CONAIR MERGING OPERATIONS

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AKRON, OHIO — Before year-end, Conair Group will close three manufacturing sites, centralize all auxiliary equipment production into an expanded Franklin, Pa., facility and erect a brand-new sales and engineering hub near Pittsburgh.

The estimated $10 million to $15 million price tag on the project includes at least some relocation costs for roughly 175 people employed at Conair plants in Bay City, Mich.; Agawam, Mass; and Elgin, Ill., according to E. Niles Kenyon, Conair Group president. The company will dismantle those operations product line by product line, with the windup slated for November, he said.

Kenyon, along with Conair Group Executive Vice President Conrad Bessemer and Dick Christopher, vice president of sales, was interviewed Jan. 28 in Akron.

The company's plans also include boosting space at Franklin from about 130,000 square feet to 180,000 square feet, and constructing, in suburban Pittsburgh, a 70,000-square-foot corporate headquarters, sales and technical center equipped with injection presses, extrusion lines and a range of Conair auxiliary equipment for plastics processing.

That equipment comprises a broad-based assortment for materials-handling, drying and blending, temperature control, pelletizing, granulating, robotics and downstream systems for extruding pipe and profiles, each family known by the name of the Conair division that produced it: Franklin, Tempro, Wor-Tex, Jetro, Martin and Gatto.

Since Pittsburgh-based GWH Holdings Inc. acquired Conair in 1986, its goal has been consistent: to establish a complete product line in auxiliary equipment. What evolved are several stand-alone, focused manufacturing facilities and profit centers. Though the system has served Conair well — it claims the past two years have seen record sales — the company, which turned 40 last year, began taking stock in typical midlife fashion; and the outcome of that reassessment was a new strategy: consolidated, one-source manufacturing.

``This is definitely not a cost-cutting move,'' Christopher said. ``This is an investment.''

Kenyon said Conair will eliminate some duplication between divisions, but the main push is a forward-looking view of the market's changing needs — from a collection of dissimilar auxiliary machinery to highly integrated, uniform manufacturing cells.

``As the auxiliary equipment business grew, our customers' demands grew, from a single product focus — demands that we could serve as we were — to today, as we see it, ... complete auxiliary equipment integration,'' he said.

``The customer is coming to us saying they want a solution to a variety of processing problems,'' Bessemer said, adding that Conair has a growing list of such customers.

Larry Bowman, vice president of sales for competitor AEC Inc. of Wood Dale, Ill., also said he sees a growing demand for the turnkey approach to auxiliary equipment, both domestically and worldwide. Both AEC and Conair do about 70 percent of their business inside North America, and both firms vie for market share in a broad range of products. Bowman put AEC's total sales at more than $125 million.

Conair executives declined to be specific, but said their firm's sales have tripled since (now Chairman) G. Watts Humphrey's investment group bought out former majority owner John Reib a decade ago. In his autobiographical book, The Making of Conair, Reib said sales at the time of the 1986 buyout were about $50 million. Kenyon called Reib's number too high.

Dave Cosner, who heads sales and marketing for Universal Dynamics Corp., agreed that the systems approach to auxiliary equipment is one that works. But he questioned Conair's consolidation plan. Like most auxiliary equipment makers, Una-Dyn, which supplies materials-handling needs, specializes in just one area.

``There might be economies to be had,'' Cosner said by telephone from Una-Dyn's Woodbridge, Va., headquarters. ``The problem is having that many different product lines under one roof.'' He added that a discrete site for engineering and sales, as many as 70 miles away from manufacturing, possibly could hinder communication.

But Conair executives are bullish on their plans, which they said are geared toward adding value for customers.

``The idea with the technical center, which [will be] the most comprehensive in the auxiliary business, is to show customers the equipment in a test setting ... to see how their plant would actually look with that equipment.''

So far Conair filled nine of 40 newly created regional and local sales positions, and it also will add 40 more engineers, including for field-based customer service.

Conair would not disclose the location of the new Pittsburgh-area tech center. The company still is finessing an incentive package from local officials. On 10 acres, the facility will be outfitted with three injection molding presses and three extruders, including two Davis-Standard lines being moved from Bay City's Jetro and Wor-Tex facility, Bessemer said.

Conair's plant in Bay City employs 65, a small number compared to the 1,500 jobs at General Motors Corp.'s plant there, said Mike Brandow of Bay City's Department of Economic Development.

But the city is unhappy about the relocation, and wonders why Conair did not choose it for its main manufacturing site.

The answer to why Franklin is simple, Bessemer said. Already Conair's largest employer, with 325 people, and biggest manufacturing plant, the site has 22 acres at its disposal. Assets such as laser cutting equipment and a computerized management information system make Franklin well-equipped to handle all the individual product lines, he said.

Bessemer, who formerly headed the Bay City operation, now will assume responsibility for MIS and marketing at Franklin. Other executives have been similarly reassigned, Kenyon said. Jack Downie, formerly Conair Franklin's president, is now a consultant to the company. Christopher, formerly with D-M-E Co., is new to his post since fall.