For as much time as executives of Irvine’s Embee Technologies Inc. spend in hospitals, they seem pretty healthy.
In the past decade, Embee has carved out a niche setting up wireless and other communications networks for hospitals.
They make up half of its business.
The privately held company doesn’t disclose revenue. The Business Journal estimates yearly sales in the $5 million range.
Embee does everything from designing and setting up networks to warehousing giant spools of cabling. It counts about two dozen employees.
Among Embee’s projects is Children’s Hospital of Orange County in Orange, where it has planned and installed voice and data cables and wireless connections for clinics.
The company is working with designers on the hospital’s planned 12-story tower, as well.
Part of Embee’s pitch: managing the cost of materials on projects.
Prices for copper used in wiring have fallen in recent weeks after peaking in February. But that hasn’t been the case for the past few years. A run-up in recent years has added costs to construction projects and even created incentive for copper thieves.
Embee has pushed clients to order copper in bulk at the start of a project. President Luke Slymen and Rob Clement, the company’s vice president, said they try to hold down costs that way.
“We have the ability right now to forecast some savings for a client,” Clement said. “We know this client is going to buy this material from us whether we do this or not. It’s only $3,000 or $4,000. But it’s a savings if they can do it this week versus next month.”
For the CHOC project, Embee urged the hospital to buy $430,000 worth of copper cable that six months later would have run an additional $122,000.
“With all of the additional clinics and the build-out we’re doing here, they gave us the foresight to purchase a lot of cable prior to copper prices going up,” said Noreen Mack, director of telecommunications for the hospital. “We prepurchased for several projects on our plate. That saved us thousands of dollars. In the 12 years I’ve been at CHOC, I’ve never had another vendor recommend prepurchasing.”
When CHOC bought the wire, Embee added space at its warehouse to store it for them.
The company pursued a similar strategy on projects for St. Jude Medical Center in Fullerton, Veterans Affairs Medical Center in Loma Linda and St. Mary Medical Center in Apple Valley, part of Orange-based St. Joseph Health System.
Hospitals are “so budget conscious, they set aside dollars a year or two in advance,” Slymen said. “It really hurts them when costs have gone up 30%, 40%, 50% in that couple of years.”
There’s risk for Embee, as well. Price fluctuations threaten the company’s already slim profits.
And there’s plenty of competition.
Rivals include Spectrum Communications Cabling Services Inc. of Corona and Houston-based NetVersant Solutions Inc.
Embee has been profitable every quarter since the business started, according to Slymen.
“Most of our growth is on cash flow now,” he said. “We have more money in cash than we did in credit lines.”
Slymen and Clement started working together on an earlier incarnation of Embee, which was doing everything from building early networks to building computers.
Slymen and Clement bought out the previous owner and focused the company on networks for hospitals and companies.
Late last month, the company won a $428,000 contract from Economic Resources Corp. to set up a wireless network at a 52-acre business park in Lynwood. The project is set to link 45 tenants in 12 buildings to a single data management and security unit.
Embee plans to install a 60-gigahertz wireless system that will allow business there to communicate with each other at gigabit-per-second speeds.
