- Associated Press - Sunday, February 9, 2014

SAGINAW, Mich. (AP) - For more than 70 years, family owned Fullerton Tool Co. Inc. has operated a successful manufacturing business in Saginaw. In fact, the company is expanding again this year.

Company leaders say a diversified customer base for its carbide cutting tools has been a key to growth, according to The Saginaw News ( https://bit.ly/1npBtQw ).

“My grandfather started that. He traveled the countryside to find different manufacturing clusters throughout the United States to diversify us,” Fullerton Tool President Patrick Curry said of Morgan A. Curry, who founded the company in 1942.

“He tried to diversify us right from the get go, and it’s been the mode of operation since,” Patrick Curry said.

It’s a different situation at TRW Automotive’s Saginaw brake-manufacturing facility. TRW officials recently announced plans to close the Saginaw plant and eliminate 600 jobs after losing the business of General Motors, its lone contract, and failing to secure new business.

Jeremy Bockelman is director of the Michigan Manufacturing Technology Center Northeast Regional Office at Saginaw Valley State University. He encourages companies to diversify for long-term success.

“Diversification is simply hedging risk. Just like hedging the financial markets. The more diversification you have, the less likely that it will impact the bottom line and dependency of an organization,” Bockelman said.

Bockelman said he has known of companies that have as much as 80 percent of their business with one customer. If that one customer moves overseas or decides to close its local facility, “their back’s against the wall. They have to lay off employees,” he said.

“Even prior to the recession we tried to encourage organizations to not put all their eggs in one basket,” he said.

Bockelman said his group has worked with companies including Fullerton, Spaulding Manufacturing Inc., Gosen Tool & Machine, M. Curry, EMCOR Group Inc., Orchid Unique Orthopedic Solutions, Duro-Last, The Dow Chemical Co., Acra Cast, Kremin Inc. and Tubular Metals Systems, among others.

At Fullerton, Curry’s father, Richard, and his uncle, Morgan L. Curry, took over as company co-owners in 1977.

The company makes solid carbide cutting tools for a variety of industries. The company also has started manufacturing polycrystal and diamond-tipped tooling.

Fullerton’s largest industries are automotive, aerospace and medical. Some of the company’s big customers are Nexteer Automotive, medical manufacturers, Boeing, Chrysler and General Motors Co.

Since 2009, revenue has grown from about $13 to $14 million to $25 to $30 million, Patrick Curry said. And in the last several years, the company has added more than 40 employees.

Saginaw City Council recently voted to approve an Industrial Facilities Tax Exemption Certificate for Fullerton to invest in new equipment and new technologies.

“We try to invest between $700,000 and $1.3 million (or more) every year in new equipment and technologies just to keep up,” Curry said.

Curry recently led a tour of the company’s approximately 40,000-square-foot headquarters. The facility is tightly packed with whirring machines, but neat and organized. There, 152 men and women are employed, covering two shifts.

Curry said the economic downturn in 2008 and 2009 prompted company leaders to take a hard look at the company.

“We were always known as a very high-quality, good special manufacturer, but as far as innovation, it really wasn’t something people thought of when they thought of Fullerton, so we wanted to change,” he said.

In an effort to do so, company leaders developed the Fullerton Advanced Solutions Team, or FAST, a team of engineers who help customers solve tooling and machine issues.

Fullerton also has a research and development lab where employees develop tools, Curry said.

News of Fullerton’s tax exemption came about a month after TRW announced plans to close its Saginaw facility in mid-February.

That represents the second-largest layoff reported to the state in 2013.

“The facility has been unsuccessful in gaining new business awards and TRW has received notification from General Motors that it intends to resource production to alternative suppliers,” TRW officials said in a news release issued at the time.

When asked whether TRW had tried to come to an agreement with GM, and whether they serve any other automakers, John Wilkerson, senior communications manager for TRW said, “We tried to win the replacement business or obtain other business from GM and others but were unsuccessful.”

Bockelman said there’s more to diversification than finding new companies to conduct business with. It can mean diversifying the entire business model, such as by diversifying into existing customer markets and diversifying products and innovations. It also can mean diversifying the way in which business in conducted, including workforce skills, marketing and sales strategies.

“Be proactive and not reactive. Go from an order taker to an order finder. Diversification is a key component for the growth and success of our region,” Bockelman said.

Tim Nash is vice president for strategic and corporate alliances and the Fry endowed professor in free market economics at Northwood University.

Despite TRW’s impending closure, Nash said manufacturing as a whole is making a comeback in Michigan.

“Before you talk about diversification you’ve gotta look at the business climate and, I would say, clearly as you look at manufacturing … there are a lot of really good things that are moving in the right direction for the state of Michigan,” Nash said.

Nash said tax reform and reduced regulations in the state have created a more hospitable business climate.

“The Michigan economy is not just doing much better in automotive, but it’s doing much better in other areas of manufacturing: Kellogg in cereal production, Masco in home products production, Whirlpool in appliance production, Dow in basic and specialty chemicals,” he said.

Curry said globalization has been an important part of the company’s evolution.

“I think it’s made us a better company. We started exporting more, getting more involved in international business .. There’s definitely opportunities for us,” Curry said.

Adding, “When you’re competing globally, it steps your game up.”

Curry said Fullerton has limited space at its current facility and is considering a physical expansion, but the company won’t leave Saginaw.

“The City Council in Saginaw has been one of the best to work with. That’s why, for us considering expansion . we’re not moving from this location,” he said.

Curry also expressed his appreciation for the support of Saginaw Future and the Great Lakes Bay Manufacturers’ Association.


Information from: The Saginaw News, https://www.mlive.com/saginaw

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