IMM’s Plant Tour: The comeback kids

American molders face insidious competitive challenges to their survival and growth at every turn, from cunning foreign competitors to the guy across the street. Others face an often more baffling challenge even closer to home—for some, it’s a family affair.

Stull Technologies (Somerset, NJ), a family-owned, third-generation U.S. molder of custom and proprietary closures, has seen it all. Family infighting over ownership and management nearly ruined its reputation and brought the company close to the brink of insolvency. Fortunately, with the help of a trusted consultant, the company survived. It has consolidated its operations and its customer base, made peace with the banks, and has recovered in better shape than ever.

Stull Technologies opened for business in 1947 as Stull Engraving. Its founder, Morton Stull, a former Navy machinist, was a toolmaker. He purchased a manually operated Van Dorn to run his molds. One machine led to another and, over time, the company became a premier supplier of specialty closures, becoming Stull Closure Technologies in the early 1990s, and Stull Technologies in 1997.

The founder’s son, Gene R. Stull, president and CEO, grew up in the shop. Today, he, his sons, and his workforce teammates have developed an inspired, lean-thinking plan of action for strong future growth by improving manufacturing efficiencies.
They also plan to aggressively market Stull Technologies’ long-standing reputation as one of the most innovative developers of value-added specialty closures and packaging components. You’ll flip your lid over their latest breakthroughs. Let’s tour.

All in the Family
The company’s brightly lit product display room right off the main lobby houses the fully restored, vintage Van Dorn press. In a conference room nearby, Gene Stull tells us, “When mold sampling developed into full production runs, my dad built his own screw and barrel for the machine to increase its shot size. And when the machine needed a bigger hopper, he built one.” Basically, he rebuilt the entire machine. That kind of do-it-yourself problem solving is indicative of the Stull family’s legacy of innovation.

During our discussion, Gene gives us a blow-by-blow of the trials and tribulations he’s endured in getting his company back on its feet after family infighting and bad management decisions had it almost down for the count.

It started in the late 1980s with an argument over Gene’s wanting to bring in SPC. His father and uncle, president at the time, balked at the idea. It progressed into arguments with his brother over business ethics, which created considerable dissension in the workforce.

After buying the company in 1997, Gene says he found it to be overleveraged. There was no money on hand to pursue new projects or to buy new equipment. At that time, the company operated three plants. One in Garfield, NJ was sold. The other operation in Randolph, NJ was brought into the Somerset plant. But the company was still on a downward spiral.
“We were getting lean before the economy tanked,” Gene says. “We made moves to consolidate and cut costs due to our own business circumstances—not global competition.”

Misjudgments were made by business professionals Gene had brought in, some from other industries. Key employees not wishing to move were lost in the consolidation. Consultants told Gene he faced a major problem in keeping the business. Bankers suggested he sell it off. Reluctantly, he began taking steps to do just that.

Luckily, Gene met a turnaround specialist named Mark Russo, of South Street Capital Resources, in November 1999. Russo helped Stull analyze his products, consolidate his customer base, and create lean efficiencies to reduce wasteful manufacturing costs. More than $6 million in overhead was removed and Gene began to substantially pay down his bank loans.

“We asked our bank to look at our numbers,” says Stull. “It came back to us in December 2001 and said, ‘We have many problem loans on our desk. With the changes you’ve made, you’re not even on our radar screen.’ We asked them to reset our covenants and established a multiyear line through 2003. Today, Stull Technologies’ green light is on. We call ourselves the comeback kids.”

A-E Stands for All-efficient
We’re joined in the conference room by one of Gene’s three sons, Jason W. Stull. Business development and analysis is Jason’s job. He explains that what we’ll see out on the shop floor is a work in progress. Then he shows us charts of the detailed, multiphased plans Stull Technologies has drawn up to improve its manufacturing efficiencies.

By the end of last year, Stull Technologies had scraped and painted the floors up to its molding machines, painted the ceilings, put in more skylights, and replaced the ones it had. It continues to implement robotics, install vision systems, and move toward replacing inspection bins with more advanced automated systems.

Centralized chillers were upgraded, as were pumps and additional energy-monitoring systems to improve efficiencies and further reduce overhead. And the company is looking at methods to recycle the heat off the shop floor into offices, all according to plan.

Last June, the company purchased three 330-ton Powerline all-electric machines from Milacron. Public Service Electric & Gas, its electric utility, awarded the company an incentive for buying such energy-efficient presses. Stull Technologies had already purchased two 110-ton Roboshot injection molding machines and one 330-ton Powerline in 1998 as a test machine. Jason says the guys on the floor loved it. Stull Technologies has two more on order as part of its phase one modernization plan, with more to come.

“The thought of our buying a hydraulic press again doesn’t make sense,” says Gene. “The power savings we’ve achieved are unbelievable.”

“That’s true, they are more efficient,” Jason says. “We get anywhere from two to four times better efficiency with them than with our hydraulics. There’s minimal power draw when the all-electrics are idle. To support our current business production, we will be able to go from using the 40 or so molding machines we have now down to 30, improving our production capacity while reducing our manufacturing overhead. We also plan to bring in additional electrics to support new business, allowing us to grow more efficiently.

“But, we may not become an all all-electric plant,” Jason adds. “Our six 500-ton Milacron hydraulics have been fitted with a number of special energy-saving features. Who knows what new machinery innovations will emerge over the next few years? We don’t want to feel like we’re locked into anything. Our goal is improving our efficiencies. Rather than being an all-electric facility, we’d prefer to be an all-efficient one.”

An Innovative Difference
Back in the conference room after our tour of the facility, Gene Stull tells us how he’s been pulling back from the business end of running the company, instead concentrating more on what’s always been his first love—namely, product development, design, and technical services.

Stull Technologies plans to differentiate itself from its competitors by positioning itself as an extension of its customers’ R&D and product marketing departments. It is committed to anticipating changes in market trends and responding proactively to help its customers improve the appearance, function, and convenience of their products. This pays off for customers, he says, in better brand loyalty, name recognition, and consumer appeal.

One of the most recent examples of this commitment to innovation is the first cosmetic senior-friendly, child-resistant closure on the market, a product trademarked “Stullsure.” It was introduced last summer in anticipation of new safety regulations effective October 2002. The regulations concern products containing 10 percent hydrocarbons by weight, such as baby oil, fingernail enamel remover, and sunscreen. The Stullsure is a one-piece, flip-top closure that fixes to the bottle and incorporates a patent-pending latching feature that automatically locks when closed.

Stull Technologies is currently pursuing and designing rotating stack mold technology as a means of producing single injection components as well as creating the next generation of multimolded closures. The Stullbright closure is one such multi-injection design, and guides consumers directly to the intended product, screaming, “Buy me!” from the store shelves. Other truly innovative products still on the drawing board were shown to us, but our lips are sealed.

“As long as you continue with what we have seen today, you are the type of supplier we want.” That’s what Stull Technologies’ biggest customer told the molder after visiting the plant late last year.

A week later, at the company’s Employee Appreciation Day, Gene said, “When a company or an individual has lost the respect of others, or its reputation, it takes a long time to regain it. Many times it doesn’t happen . . . all we can ask for is a chance, and if we are given that chance, then it is up to us to make our hopes and dreams come true. We are being given that chance by our number one customer and many others.” Stull Technologies has a plan in place for building its dream one day at a time.