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Thursday, Mar 28, 2024

Accept No Substitute

Ira Lapides got his start at Replacement Parts Industries (RPI) when he was a boy, folding and stuffing envelopes for just 1 cent per parcel. Today, he is president and CEO of the company, which provides substitute parts for health care equipment. As a young man, however, Lapides did not dream that he would be running the business begun by his parents, Al and Sherry Lapides, back in 1972. This was “partly because I didn’t want to work with my parents,” he recalled. Moreover, a graduate of UCLA’s M.B.A. program, Lapides was a successful executive at a local HMO. In 1993, when his parents brought him onto the company’s board, the younger Lapides’ thinking shifted. “I decided this is a neat company,” he remembered. Shortly after that, he left the HMO. But joining RPI, as vice president in 1995, and then taking over from his parents as head of the company in 1999 didn’t come without challenges. “One of the first challenges was being able to work with my parents on a full-time basis,” Lapides said. After becoming an RPI executive, he had to interact with them on a “higher- contact basis than I had before.” Four years later, when his parents entered semi-retirement and transferred leadership over to him, Lapides had to overcome an additional hurdle. “Another challenge was coming into a business that was 25 years old and trying to earn the trust of the employees,” he said. By making some innovative changes that benefited the company,such as creating a company Web site in 1996, long before the practice was de rigueur, increasing the amount of new equipment the company offers and developing original parts,Lapides managed to win over the employees who were skeptical about his abilities. In fact, two employees who began working at RPI under his parents’ tenure are now celebrating 15 years with the company. RPI now features an estimated 2,500 parts for medical, dental and laboratory equipment in its catalogue. That’s quite a hike from the 19 parts the company offered when it began 35 years ago. Then, customers could find parts for heaters, door gaskets and bellows for particular autoclaves. Today, RPI features motors for centrifuges, filters for compressors, gaskets for sterilizers, as well as parts for exam tables and chairs and various neonatal and dental equipment, including the lights dentists use when working on patients and the tools that spurt water. The company has received orders from the infirmaries of every major ship and aircraft carrier, according to Lapides, which is fitting considering that his father was once a defense industry engineer. Customers will tell the company, “There are 20 parts that always go bad on this equipment,” Lapides explained. “We’ll figure out how to make those parts.” Under the younger Lapides’ tenure, RPI obtained ISO 9001 certification, an internationally-recognized standard of management certification, which has expanded the company’s world-wide customer base,from Iceland to South Africa. Ten percent of customers are outside of the U.S. “It helps international sales in Canada and Mexico,” Lapides said of the ISO certification. In addition to North America, RPI has customers in Latin America, Australia and the Middle East. Located in a building that sits on 15,000-sq. feet in a quiet, industrial corner of Chatsworth, much of the business RPI gets is from the Valley. Local clients include hospitals such as Providence Holy Cross Medical Center and Northridge Hospital. “What we do as a job, for lack of a better term, repairing medical equipment here, we have a great deal of parts and we have to get the best value for our dollars and RPI provides that to us,” said Brent Slutsky, director of biomedical engineering for Northridge Hospital. “They have outstanding technical support, and it seems they’re always looking for a way to improve on the quality of their product and expand on their parts base,what they offer.” The manufacturers of the equipment for which RPI provides substitute parts are the company’s stiffest rivals. Lapides drew a parallel to the automotive industry when discussing competition in the medical after-market parts industry, likening RPI to NAPA Auto Parts competing with Ford. Lapides attributes the company’s success to being small and personal. “We come through on our warranty,” he said. But the company has also stayed in business due to word-of-mouth, according to Joan D. Woodlock, RPI’s vice president of marketing and customer service. She’s heard that hospital employees often spread the word about RPI when they move on to another hospital and even bring RPI brochures with them. The company, which doesn’t have a sales department, also has made a name for itself by issuing posters each year about replacement parts. Moreover, the mailers it sends out have been consistently yellow. The goal is to have people connect RPI with yellow, much like people connect UPS with the color brown, Woodlock explained. As to why his hospital has chosen to stay with RPI rather than go with a large manufacturer, Slutsky said, “For us, it’s a case of, like anybody else, you could go and buy the manufacturing part and spend four or five times as much, and it might not be any better. We’re being frugal with the limited healthcare dollars we have.” While the company has a varied clientele, it’s Lapides goal to expand business even more. “We have continued to grow pretty steadily over the past 35 years. I want to continue that steady, controlled growth,” he said. But, he added, “We don’t want to lose our company culture The goal is to continue to grow but not so fast that we forget who we are.” Lapides helped create a list of company values 10 years ago. “When you hire people, you want to make sure they fit a value system,” he said. “We all sat down and said, ‘who are we, and what do we want to say about ourselves?'” Ultimately, it was agreed that the values of integrity, quality, innovation, personal and professional growth, empowerment, enjoyment, teamwork, respect and pride would represent the company. The establishment of a core set of values is just one of the ways Lapides has helped RPI evolve. All in all, he said, “We’ve gone from, I think, a typical small company run by one person to a middle-stage, transitional company. Now, we’re a little more professionally managed.” SPOTLIGHT – Replacement Parts Industries Inc. Year Founded: 1972 Location: Chatsworth Revenues in 2005: Just over $5 million Revenues in 2007: $5.5 million Employees in 2005: 23 Employees in 2006: 24

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