At a time when the plastic injection molding industry is in a virtual meltdown, Plastic Components Inc. is thriving with a less-is-more approach.
Named by Plastics News as the 2008 national Processor of the Year, the Germantown company has invested heavily in technology with an employee-to-molding machine ratio of one-to-one, which is significantly below the industry standard of 8.6 people per press. The 40,500 square-foot plant operates on a fully automated production basis using Toyo and Nissei molding presses along with all the necessary support, monitoring and control systems.
“That means we don’t have the higher cost of human involvement,” says Business Development Manager Rick Riesterer. “We have high automation with each manufacturing cell — each one has its own individual robots, conveyers and automatic box handling systems — so fewer people are required.”
While many plastic injection molders are struggling or going out of business during the deep recession, Plastic Components increased sales by 11 percent last year thanks to a forward-looking strategy.
“Three years ago, when everyone could make a living doing this, larger corporations and holding companies were buying up injection molders left and right,” Riesterer says. “Now we are seeing a lot of attrition — a lot of companies that rode the automotive horse are going out of business. They were concentrated anywhere from 40 to 60 percent automotive — they never diversified — and now they are out of business.”
None of Plastic Components’ customers constitutes more than 20 percent of its business mix, which includes small engine, plumbing, the appliance industry and light automotive.
“Our portfolio is designed so that we are not top heavy in one industry or customer,” Riesterer says. “That is part of our strategic focus. Some injection molders might be dependent on the automotive sector, so that helps set us apart.”
Plastic Components has found new business niches. For example, metal gears are increasingly being converted from metal to plastic, and in the plumbing industry, plastic is also taking the place of brass and lead. “We have strategic alliances with other professionals so that we can be made aware when [an injection molding] company is not doing well,” Riesterer adds.
“We can present a value proposition to them, offering a valuable solution that will help those customers who are in need from a supplier that is viable. So they move that tool to us, and we start running production.”
The 20-year-old company has earned 17 new customers in 14 markets over the last four years, which marks a significant departure for a company that was only doing business with customers in Wisconsin for its first 15 years. When Riesterer and Marketing Manager Teresa Schell came on board four years ago, the company shifted its focus to expand its reach both nationally and internationally.
“We are engaging with customers we never had before,” Schell says, adding that anywhere from 10 to 15 percent of the company’s products go to customers in Mexico and China.
When it comes to marketing, Plastic Components goes outside the box with a customer-centric business model, using creative marketing techniques that are not common in the plastics industry. The company practices target niche marketing, and its methodology is to deliver a consistent message throughout the organization.
Plastic Components’ Web site is unique, with an online quoting system and an introductory video narrated by Terry Bradshaw. The site is kept up to date with the company’s current newsletter and published news stories so that customers can stay current.
“We don’t have a brochure, we do everything electronically,” Riesterer says. “We drive people through the Web site by marketing our Web page address from a database of customers, and Teresa sends out updates to our customers. We can tell them when we’ve got a new piece of quality equipment. And [customer] prospects looking at the home page can learn that if they have an existing mold in production, they can transfer it to us.”
Originally published in the Corporate Report Wisconsin publication.