Web-exclusive: Automation vs. emigration: Mar-Lee Cos.' plan

Automation and market specialization are two of the key elements in the business plan $18 million Mar-Lee Cos. has developed to ensure its growth as a domestic molder and moldmaker.

In our January 2007 issue, IMM takes you on a tour of facilities in Fitchburg and Leominster, MA belonging to Mar-Lee. But before we took the tour, John Gravelle, Mar-Lee's president, introduced us to an 11-year company vet, Stan Bowker, who was recently promoted to VP of operations.

Bowker is a busy man. He runs both of Mar-Lee's parts manufacturing divisions, overseeing all the day-to-day operations, “Everything from sales through to shipping,” he says, smiling. Guess that's why Gravelle was our tour guide.

Here's some of what each of them had to say about their company's strategies for success as a 21st century, 100% U.S.-based manufacturer before we took the tour.

IMM: How would you describe your company's approach to staying competitive in this era of what's called “global outsourcing” in polite society?

Bowker: I think we're a little unique, because we focus on a business strategy, one regarding where we should be-the markets we should be involved in. Take the new WD-40 spray cap, for instance. We actively participated in the product redesign to add value.

IMM: You design products?

Bowker: No, not exactly. Our customer had the cap designed by a French Canadian industrial design house, but Mar-Lee did the DFM, dealing not only with the part, but also with the influence of our customer's design on the automated manufacturing systems we proposed.

In addition to making the new products more functional and moldable, we have to concentrate on potential problems, such as robotic removal and stacking tolerances. The WD-40 cap has two PP parts and one in Delrin acetal. It took about six months to prototype and check it before it hit the market.

Gravelle: We have to consider the tooling and the automation for assembly with our projects. We buy and build our own automation on our own dime. That's another one of the unique features of our company. We do long-term contracts, including shot volumes and volume guarantees.

IMM: You pay for the automation?

Gravelle: Yes, we do. The two cells we built for an IML baby wipe packaging project cost us about a million bucks. We made it easier for our customer to get to market with that product, because we invested in their product.

IMM: That sounds like a risky proposition, though.

Gravelle: We have to do our homework first, though, finding out just who a potential customer is. So far, there have only been two investments we've made into automation that haven't worked out.

One product failed in the market, the program was cancelled, and the customer paid a penalty. On the other one, we didn't do our homework-the customer went bankrupt.

IMM: Packaging is a pretty competitive market though, isn't it?

Bowker: Yes, but we're not doing commodity packaging, like food packaging-you know, like cups and containers. We're doing added-value, specialty packaging to increase our customers' sales. You've got to get to the next page to stay ahead in this game.

IMM: Mar-Lee hosted a seminar here on the first day of the MassPlastics 2006 trade show last October, which was held right up the road in Fitchburg. You called the seminar, “Think Global, Manufacture Local.” Do you think automation is a key element for U.S. molders, like Mar-Lee, to stay competitive?

Gravelle: Absolutely! I want to make Mar-Lee into the poster child for what it takes today to manufacture in the U.S.-of what can be achieved by a U.S. manufacturer, if he positions his company correctly. And the thing that I am most happy to report is that automation works. We've proven it.

IMM: How about your customers, though-aren't they all “global”?

Gravelle: In 2006 Massachusetts generated a $5 billion sales volume in medical devices and the state is expected to do $6 billion this year. Why do I need to go anywhere else in the world to look for customers? I say, “Why not give a local manufacturer as shot at it?”

IMM: A lot of them were startup companies, though, weren't they? Isn't that a risky business?

Gravelle: I enjoy working with medical device startups. We're just getting into one new project-it's a surgical device that involves the molding and automated assembly of 17 different components. The customer-the potential customer, that is-is just getting into its first round of fundraising for the project and it may take four years until the product hits the market.But projects like this make coming to work in the morning exciting. We have several projects like this one in the pipeline. We've been through four project startups with just one of a growing number of Massachusetts-based medical companies and we're their supplier of choice. We keep our future in mind.

IMM: You must have quite a sales force to hunt up potential customers like that one.

Bowker: We don't have any salespeople. I believe Mar-Lee's growth is based on our ability to create brand awareness. If you're standing still, you're going to get passed by-by new automation and by processing technologies.

We can't sit back and be happy with where we are right now, or where we plan to be five years from now, or else we're going to get passed by. We're looking at a lot of technologies that would be new to us right now, like LSR, micromolding, and multishot molding. And we're not ruling out acquisitions to achieve our goals.

Gravelle: That gets into what we mean by “Think Global.” I think molders here need to be aware of global technologies. Personally, I'm looking forward to the K show in Düsseldorf, Germany later this year-I'm anxious to see the new manufacturing technologies that have been developed over there.

IMM: You like the K shows?

Gravelle: I'll never forget K'98. That was my first significant exposure to the possibilities in IML and multishot molding. We applied what we learned there to our first IML packaging project.

We took the product, put it through a manufacturing metamorphosis, and took our profits on that project from 5% to 25%. Being global doesn't necessarily mean that you have to move offshore to save a nickel on labor.

IMM: Your experience in molding bioabsorbable resins must help you promote brand awareness.

Gravelle: We've been running bioabsorbables for nearly three years now and we have five customers now. It's purchased in small batches-custom blends. There are long lead times involved. And materials handling and process control are the critical factors involved in running these materials. It's not for everyone.

Bowker: Bioabsorbables, like PLA, can absorb into the body quicker, depending on what's in the resin-which blend is required, that is-and the way the part is designed.

These materials represent a small percentage of our overall sales, but our familiarity with how to dry, handle, and mold them conveys a particular level of sophistication to the marketplace that's rather unique. Molding bioabsorbables has become a Mar-Lee core competency.

Gravelle: It's a niche market in which we've established our capabilities. We didn't start with the easy stuff, but, then again, we don't have to “talk quality” to our customers. We can show them what we're capable of doing.

IMM: Is it tough to find people to work here?

Bowker: All of our employees are from the local area, including me.

Gravelle: On average, our employee longevity is nine years, though some have been with the company for 20 years. And we promote from within. Bob Clinton, for instance, a 25-year company vet, was the manager of our tool shop. Today he's the director of engineering.

Bowker: Part of it is creating a workplace that's exciting. Other molders may be singing the blues, but we've had no layoffs. We try to keep things around here new and exciting.