AVON LAKE, OHIO — Matt Hlavin, third-generation president of Thogus Products Cos. in the Cleveland suburb of Avon Lake, considers his firm to be “a 51-year-old startup company.” Indeed, the custom injection molder has changed its stripes enough that one could argue it's been reborn.
For starters, it just changed its name to the plural, from Thogus Products Co., after realigning its various operations into four distinct businesses. (Jack Thompson and Walter Gus founded the firm as Master Mold & Die in 1950, but the company changed its identity to Thogus in 1958.)
In the midst of a down economy, the firm in 2009 has invested $2 million to buy its largest-tonnage injection press yet, along with seven servo robots and two fused deposition modeling machines for rapid prototyping and low-volume part production. More FDM machines are probably on the way.
The company also has brought in-house 223 tools since just last November, and reorganized its factory floor into more-efficient manufacturing cells.
At the beginning of this year, “We had our presses in a line, with an operator at every press. Now one operator can monitor six presses” due to the new plant layout, Hlavin said.
But 2009 has not been without its pain. In part due to a new management approach and in part due to the recession, Thogus laid off 15 full-time employees in February — its first layoffs ever — along with a number of part-timers. The move essentially halved the size of its then-110-person workforce. But it has acted to leverage that into a positive, and while altering its approach to hiring.
Now with 57 employees, Hlavin said the firm's new work-flow processes have allowed it to slightly increase throughput with no slippage in quality.
“We've changed our type of employee,” he explained. Most of the firm's new hires now are process engineers. “We've become very young. We have 24- and 25-year-olds running the floor now. Morale is very high. We're trying to create a Google-type atmosphere,” where the company “is a destination, not a place to work.”
Hlavin said the plant already is working around the clock, and he plans to have it open 24 hours a day to customers who wish to come in and brainstorm or plan around innovation.
“We beat our best September ever [in both dollar sales and profitability] by 20 percent,” Hlavin said in an Oct. 6 telephone interview. He estimates the company's October will best September by a similar percentage.
Due in part to the firm's tool-transfer strategy, which has facilitated the huge influx of new tools and programs — including 83 in just the past 30 days — Hlavin projects Thogus will increase sales by 50 percent next year from the $10 million forecast for 2009. Four years ago, the firm had sales of less than $5 million.
In late September the firm paid an undisclosed amount to acquire privately held Alpha Pack Biomedical Engineering & Design, a four-person company in nearby Westlake, Ohio, thereby doubling the size of its engineering department. Medical products make up about 30 percent of Thogus' current sales, and Hlavin said he intends to get his firm certified by the Food and Drug Administration and to keep building that part of the business.
Earlier in the year Thogus added a 165-ton, tie-barless Engel injection press. It recently acquired a 720-ton Nissei; previously its largest machine had been a 420-tonner. The firm now runs 27 presses at its 76,000-square-foot plant, focusing on short-run jobs. It runs more than 300 materials at any one time and averages 4.8 setups per machine per week.
During an August plant tour in Avon Lake, Hlavin recalled how a dozen years ago his firm generated 56 percent of its sales from the Big Three automakers.
In July 1997, “we got our QS [quality] rating, and fired our three auto customers the next month.”
“We didn't want to be Thogus Savings & Loan,” he said.
The firm broadened its scope, and ventured into much more custom work. It also identified tool transfer and advanced material development as strategies, and partnered closely with its resin suppliers, particularly PolyOne Corp. and Sabic Innovative Plastics, which between them supply Thogus with 90 percent of its materials.
About two years ago, the firm installed enterprise-resource-planning software from Paso Robles, Calif.-based IQMS Inc., and late last year hired Berkely, Mich., consultants Harbour Results Inc. to thoroughly revamp its work flows, while also creating close vendor partnerships and adopting a vendor-managed inventory system.
Beginning last January, Harbour partner Scott Walton virtually embedded himself in the Thogus facility — initially for two weeks per month, before scaling back to about three days per month. Walton, a former Nypro Automotive president, brought operational experience and a fresh eye to the shop floor, Hlavin said. That, combined with its implementation of the ERP software system, completely transformed the way Thogus does business. Now, Walton is helping the company with everything from strategic planning to assessing possible acquisitions and potential hires.
During the plant tour, quality control manager Blair Mumau said using the IQMS software “transformed our daily production meetings.” Suddenly, workers were able to closely track scrap rates, and do final quality inspections and audits right at the press. The software also helped Thogus better manage its internal tracking system, allowing it to automatically label incoming materials and parts, rather than having to do it manually.
Russ Wolfe, Thogus vice president of business development, added: “Unexpectedly, IQMS also helped us to estimate and quote jobs. We still probably only use a portion of what IQMS offers.”
Meantime, one of the molder's more successful moves recently has been its adoption of rapid prototyping and rapid manufacturing.
Earlier this year Thogus purchased a Fortus 3D production system from Stratasys Inc. and shortly thereafter bought a second such machine. The models they bought cost roughly $200,000, including the required software key and various materials licenses.
Working directly from a computer-aided-design file, the Fortus machines essentially “print” prototype and low-volume production parts using an additive fabrication process and engineering thermoplastic materials. With a build envelope of 16 inches by 14 inches by 16 inches, it can produce a three-dimensional part in less than 24 hours.
Stratasys, based in Eden Prairie, Minn., said its Fortus line yields parts that are “30-300 percent stronger than Stratasys parts produced with 3D printers, even when using the same materials.”
Hlavin is completely sold on the technology. Both of his FDM machines are running 24/7 now, and he said he's in negotiations to buy many more.
“We understand material science and the process,” he said, noting that he believes Thogus is the only firm in the country currently running all the materials Stratasys offers for this system. That includes ABS, polycarbonate and various blends, as well as polyphenylsulfone and polyetherimide resin.
“One of our biggest challenges is capital,” he said. “This allows us to make production parts without tooling.”
Hlavin said Thogus currently is printing production parts for six customers, mostly targeted at the medical, food and beverage, and general industrial markets.
On the prototyping side, he said, “Half the parts we're printing are for other molders,” meaning Thogus essentially has become a service bureau for some of its competitors.
“We're helping one customer take his part to market now,” he said, noting the company is even helping to teach Stratasys and some of its resellers about all the possible product applications for their systems.
Because that activity is becoming such a significant part of the business, Hlavin said Thogus just incorporated it as a separate company called Rapid Prototype + Manufacturing LLC.
As a result of a just-completed corporate realignment, Thogus Products Cos. is the umbrella entity that includes its traditional custom molding and contract manufacturing. The company comprises three other businesses:
c The newly formed Rapid Prototype + Manufacturing unit.
c The newly acquired Alpha Pack Biomedical Engineering & Design.
c Radiation Protection Technologies, an existing metal- and lead-replacement business.
As if running his fast-moving company isn't enough, Hlavin assumes the presidency of the Indianapolis-based Manufacturers Association for Plastics Processors, a grass-roots trade group widely known as MAPP. But then, such industry interaction is consistent with his overall approach.
“It's all about collaboration,” Hlavin said.