PVC compounder O'Tech Corp. will add its fourth production line next year and is scouting around for a new location in the U.S. Midwest.
The new line will increase production at O'Tech based in Rolling Prairie, Ind. by about 30 million pounds, O'Tech founder Jack O'Donnell said in a recent phone interview. The $1 million project also is expected to create 10 new jobs.
The new location is needed because O'Tech which currently employs 50 and has annual capacity of 60 million pounds has outgrown its 80,000-square-foot leased space in Rolling Prairie. O'Donnell said he would like to find a new location nearby and be moved in by mid-2010.
``We're in the beginning stages of a greenfield project,'' said O'Donnell, who founded the firm in 1999.
On the sales front, O'Donnell said that he expects 2008 sales to hit $22 million a considerable jump from $15.5 million in 2007.
``We're finding that we're able to satisfy a lot of people's requirements when they don't want to go to the big guys,'' he said. ``We try to spoil our customers and give them what they want.''
O'Tech supplies compounds based on flexible PVC, with an emphasis on the wire and cable market, which makes up about 65 percent of the firm's business. Other sizable O'Tech markets include profile extrusion and footwear.
Recent new products at O'Tech include a line of compounds that are flame-retardant and another line with low smoke and flame properties. The firm also has done some work with styrenic block copolymers and a group of recycled products under the Ecolene brand name.
Ecolene combines recycled rubber from tire reclamation and recycling with polyethylene, polypropylene, polystyrene and other base resins. The materials are lower priced than standard grades and also meet the need for a ``green'' initiative, O'Donnell said.
O'Donnell had been in the compounding market for about 15 years including stops at Gary Chemical, Colorite Plastics and Cybertech's polymer division when he struck out on his own. He started by purchasing a 15 million-pound capacity PVC compound line from Wirekraft Corp., which had been using it for in-house wire production.
Flying solo ``was something I always wanted to do and I've been able to find a niche,'' O'Donnell said. He now owns a majority stake in O'Tech and has several equity partners, including Chief Financial Officer Paul Devitt.
O'Tech has found ways to prosper while the domestic plastic market is going through a difficult stretch, with many firms pinched by declining business and rising raw material costs.
``We've made the right investments and partnered with customers who have grown,'' O'Donnell said. ``The market is always challenging, but we've done OK.''