Glycon project ‘success story’ for community partnering
Two years ago as the manufacturing community was struggling in a tough economy, especially those who supplied the auto industry, the Glycon Corporation approached Tecumseh City Council for an industrial facilities tax abatement for an expansion it was working on.
“We all know that the automotive industry had slowed down and approximately 55 percent of our business went directly to automotive or Tier 1 or 2 suppliers,” said Jeff Kuhman, president of the company. “We were heavily committed to automotive and as it dropped off so significantly, we were at a point where we had to either close up shop or go a different direction in our marketing effort.”
“Those were hard times, but Jeff was willing to take a risk and go out on a limb, making a plan for the future when the economy would come out of its rough spot,” said John Phelan, General Manager and Corporate Counsel for Glycon. “He had the foresight and was prepared to take advantage of the situation.”
Tecumseh City Council approved the tax abatement for approximately $1 million, which Glycon said would retain at least 30 existing jobs and create approximately 10 more. Glycon then approached United Bank and Trust’s (UBT) Structured Finance Division, which offers loans from the Small Business Association (SBA) so that the company could complete a 4,000 square foot addition to its plant at 912 Industrial Drive and add machinery.
“When you look at UBT, we’re all about finding local solutions together,” said Joe Williams, UBT’s Lenawee Community President. “We never want ‘no’ to be the first words our clients hear. We want it to be, ‘Let me see how we can make this work for you.’”
Williams said UBT ranks second in offering SBA loan programs in the state, and is number one in the counties in which it operates, including Lenawee, and SBA loans allow companies to get better terms.
“At the end of the day, I’d known Jeff and his company a long time and they’ve always been a good community partner and client of the bank,” Williams said. “When people struggle, we try to support the community and want to lend money back to our local community because that’s the only way we’re going to bring jobs back to the community. We want to be partners in making things happen, and that’s what happened with Glycon.”
Because of the support from UBT’s Structured Finance Division, the city, and efforts by the Lenawee Economic Development Corporation, Glycon was able not only to retain jobs during a difficult time, but begin to add the promised jobs. Phelan said Glycon purchased two large CNC machines, which were part of the $1 million project, and totally converted and refurbished them.
“The reason we wanted to bring on the new equipment was that we wanted to increase our capacity and expand our markets,” said Phelan. “We were handcuffed a little bit when large orders came in because there was a bit of a log jam when it came time to put the materials on our largest machine at the time.” The purchase of a Waldrich Coburg machine provided an option for an expanded market and the manufacturing of larger feed screws than an Austrian made Weingartner machine previously had provided as the former “workhorse” of the shop, as Phelan put it. A large CNC lathe was also added. The company has added four employees who have been training for the work, and plans to soon add up to six more, meeting the promise made when City Council approved the tax incentive.
Glycon, which has been in Tecumseh 35 years, is an international company, supplying products to China, Taiwan, Brazil, Europe and other destinations, along with regional companies, some of which have changed hands. Recently, because of the expansion and addition of the new machinery, Glycon was able to bid on a job for Wacker, a German company based in Raisin Township. A large feed screw that looks like a big auger, is being turned on the Waldrich Coburg machine and should be available to the company in a few weeks.
“Their design is a little unique, and our former machinery didn’t necessarily lend itself to that type of project, but we’re in a much better position now,” said Phelan. “This is a good example of the type of niche work we are now able to do because of our partnerships.”
Kuhman said many of its customer companies are involved in extrusion, but Wacker’s difference is their product is silicone. “They’re one of the largest manufacturers in the world, and they’ve also done a nice job in terms of expansion in the Lenawee community,” Kuhman said. He added that working with a local company was a special bonus, expanding the partnerships that have come about for his company. “That’s a good feeling, the fact that you know you’re saving them the freight cost. They were able to drive down the street and sit in our conference room and work with our engineers, all local people. That was a good feeling.”
“Having a local company supply some of our needs is pretty much a win-win situation with a vendor in close proximity,” said Bill Toth, Wacker’s Manager of Corporate Communications. “It’s good to have a local source of material for parts that are appropriate for our corporation. One of Wacker’s concepts is to do business locally whenever that’s possible. I think that’s valued in terms of stimulating the economy in the local community.”
Tecumseh City Manager Kevin Welch couldn’t be more pleased with the way the Glycon project has worked out, linking the city, the bank, the companies and the community in partnership.
“It’s one of those home-grown stories where we were able to help a local business owner by participating in an abatement which in turn helps another local business,” he said. “There’s a domino effect that ultimately provides more jobs and helps keep jobs locally. I think it helps all of us.”