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Sunday, 05 February 2017 16:25

Bottling equipment supplier turns tragedy into second chance for growth

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Plainwell-based FBN Sales Inc. makes components for and services bottling equipment used by a range of beverage manufacturers, including juice companies, Coca-Cola and Jack Daniels. Part of the company’s growth strategy includes transitioning from being strictly a components maker into manufacturing its own line of bottling machines. Plainwell-based FBN Sales Inc. makes components for and services bottling equipment used by a range of beverage manufacturers, including juice companies, Coca-Cola and Jack Daniels. Part of the company’s growth strategy includes transitioning from being strictly a components maker into manufacturing its own line of bottling machines. Courtesy Photo

 

PLAINWELL — Jim Turley remembers the call he received late one September night in 2014 as a moment that “altered our life.” 

Turley learned that the facility housing his company, Plainwell-based FBN Sales Inc., had caught on fire. By the time he reached the business, several fire departments had arrived on the scene to put out the blaze, which started when an exhaust fan failed and steadily grew into three separate fires. 

All told, the fire caused nearly $3 million in damages to the manufacturer of cap chucks, filling valves and magnetic headsets for the bottling industry. It wiped out the company’s inventory and destroyed the majority of its equipment and machinery. The building also was deemed unrepairable and eventually demolished. 

Despite the tragedy, FBN’s leadership had little time to regroup. When the fire occurred, the company was in the middle of a large project to machine supercharger covers for an undisclosed domestic automaker. While the one-off project was outside the company’s typical work, FBN didn’t want to make headlines as the company that shut down production for a major automaker. 

Immediately, FBN contacted its financial institution, 1st Source Bank — which is based in South Bend, Ind. but operates branches in Kalamazoo, Portage and Dowagiac — to double its line of credit. 

With the influx of money, FBN quickly purchased six new machines, leased a small facility 5 miles away and was back up and running within a week to finish the automotive project.

At the same time, the company moved its primary business for the bottling industry into a facility Turley purchased in 1989. 

“From 20,000 square feet, we moved back into 1,800 square feet and split the crew into two shifts because we didn’t have space,” Turley said. “During this time, everybody switched hats and did what was needed. Not one of our employees lost an hour of wages through this.” 

While tragic, the fire marked a turning point for the business, which had drifted away from its core competencies, a shift that culminated with the automotive project. 

“With the whole fire story, the timing is interesting because the (automotive) project was a complete disaster,” said Mike Turley, president and CEO of FBN and Jim Turley’s son. “Not only did it go poorly, but it was a distraction from what we do and it took key employees out of our main operation and moved them into this secondary project. It was very disruptive.

“Really, the strategy now is to focus on our core business. We’ve gone through a lot of work, we brought in a consultant and we restructured our organization from a personnel standpoint to make sure that we’re doing that. We’re not going after opportunities that are outside of our core focus and competencies.”

In April 2016 — after purchasing another building to consolidate its production under one roof — the company moved for the final time into its new 22,500-square-foot facility, which was built at the site of the fire. FBN invested a little more than $3 million in the project, taking the opportunity to build a facility with 4-foot-higher ceilings, add 100 feet of glass and improve the workflow on the shop floor. 

Since the fire, the company has doubled down on its core products. While FBN primarily serves the beverage industry, including Coca-Cola and other soft drink and juice producers, the company expanded to include customers in the distilling industry like Jack Daniels and Buffalo Trace.  

The company also sees further potential with its components for customers in the chemical, household goods and pharmaceutical industries. 

In addition to producing parts, FBN also services bottling equipment. 

Over the long term, FBN executives hope to transform the company into a bottling equipment manufacturer, instead of focusing on several key components. 

As a whole, the global packaging industry, which includes the beverage, pharmaceutical and other sectors, is expected to reach $52.5 billion in 2019, a 37-percent increase from $38.2 billion in 2015, according to a report from Freedonia Group, an Ohio-based research firm.

So far, the company’s growth strategy of sticking to its core business has paid off. FBN generated $2.7 million in annual sales prior to the fire and has grown to nearly $4 million now.

FBN employs 18 people at its new facility and plans to hire three additional workers in the coming year. 

Lanny Scoby, city president for 1st Source Bank in Kalamazoo who worked with FBN throughout its history, says the company’s success following the fire serves as a testament to executives’ commitment to the business.

“This is a really good example of a company’s owner who took a lot of pride in his employees and business,” Scoby said. “He could have walked away with a multi-million insurance settlement and drifted off into retirement. They built this thing from the ashes up.”

For the leadership at FBN, walking away from the business was never in the cards.

“I enjoy doing this and there’s 16 families whose livelihoods I was in charge of,” Jim Turley said. “There really wasn’t any thought to just taking the money. It was always the thought to rebuild.” 

Made in Michigan: After a devastating 2014 fire destroyed its building, inventory and the majority of its equipment, Plainwell-based FBN Sales Inc. turned tragedy into an opportunity to refocus the business. The manufacturer of cap chucks, filling valves and magnetic headsets for the bottling industry rebuilt its facility and then sought to enter new markets and expand the sectors it serves. FBN grew in the years since the tragedy, generating nearly $4 million in annual sales last year. Executives continue to eye growth by becoming a full-scale bottling equipment manufacturer, versus serving as a component manufacturer.

Read 2761 times Last modified on Tuesday, 16 May 2017 16:04
John Wiegand

Staff writer

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