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Biz Talk Q&A: Ex-Moog exec has big plans for small company

Martin J. Berardi is thinking big. Last December, he bought a small manufacturer, Schutte-Buffalo Hammermill, which makes machines that reduce all sorts of material to smaller sizes for new purposes.

The company, which has a plant on Depot Street on the East Side, generates about $10 million in annual sales and has about 40 employees. But Berardi, a 58-year-old Elma resident, isn’t content for the company to just roll along at those levels.

His background helps explain his mindset. Berardi spent 34 years at Moog Inc., an Elma-based motion control equipment maker which recorded sales of $2.65 billion in its 2014 fiscal year, and has a global workforce of about 11,000 people. He retired in April 2014 as vice president of Moog’s medical devices group, and has been active in regional manufacturing issues over the years.

Now Berardi is applying his ambitions to a company of his own, while keeping in place the leaders he bought Schutte-Buffalo Hammermill from. He is determined to grow the business, partly by expanding its product line. “My objective is to make this (company) bigger faster, and keep it here, and hire Western New York people,” he said.

Q: What has it been like to own your business?

A: It’s really been a lot of fun, because it’s a completely different industry. In my former company, I walked a lot of factories … and saw different welding and grinding and assembly. It’s kind of fun to actually have that, because Moog doesn’t do a lot of welding and grinding, Moog does a lot of assembly. But it’s been interesting. And we’re really in some neat industries, things you just don’t think about.

Q: Was it a big transition for you, to go from such a large company to a small one?

A: I wouldn’t say it was too different. I worked for (former Moog chairman and CEO) Bob Brady for 34 years. And Bob really gave you a tremendous amount of latitude if you did your job well and all that kind of stuff. You couldn’t make every decision on your own, but you could really make a lot of them. And I think that was the culture and the strength of what Moog did, and you learn from that.

Q: Has the experience of owning a business matched your expectations?

A: I guess I didn’t walk into it with any expectations that there would be anything different than what I experienced. But there is. As an owner versus working in a big company like Moog, there’s issues like cash flow. At Moog, there’s a treasury department. So when you need money, you go to treasury, or if I ever wanted to buy companies – because over the years I probably acquired 15 companies for Moog, and then integrated them – I’d go to the corner office and say, ‘Gee, we need $100 million.’ Next thing you’d know, we have $100 million. So it’s a little different. I have to worry about cash flows that I didn’t have to worry about before. And cash flow’s fine here.

Q: What markets is the company serving?

A: We refer to what we make as size-reduction equipment. … The types of industries that we’re involved in – and the reason why I actually I acquired this company was the types of industries and markets they’re involved in – is really the recycling world. I refer to myself now almost as an environmentalist, a capitalist version of the environmentalist. We’re into things like, scrap wood converted to the types of stuff used for power generation or heating, things along those lines.

Recycling of shingles – believe it or not, as things come off roofs, or if there is a disaster someplace, they take all those shingles and you can actually reduce those down to a powder form through our size-reduction equipment, and then it gets reused in asphalt paving of roads, or additional shingles.

Carpet recycling – there are carpets getting torn out all the time. We have an awful lot of installations down in the Southeast in the carpet mill territory, like Dalton, Ga., where all that carpet gets put in our size-reduction mills, and it renders it down to the basic material, which gets used in a lot of forms and fashions. …

E-scrap, electronic scrap – we’re going to an e-scrap show in Orlando in the first part of September, and we just developed a brand-new product line that we’re going to demonstrate at the show. It’s for cellphone recycling, hard-drive recycling, monitor recycling, old tower computers to, again, render those down to bits and pieces, and then there’s separation technology that takes all the bits and pieces that come out of that and it puts the metals in one direction, it puts the plastics in another direction, and they all get reused.

Q: What is your impression of the health of manufacturing in Western New York?

A: I think we might have a little bit of an inverted pyramid. The advanced manufacturing, the advanced assembly techniques – that’s sort of talking about the big manufacturers, the Solar Citys, the medical campus assembly-type activity, those kind of jobs, they’re real, they’re important and they’re growing. I think we probably have that covered in a lot of different ways. I think the untapped area, or the area of this inverted pyramid for me, is that there’s so many jobs for runners, for sweepers, for people who are going to entry level into companies that cut metal and weld metal and grind metal, who can then learn over the course of time. And I’m not so sure we’re talking enough about that stuff.

From a head-count perspective, there’s many more of those than there are of the advanced manufacturing jobs, from my perspective. I’ve been here six months and I’ve added six people, because I’m going to grow this business in Buffalo, New York. Now, I’ve added a couple of selling guys, a couple of engineers and all that to help us scale, but go out and find people in the shop. You’ve got to bring them as a beginner. They’re literally driving a fork truck around and learning what goes on. Then they learn how to weld, then they learn how to grind. And ultimately they end up in a real fancy position called a fabricator, which means they really know what they’re doing and they make the top dollar. I think there’s a lot of jobs at that lower level that we’re not paying attention to, but we should.

Q: How can manufacturing attract more young people?

A: I spent a number of years in Germany for Moog, running our German company and basically running Europe out of Germany. And I think the way that the educational system is set up in many European countries, but especially Germany, fills those needs, fills how you get people interested. They get them involved in a very early track. Now, they can jump tracks – a guy who was lined up to be a machinist can go off and get a law degree, too, or become an engineer or whatever you want to do. You’re not forever locked in. But they get you on a pathway early in life for aptitude. I think we’re so worried about trying to get people to actually be educated, to learn how to read and write at whatever grade level, that we don’t spend any time sort of helping them see their future as to where they might want to go. Now, that’s a big deal, and I understand that. Talk about a sea change … It’s a profession (in Germany). People learn manufacturing early on, and it’s an admired and respected profession.