Episode 32: As One Door Closes…How Bluffton, Indiana Lost and Gained a Major Manufacturer in 6 Months
November 14, 2017 | By: DCI
When a manufacturer announces plans to shut down its plant in a rural community, it’s not often followed by good news. But for Bluffton, Indiana, the loss of a major employer was the start of positive change and, ultimately, a happy ending. This week we bring you the story of 20/20 Custom Molded Plastics and its decision to take over the factory and machinery of a competitor company, along with much of its workforce, in Wells County, Indiana. To get the full story, we talk to Ron Ernsberger, Owner and President of 20/20 Custom Molded Plastics, and Chad Kline, Executive Director of the Wells County Economic Development Corporation.
Nicole D’Souza (Impact DataSource): Hey, The Project listeners, it’s Nicole D’Souza from Impact DataSource. I’d like to extend an invite for you to check out our podcast, “Economic Development Secrets.” Every month, economic developers from across the country share their tricks of the trade, exciting projects, and innovative economic development ideas. From rural to urban, business recruitment to business retention, you’ll hear great advice from your state and local peers and their new approaches in this constantly evolving field. You can check out “Economic Development Secrets” on iTunes, SoundCloud, and impactdatasource.com.
Patience Fairbrother (DCI): Picture this. A manufacturer in a rural county announces plans to shut down its plant, leaving some 100 workers without jobs. Sadly, we’ve seen this movie before, but we haven’t seen what happened next nearly as often.
Andy Levine (DCI): Just a few months later, another company in the exact same industry announces plans to take over the vacant factory, purchase all of their equipment, and hire back many of the same workers.
Patience: So here’s a story with a happy ending from Bluffton, Indiana.
Andy: So welcome to Episode 32 of The Project: Inside Corporate Location Decisions. I’m Andy Levine of Development Counsellors International.
Patience: And I’m Patience Fairbrother, also with DCI, and Andy is co-host of The Project. So this week, we bring you the story of how Bluffton, a city in Wells County, Indiana, lost a major employer and gained a major employer in the exact same facility all in the course of six months.
Andy: To give you the full story, we have to take you back to March 2017, when Buckhorn Inc., a plastics goods manufacturer, announced plans to close its plant in Bluffton, Indiana, to consolidate all of its manufacturing operations in Springfield, Missouri.
Patience: Bluffton Mayor, Ted Ellis, described this news as “a bombshell.” The city had no idea it was coming. The closure was slated to affect about 100 employees in Bluffton and leave the facility vacant. For a city of less than 10,000, this is pretty significant. Mayor Ellis said he had no doubt everyone in town would know at least one person affected by the closure. On top of that, this was actually the city’s second closure in about three months.
Andy: What Mayor Ellis and the other city and county officials didn’t know at the time was that Buckhorn was already in conversations with a competitor company that was considering taking over the facility and that company was 2020 Custom Molded Plastics.
Patience: 2020 Custom Molded Plastics was founded in Holiday City, Ohio, in 1999. The company custom molds structural foam parts for customers across a wide variety of industries. It started with just 2 machines and 3 partners and has since grown to 12 machines and 280 employees. Here’s Ron Ernsberger, owner and President of 2020.
Ron Ernsberger (2020 Custom Molded Plastics): When we started in 1999, our plan was to grow our plant to five machines and then live happily ever after. Our growth rate has been like a hockey stick. Today, we have seven structural foam machines and five high-pressure machines. We’re operating… We started, excuse me, in a building of 37,000 square feet and today, our facility is 350,000 square feet with 170,000 square feet of warehouse.
Andy: So the company has seen pretty impressive growth over the years, but this recent expansion to Indiana was never part of 2020’s plans.
Patience: In fact, the expansion came about almost as an accident when Buckhorn and its parent company, Myers Industries, approached 2020 in October 2016 with an opportunity to purchase some machinery in Bluffton, Indiana.
Ron: When we went and looked at those machines, they said, “Would you also be interested in the real estate?” Well, we ended up, we made a deal for the entire package: the real estate and the machinery. It was never on our radar, never, to open a company or start a company in Bluffton, Indiana.
Andy: Given how niche the structural foam industry is, an opportunity to take over the facility and the machinery of a similar company was just too good to pass up.
Ron: In the structural foam industry, there are not a lot of molders like us or like the company that was there. This is a pure guess, but today, there’s probably 2 over 13 companies in the United States, Mexico, and Canada that do what we do and with the number of machines and with the…how do I say…the particular machines that they were selling, it made all the sense in the world to us because there was gonna be an immediate vacuum created by them leaving the marketplace.
Patience: In addition to taking over the facility and machinery, 2020 had the opportunity to tap into an existing workforce with just the skills they needed to begin operating right away.
Ron: In our industry, I can’t hire anyone today with structural foam experience. If you have somebody in this industry and they’re worth their salt, you do everything you can to keep them. So when we looked at that workforce and we looked at all the experience, the years of service that they had, it made all the sense in the world to try and keep as many of those people as we could.
Andy: This almost seemed too perfect not to have been premeditated. We asked Ron, “Was this decision part of a master plan?”
Ron: I wish it was a long thought out process. It would make us look more like we knew what we’re doing, I guess. We kind of look like we’re spending money like a drunken sailor. We have been very blessed, we have a lot of work, we just closed on another contract that is going to bring other work in here. The opportunity for that facility with the machines that they have is enormous. We do know our industry, I know my competition, and we just think that there’s an opportunity today that’s on equal.
Patience: All in all, 2020 is investing $27 million to buy and refurbish the facility, which will double the company’s production capacity and create up to 155 jobs by the year 2020.
Andy: We’ve heard a lot about the interactions between these two companies that helped to form this deal. So where do the economic developers fit in the equation? To get that side of the story, we spoke to Chad Kline. Chad is the Economic Development Director for Wells County, Indiana, at the end of 2015. He’s had an interesting variety of careers, including roles as a photographer for a local newspaper and as a police dispatcher. Most recently, he served as County Commissioner for nearby Noble County.
Chad Kline (Wells County Economic Development Corporation): So our first interaction with 2020 was when they notified… We were essentially notified that they may be the offer that was gonna be accepted for the facility. So I had conversations with Dave Rupp from the company fairly soon after and we started talking about the opportunities in Boston. I immediately connected them with the Indiana Economic Development Corporation to work on putting together a incentive package for them since we knew they would be creating an investment here in Wells County, in Indiana, being that they were an Ohio company.
Patience: So to put this in perspective, the two companies had been talking since October 2016, but Wells County Economic Development wasn’t looped in until about six or seven months later. At that point, Chad was pretty sure the deal would go through.
Chad: I think it was fairly certain that the deal was going to happen. You know, we certainly still put together a competitive incentive package for the company while we were pretty sure that they were gonna continue on and actually make the closure happen or the closing of the sale of the facility happen. We still wanted them to know that we’re a business-friendly community and that we were gonna put out forth an incentive package that we would give anybody, whether we were having to go work hard to get them or whether or not they called us and said, “Hey, we’re thinking about coming to your community.”
Andy: Given that Buchhorn’s closing was such a blow to the community, we wanted to horn in on the impact that 2020’s decision to bring jobs back to Bluffton would be.
Patience: So this is a bit of a unique project for a couple of reasons. First is that this company is fairly seamlessly taking over a facility that recently closed. But even more interesting to me is the fact that they’re now in the process of or they have already hired a number of the employees that were previously without a job after this closing. What involvement did you all have in that and what has been the reaction of the community?
Chad: Well, I think the reaction of the community has been great. You know, I think the fact that, again, 2020 came in here with the hope that they would be able to grab onto whatever staff they could from Buckhorn because of the fact that they came and had such high-quality skills that they were needing to produce those jobs. The fact that they were able to quickly secure some of the remaining staff members at Buckhorn, I think had a huge role in allowing for them to get back many of the employees that were displaced from the closure.
Patience: Next, we asked Ron his perspective on how the community has reacted.
Ron: It’s honestly amazing. Everybody down there has been very warm and very receptive, very open since buying the plant.
Andy: Ron is very optimistic about 2020’s growth in Bluffton, Indiana.
Ron: We purchased the 38 acres right next to the plant. In 2018, we intend to put on a significant expansion there. We have three new machines on order that will be delivered to that facility by the end… Today, we have hired and kept on about, I think, 45 of the people that had worked there previously. By the end of the year, that’s probably gonna be about 100 or 110 people. So the commitment we’ve made to the community and the help that they’ve provided, working hand in hand, it’s been enjoyable.
Patience: 2020’s successful expansion has gone hand in hand with the best year for the company since its founding.
Ron: We are having the biggest year in our company’s short history. We stuck a shovel in the ground here in ’99, we turned the first machine on in 2001, and we started with literally nothing. At the end of the year this year, we’ll be around a $60 million company and with the expansion of machinery in Bluffton, and we have the biggest machine that Cincinnati Miller KRON has ever built on order to be delivered in September next year, we believe that by 2020, 2020, there’s a catchphrase for you, will be a $100 million company. And personally, I think that’s a growth rate that’s unparalleled in our industry.
Patience: So there you have it. 2020, by 2020, aims to be a $100 million company. We always appreciate a good catchphrase.
Andy: So, Patience, here we are. We’re at the takeaways portion of this episode. Since you are the one who interviewed both Ron as well as Chad, what stood out to you in this episode?
Patience: This was an interesting one and I think Ron put it very well at one point in our interview. He said, “This opportunity was just too good to pass up.” I mean, this is a very niche industry to begin with and to have a competitor company saying, “You could have our facility and our machinery,” and on top of that, they were tapping into this workforce that already had the very specific skills that they were looking for. It just seemed like a win-win on both sides of the equation.
Andy: So like this huge Christmas gift just fell into his lap.
Patience: Exactly. And as he mentioned, it was really never part of their long-term plan, but ultimately, it’s leading to even further growth for them which is great.
Andy: It’s great opportunity for the community of Bluffton to basically lose an employer and then within six months, they get it back.
Patience: Exactly. And I think, you know, Chad and his economic development team’s role in this was really just to support this decision, to make sure that they were seen as business-friendly and to develop an incentive package that would be attractive to them. But really by the time they came into the equation, it was already kind of a done deal. So it was a nice kind of smooth process and particularly in the economic development world, a very quick one. It was just about six months.
Andy: But I guess the big takeaway to other economic organizations is when you lose a company or a company shuts down, there are assets in both the machinery and the facility and most importantly, in the workers that you should be aware of and try to market. So that is a wrap on Episode 32 of The Project: Inside Corporate Location Decisions.
Patience: Our sincere thanks to Ron Ernsberger, President of 2020 Custom Molded Plastics. In the economic development world and especially in Bluffton, Indiana, he is a genuine hero. And special thanks to local economic developer, Chad Kline, for sharing his perspective on the company lost company found tale.
Andy: We also wanna thank Kate Virag. She is the VP of Marketing and Strategic Communications for the Northeast Indiana Regional Partnership. This podcast never would have happened without her help. The Project is sponsored by DCI. We are the leader in marketing places and have served over 450 cities, states, regions, and countries. You can learn more about us in aboutdci.com.
Patience: We hope you will keep listening. There are many more projects to come.