As editor of Plastics processors can be very important cogs in a their local economy. That's especially true for the many large and mid-sized processors that are based in small towns. Usually that's a plus -- the company has the attention of local and state officials, and company executives can expect to play an important part in the community.
But when something goes wrong, it can mean big problems for the local economy, and quite a bit of interest and concern.
That's definitely the case with Victor Plastics Inc., the North Liberty, Iowa-based injection molder that saw its sales plummet from almost $100 million in 2006 to about $70 million in 2007 -- and which filed for Chapter 11 protection on Jan. 15. We reported on the news on our Web site as it unfolded last week, and featured the story on Page 1 of our Jan. 21 issue.
Today The East Iowa Herald in Victor, Iowa, is revisiting the story, and the tone of the newspaper's update suggests that locals are very concerned. Here's the first graph:
In a community where a person’s word is usually good enough, the bankruptcy filing by Victor Plastics could have wide ranging repercussions for local businesses. As the details begin to emerge in the recent filing, questions are beginning to mount for both area businesses and employees.
The story goes on to explain how Victor employees are concerned not only about their jobs, but about their retirement savings, and how other local businesses could be hurt by the bankruptcy.
We've seen this happen elsewhere, for example when Rubbermaid Home Products closed its flagship plant in Wooster, Ohio. There was a lot of concern at the time, and the decision undoubtedly hurt many in the community. Still, Wooster has bounced back, and I hope that Victor and North Liberty, and Flora, Miss. (where Victor has another plant) will do the same.
Meantime, Iowans continue to hold out hope that Spell Capital Partners LLC, the owner of Victor Plastics, will find a buyer for the injection molder. The story quotes Dr. Leonard Seda, president of the Victor Community Development Association, saying he remains encouraged. “We do have a possible buyer or two,” Seda said. “We are hopeful and confident. I was encouraged by what I’ve heard.”