CVT bets big on continued growth

SHERBURNE — The 1967 movie “The Graduate” alerted the public to the coming plastics revolution when Dustin Hoffman, playing Benjamin Braddock, had a conversation with his father’s business partner, Mr. McGuire. “I want to say one word to you,” says McGuire … “Just one word — plastics. There’s a great future in plastics.” The ubiquity of plastic products provided Joan Rivers with her best gag: “I’ve had so much plastic surgery, when I die they will donate my body to Tupperware.”

The plastic revolution is here, and its utilization continues to grow. And Chenango Valley Technologies, Inc. (CVT) is fully capitalizing.

“My father, Lloyd Baker, started our firm — CVT — as a tool-and-die company,” says his son Shawn, CVT’s president. “Seeing the continuing growth of plastic products, he made a strategic move in 1995 when he bought Madison Plastics in Verona. Today, the company is a full-service, single-source operation offering part design, mold/tool design, mold making, 3D printing and assembly, and injection molding. The parts are sold to a variety of industries, including medical, electronics, lawn and gardening, consumer, automotive, marine, and RV (recreational vehicle). We also sell a proprietary line of battery boxes and trays to the RV, marine, and auto industries.”

New investment
Two years ago, CVT added 5,000 square feet to accommodate customer demand and a need for more inventory space. “Our growth has been steady,” notes the younger Baker. “Our sales are up another 10 percent since we completed the addition. This summer, we invested $300,000 to buy a new 500-ton [Cincinnati] Milacron injection-molding machine, which gives us the capacity to produce larger parts for our customers. The machine cost us $250,000, and the other $50,000 was invested in an outside silo that can hold 65,000 pounds of polypropylene. The silo investment now lets us buy polypropylene pellets by the tanker-load, [thus] reducing the purchase price significantly. The silo was up by mid-July, and the injection-molding machine was producing products by Sept. 1.

“I’m still amazed at how quickly the process went,” exclaims Baker. “In the period of one month, we ordered the machine; moved five machines, weighing between 10,000 and 70,000 pounds, and re-installed them to accommodate the new machine on the production floor; and set up the 500-ton Milacron. Most of the moving and installation was done by our employees, who also handled the electrical and plumbing [requirements]. Special kudos go to Eddy Arsenault, who supervised the project.” No outside financing was required for the investment: CVT funded the new project from its profit.

CVT started out as a small tool-and-die company. Today, the business occupies a 30,000-square-foot plant sited on 15 acres just north of Sherburne. The facility runs three shifts, consuming 1.2 million pounds of resin annually, and employs 35 people. The Baker family owns the “sub-S” corporate stock. The Business Journal estimates CVT’s annual sales at $5 million.

“CVT’s growth strategy is best defined as slow and steady,” notes Baker. “I feel more comfortable with controlled growth, because I like to sleep at night. My strategy is to continue growing by focusing first on new projects with our existing customer base and second on new business. The key to our success is to get involved early in a project, especially in the design phase. Our growth is also based on retaining a diversified group of customers, primarily located within a 200-mile radius of the plant.”

The team
Baker attributes the company’s growth largely to the employees. “I depend a great deal on the management team,” he acknowledges. The team includes Baker as president, Norm Wynn as production manager, John Davis as the VP of engineering and tooling, Eddy Arsenault as the facilities/maintenance manager, and Cole Williams as the molding manager. 

“CVT has dedicated employees, some of whom have been with the company more than 20 years. Many live in the area, but some drive 45 miles daily [each way] to work here. Attracting and retaining good employees is critical to our success, and we spend a lot of time looking for talent and training our employees. I also reach out to area schools to help promote their technical programs. CVT offers competitive wages and benefits, and we work hard to encourage a balance between work and family. I think the culture we have established at CVT has also helped with retention.”

CVT also benefits from its dependence on the local, municipal utility. “Ours is an energy-intensive industry,” stresses Baker. “The molding process involves injecting molten-plastic materials at high temperatures into a mold and then solidifying them. Not surprisingly, we use a lot of energy. The local utility charges us approximately four cents per-kilowatt hour, which really helps to make us competitive.”

Baker is seeing a growing demand for plastic products across a number of industries. In a 2016 Allied Market Research report entitled “World Injection Molded Plastic Market,” the author projects a 4.9 percent compounded annual growth rate from 2015 to 2020. The report goes on to say that minimum waste, faster production, the ability to process multiple raw materials simultaneously, and low labor costs are boosting the market growth. Packaging remains the dominant market application, but plastics also continue to replace metals in the auto and construction industries. Even sports equipment, such as helmets and boots, are using new polymers. Allied Market Research forecasts a $162 billion global injection-molding industry by 2020.

Baker is a native of Sherburne. He received an associate degree at Hudson Valley Community College and has earned a journeyman-toolmaker certificate. Baker was appointed company president on Jan.1, 2014, after serving for five years as the VP of sales. He lives in Sherburne with his wife Katie and two teen-agers, a 16-year-old daughter and a 14-year-old son.

As he looks ahead, Baker finds plenty of reasons to be positive.

“I’m very optimistic about CVT and the industry’s future,” the CEO asserts. “We are very busy and continue to see rising demand. The company has a diversified base, and we’re in a strong financial position. That’s why we made such a large, capital investment. CVT has maxed out the space on the production floor with our latest purchase, so sometime in the not too distant future I’ll have to consider expanding the plant to handle the anticipated growth. Fortunately, we have plenty of room for more expansion.”

Contact Poltenson at npoltenson@cnybj.com