 percent to 90 percent compared to conventional approaches. They also developed techniques for producing ultra-robust components able to stand up to the punishment delivered on the battlefield and in the woods. They specialized in solving the customer problems that other suppliers ignored. They built a product line that took the best of what was around and made it better.
In 2014, Salvo Technologies began strategic discussions with Mil Aero Solutions (MAS), a supplier of high-reliability electronic components. MAS directly served the US Defense Supply Center Columbus (DSCC), as well as many tier-one prime contractors. The synergies between MAS and other parts of the Salvo Technologies organization such as Salvo EO and Salvo Coatings were obvious. Also of significant potential were MAS’s connections and distribution channels. It became clear to the Salvo Technologies management team that MAS could play a vital role by contributing to growth and generating market access. From the MAS point of view, the company could now offer custom products. Perhaps more important, it could assure its customers of product quality and delivery schedules because it had direct inside knowledge of the manufacturing process every step of the way. In 2014 Salvo signed a distribution deal with MAS. Ultimately Salvo Electronics was formed after making the relationship formal.
At this point, things began to happen quickly. Eager to leverage the synergies among divisions and facilitate collaboration, Salvo Technologies purchased a 10,000 sq. ft. building in Seminole, Florida. In addition to corporate headquarters, the structure housed Salvo Coatings, Salvo Defense, and Salvo EO. The organizations shared laboratories, test facilities, manufacturing space, and offices. Gone were the days of telecons and Skype. Suddenly, collaboration was as easy as walking down the hall.
To add depth to its offerings for both the military and law enforcement, Salvo Technologies created a strategic alliance with 4D Tactical, a developer of innovative personal protective equipment (PPE). The 4D Tactical portfolio included arm guards, helmet pads, blast plates, and carrier vests. With a special emphasis on blunt-force impact resistance, 4D Tactical created a foundation of products that allowed Salvo entry into this complex and fast-changing market.
Soon after 4D Tactical moved into the Salvo Technologies headquarters. Meanwhile, the organization worked top to bottom toward the goal of being AS9100 registered, starting with achieving ISO 9001 compliance.
By this time, Salvo Technologies encompassed a design group, a fabrication and assembly group, a coating group, and a group dedicated to PPE. The organization could design and build one-of-a-kind rifle scopes and sell the owners the firearm to mount it on and the PPE to wear while using it.
Of course, this vertically integrated value stream in optics and electro-optics could also be applied to other industries, like medical. When the U.S. Congress invoked sequestration in early 2013, it shut down US Department of Defense spending, which had a ripple effect in the industry. That experience underscored the value of diversification to Salvo Technologies management.
Luckily at this point the various divisions sold into multiple markets. Salvo Coatings produced industrial products while 4D Tactical sold to recreational hunters, medical, and even bull riders. Salvo Technologies management recognized that in order for the company to achieve its potential, their efforts to expand into other markets needed to be strategic in service of a greater goal. They assembled an advisory board that included members with decades of expertise in life sciences, analytical instrumentation, medical devices, industrial manufacturing, and defense. As they explored the company’s IP, it became apparent that the greater Salvo organization could develop robust product lines for many of these sales areas, as well as other targets of opportunity like agriculture. This approach will help insulate Salvo from downturns with minimum additional investment.
At Salvo Technologies growth remains a primary goal but, as seen in the acquisitions of Next Phase Optics and Shepherd Enterprises, always in the context of strategic planning. Next Phase Optics brings with it unique processes that multiple groups within Salvo Technologies will benefit from and as the company evolves, the goal is not to diversify across all industries but only those that will allow it to leverage its existing technologies while hedging against market downturns in any one space. The synergy with Shepherd Enterprises is even more apparent. Salvo Technologies now has a direct link to the consumer hunting market. A strong emphasis on the consumer, medical, and industrial markets will drive the groups, but continued excellence in the military markets will remain a cornerstone of the Salvo Technologies foundation. Quality, innovation, and the ability to solve even the toughest customer problems will be the others.