German company expands operations in the Springs

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While many U.S. manufacturers have taken production offshore, one local company has won a contract with a Germany-based company that has chosen Colorado Springs as the site of its American-based operations.

Twelve years ago, Ulrich “Uli” Schoberer invented a power meter system that measures the speed, distance, power, heart rate and pedaling frequency of cyclists. Tour de France winner Greg Lemond was one of the first to use the system, and today 80 of the top-100 professional bicyclists pedal their way to victories with a computerized system referred to as the SRM, or the Schoberer Bike Measurement Technique, said Leslie Klein, chief operating officer of SRM’s U.S. based operations.

Klein said Schoberer decided to open a manufacturing plant for his cycling invention in the United States where sales exceed 50 percent. And happenstance combined with a local company’s reputation for quality and fast turnaround sealed the deal for J. Palace, president of Springs-based Linear Electronic Manufacturing Services.

Klein was on an airplane telling the person seated next to her that SRM Service Center was looking for a manufacturer in Colorado when the passenger behind her reached over the seat and handed her his business card. The passenger was a parts distributor and a customer of Linear Manufacturing.

After researching Linear and checking the company’s references, Klein said Schoberer chose Linear to produce the circuit boards – the backbone of the cycling power meter system.

“This is the Cadillac of training systems for bicyclists,” Palace said. The SRM circuit boards will be assembled through Linear’s “Pick and Place” robotic machine, which is programmed and monitored by engineer Sudip Shrestha.

At a time when many manufacturers are scrambling to stay in the game, Linear has grown every year since Palace started the company in Oct. 1997. “Service is a big thing in manufacturing,” he said. “Murphy’s Law runs through this industry everyday, so everything works best when you can hold the hand of your clients.”

Palace has established Linear as a one-stop shop for electronic manufacturing. About 60 to 70 percent of the 30 different products Linear manufacturers are made for small businesses with yearly revenue of less than $10 million a year, he said.

Palace also is an incubator of sorts for budding inventors. If he intercepts a good idea, he may partner with the inventor, form an alliance or fund the project. “A lot of people come up with a concept or an idea, and they just don’t know how to build it.” Palace’s 45 employees assemble products as diverse as bingo boards, aircraft and surgical equipment.

Palace is excited about the SRM production. “We have already started ordering parts, and we plan to be up and running with full production by first quarter 2005,” he said.

Klein said Linear will produce about 2,000 of the SRM circuit boards per year. However, that number could change in a heartbeat as the SRM system catches on beyond professional cyclists. “Both master and recreational cyclists – road and mountain bikers – are using the SRM – it’s available to everyone,” Klein said. She said most of the buyers are those with discretionary income, as the amateur SRM system costs about $1,900 and the professional system about $3,250.

Various retail shops and dealers in the United States, such as Springs-based Carmichael Training Systems, sell the SRM systems, and more are interested. Klein, a 1984 Olympian kayaker and the former director of the Springs-based National Off-Road Bicycling Association, said the company receives three to four calls a day from dealers who are interested in selling the SRM systems. SRM also directly markets the crème de la crème cycling performance tool.

The system allows cycling athletes to monitor and improve their performance through precise and accurate recordings of their power output, which helps cyclists gauge their time and distances.

The SRM system, which is similar to what is used by NASCAR drivers, is mounted on the bottom of the bicycle bracket, between the crank and the chain rings, Klein said. That piece of equipment sends signals to a power control device that is secured on the handle bars.

Prior to the SRM system, there was no way to measure the atmospheric conditions that affect the cyclists, said Dean Golich, a Carmichael coach for cycling and other sports. “I’ve known Uli since I was a physiologist for the U.S. Cycling Team in 1994,” Golich said. “I used to fly over to Germany and get the systems and bring them back for the cycling team to use. The product is a gold standard of professional cycling.”

Golich said professional cyclists have been using the system for 10 years, and “now we’ve taken it for granted.” He said the atmospheric conditions affect cyclists more than any other sport. “With swimming or track and field, there are distance measures like the four-minute mile – it’s a worldwide measurement,” Golich said. “In cycling, you can have head winds over 100 miles, which makes timing difficult. With the SRM system, we have a real-world definitive measure. Someone like Lance Armstrong can ride a stage in a race and know what is demanded from him.”

“People have, in the past, measured their performance by their heart rates, and that is not as exact as measuring your power output,” Klein said. And Klein and Golich reiterated a statement on the SRM Web site: “Heart rates vary from day to day with such factors as temperature and health, but 300 watts is 300 watts no matter what direction the wind is blowing.”

Although Schoberer was invented the system, Klein said two other companies have created imitations. But the SRM system has retained its No. 1 spot among cyclists.

And the Springs outdistanced other cities in states such as Washington, Arizona, Utah and Oregon as the No. 1 choice for SRM’s U.S.-based operations.

Schoberer chose the Springs because of Carmichael’s presence and the Olympic Training Center, the qualify of life, the business community and the area’s strong cycling community, Klein said.

And SRM also chose Linear because “Schoberer did not want to go with a huge company – he didn’t want to be a small fish in a big pond and go unnoticed,” Klein said.

Palace is not afraid of offshoring. Smaller product quantities will never be sent overseas, he said. “The future of manufacturing is with a niche market and quick response times. Manufacturing is still alive in this country through the small-niche market.”