U.S. Manufacturing Today Podcast

Episode #5: Navigating the New Manufacturing Landscape with Bret Boyd of Sustainment

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In this episode of the U.S. Manufacturing Today Podcast, host Matt Horine welcomes Bret Boyd, CEO of ⁠Sustainment⁠ and author of the article ⁠'Making American Manufacturing Great Again, Starts with Small Businesses.'⁠ Bret shares his extensive background in manufacturing and supply chain, his military service, and his inspiration for founding Sustainment. The discussion covers the current state of American manufacturing, challenges faced by small and medium-sized businesses, the importance of localized supplier networks, and the potential of new policies to revitalize the industry. The episode concludes with Bret's advice for those entering the manufacturing landscape and the pivotal role of software in enhancing supply chain efficiency.

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Links

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Timestamps

  • 00:00 Introduction and Episode Overview
  • 00:33 Meet Bret Boyd: CEO of Sustainment
  • 01:02 The Origin and Mission of Sustainment
  • 03:26 Challenges in American Manufacturing
  • 05:06 The Role of Small and Medium-Sized Businesses
  • 08:57 Impact of Recent Policies on Manufacturing
  • 13:40 Strategies for Supply Chain Resilience
  • 19:44 Opportunities in the Manufacturing Sector
  • 21:11 Conclusion and Final Thoughts

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Episode Transcript

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Matt Horine: [00:00:00] Hey everyone. Welcome back to U.S. Manufacturing Today, sponsored by Veryable. I'm your host, Matt Horine, and today we have a special guest, Brett Boyd, CEO of Sustainment and author of the recent article: Making American Manufacturing Great Again, starts with small businesses.

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Bret brings a wealth of experience in the manufacturing and supply chain sectors, and we're excited to discuss his insights on revitalizing American manufacturing, the role of those businesses and the future of the industry.

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Bret, welcome to U.S. Manufacturing today.

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Bret Boyd: You bet. Thank you for having me,

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Matt Horine: We're excited to have you and have a lot to talk about. First, I would love to give you the chance to give a little bit about your background and inspiration for starting sustainment.

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Bret Boyd: Yeah, look, to go way back, you and I both share the heritage of having done undergrad at West Point. I actually was a senior at West Point when the towers went down. So I was the generation in, in the early phase of the Iraq war, so I was an infantry officer. I served in the 75th Ranger regiment, deployed to Iraq four times, and separated from the military in [00:01:00] 2007, at which point I generally went into tech. So I've been, I've been in industry building businesses here for the last 15, 20 years here.

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Anyways, have a lot of experience in both hardware and software and have specifically worked in a lot of these big, real data rich companies here prior to starting Sustainment, which, which we founded in 2020.

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Matt Horine: Thank you for your service and when you benchmark that, that year gets further and further back there. So definitely 15 years ago is a bit of surprise on my end as well. 2020 was an interesting timeframe and something that inspired a lot of American businesses. What was the need where you saw that background and experience kind of mold together for a moment that was pretty big in supply chain all around.

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Bret Boyd: The story of Sustainment goes back a few years prior to 2020. We were really looking at the industry, my co-founder and I, and just making the general observation that says, wow, in the whole digital revolution that we've seen cut through a number of industries. When we look at manufacturing, it really just felt like a lot of the innovation and the [00:02:00] industry had been built around the offshoring movement. So there are these great software platforms that you could use to go find international manufacturers and the Alibabas and kind of their peers for other nations here. But when we looked at it, we said that the fundamental way that manufacturers in the United States are essentially finding each other and getting work done together looks a lot like it did before the internet, who's very local, very kind of relational chamber of commerce, and it was just a lot of work.

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It seemed to drive a fundamental inefficiency in the U.S. manufacturing economy. That was the origin of the thesis is that, look, there needs to be a software platform that makes it easy to find and get work done with u.s. manufacturers, and that business needs to be designed in such a fashion that actually helps small and medium manufacturers, which essentially are the heart and soul of American manufacturing.

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Matt Horine: You hit on something really big there. A lot of times. A lot of the tech development we see doesn't really speak to the need of the manufacturing sector overall, an underserved industry. And I think taking it from the top, the current [00:03:00] state of American manufacturing, or maybe perhaps the last 30 years, in your article you mentioned that the U.S. has lost about 25% of its manufacturing companies since the nineties.

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Manufacturing employment has shrunk by 36% since the early eighties. What do you think are the primary factors contributing to this decline? And we'll get into all kinds of solutions, but it's always interesting to hear what the problem was and why you started your company.

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Bret Boyd: Oh goodness. I think this is one of these multivariate problems that has a ton of these different sources, and you could look at the financialization of industry and kind of the optimization of near term financial returns over kind of long term business strength.You could also look at some of the trade and industrial policies that were put in place essentially after the fall of the Soviet Union and the Cold War.

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I think there were a lot of different contributing factors to this, but at the end of the day, it is worth saying that despite all of the destruction and kind of de-industrialization that has happened over the past 20 or 30 years, manufacturing is still a huge industry in this country.

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It is [00:04:00] very important, and it's interesting in how it's evolved. When you look at manufacturing right now, there are about 13 million men and women that work in manufacturing. I believe it contributes 2.2 or $2.3 trillion to GDP. And the industry has grown in such a fashion that it is a lot of mid-market manufacturers.

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So there are 250,000 manufacturing businesses ish in the country. Just over 98% of those are sub 500 employee businesses. That sub 500 employee business segment in manufacturing actually employs the majority of manufacturers.

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So maybe two thirds of all the manufacturing workers work in these small and medium sized businesses. And so really when you look at this industry, huge. Strategically important socially, culturally important, obviously economically important. It really is contained in this long tail of these amazing small and medium sized businesses spread throughout the country.

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Matt Horine: Those statistics are unbelievable 'cause you think of the big names, right? In manufacturing, your car builders, your gigafactories, those types of things is what people [00:05:00] drift towards naturally when they think of manufacturing. But there are thousands of businesses that stand to be part of this reindustrialization message, which is what we're certainly aligned on and growing that manufacturing base.

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What unique challenges do you see prior to Trump 2.0? Looking back over the last 10 years, the unique challenges of those small, medium sized businesses in the market. You highlighted a little bit earlier about Sustainments model and how connecting them regionally was so important in a global economy and how globalization has changed everything.

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And you could get online to look for a shop in China, but sometimes it's hard to find a supplier down the street from you or a couple hours away.

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Bret Boyd: So if we're on the same page, that manufacturing is really constituted of a number of these small businesses. When you look at like how things are built, it is interesting the effect to which manufacturing is done in community. And really what I mean by that is take a 500 employee OEM that's building a winch or a pump or some sort of a machinery item like that. And let's say there are a hundred or 150 parts in that that [00:06:00] manufacturer, that OEM is gonna build some percentage of those parts in their factory, but they're gonna take the rest of those parts and they are gonna subcontract them out to a network of trusted partners who will then build those parts, send them back to their shop for assemblies so they can sell their item to their end customer.

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When we talk about this, when we talk about how that gets done, there are 20, 30, 40 companies that are all contributing to this ultimate end item that that OEM sells. And these suppliers are actually like critical parts of the value chain of that business. So this is not off the shelf stuff that it doesn't matter who's building it for me. These are deep. Personal relationships where I need to have trust, I need to have confidence in that manufacturing supplier to deliver those parts. I probably have some regulatory and certification requirements that I actually need to like have a ton of confidence in what they're gonna do to, to both be effective for my customers and get through all the audits and so on that I need to have.

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But this whole idea that manufacturing is a team sport, manufacturing is done in community and that the value stream of manufacturing runs [00:07:00] through these relationships between OEMs and their suppliers is something that I, I don't think most people appreciate until they get into this industry.

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If you take that as essentially the state of play for how manufacturing works, and then you combine that with our earlier comment that said, Hey, there are a lot of manufacturers. There are these small businesses. There's just a lot of like fragmentation and fog in who's what, where with what capabilities and so on. That's the essential observation of like when we look at this, the problem that we want to participate in.

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So we see these buyer supplier relationships as being critical assets to both sides of the equation.And essentially our goal here is to build the digital connective tissue and to help digitize some of the workflows in between those companies so that everything can go faster, right?

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And this is not just, Hey, who's the right supplier for this job? It goes all the way through to like, how do I quickly get quotes? Getting quotes quickly allows me to understand who's got the right timelines and the right machine capacity for, I want all the way through my managing delivery of parts and supplier a. [00:08:00] Analytics and so on.

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So it's that community nature of the industry that we find very interesting and very uniquely American that, that we're really trying to lean into with software.

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Like not to abstract people from those relationships, but to really like allow them to digitize some of those workflows so they can have more relationships and manage them better and faster. That's one of the really interesting nuances of the industry from our perspective.

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Matt Horine: It is really interesting and I think something you said there that is uniquely American, and that kind of leads into our next topic. There's a lot of debate, a lot of new policy coming out, but the current administration and what we call Trump 2.0, which has seen some significant changes in the first a hundred days. They've introduced policies aimed at revitalizing manufacturing, potentially tax cuts, regulatory reform. Tariffs are the big one.

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It's probably the most newsworthy right now to promote domestic production. How effective so far are some of these measures, and what are some of the changes early on and how do you see this playing out over weeks and months?

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Bret Boyd: That is a loaded and complicated  question, which I appreciate you [00:09:00] asking. So we work with thousands of manufacturing suppliers and OEMs. So we have a lot of different perspectives from the smaller businesses who are trying to figure out how to win in a world of localizing manufacturing, all the way to larger organizations who have significant international supply chains and are trying to figure out how to reorient their businesses here. So it's, it's a very difficult and a very complicated question, but I, I think if you step back and look at it, a national strategy is a response to the global environment. That's an obvious statement, but I think to start there, to say national strategy is a response to the environment in which we operate on April 11th, 2025.

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And as you look at some of the industrial policy, which again is a tool of national strategy, a lot of our industrial policy was developed in the post Cold War world. You almost had a uni power situation here where the United States was the dominant economy, et cetera, et cetera. We can argue whether or not these free trade policies made sense at that time and place, but regardless of how you feel on that, the [00:10:00] world has absolutely changed.So we are not in that world right now, and we are in a, an increasingly competitive world.

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In a world that competition is defined by economic competition. And if you look at some of the data, China as a percentage of global manufacturing capacity is projected to be in the 43 to 45% of like global manufacturing capacity here by 2030. And that's bonkers. That's a number that's only been hit by the UK in the Industrial Revolution and the United States post World War II. And they have been very deliberate about an industrial strategy that advances their interests.

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So I would just say fundamentally, like I, I think that we are past peak globalization and regardless of who's in the White House, I think the next 20, 30, 50 years are going to be characterized by more proactive industrial policy. One tool of which is tariffs. Others are monetary and investments in specific industries and so on. And I guess my point is that I think that. Companies should expect this to be the new normal. And these times, if you look at [00:11:00] these global transition periods where you go from an old world to a new world, the space in between tends to actually be pretty difficult.

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Those are the times in which market leaders are made and, and others tend to be dethroned. And I think it is a very interesting and dangerous time for companies, and I'm happy to go into that in a little bit more detail around what we see some companies doing to react to this. But I think fundamentally just putting on the table that in my view or in our view, this isn't a blip in the radar and I have no idea how it's gonna settle and who's at what percents and all this kind of stuff.

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I have no idea, and I don't really feel entitled to a view on that. I do think that the world is going to be characterized by these things going forward for time.

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Matt Horine: Yeah. I think you hit the nail on the head there with what does it mean? It means that things are certainly changing. It's not going to be the post Cold War, world structure, global order of Uniparty superpower type structure where we live in a multipolar world and people are often talking about building supply chain resilience and supply chain agility and all those [00:12:00] things in the operational environment, and how do they build additional flexible capacity.

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I guess the better question is if there is this reindustrialization movement in America and over the next couple of decades, 25 to 30 years, which is what you framed really nicely in your article, and I think the underlying theme is, Hey, it's time for people to start taking the long view. I. What does that look like for the next generation of people who are coming into this era, coming out of it?

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One way we've heard it really greatly framed, and I think you did a nice summary on it there, is that no one knows, no one has been through anything like this, whether from the industrial revolution or post World War II, the US economy. No one's been in an actual trade war. No one has been through a real economic shift like this in generations. So that long view was what was inspiring. Kind of thinking through what does that look like decades beyond, rather than, do we just look to markets as the economy? Do we look at to equity markets as the economy?

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Bret Boyd: It's a great question, and I think it's interesting to talk about, but you do need to balance both, right? I run a business and I suspect a lot of people that are listening to [00:13:00] this also run businesses, and we need to thrive in the near term so that we get the opportunity to participate in the long term. And I, I respect that, that a lot of people are facing that. And so to hit those kind of in sequence. Look, if you agree that we are in a period of rapid change, the obvious and natural response to that is to figure out how to be agile and flexible and quickly reactive.

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And so if tariffs switch from this to that, or if nearshore becomes in favor or out of favor, really it's incumbent upon you to look at your supply chain and first off, develop options. So develop alternative sources of supply for your key supplier areas that that are potentially at risk. So you need to do that. And I actually deeply respect how challenging that is and how long it takes and how you really do need to actually look through your whole supply chain and say, look, where are we gonna start? We cannot eat the elephants. Where are we gonna start? What are the ones we're gonna look to add a secondary source of supply or go validate an additional supplier?.

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We talk to a lot of companies that are looking at [00:14:00] both Nearshore and onshore alternatives, and I think that is probably appropriate. And then the second piece is that you need to be able to react quickly and reacting quickly as a procurement or a supply chain team really means the ability, like I need to get quotes quickly from my suppliers so that I can understand. Who has the availability and pricing and so on that I need for this delivery now. So being able to look at your supply chain from a systematic or a programmatic perspective so that you can be fast and agile in times of rapid change is what we think is going to separate the winners and losers going forward. And we think that applies even to your U.S. suppliers.

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So we would strongly suggest don't just be comfortable if you have a single source of supply who happens to be in the United States. Because most of those contract manufacturers are getting an insane amount of inbound right now that they're sorting through.

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And so being very deliberate about those relationships and even identifying alternatives to complement those relationships is pretty important right now.

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Matt Horine: You said something interesting [00:15:00] about what I've seen in this current environment is people have either looked at things in terms of offshoring or reshoring, and that Nearshoring component really shortens the chain. It's one of the interesting dialogues that I see on X or on LinkedIn and people talking about bringing things a little bit closer. Not to hedge, but to essentially build continuity and to build some kind of level of survivability when you're not gonna be able to guess what country has what tariff rate.There's a lot of uncertainty around that and it certainly changes year over year.

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The big question, I have to wrap this up here in just a minute, but one other thing that you highlighted earlier was there some Component of your business and what is part of Reindustrialization is working with the defense industrial base.

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And so this was a little bit more of a maybe commentary that you had on that and some thing things that you see changing in that environment right now from your perspective.

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Bret Boyd: This kind of runs through our origin story. We grew up in the DOD supply chain, essentially helping them solve this problem of like, how do I identify more excellent commercial manufacturers and, and encourage them to [00:16:00] join our supply chain. And then once they're here, how do I actually work with them quickly so I can get the things that I need on time? And it all kind of ties to this overall fundamental premise that we have that, that there is untapped capacity in the U.S. manufacturing economy. Now, there simply is. Part of the reason that is the case is that it is not easy to find and engage with these manufacturing suppliers.

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You've got essentially these regional networks and in many cases these industry networks where you have capacity and it's not obvious like how to tap into that if you're in another industry. And just to use the DOD as an example, so if you're trying to buy repair parts for airplanes. It is highly likely that contract manufacturers supporting oil and gas equipment are probably using the same exact type of machines.They're probably using a different version of iso, but they have similar quality standards and and practices, and they probably could build what you need, but it's not obvious to you as the buyer that they have that capacity, and it's not obvious to [00:17:00] them as the supplier that their capacity could be allocated to support a customer in a different industry. And so we see technology as being an ideal bridge to that.

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This actually came up during Covid, which is a, an interesting anecdote to go through. We've got our legs under us in, in that timeframe. And one of the interesting anecdotes was this idea of ventilators. So obviously a piece of equipment means life or death.We had ventilator shortages working with some of our partners in the states, specifically in the state of Texas, who was trying to survey like who, who makes ventilators? And you can grind the internet all day. And there are not a lot of companies in Texas that say I build ventilators on their websites.And one, one conclusion that you can make from that is there, there's no ventilators in Texas. We're done for, we need to go elsewhere.

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But if you actually say, hold on a sec, what are the part groupings and what are the specific parts that are in a ventilator? Thousands and thousands of manufacturers can contribute to that.And then there are some wonderful assembly shops in the state of Texas, and that's an example of there [00:18:00] really was a lot of untapped capacity to support requirements like that. That's what we see across the country now. Like we think right now there is more capacity in U.S. manufacturing and I think that the demand that's coming as a result of some of this is, is going to be very interesting and it'll be a little bit tumultuous to, to see how that lands and see how all the relationships develop, but there is capacity there.

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We also just think that there is a ton of potential in the U.S. manufacturing economy that can and will be unlocked in upcoming years as more talent and more capital enters the industry. That's the world that we want to help build towards where we've got these hyper-efficient networks of manufacturing suppliers and relationships where people can be very fast, very agile, and all boats rise here across the country.

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Matt Horine: Yeah, that's a really great point in terms of thinking optimistically, which is what I find most manufacturers to be. There's several personas that have gone through the last couple of years and they've fallen into a couple of different categories. There's somebody who's probably what we would [00:19:00] call the optimistic survivor. Somebody who maybe has been through a little bit of the crunch, but they are fundamentally optimistic and they fight the fight every day.

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As an operations leader, there's somebody that's on the shop floor or there's somebody that's running the business, they have to survive, and that builds some type of sense of optimism. Which leads me to some closing thoughts and some things that you think about manufacturing work and what in terms of the future, and there's this need for an expanded industrial and manufacturing base.

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There may be people on the sidelines looking to enter the market or go into manufacturing themselves. What would advice would you give them about entering the manufacturing landscape?

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Bret Boyd: It's high adventure, it's tumultuous, et cetera, but this is also a pretty exciting time. I would say that to repeat a prior comment, I think these transition periods are really when winners and losers are made. And so I guess the way that I would think about this, and if you're a, if you're a small business owner, you're thinking about starting a business or if you're thinking about entering the industry or maybe you're a capital allocator, looking at opportunities in this space, I, I really think the time is now.

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Like when it's obvious that [00:20:00] this whole reindustrialization movement is, is on track like it, it will probably be too late. And I do think we're in for a couple of years of swings back and forth, but I think these are the times that the individuals who are able to really be aggressive and seize the opportunity are gonna end up being successful.

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So I, I would just say like the moment is now. I think it's gonna be here for a while, but it's not going to get any better than it is today. And the fortune favors the bold getting in the ring. My suggestion.

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Matt Horine: Optimistic urgency is probably the way that we see things and people getting involved and there's so much fulfillment in the work of building things and making things and how much dignity that brings in terms of manufacturing jobs. And it gets lost in some of the bigger rhetoric. Bret, for some of our listeners, where can they find out more about sustainment, find out more about you and learn about your, what you guys are doing?

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So Bret Boyd: again, our company is called Sustainment. Our website is www.sustainment.com and we sell supplier relationship management software.

To procurement and supply chain teams at, at the OEMs and contract [00:21:00] manufacturers to help them find and get work done with, with their manufacturing suppliers. So we've got a great business built out. Please come check us out and we would love to work with you.

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Matt Horine: Thank you very much, Bret, for taking the time today and sharing your valuable insights, especially on the pivotal role of small businesses and smaller, medium sized businesses that are gonna need to be taken to revitalize American manufacturing. To our listeners, we hope this conversation has provided a deeper understanding of the manufacturing sectors current state, and future potential.

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Stay tuned for more episodes of where we continue to explore the forces shaping the industry.

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And to stay ahead of the curve and to help plan your strategy, please check out our website as well, www.veryableops.com, and under the resources section titled Trump 2.0, where you can see the framework around upcoming policies and how it will impact you. If you're on socials, we just launched on X, formerly Twitter, and you can find us also on LinkedIn.

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And if you're enjoying this podcast, please feel free to leave us a rating and don't forget to subscribe. Thank you again for joining us and learning more about how you can make your [00:22:00] way.