Southeastern Extrusion and Tool Inc. plans to invest about $3 million to expand and modernize at a new facility.
The investment will help Southeastern make a stronger push into extrusion dies for plastic parts, right now a smaller market area for the firm. Co-owner Gary Barnes said he expects the changes to make the 31-year-old Florence, Ala., company more competitive.
``What we have done is decide to get into the marketplace more seriously,'' he said. ``We worked with suppliers to get concessions. Now we're putting in more modern equipment so we can offer more competitive pricing.''
By early next year, the company plans to move to a new, 20-acre site in Florence and out of its cramped, 40,000-square-foot facility. The first phase of the plant, opening around the beginning of 2003, will double space to 80,000 square feet. The company is investing about $1 million in that phase, adding 10 employees and five pieces of automated equipment, Barnes said.
That equipment includes new machining centers, lathes, mills and wire electric discharge machining equipment.
In the second phase, scheduled for completion within two years, the company will invest $2 million and increase space by at least 40,000 square feet, Barnes said. The company plans to hire at least 50 workers when that phase is finished, he said.
The company is one of the larger tool and die makers in the South, with 2002 sales of about $20 million, Barnes said. Southeastern has four facilities in the Florence area, two that focus on die-cast tooling and two others that build extrusion dies.
The headquarters plant makes dies for such areas as profile extrusions for automotive bumpers and engine cradles, windows and home furnishings. It makes dies for extruded vinyl lineals and trim for decorative furniture, Barnes said. The company employs 210 at its four plants.
Southeastern started from humbler roots. President John Moody and Barnes had lost their jobs in 1971 after toolmaker Permanent Mold and Die of Florence went bankrupt, Barnes said. Instead of moving out of the area to find work, the two decided to form their own company.
They started with one lathe, one mill, one saw and one EDM machine, using savings and money from life insurance plans to put down the $35,000 investment, Barnes said.
After moving once and adding on twice to their operation, the partners had made no expansions since 1991. But the plant grew crowded, and the two found a need for automated equipment as profit margins became tighter.
``You've got to spend money to keep costs down,'' Barnes said. ``We see a lot of other tool shops in the South that haven't expanded and aren't doing that well. It's sort of short term for them because they cannot compete.''
Southeastern received a break from a local economic development group. The new building's previous tenant, apparel maker H.D. Lee, closed its plant in Florence and sold the building in July to the Florence-Lauderdale Industrial Expansion Board for $465,000.
A clause in that agreement stated that the government group must find a buyer that would add jobs to the area in northern Alabama. By adding at least 60 people during the next two years, Southeastern fit those needs, Barnes said.
``So much work is going overseas, but there will always be certain needs in the states,'' Barnes said. ``We can't give up, and we have to keep our prices down.''