Share this article

print logo

Niagara Falls plastics manufacturer finds its future next door

In Niagara Falls, Tulip Molded Plastics Corp.'s past and present stand in stark contrast to each other.

Its former manufacturing building, more than a century old, is virtually vacant. Employees recall it as an unappealing, poorly laid out place, long past its production prime.

"The building itself was old, the equipment was older," said Craig Kellogg, CEO of the Milwaukee, Wis.-based company. "We were in a position that we knew we had to leave. The question was where we would go."

The answer was right next door on Highland Avenue, on what had been contaminated land.

Today, the cleaned-up property is home to Tulip's $11.7 million factory. It's a smaller and more efficient plant, with modern lighting and equipment, a better layout, and a vastly better atmosphere for its employees. As one worker told Kellogg: "Wow, now I can wear nice clothes to work."

It's an industrial revival in a city that has seen far too many manufacturers downsize or disappear. In Tulip's case, a combination of incentives, the workforce's experience and a development partner's initiative kept the company in town.

But the new plant, which debuted in March 2017, faces a challenge.

As Tulip's business has grown, the company has already surpassed its five-year hiring target.

The manufacturer is looking at expanding the new facility, but executives haven't decided how big it will be.

For now, it's still using part of its old, unloved building next door, to accommodate its production needs.

Tulip's old factory building was more than 100 years old. (John Hickey/Buffalo News)

Tulip's injection-molding operations use recycled plastic to make products such as covers and components for automotive and industrial batteries. Tulip also produces resin, some of which it uses for its operations and some of which it sells to customers.

The company, which is owned by Saugatuck Capital, a Connecticut-based private equity firm, had determined the old plant on Highland was not feasible for future growth. Tulip weighed its options, including whether to move the operation to another state.

"We are not perfectly situated in Niagara Falls relative to our customers, so logistically there are other places that would be more suited for our customers," said Kellogg, who was named president and CEO about five years ago. Its customers are battery manufacturers, with plants located generally in the Midwest region.

"On the other hand, we have an outstanding workforce here," Kellogg said. "They're dedicated. A lot of them have been here for many years."

A solution emerged on neighboring property. Jon Williams, CEO of Ontario Specialty Contracting, cleaned up the site of a former Prestolite battery-making plant, in conjunction with Honeywell, through a state Department of Environmental Conservation program.

Williams' OSC/Brightfields company built the new plant and leased it to Tulip. Tulip poured $10.3 million into the project, a figure that includes new injection molding machines.

The new facility was laid out to Tulip's liking. The production floor is more wide open. The tool room and maintenance staff are just steps from the production floor. In the old building, those employees were in the lower level of the corporate offices and had to trek outside to reach the manufacturing plant.

"We designed this with material movement in mind," Kellogg said. "Everything has minimum movement."

Tulip Molded Plastics moved into this building last year. (John Hickey/Buffalo News)

Something Tulip didn't fully prepare for was how fast company would grow. Tulip had committed to increasing its workforce from 81 workers to 91 over a five-year period. It now has 110 employees.

"Quite frankly, with the growth trajectory, there's a chance we could grow that more," Kellogg said. Tulip declined to disclose its annual sales figures.

A lot of the increased business is from Tulip's existing customers, Kellogg said.

"The growth has put us in the position to expand, which is great," he said. "And it's great for the community because we have such a great workforce, they're dedicated. We have the ability to hire people here."

Some of those workers are from the neighborhood, riding buses or bikes to work. About 90 of the employees are represented by United Auto Workers Local 2571.

John Wolfgang, a millwright and the local's financial secretary, said the new plant is a big step up for the workers.

"A lot cleaner environment, less hassles, things are more dependable here," he said.

Tulip and the union have a six-year labor deal that is set to expire next year.

"We get along pretty good," Wolfgang said. "We have our arguments, but we both kind of meet in the middle somewhere."

Craig Kellogg, president and CEO of Tulip Molded Plastics. (John Hickey/Buffalo News)

Tulip has managed to keep making its products in the U.S. — in Niagara Falls and Milwaukee — at a time when manufacturers face low-cost competition from overseas. Kellogg credits Tulip's "know-how" and its production model.

"It's the intellectual property and the ability to make what would seemingly be a relatively easy part, but they're actually quite complex," Kellogg said. Tulip is also a vertically integrated company, meaning it controls different stages of production that allows it to keep costs in check.

The Tulip plant project also benefited from a variety of incentives, including a $1 million award from the New York Power Authority, as well as low-cost power. Empire State Development Corp. provided a $250,000 capital grant, and up to $300,000 in Excelsior Jobs Program incentives based on the company meeting hiring targets. A Niagara County Industrial Development Agency payment-in-lieu-of-taxes program provides for $1.9 million in savings to the project over a 15-year period.

As Tulip determines how to expand the Niagara Falls plant, Kellogg sees even more possibilities. He pictures other companies moving into adjacent property, that would be a natural fit with Tulip's production. "I would love to see this become a new industrial park," he said.

Story topics: / / / /

There are no comments - be the first to comment