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Wire & Cable ASIA – March/April 2013
That is the steady growth of a small business – Marlin
Steel Wire Products – which only six years ago was facing
closure. The company is located in a state and city which
both have suffered devastating losses. Nearly half of
Maryland’s manufacturing jobs vanished over the past
three decades; in Baltimore, the drop was 80 per cent.
Yet, as reported by Jamie Smith Hopkins in the Baltimore
Sun, Marlin Steel Wire Products has bucked the tide,
with conspicuous success. The firm has 35 employees,
up from 20 five years ago. Its revenues of $4.4 million in
2011 were up 33 per cent from 2008, enough to place it at
No 4,112 on the Inc Magazine list of the 5,000
fastest-growing privately owned companies in the United
States. The owner, Drew Greenblatt, was hoping for revenue
of $5.5 to $6 million for 2012; and, in Ms Hopkins’s view,
this was not an implausible expectation. (“Fast-Growing
Local Manufacturer? Yes, It Is Possible,” 30th November).
When Mr Greenblatt bought the company, in 1998, it
employed 18 people and made wire baskets for bagel
shops, then proliferating across the country. Having
moved it from Brooklyn, New York, to Baltimore, he was
overtaken by events. Chinese factories started selling bagel
baskets for less than Marlin could purchase its steel, let
alone manufacture its product. Mr Greenblatt told the Sun:
“We were haemorrhaging cash.” Then Marlin Steel
Wire Products changed course. About four years into
its Baltimore phase, a Boeing engineer approached
the company with a request for a basket that would
hold an airplane part. It would command a much
higher price than bagel baskets fetched. According to
Mr Greenblatt, the solution to his problems came to him in a
mantra-like flash: “quality engineered quick.”
Ms Hopkins brought the Marlin story up to date. Taking a
company with measuring tools no more high-tech than tape
measures – “where plus-or-minus one bagel was a perfectly
acceptable variation in basket size” – Mr Greenblatt now
sells to customers needing accuracy down to one-4,000th
inch. These days, reported the Sun, the company employs
mechanical engineers and skilled craftsmen, and has more
than $3.5 million in robotics.
❖ The upward course of Marlin Steel Wire has produced
better-paying jobs for its people. When the company
was purchased 14 years ago, its workers earned
minimum wage with no health benefits. Now, with five
per cent of the corporate labour budget going to worker
education, annual pay on the factory floor – excluding
the degreed engineers – ranges from $30,000 to
$80,000. And everyone is eligible for health insurance.
In addition to a highly skilled workforce and cutting-edge
automation, Drew Greenblatt credits Marlin Steel’s
good fortune to a drive to sell far beyond US borders.
The company has customers in 36 countries, including
China, and its owner claims to relish competition.
In 2011 he testified in Congress in support of the
US-Korea Free Trade Agreement that would do away
with tariffs that add to his costs of selling to his South
Korean customers.
❖ Ms Hopkins noted that free-trade deals are always
contentious, as are some of the Maryland-specific
changes suggested by Mr Greenblatt. But his attitude
resonates with the Manufacturers’ Alliance of Maryland,
which lobbies for the sector and has seen a blurring of
the distinction between small and big manufacturers
over the past decade or two. “It’s global competition,”
the trade group’s president, Gene Burner, told the Sun,
with the Internet making it easier for “the little guys” to
sell to South Korea and for South Korea to sell to those
companies’ customers. “Whether you’re big or whether
you’re small, it’s still global.”
Its image in need of burnishing, Apple
says it will be bringing at least some
production back to the US from Asia
“The Mac is coming back to America, but it’s unclear
whether Apple’s decision to manufacture one line of
computers at home is a serious shift in corporate strategy
or a much-needed PR adjustment.” In fact, Politico seemed
quite clear about its own views on 6th December news
that Apple Inc would again manufacture computers in the
United States. The Washington-centred political journalism
site summarised the “growing rap sheet” on the consumer
electronics giant whose chief executive, Timothy D Cook,
said that, beginning in 2013, the company “will do one of
[its] existing Mac lines” in the United States:
The Justice Department says Apple tried to fix e-book
prices; the company depends on cheap Chinese labour to
turn big profits; and Apple, like many global firms, is holding
billions in cash overseas. Apple has even taken a hit in the
stock market: a few months ago, it peaked at over $700 per
share but opened [6th December] under $550 per share – a
drop of more than 20 per cent. (“‘Made in USA’ Polishes
Apple’s Image,” 6 th December).
Apple, the biggest company in the world by market value,
moved most of its manufacturing to Asia in the late 1990s.
Ever since, the action has prompted resentment as an
injustice to American workers and taxpayers. In an October
debate on the campaign trail, President Barack Obama
and his rival Mitt Romney clashed over the question
of why the iPhone and iPad are not made in America.
Mr Obama has repeatedly raised the point-of-production
issue with Apple. At one meeting, according to Politico, he
pressed Steve Jobs, the since-deceased Apple co-founder
and visionary chief executive, on the subject of what it
would take for Apple to resume production in the US.
Mr Jobs said that the work would not be coming back.
❖ Now, Mr Jobs’s successor has said that Apple will
spend $100 million to engage contract manufacturers
in the US this year. The company provided no details,
including which line of its Mac computer will be made in
the US and what that might mean for American workers.
Jared Bernstein, a former economic adviser to the White
House and now a senior fellow at the Center on Budget
and Policy Priorities, offered a recommendation: “Let’s
not pop the champagne corks just yet.”
Technology
❖ Whether or not Apple Inc manages to convince a
dubious American public of its purity of intention in
returning “home”, the company can report success on
another front.