A custom injection molder and two extrusion companies will compete to become Plastics News' next Processor of the Year.
A team of judges has selected three finalists: Freelin-Wade Co., an Oregon maker of plastic tubing and hose; Wisconsin-based custom molder Plastic Components Inc.; and PolyPipe Inc., a polyethylene pipe extruder with headquarters in Texas.
Plastic Components, known as PCI, was a finalist for the award last year.
The winner will be announced March 3 at a reception during the Plastics News Executive Forum at the JW Marriott Las Vegas Resort in Summerlin, Nev. The finalists and winner will be honored during a ceremony at the event. Then, the following morning, a senior executive from each finalist will discuss best practices in a panel discussion.
Plastics News will profile the winner for Processor of the Year in the March 9 issue.
The award, now in its 13th year, honors excellence in well-rounded companies by examining seven criteria: financial performance, quality, customer relations, employee relations, environmental performance, industry and public service, and technological innovation.
Last year's winner was Innovative Injection Technologies Inc. of West Des Moines, Iowa.
Members of Plastics News' editorial staff make up the team of judges. The co-sponsor of the award, Chicago-based Blaige & Co. LLC, will help analyze the financial performance of each finalist.
Here is a look at the finalists, in alphabetical order.
Freelin-Wade, which claims to be the largest independent tubing extruder in the United States, has management and employees that do whatever it takes to serve customers out of its headquarters in McMinnville, Ore., near Portland.
When resin prices skyrocketed last summer, Freelin-Wade made a bold announcement. The company would not raise its prices for the remainder of 2008. Other customer-friendly policies include one-off prototypes and no minimum order for any of the 4,000-plus tubes which can be searched via Freelin-Wade's Web site.
As a result, Freelin-Wade scored highly in the customer relations criterion. Customers from two major tubing and hose distributors raved about the company, calling Freelin-Wade honest, creative, flexible and service-oriented. ``We get a lot of bang to the buck,'' one said.
Freelin-Wade employs 111 and runs 14 extruders. Sales were $18.9 million for fiscal-year 2008, which ended Sept. 30. That's down from $19.8 million in 2007 and $20.8 million in 2006. Sales had steadily increased each year before that.
Sherl Hill, a 21-year company veteran who is vice president and general manager, said that, of course executives prefer sales growth for Freelin-Wade, growth of around 10-12 percent a year is a good rate.
Much of the downturn in 2007 and 2008 came from the coil hose category, used for pneumatic nail guns and other power tools, Hill said. Imports from China have hurt, as well as the slowdown in construction, she said.
But sales numbers only tell part of the story. Freelin-Wade, a consistently profitable company, has increased its profit margins, sales per employee and inventory turns while reducing the number of employees by focusing on lean manufacturing.
Hill said doing more with less is engrained into Freelin-Wade's corporate culture, down to the extruder operators. Lean has helped improve quality, and boost on-time shipments, which is above 99 percent.
Freelin-Wade has a colorful history. Founder Fred Plews had worked at A-dec Inc., a major dental equipment maker in Newberg, Ore., where he designed a new polyurethane tubing for the dental industry.
Plews thought PU tubing would make a good product for industrial applications, such as pneumatic power. He started Freelin-Wade in his garage in 1980, at first selling tubing made by an outside processor. Freelin-Wade began extruding its own products in 1983.
By the late 1980s, the company had grown to about 80 employees, as business took off.
In 1990, Plews sold the company to Coilhose Pneumatics, which had supplied Freelin-Wade with fittings and bought its nylon tubing for its line of fittings, quick-disconnects and other products for air-powered equipment. Plews continued to work as a consultant, before retiring this year.
The company enjoys a diverse group of markets, including medical and dental, construction, environmental, scientific, packaging, transportation and pneumatics. One product you see during every visit to the grocery store: the tethers used to rope off checkout aisles when they close.
Technological innovations include the introduction last year of coextrusion to the pneumatic power industry. Fast die changes help Freelin-Wade meet demand for many colors and types of hose and tube.
The Plastics News judges also gave Freelin-Wade high marks for employee relations. The company pays 100 percent of employees' medical and dental insurance, among other benefits. Employee teams also keyed several environmental-performance initiatives, to cut waste in extruder startups and dramatically reduce the amount of trash going to the landfill.
Company officials also are very active in the community.
Freelin-Wade was self-nominated by its marketing manager, Ron Miller.
Plastic Components Inc.
Hands-on management, solid marketing, a high degree of automation and a tight focus on what it does best have helped PCI forge a reputation as a custom injection molder that delivers a lot at a competitive price.
Now PCI is back in the hunt for the Processor of the Year Award, after making it to the circle of finalists last year.
President Tom Duffey founded PCI in 1989. From the first day, his goal was full automation with a robot on every press. The result is a highly efficient plastics factory in Germantown, Wis. PCI employs just 53 people, but runs 42 injection molding machines.
PCI has been consistently profitable, as sales have increased steadily, to hit $12.3 million in 2008.
PCI's submission for the award said the company's business strategy ``requires an organization of well-trained, talented employees throughout the company.''
Duffey said many of those employees were hired from nonmanufacturing jobs, and brought up in the PCI methods. ``We don't have anyone out there working that isn't adding value in some role,'' he said.
Fittingly, employee relations are a strong point. Turnover was less than 3 percent in 2008. PCI pays for employee training and on-site technical training through the Manufacturers Association for Plastics Processors, or MAPP (formerly the Mid-America Plastics Partners), an Indianapolis-based trade group where Duffey serves as president.
PCI molds precision parts, but does not do assembly meaning it specializes in what used to be known as shoot-and-ship molding, a category seen as at-risk for losing to China. But PCI has honed it to a fine art, taking all direct labor out of the manufacturing process. The employees are process engineers, quality personnel and material-handling people. ``They really analyze each job,'' said a customer.
PCI also sources molds from China, passing on the cost savings to customers. The company checks and reworks molds at an in-house mold shop.
Customers praised PCI for strong engineering support, good quality and fair pricing. ``They are very, very competitive, even when comparing to overseas,'' said one.
PCI inherited molds from another customer, which had transferred work from one of its former suppliers. By testing molded parts, PCI employees discovered one mold had a blocked water line something the customer was not even aware of and the company made adjustments to continue molding perfect parts.
Duffey even offered to replace parts PCI had already made, at no charge. The customer said PCI also changed its procedures for inherited tools, the type of fast adjustment a small company can make.
A third customer called PCI ``very responsive.''
``They have very, very good quality, very good delivery and are very helpful in the engineering and development side,'' the customer said.
PCI reports that its on-time delivery is a whopping 99.94 percent. Several customers have awarded PCI top ratings for quality.
Unusual for a small company, PCI stresses marketing. The company hired Teresa Schell as marketing manager in 2005. Since the marketing plan was implemented that year, PCI has been awarded 17 new customers in 14 new markets.
In 2008, PCI and Schell moved to bring marketing to the quoting process. Now when you get a quote, PCI gives you a 14-page proposal, complete with a mold-flow analysis, photographs and contact information for the team.
PCI also convenes a Customer Advisory Council to get feedback and make changes.
The company is active in plastics trade groups, such as MAPP. PCI has hosted a blood drive, working with other firms in its industrial park. PCI also collected 2,424 pounds of food for the Hunger Task force of Milwaukee 43 pounds of food per employee.
PCI also works with the Germantown Manufacturers Alliance to give tours and open houses for high school students.
Six people nominated PCI for the award: Daniele Fresca, marketing director for IQMS Inc.; Neil Gerrity, district manager of PolyOne Distribution; Bryan Golt, technical specialist of DuPont Engineering Polymers; Mary Chandler, vice president of M&I Marshall & Ilsley Bank; Jesse Smith, a business development official with Mississippi Power Co.; and Katie Barrette, shareholder of Kolb+Co.
PolyPipe is a major extruder of smooth-wall polyethylene pipe a market segment of plastic pipe that has held up well, even in the current construction slowdown. One reason is the diversity of markets for the pressure pipe, including natural gas distribution, oil and natural gas drilling sites, mining, municipal water and water, communications and fire protection.
The Gainesville, Texas-based company extrudes PE pipe at five factories, in Gainesville; Erwin, Tenn.; Fernley, Nev.; Sandersville, Ga.; and Evansville, Wyo. The company is building a sixth plant, in Midland, Texas, expected to begin production in March.
PolyPipe, which is owned by private equity firm Halifax Group, does not disclose sales figures. The company's submission for the award lists a range of $150 million to $180 million for 2008 sales. In Plastics News' most recent ranking of pipe, profile and tubing extruders, PN published estimated sales for PolyPipe of $180 million. PolyPipe was tied with smooth-wall competitor W.L. Plastics Corp. in Fort Worth, Texas, as the second-largest smooth-wall, PE pressure pipe firm in North America well-behind Performance Pipe, with estimated sales of $495 million.
But PolyPipe has made moves to differentiate itself from the pack, by expanding aggressively into large-diameter pipe, with a line in its Nevada plant that can extrude PE pipe measuring 65 inches in diameter the largest in North America. Other major investments have included a 63-inch pipe line in Tennessee and a 54-inch line in Gainesville.
The new plant in Midland like the Wyoming factory that PolyPipe built in 2007 is geared to serve the energy sector.
PolyPipe was founded in 1977 in Gainesville by a small group of local investors. They wanted to serve the regional oil and gas production market. The company expanded, adding factories. When the Nevada plant opened in 1995, PolyPipe got a nationwide presence in the PE pipe market.
In 1995, concrete pipe giant Hydro Conduit Corp. bought PolyPipe, to continue a diversification into plastic pipe after buying Quail Pipe Corp. the previous year. CSR split off the PE pipe business in 2001, creating the PolyPipe division of Rinker Materials Corp.
Halifax Group, with offices in Washington, bought PolyPipe in 2005, ushering in a period of expansion and growth that included the move into larger pipe and the new factory this year.
Plastics News ranking data shows a steady increase in estimated sales for PolyPipe from $100 million in 2003 to $180 million today.
PolyPipe scored high marks for most of the award criteria.
Customers said PolyPipe is a good supplier that makes quality pipe, is cost-competitive and fosters good communication.
Under employee relations, the company has a generous vacation policy and solid benefits package. The company helped a family with burial expenses when an employee's grandchild died in a natural disaster in 2007.
Each PolyPipe factory is active in community affairs, such as the Salvation Army, Habitat for Humanity, the American Red Cross and the Special Olympics. For industry service, the firm encourages employees to participate in trade associations, such as the Plastic Pipe Institute, where several play major roles.
To promote PE pipe, PolyPipe works with distributors to host seminars and brown-bag lunches with design and engineering firms.
PolyPipe officials also have invested to improve the company's environmental performance. About five years ago, the company installed a $200,000 system to reclaim fines from its grinding process, by capturing the particles, then compressing them. PolyPipe sends the material out to be repelletized.
PolyPipe was self-nominated by Allison Crabtree, technical manager at the pipe maker.