Like many entrepreneurs, Princeton-educated Lorand Spyers-Duran struck out on his own after becoming increasingly dissatisfied with his employer’s management and priorities.
From Spyers-Duran’s perch, his boss liked machinery more than people.
So 40 years ago, envisioning a plastics company that would be employee-focused, Spyers-Duran opened Sussex Plastics in Sussex, Wisconsin – about eight miles from his former employer. He launched the business with $1 million in business commitments, $100,000 in start-up capital from four investors and “a couple of workers” from his former employer.
“We went to auctions where we bought old used equipment, and my sidekick and I worked on restoring those machines,” recalled Spyers-Duran., who had escaped Hungary in 1956 during the Soviet-repressed uprising.
With Sussex receiving raw materials on 90-day credit, Spyers-Duran’s firm generated positive cash-flow from the get-go, and through the years, its injection molding equipment formed everything from metering pumps to compacts for eye shadow.
By 1999, the firm had become the largest compact manufacturer in the United States, with a roster of customers that included Revlon, Avon, Max Factor, Mary Kay, Maybelline and Elizabeth Arden.
Yet, Sussex was increasingly becoming a victim of seismic changes in the cosmetics industry – where companies were not only selling products globally but sought to manufacture them in all four corners of the globe.
After futile attempts to keep pace with the industry trend and form relationships with overseas manufacturers, Spyers-Duran decided to sell the business to a strategic partner in order to gain access to the global market.
Its new owner, Rexam PlC, a British conglomerate that was transforming itself into a worldwide packaging company, seemed like a perfect fit. Its holdings encompassed glass, aluminum and closure firms, as well as personal care, home and pharmaceutical companies.
The firm not only provided Sussex with the global reach it sought but it invested in Sussex in varied ways, including in employee training and automated material handling systems. It also brought to the Wisconsin company a lean-management mindset, according to Keith Everson, Sussex’s CEO, who joined the company in 1979 – two years after its launch – and worked his way up the corporate ladder to succeed its founder.
But when the recession hit in 2008, Rexam decided it wanted out from the Wisconsin company and approached Everson about the management team buying it.
In response, Everson and Dave Guagliardo, who serves as CFO, and Phil Salzman, the company’s vice president of manufacturing, joined together to become partners in the business. Each contributed cash from their own resources and, with bank financing and an angel investment from Spyers-Duran, the partners purchased the business for “tens of millions of dollars” at the end of 2009, said Everson. The new owners renamed the company Sussex IM (Integrated Manufacturing).
Today, with 250 workers – double the number of employees since the management buy-out, and two manufacturing facilities that total 212,000 square feet and run 24/7, the profitable firm generates $70 million in annual revenue – a 100 percent increase from $35 million in 2010.
Based on Grand View Research’s analysis of the global injection molded plastics market, valued at $199.86 billion in 2014, Sussex operates in a flourishing industry, which is slated for significant growth from such industries as packaging, automotive, electrical and electronics, home appliances and medical devices.
For its part, the firm produces plastic products for manufactures in the industrial, cosmetic, healthcare, hygiene, electrical, home and garden sectors, including Johnson & Johnson, P&G, Revlon, United Technologies, Dow and GE Healthcare. Its plant turns out the ubiquitous plastic wall-mounted systems that dispense the Purell brand of hand disinfectant and the plastic components used in Broan-Nutone’s bathroom ventilation fans.
In addition, Sussex has launched its own products for the market – in the form of Mr. Lid food storage items, and with Mogo Sports, it has co-developed permanently-flavored mouth guards. It is also the domestic producer of Nike-branded flavored mouth guards and customized water bottles.
Moreover, Sussex IM is the global third-party manufacturer for Dow AgroSciences’ Sentricon pest control line, and it provides fulfillment services to Dow’s distribution centers.
“Rexam tried to make us a plant, and now we’re a company again” – with everything from company picnics and sit-down dinners to baseball game outings, said Everson, adding, proudly, “and we didn’t lay off people but invested in training them.”