Velicon Ltd.
4044 N. 31st St., Suite A, Milwaukee
Industry: High-performance electric motors
Employees: 8
www.velicon.com
It may not be the ideal location for a business, tucked in an alley just off Capitol Drive and North 31st Street in Milwaukee, but there are some very good reasons for Velicon Ltd. to be located where it is. Specifically, it is the transformer located near the building and the 11,000 volts it can supply.
“That opens a lot of avenues for what we are doing,” said Cecil Edirisinghe, who owns Velicon with his wife, Irina.
Velicon manufactures high-performance electric motors for testing power and torque in the aerospace, racing and automotive, and agricultural industries. The motors can take up to 16 weeks to build and ship. They can cost up to $100,000 and require extensive testing before being delivered to customers. That’s where the transformer and its 11,000 volts enter the picture. Edirisinghe is able to draw enough power for testing to have confidence in his product when he sends it to customers. He’s hopeful that eventually he can use the generator capabilities of the motors to return power to the city’s energy grid.
If that day arrives, it would be another step in the evolution of a business that started with Edirisinghe working as a consultant in the early 1990s. Velicon was founded in 1995 as a company that licensed design products for machine tools, spindles and components. The company moved into manufacturing small spindle motors in 2003 after receiving requests from all over the country. In 2005, those small motors began to instead become the large test motors Velicon makes today.
“We consider ourselves as our competitor because for every product, we make another product to compete with it. That actually improved our product performance over the years,” Edirisinghe said, adding that improving technology and customer demand are the driving factors behind the company’s evolution.
The business hasn’t always been on an upward trajectory. A flood a few years ago meant not being able to ship a $400,000 order to Hyundai. The company had 15 employees at the time and is now down to eight full-time and two part-time. Edirisinghe said the business was somehow able to recover, but the effects of the flood are still being felt.
“There’s some components still lying on the shelf,” he said.
Edirisinghe said Velicon doesn’t face a lot of competition from within the United States. What competition does exist comes from other smaller companies like Velicon.
“We are (more) worried about foreign competition than U.S. competition,” he said, adding that large foreign companies in particular are a threat and protecting intellectual property is becoming more important.
One change Velicon has made is to use as many local suppliers as possible. It isn’t because Edirisinghe is worried about the threat of foreign competition, but because of the flexibility it can afford his small business. Nearly all of the components in his motors come from within southeastern Wisconsin. He contracts with the machine shop next door to limit the capital investment he needs to make.
“Personally knowing the suppliers and customers is helping us quite a bit,” he said, adding that payment terms or issues with supplies can be better worked out when the parties are in close proximity to each other.
But the desire to keep things local hasn’t stopped Edirisinghe from looking to export. Velicon was part of a Wisconsin Economic Development Corp. trade trip to Germany in 2015. The trip included attendance at the Hannover Messe trade show and led to potential customers in Germany, Italy, the Czech Republic, Hungary and Belgium.
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