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Anchor Plastics Inc.: Starting From Scratch, Molding the Future of Plastics
“I was not really born for this job, I was bred for it,” Steve Rogers laughs. "I have done almost every job in this place!" Steve grew up working alongside his father Ron in his plastic injection molding company, Anchor Tool & Plastic. After Ron expanded the company to Nogales, Mexico, Steve purchased the Minnesota location in 2007, renaming it Anchor Plastics, Inc. “In 2008 we were at $2 million in sales and we are growing at a constant pace,” says Steve. "I see us increasing by at least 25 percent in sales in 2011. We are also planning on increasing our work force by 25 percent."
While 2009 was hard on most companies, Anchor didn't feel the effects of the recession until March. During 2009 Anchor took a 40-percent loss in sales, but fortunately was still profitable. “We became more efficient in how we ran, concentrated on cash flow, and tightened our belts,” Steve says. Even with its struggles, Anchor was able to maintain its competitive work force and full benefits package.
Many different options were considered as part of Anchor's cost-restructuring, but ultimately Steve went to his employees to hear their opinions. “I have a fairly young, empowered workforce of 13 and when I talked to the employees about shifting hours to allow for Friday afternoons off, there was an extremely positive response," Steve shares. “This saves me money on overhead and keeps everyone happy.” By the end of 2009 Anchor was back to running at a steady pace.
Standing Out from the Crowd
When asked about what Anchor's core, internal strengths are that differentiates the company from the competition, Steve points out four.
First of all there is professionalism. "For every customer visit an employee goes on, a suit and tie is required. This has become a rarity in today’s industry," says Steve. "All correspondence is in a professional letter format, and all of our quotes include a detailed description of all the costs associated with tooling and part production." Because Anchor is a smaller company it can also offer a more personalized service by partnering with its customers, and is favored because of its quick response time.
Secondly, there is what is called the high “do/say ratio.” This is a concept introduced to Steve by one of his customer’s engineers. “It’s the ratio of what you do versus the ratio of what you say you will do. When we say we are going to do something, we do it and follow up,” explains Steve. Anchor has experienced numerous compliments over the years in addition to increased business due to the company’s passionate commitment to clientele, even keeping some companies coming back for over 40 years.
Thirdly, there is Anchor’s engineering ability. “What separates us from our competition is our engineering and design capability. We review each and every project in-depth and offer our customers cost-saving suggestions, as well as a no-obligation design review. We offer prototyping with a typical one week lead time,” Steve explains. “If you have a project, we’ll look at it and offer design suggestions. We are more of an engineering company that specializes in plastic injection molding. Instead of just making plastic parts, we offer our services to help guide our customers through the process, from concept to production, making it as easy as possible.”
Finally, there are relationships. Anchor Plastics' close relationship with Anchor Tool & Plastic in Nogales, Mexico, is another added benefit to the company. Not only does Anchor Tool & Plastic have injection molding capabilities, it has an assembly workforce of over 200 employees and is capable of automated and manual assemblies. The Nogales plant is only 90 miles south of Tucson, Ariz., and product is crossed on a daily basis into the United States and transported across the country to its final destinations, even as far as Canada.
Anchor’s customers benefit from the diversity and flexibility in the company’s product line. “From nanobody-type connectors to electric motors, cable boxes to children’s furniture items and everything in between,” Steve explains. “We’re not industry-specific, but we thrive on projects that require engineering services. It is in these complicated designs where Anchor Plastics' specialized experience can be utilized to the full extent. We really push limits on molding capability.”
To make all the necessary parts for the huge range of sectors, Anchor invests heavily in automation. “We have more than $2 million in sales with only seven people dedicated to production. We run a first and second shift, but the third and weekend shifts run lights out with no one here. For efficiency we have high-end work cells, including robots, granulators, chillers, heaters, conveyers, and we invest in Cincinnati Milacron machines and auxiliary equipment from QMC Machinery,” Steve shares. “Anchor’s customer products are shipped all around the world, even to China and Taiwan.”
In addition to recycling molds, Anchor keeps much of its minor tooling in-house allowing for significant cost savings to its customers. “We utilize subcontractors, both domestically and offshore, allowing us to increase efficiency and shorten lead times in larger projects," says Steve. "We have built strong relationships with our subcontractors, some who have worked with us for more than 40 years."
Partners in Prosperity
When asked for an example of how customers have grown through use of Anchor’s capabilities, a few came to mind. “We participated in a project to redesign a coat hook for a furniture manufacturer,” Steve remembers. “New laws in California state that any products in contact with children have to be lead-free. Many of the current hook designs use molten die cast parts with lead. We were able to help our customer design a new product that would meet these new regulations. The final product actually ended up beating its original die cast part and is able to withstand 240 pounds of pressure without breaking.”
Another project Anchor has recently been awarded is a centrifugal clutch for a major electric motor manufacturer. “My customer was experiencing quality defects with the original producer in Taiwan. After working with our customer, we were able to develop a process that was less expensive and of higher quality. The project was removed from the Taiwan-based company and brought to our facility in Minnesota, allowing for shorter lead times and reduced customer inventories. This particular component is of critical importance inside electric motors,” Steve shares. “This company does 2.25 million motors per year. The project was just a small part of the $500,000 in costs we were able to help save our customer this year.”
Anchor’s design input increases manufacturing efficiency and helps preserve the environment through smart byproduct reuse. “I like to joke that we were green before green was cool,” Steve laughs. “We start by designing the product to be created with as little excess material as possible, saving cost and time on the project." Every plastic product Anchor makes always has some extra material associated to make the part. They melt the plastic and then inject it into delivery channels called a runner system, which flows into each cavity. Each cavity forms the finished part. In most molds, a small percentage of the plastic is excess, generally from the runner system. A robot picks the runner system out of the mold and places it in a granulator that reuses the plastic on the next shot. This process results in a reduction in manufacturing costs that is then passed on to the customers.
Putting Training to Practical Use
Steve is always focused on the end result and how he can continue through his daily operations to bring new and innovative products to his customers through each project. His ability to incorporate engineering into business while efficiently balancing production and sales was heavily influenced from a few different sources.
First, there were the lessons learned from both his father and his formal college education. In addition to these teachings, Steve developed his skills through involvement in Pi Sigma Epsilon (PSE). “PSE is a national professional sales fraternity. This is where I gained the tools that have made me successful,” Steve shares. “During my time with this organization I found that the lessons I learned were great training grounds for business models today. We completed several money-making projects while learning about dealing with different types of situations. Developing supplier relationships while understanding accounting and cash flow are just a few of the skills acquired here. Overall, it is probably the biggest key I had, next to family support.”
All these factors have contributed to Anchor’s growth and success, and as a result Steve will have more opportunities to use his extensive skills and talents. “We are considering new acquisitions in the future. There are some companies getting out of our industry through the natural attrition of business or their owners are getting toward retirement age. Anchor Plastics is looking for growth through current and new customers,” he shares. “Our current goal is to be at $5 million within four years from the $2 million we are at right now and we are on track to meet that goal.”
With these plans in mind and the company’s history of impressing its customers through high-quality products, designs, and money-saving capabilities, Anchor Plastics, Inc. will certainly meet its growth goals, innovating and enhancing its industry as the company continues to expand. To contact Anchor Plastics, Inc. with questions or help with any stage of a project, please visit the company’s website at www.anchor-plastics.com, or contact the company directly at 763-546-2401.