Diversification has been the passcode unlocking growth for Graham Engineering in an economy that requires nimble movement to stay successful.
The company, a U.S.-based producer of equipment for blow molding and extrusion, weathered the ups and down of market conditions over the past two years by adroitly shifting focus to different applications when needed, said Michael Duff, Graham vice president of sales and service.
For instance, while new housing starts has sagged and fewer plastic construction parts were needed, the company has shifted focus to health care, where the market is booming.
Instead of placing all its cards in one pot, the York, Pa.-based company has increasingly spread its focus on three main areas of business: health care, building and construction, and packaging, Duff said. That has helped the company earn a record year in some areas of its business in 2022 while not having to shoulder any shutdowns or layoffs during the darker COVID period.
"A diversified portfolio has helped us continue to expand," Duff said during an Oct. 20 interview at K 2022. "We're managing the market changes as well as anyone can."
Lately, the company has moved heavily into health care, which accounts for about 20 percent of Graham's sales and rising, said Scott Howland, Graham's strategic market manager for blow molding systems. At the start of COVID, the medical market moved from a focus on elective to emergency surgery. Graham responded by providing equipment to help make such items as multiwall catheters, molded sheet and even wipe containers for hospitals, he said. It introduced a medical modular extruder that allows a barrel to be changed in less than four minutes.
And while construction work has been slow to grow due to high interest rates dampening home starts, the company found other opportunities, albeit in some unexpected areas. That includes equipment used to produce fiber tubes for underground vaults, also called electrical junction boxes, needed to replace older electrical systems in homes, Howland said.
Another trend benefiting blow molding suppliers has been the reshoring trend that has led many U.S. customers to take back production in-house instead of having components or machines delivered from overseas, Howland said. The company has quite a few machines on order for U.S.-based processors that have decided to take production in-house, Howland said.
Other blow molding processors have expanded in-house production instead of having parts shipped from outside companies. "Deliveries have been pulled back in," he said.
That has benefited Graham and allowed it to meet some of its supply chain challenges, Howland said. That has offset some of the issues associated with higher costs of blow molding machinery, which has swelled due to rising material prices and lack of supply. That situation has affected everyone in the industry, and processors have grown accustomed to paying more for equipment than in the past, Howland said.
While Graham has not expanded its internal operations recently, the company continues to grow. In July, Graham purchased Kennedy Tool & Die Inc., adding molds and tooling for blow molding, reaction injection molding, thermoforming and structural-foam molding to its portfolio. Kennedy is located near Graham in Birdsboro, Pa., keeping production close at home, Duff said.
Graham now has four business units: Kennedy Tool, American Kuhne, Welex and the Graham brands. The company is owned by Graham Partners, a Newtown Square, Pa.-based holding company.
The company also continues to expand its offerings, Duff said. The newest development is a machine with a higher shot size of 70 pounds, a move that allows customers to provide larger and heavier parts.
Graham also has expanded use of its Navigator control platform that Duff said is ready for Industry 4.0 applications. The control panel has added features that provide remote monitoring and support and can troubleshoot and fix potential problem areas online instead of having to send a technician on-site. Duff added that 75-90 percent of machine troubleshooting can be done online.