CHICAGO — H. Muehlstein & Co. Inc., a resin distributor and compounder based in Norwalk, Conn., is looking to grow its business through acquisitions, but officials said it won't imitate distribution industry giants in the process.
``Our business strategy isn't to be General Polymers, Hanna or Polymerland,'' Muehlstein North American sales manager Damian Mullin said at Plastics USA 98, held Oct. 6-8 in Chicago.
Instead, the company will look at growth that complements its existing product line, which is highly concentrated on commodity resin distribution, Mullin said.
``We could add more in engineering resins,'' he said.
Muehlstein isn't limiting its expansion vision to any particular geographic area, Mullin said. The firm's current coverage area spreads from its northeastern U.S. base as far west as Chicago and as far south as Louisiana.
Muehlstein also is looking to move its product mix more into prime resins and away from off-spec materials. Globally, its prime products hold a 60 percent share in the Muehlstein lineup, although in North America the balance is 50-50.
Mullin said he expects a continued trend in consolidation for distributors for the next several years as firms struggle with ample supplies of resin, Asian competition and squeezed margins.
Distributors also are contending with high costs for warehousing, customer service and technical support. However, this business downturn could create new opportunities for Channel Polymers, the small-lot engineering resin distribution firm that Muehlstein formed in early 1996.
Mullin said Channel's low-cost producer status could allow it to remain profitable through the downturn.
Muehlstein also is reporting early success for the 15 new grades of rotomolding compounds introduced in June. To date, sales of the polyethylene-based compounds are 12-15 percent ahead of the firm's first-year estimates.
Muehlstein's combined distribution and compounding businesses posted sales of $800 million.