With billions of dollars worth of capital equipment in operation around the globe, and over 50 years of service to the plastics and converting industries, Gloucester Engineering Co., Inc. (“GEC”) is coming off two consecutive years where it has doubled its annual sales. By recapturing customer confidence, the company’s backlog has steadily increased and management is forecasting an additional 35 % growth in 2013.
“We know many customers were concerned about our future back in 2010 when the company was forced to restructure”, said Carl Johnson, GEC’s President. “But our recent financial performance, our new product introductions and the fact that we made two acquisitions last year have signaled to the market that we are healthy and resurgent,” he added.
Ownership and Economic Issues
The story of GEC is about a company, founded in 1961, which rose to the top of the plastics industry by leading the way into the booming plastics packaging market. GEC developed machinery and equipment that produced plastic bags, films and sheet, a market that was in its infancy but would soon experience exponential growth. GEC rode the wave of that success, continually creating newer and better ways to produce superior plastic products.
The Gloucester, Mass. USA based company was purchased by German industrial giant Battenfeld in 1978, which helped the company expand its offerings to the global marketplace. By the late 1990’s, the company was flying high – but great challenges lay ahead.
Lower cost competition began appearing in the market, which began eroding GEC’s market share. Unfortunately, management failed to react to the changing times. Following a period of constant management turnover, in 2007 the company was sold to a few individuals who lacked the capital and expertise to manage a global company of GEC’s scale. During this period, the lack of professional systems and rigorous controls took a toll on the company’s service, market position and financial strength.
“We were hurt by a number of factors, and quite honestly we were a capital-intensive business with inadequate capital. While we had a strong backlog in 2009, we lacked the financial resources to build the machines and there was nowhere left to go but through an aggressive restructuring,” said Johnson.
A New Day
In January 2011, GEC was purchased out of receivership by private equity firm Blue Wolf Capital Partners LLC, who set about implementing necessary changes at GEC. These changes have included adding new and experienced leadership, rebuilding the sales and engineering departments, installing a new state-of-the-art ERP system, introducing new products and completing two acquisitions. These substantial efforts have transformed GEC into a leaner, stronger company.
“We had a great NPE2012 show last year in Orlando,” said Johnson. “It helped us get the message out to the industry that GEC is very much alive and well, and ready to compete and succeed in the global plastics marketplace.” The company is continuing to exhibit at leading industry events around the globe and will be present at this year’s flagship shows of Chinaplas and K2013.
“We have done a ton of work since restructuring in 2010. Our backlog and slate of new product introductions are tangible evidence of that,” Johnson said.
Lifetime Support = Service, Service, Service
GEC has been known throughout the years as a leading supplier of capital equipment including blown-film, cast-film, foam, and film and sheet extrusion lines. That hasn’t changed. What has changed is the company’s increased commitment to servicing its massive installed base and to upgrading and improving the performance of other manufacturers’ equipment.
“We know we have more experienced personnel in plastics extrusion than just about anyone,” said Laurent Cros, VP of Aftermarket & Service. “It’s a clear strength that we are focusing on and it’s paying off for GEC in a big way.”
“While we continue to sell new production lines, many companies are putting our expertise to work to upgrade their existing machinery. This helps them get better performance out of their existing equipment.”
GEC’s unique ‘Lifetime Support’ is an exclusive support program designed to provide processors with the best maintenance, spare parts, training, and performance enhancements possible. “It focuses on three critical areas: equipment, people and processes, the critical areas that any business needs to be competitive and profitable,” said Cros.