Using a 'conservative Midwest philosophy,' Evco Plastics wins Processor of the Year

Oshkosh, Wis. — To hear Dale Evans say it, the people running Evco Plastics Inc. are simple, humble Wisconsin farm folk — who are in the middle of a $12 million investment to expand in the United States, China and Mexico.

Don't be fooled by Evans' soft-spoken demeanor. Evco, which turned 50 years old in 2014, helped pioneer the plastics factory of the future, dubbed the Advanced Manufacturing Plant (AMP), and established a mold-building factory in China — and both big moves came in 1989, well before other plastics processors.

The company is an interesting blend of a family atmosphere, fostered by the Evans family owners, and a large and long-term global presence, with factories in Wisconsin, Georgia, China and Mexico. Under Dale Evans, the longtime president, the company has become international and gotten into clean room molding.

When Evco celebrated its 50th anniversary, events happened at its plants around the world. In the headquarters city of DeForest, Wis., near Madison, 800 people packed Evco Circle to hear music, eat, drink and tour the molding factory.

“We had a good time. A lot of people had a good time,” Evans said. “When you advertise, in Wisconsin, ‘Free Beer,' a lot of people come. It's really simple to draw a crowd.” He laughed.

Though Dale Evans sometimes has an aw-shucks way of speaking, he is a savvy plastics veteran who started out working for his father, Don Evans,

in the family basement with a Giddings and Lewis molding machine. “I was probably 12 years when I started running the molding machine,” he said.

Fast forward to today: Evco generated about $145 million in 2015 sales from North America, including Mexico, for the sixth straight year of sales growth since rebounding from the Great Recession. The debt-to-equity ratio declined by 25 percent last year. The company employs about 1,000 people worldwide.

Evco runs about 150 injection molding machines, including 28 large tonnage injection presses, from 1,000 to 3,500 tons of clamping force — making Evco a major force in large-part molding. The 3,500-tonner runs at Evco's factory in Oshkosh.

Now, Evco is a major force in industry awards, as the newest Plastics News' Processor of the Year. Plastics News presented Evco officials with the award, and honored all the finalists Feb. 17 at its Executive Forum in Naples, Fla.

Evco earned high marks from the judges — who are Plastics News reporters and editors — on all seven criteria. Exceptional categories were financial performance, customer relations, employee relations, industry and public service and technology.

Evco won the Processor of the Year Award over the three other finalists: Nicolet Plastics Inc., Dymotek Corp. and MTD Micro Molding. All four finalists are custom injection molders.

In addition to its strong position in large-tonnage molding, Evco also offers multi-shot molding, overmolding, insert molding, in-mold decorating and labeling, gas-assist molding, stack molds, thin-wall packaging, automation and assembly. Evco does Class 8 clean room molding.

Investments

The Evans-family owned company has become big — and global — but they make sure Evco retains a welcoming approach to new employees, while offering advancement opportunities for long-term people. Dale Evans believes a manufacturer should hire for attitude and train for knowledge.

Give them the skills as needed, and boost the pay of employees who gain more skills, Evans said. Evco, like most plastics processors, used to try and hire employees with experience and existing skills for specific tasks. But management found that people with plastics molding background often were rigid, not open to try new things.

“Yes, it's difficult to change people, unless they want to change themselves,” Evans said.

Evco regularly invests in technology. The big 3,500-ton Engel press was installed three years ago in Oshkosh. Evans said the company now uses magnetic mold clamping on every large-tonnage press it buys, allowing for faster mold changes.

The most recent investment of $12 million, which Evans announced last year during NPE 2015, includes a 36,000-square-foot expansion and added a 3,300-ton Ube press at Evco's factory in Calhoun, Ga. — that plant's first above 3,000 tons; relocating its China molding factory to another city and putting in a Class 8 clean room there; and in Monterrey, Mexico, adding a 2,500-ton Engel press and a large crane.

Having the massive injection molding machines sets Evco apart. “We had turned down a bunch of work, because you can't even quote on it before when you didn't have the big equipment. Now we can,” Evans said. Existing clients had asked Evco to expand into larger tonnage presses.

But it's not easy. Floors need to be reinforced. Hefty cranes are mandatory. At Oshkosh, one big mold on the shop floor weighs 90,000 pounds; the plant has cranes of 80 tons and 33 tons lifting capacity, and they can be used in tandem for the really giant molds. “Not many people put in the infrastructure and the equipment to go with it. You need both,” Evans said. “We started new [by building the Oshkosh plant], so we could put the infrastructure in place to do that.”

Evco has three plants in Mexico, but, given the large press sizes, Evans said room is running out. “There's a finite amount that we can grow with our current facilities. We're almost to that point,” he said. “We've added some more equipment, but it's going to be another year or so that we won't be able to do that. So facility four will have to be looked at.”

Evco's groundbreaking year of 1989 comes along maybe once in a custom molder's history. Evco set up the mold-building factory in Shenzhen (and began molding there in 2000). AMP, which molds parts in the DeForest headquarters plant, has utilities underground in a big, walkable trough and sports a high level of automation — forward looking, especially by the standards of 1989.

Dale said his brother, Steve Evans, played a major role in designing AMP. A mining engineer, Steve likes to develop systems.

“And so the AMP plant was a giant system,” Dale said, from the layout of utilities and resin flow to how product moves through the plant to shipping.

“All of our newer facilities are takeoffs of what we learned in that AMP plant there,” Dale Evans said. Evco didn't try to duplicate the entire Advanced Manufacturing Plant. “You took what worked. All the utilities at the AMP plant are underground. Well, OK that's fun, but it's an expensive way to do it. Our newer facilities, we've saved money, we keep them at the same level [as the molding presses]. It adds more clutter to the facility, but on the other hand, it's not as expensive,” he said.

In addition to Dale and Steve, other family members play important roles at Evco. Dale's daughter Anna Bartz is marketing director, and another daughter, Katherine Bashir is business unit leader in sales. Founder Don Evans still comes in regularly, and thinks up new plastic products.

And now the fourth generation has arrived. Bartz and Bashir in January gave birth to their first babies — and Dale's first grandchildren — within three days of each other. They work from home offices in the Chicago area.

Plastics News visited Evco's 100,000-square-foot Oshkosh plant in mid-January. The company purpose-built the facility in 2003 and expanded it three years ago. It employs 75 people and runs 19 injection presses, a mix of Engels, Arburgs, Van Dorns and smaller, all-electric Toyos.

Oshkosh specializes in large part molding, including shorter runs. Plant Manager Spencer Wright said that every time a molder makes a big growth spurt, it's like an entirely new company to run. But Wright said Evco keeps everyone grounded.

“We've got that conservative Midwest philosophy. We want to do it right. So you maybe take it a little slower than someone might. But you do it right. And you do it conservatively,” Wright said. “We all got a little farmer in us. We have that mentality. I think my most important job for Dale and for Evco is that, as we get bigger, we don't forget where we came from.”

Starting out small

Dale's parents, Don and Joan Evans, started in plastics in 1948, forming Evans Plastics. They had a couple of plunger machines. The first part that earned any money was a small red plastic knob for a customer that made grease filter systems above the short-order grill in restaurants.

“They were machining that knob out of red stock, and [Don Evans] was able to do it for 80 percent savings over what they had,” Evans said.

Don's brother-in-law invested in the business and they formed Evans-Zeier Plastics in 1951. “They were doing really good in the ‘50s to early ‘60s. My dad wanted to expand. My uncle did not. So my dad sold out to my uncle,” Evans said.

Don Evans started over in his basement. Evco dates to 1964, the year Don sold the business and started his own molding shop, with a little half-ounce plunger machine. Then he built a 1,200-square-foot plant in DeForest.

Dale graduated from college in 1973, as company sales were less than $2 million. Evco opened its first satellite plant in 1976, buying a building in Oshkosh. In 1981, his parents retired.

“They essentially handed me the keys and said, ‘OK Dale, run it,'” he said. Dale Evans and Evco employees did just that, opening the China mold-building operation, then designing and building AMP. A few years later, between 2001 and 2007, they opened three plants in Mexico — two in Monterrey and one in Juárez.

Evco got some exposure to the Southeastern United States by building the Calhoun custom molding plant and tooling facility in 1984 — then in 2009 the company doubled its size, to 70,000 square feet. In 1985 the company opened a new factory in DeForest. Clean room molding, expansions and the startup of manufacturing in Mexico followed in the 2000s.

Evans agrees that there are some good molders in Wisconsin — including two previous Processor of the Year winners — and throughout the Midwest.

“What's a good molder? A good molder is somebody who does what they say they're going to do. Keeps their promises. Consistently delivers a good product, on time. And figures out a way to save clients' money — that's how you keep your customers nowadays,” Evans said.

“Not many people give raises on our plastic part costs, at all. So you have got to figure out how to continuously, never-endingly, do it better — cheaper, faster. And you got to instill that attitude in your people who work for you, so they understand that, as well,” Evans said.

Another key discipline: Pick the right customers.

“You can have the best management team in the world. The best management practices. The best equipment. But if you got the wrong industry, the wrong client, you will lose,” Evans said. “And so we spend a lot of time selectively going after clients, trying to find the right ones that will grow.”

It's a job he takes seriously: How will new customers perform in the future, and how can Evco fit with that? He likes to study demographics, to determine “sweet spot” spending periods for individual products; he looks at birth rate data.

Diversity of customers is also important, said Richard Duval, director of quality and human resources. “Dale is always watching how much business we have in each market. Trying to make sure that we don't have a lot of volatility between our quarters, and with our staffing.”

Evco's markets include industrial, agricultural, power sports, medical and packaging. Officials do not publicly identify customers, except for John Deere, which has named Evco to partner status — a level achieved by only a few suppliers.

Satisfied customers

Evco scored high marks in customer relations, because of its 99.5 percent on-time delivery rate and glowing customer comments made to the judges. One maker of high-end appliances said Evco molds parts and does some assembly, and also does mold design — including molds that go to other processors. “They've been very accommodating. Every time I call them up they're there to answer questions,” he said.

Another customer said Evco performs well on its high-volume, Class A cosmetic parts for a consumer product. “Quality is very good, which is why this latest program that I just awarded them is coming from a bad situation, and I moved it to them specifically because they would be able to fix it,” he said.

Evco has solid systems in place for program management, where a project engineer tracks the part from design through tool build, sampling and production.

Quality is a given. Evco's global rate of defective parts per million is 121, and leaders want to slash that to 3.4 PPM, in part by forging partnerships with customers to make sure every product launch goes smoothly.

Investment in people

“I think that Evco cares about the people that work here, and they treat them like family,” said Andrea Brothwell, human resources coordinator at the Oshkosh factory.

Employees are a key for keeping the growth going. Evans says he asks a lot: “How can the people that we have be successful and grow within our company, and satisfy [customer] needs?”

One way is a gainsharing bonus paid out monthly. It's based on profitability, on-time delivery and quality. Duval said the transparency gets employees actively involved in how the company runs. And managers present a monthly PowerPoint to each shift. Dale Evans writes a monthly newsletter.

Employee involvement also helps make Evco plants a safe place to work. A free meal helps.

“Every time a facility goes a month without a lost-time injury, we buy lunch for everybody,” Dale Evans explained.

Before management hit on the idea of free food, Evco's workers' compensation costs were about $400,000 a year. Management used employees' ideas to improve safety, and invested money. “We spent money and spent money, and it just never got any better,” Evans said.

At Evco, there is such a thing as a free lunch. Evans tells the story: “And then one of the plants went for a month without a lost-time injury and the HR people said, ‘Hey, can we buy people lunch?' I flippantly said, ‘Well, yes, and anybody else that does it, we'll buy lunch again.”

Sometimes the simple things work.

“So we started doing that. A year later, our workers' comp. costs were down to $17,000 a year,” Evans said, still marveling at the huge reduction. Employees look after each other, and let co-workers know if they're not being safe.

Evco also has a Wellness Bank, reimbursing employees for things like gym memberships, running races, weight loss and smoking cessation. And any employee can use the company's 10-acre garden in DeForest — so you can work off the pounds from all the zucchini bread.

Evco encourages its employees to learn new skills, and backs that up with a pay-for-performance policy. Evans said the company stopped giving raises based on seniority about two decades ago.

“We give raises based on knowledge. So, learn how to do this job, you get a raise. You learn how to do more, you get another raise. You learn how to train people to do that, you get a raise. You progress from an inspector/packer, to a person in quality, you get a raise. And some raises, as it gets higher up, requires a class at a tech school or something like that, you get a raise.”

The goal is to spend 4 percent of payroll for training each year. Evco has developed training programs for production workers, inspector/packer and quality staff. Duval said the company is creating training for material handling and customer service. Management likes to promote from within.

Every facility also has Paulson Training programs.

But Evans pointed out that nobody is forced to participate; if you're happy on your job, you can stay there and still get cost-of-living increases.

The Great Recession has faded into memory, but Wright, the Oshkosh plant manager, said the company tried a flexible approach during the 2009 downturn.

“What we did is, we shut down Fridays. We would shut down a week a month. We did everything we could not to lose our skilled employees, and we did not,” he said.

Brothwell said the voluntary days allowed the workers to file for unemployment, then return.

Duval said management explained the reasoning well.

“Everyone understood,” he said. “It was well-communicated. People knew it was tough. You didn't hear people complaining in the plants — and in some areas we had to cut heavily in other plants, and so you had people doing four or five jobs because the one job wouldn't have kept them busy,” he said.

Money from recycling, be it soda cans, cardboard, regrind, even purge piles, goes into a Team Fund to reward employees with things like Brewers tickets or, last year, Christmas trees purchased from the local high school booster club.

The recycling efforts also earned Evco points for the Processor of the Year's environmental performance area. In its submission, Evco also included charts measuring electricity use, gallons of water consumed and pounds of waste. And the new presses are more energy efficient. In 2015, the DeForest plant managed to reduce utilities by 10 percent, even though machine hours increased 24 percent.

The company also has developed returnable packaging, dubbed EV-PAC.

Evco was nominated for the Processor of the Year Award by Lauren Smith, an account executive of Hiebing, a marketing and media company in Madison.

Lights out in China

Evco scored very high in the technology section of the award. More than 120 robots run on presses throughout the company, including three-axis, six-axis, side-entry and SCARA robots.

Since last November, Evco has run a lights-out operation in China, of all places — a national economy built in cheap labor. Is Dale Evans a contrarian?

“Eventually China's got to start operating like a U.S. company, having less people, less hands touching things. So in our plants we are starting to do that,” Evans said.

Evco has moved its China factory from Shenzhen to Dongguan.

“We're running lights out in China. We've put in new infrastructure, new utilities. New machinery in there. They set things up on the first shift, we have a staff there, for quality. And then the second and third shift, we're running lights out,” he said. “Nobody there.”

The automated molding sometimes runs on the weekend.

For Evans, lights-out in China presents a challenge.

“I'm after everybody else in the U.S.: Hey, we can do this in China! Why can't we do it at some select plants in the U.S.? So we're gonna make some attempts to do that more here,” he said. “Now, we've done that in the U.S. before. But we've never consistently kept it up.”

Evco began clean room manufacturing in the mid-1990s. The ability to mold medical parts makes Evco a rare custom molder that does clean room molding, and also makes very large parts. The firm's engineering staff also is experienced in metal-to-plastic conversions.

The company regularly invests in metalworking equipment for its tooling department — buying a Kitamura machine in 2014 allowing Evco to build molds large enough to fit into a 2,000-ton press. Last year, the company invested $700,000 on a Grob five-axis machining center, boosting capacity for making complex parts with a single setup.

And the family owned business is a major player in community affairs. For more than 25 years, Evco has sponsored a work-study program with DeForest High School. Evco has started to sponsor the hometown school's robot competition. Two years ago, Evco started The Legacy Project, providing two scholarships a year for students who are interested in engineering or a similar technical degree.

And Evco is open to plant tours for students, professional groups and local government officials.

The ever-humble Dale Evans sets the tone.

In Oshkosh, Spencer Wright explains: “Working for Dale has been interesting, to say the least. He's a very compassionate guy. He listens. He understands. He values what you say. He understands what you're saying. And deep down, we're all in this together. He's learning as we go, too.”