There was plenty to like about PolyTech Molding Inc. when Northwest Arkansas business partners Jim Benton and John McCutcheon first considered buying it last year.
What they found in Prairie Grove, a town of 5,000 about 15 miles west of Fayetteville, was a 75,000-square-foot plant with about 50 employees. After two decades in business, the custom injection molding plant was pulling in about $6 million in annual revenue, but running nowhere near full capacity.
In PolyTech, the two men saw a well-run business with plenty of growth potential. It seemed, at the time, like a sound investment.
"Little did we know what was coming," McCutcheon told me during a recent tour of the plant. "We had no idea."
Their decision to purchase the manufacturing plant looks even better now that Wal-Mart Stores Inc. has committed to purchasing $250 billion in American-made products by 2023.
As noted in a story you'll find in today's Business/Farm section, PolyTech Molding is contracted by Jarratt Industries to produce an item called the Taco Plate. Wal-Mart recently made a public commitment to order 1 million of the plates, which sell for between $4 and $5 each.
Not only will the Taco Plate purchase help the molding plant grow, other companies have either contracted with PolyTech or scheduled meetings with Benton and McCutcheon as a result of the push to return more manufacturing to the United States.
Right now, the facility houses 17 machines and many of the tools it uses are made in-house. PolyTech is set up to manufacturer anywhere from 100 to, well, 1 million units of a specific product.
What sort of products? "We can do anything," McCutcheon said.
That isn't really much of an exaggeration. All sorts of stuff comes out of the facility in Prairie Grove, a town best known for its Civil War park and 40-something-year-old phone booth. (Google it.)
PolyTech has done work for Tyson Foods Inc. Nautilus, the exercise equipment company, uses PolyTech for certain parts. So, too, do suppliers of products as varied as knife sharpeners, urinal cakes and a line of Christmas candles. Right now, the PolyTech client list is at 53, and it isn't outside the realm of possibility that the company could grow by 25 percent over the next year.
As many as 20 employees could be added over the next 12 to 18 months at the plant, which operates 24 hours a day, six days a week. Most, if not all of the new hires, will be a result of the Made-In-America push.
Annual turnover at the facility is low, and there are a number of employees who were there when its doors first opened. Plant manager Gaylene Deere has been at PolyTech for 20 years, including the last eight in her current role.
Asked about her reaction to the news that PolyTech would be handling Wal-Mart's 1 million orders for the Taco Plate, Deere said her sense of excitement was initially delayed.
"We better get to building Taco Plates," Deere said of her thoughts after learning the news. "It's exciting, don't get me wrong. It's my job to think about the numbers and how to make it happen. So that was the first thing that crossed my mind."
A Made-In-America campaign won't come without added expenses for manufacturers and suppliers. Many will likely have to tweak how they do business to satisfy Wal-Mart's business model of buying and selling as cheaply as possible.
In the case of PolyTech, the changes could be as simple and cost-effective as developing a tool that cuts four Taco Plates at once, rather than one.
McCutcheon and Benton figured the plant was poised to grow. That was before they began attracting business related to Wal-Mart. Both owners have marketing and sales backgrounds and noted they wanted to be more aggressive with selling than PolyTech had been in the past. Previous owner Steve Booth told the Washington County Enterprise-Leader in a 2010 article that the company had sales growth of about 14 percent annually over the first nine years he owned it.
"We saw the potential," McCutcheon said. "We're seeing even more now than we'd realized."
SundayMonday Business on 07/20/2014