Strong toll compounding volume is leading American Compounding Specialties LLC to build a major addition to its plant in Fowlerville.
Fowlerville-based ACS will begin work on the 45,000-square-foot addition by year's end. A new extrusion line with 50 million pounds of capacity will start production in the expanded space by early 2010. The firm currently operates 60 million pounds of annual capacity on two lines in a 17,500-square-foot space.
ACS also plans to add two 50 million-pound-capacity lines, one each in 2011 and 2012. Each new line will create 10 jobs at the site, which now employs 20.
``We've taken a more sophisticated approach to toll compounding,'' ACS co-owner Randy Rudisill said in a recent interview at Fowlerville.
Rudisill and Dave Donie founded ACS in 2005 after each ended careers of 20-plus years at Fowlerville-based compounder Thermofil Inc. Thermofil was founded by plastics veteran Ron Woods in 1967 and later was owned by Nippon Steel Chemical Co. Ltd. and then by Asahi Kasei Corp., its current owner.
ACS toll compounds polypropylene, nylon, polycarbonate and ethylene vinyl acetate, mainly for large resin makers. Customers provide the resin to be compounded, and sometimes the additives. Runs range from 40,000 pounds to 1 million pounds.
``We can do quick and easy changeovers and can handle loadings of 60 percent or higher,'' Donie said. A recent compound made for a thin magnetic film had iron content of more than 80 percent.
Rudisill and Donie said they have no plans to make proprietary compounds, even though noncompete agreements they signed with Asahi Kasei have expired.
``If we got into proprietary, there would be huge raw material costs and we could only do business with certain customers,'' Rudisill said. ``We've got no interest in doing that.''
ACS' services include a detailed computer readout of every run the firm produces. The firm promises a 90 percent yield rate, and often delivers 95 percent or higher, according to the company. A recent run of a complicated nylon compound produced a yield rate of 98.5 percent.
Toll compounders often produce yield rates of only 85 percent, according to ACS director Rena Pomaville.
``A lot of tollers don't want to be accountable for the material they use,'' said Pomaville, who joined ACS in 2007 after a long career at Thermofil. ``Our customers love getting this amount of detail from us. It's their money and they want to know what's going on.''
ACS' high yield rates allow it to charge higher hourly rates for tolling work. High yields and low scrap rates also increase the value of its services as material prices escalate.
``Randy [Rudisill] used to tell us leaving resin pellets on the floor of the plant was like leaving pennies,'' Pomaville said. ``Now those pennies are dimes.''
Rudisill and Donie who co-own the firm decided to enter the toll compounding market based on an experience they had in 1998, when a fire at Thermofil's Brighton, Mich., plant led that firm to work with toll compounders until a new plant was built.
The men saw opportunities that many toll compounders were not using to their advantage.
In some cases, ACS is replacing compounding work that resin makers had done for themselves; in other cases it complements ongoing compounding operations.
``We can make these materials at a lower total cost than what [resin makers] can do on their own,'' Rudisill said.