For Middleville Tool & Die, growth comes from production, not tooling

For Middleville Tool & Die, growth comes from production,  not tooling
While Middleville Tool & Die started as a tooling company, it has steadily increased its focus on its production business over the years. Now, production work has grown to encompass roughly 90 percent of its book of business. Backed by a new investment from the Bayer family of Southeast Michigan — who took a majority position in the company — Middleville Tool plans to expand the production business.

MIDDLEVILLE — Backed by a new investment, Middleville Tool & Die Co. wants to ramp up its manufacturing capabilities that will pull it further away from its legacy business.

In late December, the Bayer family that owns Bayloff Stamped Products Detroit Inc. and several other companies in Southeast Michigan acquired a controlling equity interest in the 51-year-old Middleville Tool, according to President and CEO Bill Blanton. The founding Middleton family still maintains “a significant” stake in the company. 

Both organizations will run independently, he said, declining to disclose the terms of the deal. 

With the injection of capital, Middleville Tool wants to focus on adding resources to the manufacturing side of its business without being saddled with debt.

“We don’t want to be a leveraged company,” Blanton said. “We want to be responsible because we have so many people in the community that are counting on us.” 

Blanton said the acquisition and the investment will “really propel us for the next 24 months.” 

“By that time, based on our structure, that gives us the smooth transition into more controlled growth going forward,” he said. 

The move gives Middleville Tool the flexibility to invest in its manufacturing operations, which have been responsible for the company’s growth in recent years. 

While the company has offered contract manufacturing services since 1972, it significantly increased its capabilities in 2003 after it developed a proprietary process for stamping unique tubular metal structures. 

Since then, the company has patented the wrapped tubular stamping technology, which has expanded to encapsulate approximately 90 percent of its business, Blanton said. In the last three years, the company has grown from 130 employees to 265 people currently. 

Middleville Tool & Die plans to expand the tubular stamping arm of its business, which manufactures exhaust and other tubular components for the automotive industry, as well as supplies the office furniture industry. 

“This innovation is special and we’re trying to use it as an anchor for who we are and what we’re trying to do as we go forward because it’s unique,” Blanton said of the technology.

The company has no plans to abandon its roots as a tool and die maker, even though that segment only accounts for roughly 10 percent of its business today. However, the opportunity presented by the manufacturing side of the business was simply too good to pass up, according to Blanton. 

“The reason why (tooling) is 10 percent today is because our manufacturing has grown so much. Really, the (tooling) volume has sustained,” Blanton said. “We feel like to take more space to grow that area at this time wouldn’t make sense because manufacturing space is at such a premium. But I do think there is an opportunity to see where that goes.”

Middleville Tool & Die uses its tooling group to supply its manufacturing arm with tools, while also performing contract work for larger Tier I automotive suppliers. 

SMOOTHING PEAKS AND VALLEYS 

While not an industry-wide trend, larger shops often will add manufacturing capabilities to smooth out the peaks and valleys inherent in the tool and die business, said Laurie Harbour, president and CEO of Southfield-based Harbour Results Inc.

“The tooling business is the toughest business out there,” said Harbour, whose business intelligence firm tracks the tool and die sector. “If I have the capability of people to run part production, I can absolutely smooth the peaks and valleys, but it’s just not for everyone. Not everybody has the capability to do that.”

Outside of Middleville Tool & Die, Grand Rapids-based AutoDie LLC also has expanded its operation to encompass production. AutoDie invested $4 million last year to purchase an automated line of presses that allow it to diversify its business through low-volume production runs. 

“(The investment) let us enter a new market area of doing emergency offload for stamping for aftermarket parts for vehicles,” said Mary Nicholson, vice president and COO of AutoDie. “If there is a niche vehicle that has low-volume production, we can also do that.”

Emergency offload refers to a manufacturer’s ability to transfer production from another company that has its presses go down for maintenance or other reasons, Nicholson said. 

By focusing on manufacturing capabilities, executives at Middleville Tool & Die are positioning the company for the future, said Vice President Jeff Cope. Meanwhile, the capital injection will serve to stabilize the organization’s future trajectory, he said. 

“We felt that in the past people have lost sight and they grow for the sake of growth,” Cope said. “Like anything, growth is good, but too much of it can cause even the best companies to stumble. 

“Our goal all along was to not be that company. Let’s make sure we’re servicing our customers but at the same time, we’re servicing our employees as well as our shareholders and do it in a responsible way.” 


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