We had an interesting conversation with Don Johnson, Principal Engineer with ETA International, about breaking things. Specifically about destructive testing. ETA International takes products and tests them to see when and under what conditions they break. I thought I had a cool job.
Please excuse any typos in this hasty transcript.
Matt Register: Hey guys, welcome back to the show, Texas Business Radio. I’m your host Matt Register. Jay Curry had to step out for a minute. He’s going to be back here shortly. In the meantime, George Walden, my business partner is joining me in the co-host chair. George what do you think?
George Walden: Well, we’re talking about testing. And interestingly I’ve lots of experience with nondestructive testing and the applications that it’s used for. I was not aware that there’s actually people out there who do destructive testing. I mean, trying to find out where something fails at, is really an important model for manufacturing. And we’re talking to someone understands that.
Matt Register: Well, no doubt. And when you build something, especially when you build something in the oil patch, you build something big and heavy. Knowing when that thing’s going to fail, knowing what’s going to kill it, is very, very important and it’s, you know, very important to the end user. Don Johnson is the owner of ETA International, Engineering, Testing and Analysis International, out of San Antonio. Don welcome to the show.
Don Johnson: Thank you. It’s good to be here.
Matt Register: So tell me about ETA international. What do you do? Who do you do it too?
Don Johnson: We are an engineering, testing, analysis firm. We do full scale testing primarily. We’re also, I guess, primarily machine design. So when you talk about mechanical engineers, you’ve got machine designers, you’ve got HVAC the guys, you’ve got… so we focus on that. We would design and build machines. Generally what’s happening for us is a product is coming to us. Generally it’s offshore oil production related. The manufacturer is asking us to determine where it would fail. So we maybe just need to pull in tension, maybe we need to pressurize it internally until it bursts. Right now we’re running a test where we’re actually bending and pulling at the same time for a million cycles. So we would do that test for the client until the product fails or until it’s been exposed to the number of cycles that the manufacturer wants it to have.
Matt Register: Now you’re client is that manufacturer of the equipment. Typically they want to know what the capability of what their product is. Right?
Don Johnson: Generally it is. There are also end users, you know, so you may be as far up the food chain as a major oil company. You may be at some intermediate level. So they are wanting to purchase this product and they have some specific field performance parameters that they want to make sure this product can meet.
Matt Register: Well, because every end user always uses the product the way it’s designed to be used. Right?
Don Johnson: Exactly, never exceed the published values.
Matt Register: I got it. So sometimes the end user will take that product, they want to use for a different purpose. Let you test it, let’s make sure it’s going to work. Right? As a commonsense check before they… how long you guys been doing this?
Don Johnson: We’ve been doing this since 2001.
Matt Register: OK.
Don Johnson: 2001, it was me in an office on Brookhollow.
Matt Register: OK.
Don Johnson: And we’ve been blessed through the years to grow a little. We’re four engineers now.
Matt Register: Well, good. And you operate throughout the state but you do a lot of offshore stuff. So I would imagine you operate out of Corpus and Houston and everywhere.
Don Johnson: We do and we actually… the international in the name is there on purpose. I mean like I was in Kuala Lumpur two weeks ago. We do work in Jakarta, we do work offshore Bali, we’ve done work off of West Africa a number of times, Equatorial, Guinea, Angola.
Matt Register: Sure.
Don Johnson: We do get around in terms of where these products are being installed. Oftentimes, you did the test, now it’s being installed or there’s something different going on along. So we want you to come take a look at it.
Matt Register: Yeah, no doubt. And this is something that is critically important to the safety of the infrastructure out there. Right? When you’re off shore and stuff starts breaking, that’s not a good place to be in. Right?
Don Johnson: Yep and we don’t want to be there yourself either. It’s not…
Matt Register: No, I can imagine. We were talking during the break and one of the pitfalls that, that small and growing companies can run into. Right? Is that customer concentration to where, when all of sudden an oil downturn hits, right, and you’re one customer ends up going under. Can, can drag companies down with it. Now you guys have learned a pretty good lesson over the, over the last downturn. What different, how different are you operating today? Knowing, learning, having learned that, learned that lesson. Right?
Don Johnson: That, that is a good question and one of the reasons we’re here is that very question. All of our work traditionally was offshore, oil related, all of our clients were offshore, oil related.
Matt Register: Sure.
Don Johnson: As a small company, one client kind of swallowed us. You know when your client keeps saying can you do this? Can you do this?
Matt Register: Hard to say no. Right?
Don Johnson: Exactly. Hard to say no, until they stop paying and then you find out that they’ve filed for bankruptcy and you’re not going to get paid. So one of the reasons we’re here is to try to embrace the local market more. We’re, they, you know, where San Antonio-ins, you know, a lot of, two of our engineers went to school at UTSA. The other two are Aggies. We’ve got this boom going on in our backyard, up to the last downturn. So you’ve got the Eagle Ford Shale, that’s going crazy and we’ve got no clients here in San Antonio. So we about two years ago really started making a concerted effort to get involved in this local industry.
George Walden: So what are the areas that you are trying to expand into?
Don Johnson: Right now we, we have a downhole tool, for example, that we’ve developed for a local producer in the Eagle Ford. So he has a tool now, that he uses to take data down inside the well, when he’s producing the well. So those kind of things were still related to the oil business but here locally. So you can get in the truck and drive down to the well site.
Matt Register: Sure.
Don Johnson: And, you know, prep the tool and help them put it in the hole. Where as in the past it would have been, OK, you got to fly to Paris and then you got to fly to Congo and then you got to get on a boat and go off shore. So that’s one of the specific things. Another step, actually away from that, because I think anyone would, would say it’s wise to not be in one field only.
Matt Register: Sure.
Don Johnson: Is this, just the local manufacturing. We’re doing machine design for some local manufacturing. So we’ve done work for the solar panel positioning people and things like that. So you’re just trying to…
George Walden: How about HVAC, containment, that area?
Don Johnson: We have not done any of that. Yeah. Were, two of us are professional engineers. One of the requirements is that you have proficiency in that area and none of us really have proficiency in HVAC. So that’s the kind of thing where we would hopefully know somebody we could point them towards but we wouldn’t do that work ourselves.
Matt Register: We’re talking to Don Johnson who is with ETA international, Engineering, Testing and Analysis International, out of San Antonio. Don, welcome. Thank you for joining us.
Don Johnson: It’s my pleasure.
Matt Register: So, guys we gotta jump to a break. We’re going to be right back with a whole lot more about testing. Destructive, in… nondestructive and other wise. We’ll be back right after this.
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In addition to hosting "Texas Business Radio," Matt is an investment banker and serial entrepreneur from Montgomery, Texas. He is the owner of RREA Media and Register Real Estate Advisors and a Managing Director and Principal at Corporate Finance Associates. He has a BS from the United States Military Academy at West Point and an MBA from Rice University in Houston. You can read more about Matt HERE.