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Power Engineers looks to tap local talent pool
SYRACUSE — Power Engineers launched and is growing its Syracuse office with the aim of tapping into the technical talent base present in the region. Power opened its office in Syracuse last May. The firm employs 16 people in a 7,500-square-foot space at 1 Dupli Park Drive. The site has room to grow to more […]
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SYRACUSE — Power Engineers launched and is growing its Syracuse office with the aim of tapping into the technical talent base present in the region.
Power opened its office in Syracuse last May. The firm employs 16 people in a 7,500-square-foot space at 1 Dupli Park Drive. The site has room to grow to more than 40, says Rod Coffey, who heads Power’s local office and is the northeast regional manager for substations.
Coffey says the office could double in size in 2013 and notes Power has no plans to cap the local site’s size.
“So long as Syracuse produces people, we’ll continue to bring them in,” he says. “We can’t find enough people in our industry.”
In Syracuse, Power works mainly on design of power delivery systems within the electrical grid. The office has other capabilities including civil, structural, mechanical, and environmental engineering, Coffey says.
The local market has plenty of good engineering schools Power hopes to tap, he adds. And there are experienced engineers in the region as well.
Power could also draw new employees from schools in the North Country as students from those colleges drift toward larger communities like Syracuse in search of more opportunities, Coffey says.
The need for work in the energy space is not likely to ebb anytime soon, he adds. Demands on the power grid will continue to grow and companies like Power will find plenty of work.
The firm had already been working for utilities with a presence in New York even before the Syracuse office opened. They include National Grid and Iberdrola.
Power Engineers also already had an office in Freeport on Long Island before launching in Syracuse.
Recruiting more people from the state should only help Power’s business in the market continue to expand, Coffey says. He adds that local employees could find themselves working on projects from around the country.
But the energy environment in New York is unique in some ways, Coffey adds. It’s the only state with its own independent system operator (ISO), the entity which controls the power grid, he explains.
Most other ISOs span multiple states. New England has its own, for example, and one of the operators in the Midwest also covers parts of Canada.
New York’s one-state-only ISO can make working on power projects here different, Coffey says.
“New York really is an island,” he says.
Power’s Syracuse office has already found itself working on a very public project that had nothing to do with energy. The company worked on rigging the line for Nik Wallenda’s high-wire walk across Niagara Falls last year.
The task wasn’t as simple as stringing a wire from one side to the other, Coffey says. Power added balancing sticks that hung below the line to prevent it from rotating as Wallenda crossed.
The firm also had to calculate the tension required to keep the wire from sagging under its own weight as it spanned the distance across the chasm.
In addition to Syracuse, Power Engineers could look to open additional new Northeast offices in Pennsylvania and New Jersey, Coffey says. The employee-owned company has more than 30 offices in the U.S. and abroad and employs more than 1,700 people.
The firm is headquartered in Hailey, Idaho.
Contact Tampone at ktampone@cnybj.com
Binghamton Web firm sets up shop downtown
BINGHAMTON — A Web-design firm launched last year is making the leap from home offices to a physical location in downtown Binghamton. FreshySites began unofficially and 2011 and its founders formed their company just last year. They built their business from their homes to a base of 77 customers. They opened their 1,300-square-foot office, at
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BINGHAMTON — A Web-design firm launched last year is making the leap from home offices to a physical location in downtown Binghamton.
FreshySites began unofficially and 2011 and its founders formed their company just last year. They built their business from their homes to a base of 77 customers.
They opened their 1,300-square-foot office, at 37 Court St. in Binghamton, in January. Four of the company’s five employees are originally from the Binghamton area, but left to attend college.
Four of the firm’s employees are based in Binghamton and the fifth works from Fairfax, Va.
The partners decided to launch the company in Binghamton in part because it offers a host of potential customers in the small and mid-size business space, says Ben Giordano, FreshySites’ co-founder and lead developer. Many of the local companies also don’t have an updated Web presence.
There’s a need in the market, Giordano says, for a firm that can help local businesses improve their Web sites quickly and inexpensively.
He adds that FreshySites is trying to offer Web design almost as a retail product. The company’s office is in street-level retail space. The idea is for potential clients to be able to walk in off the street and talk about their sites easily.
Giordano also notes that the company’s goal is customer volume. He says the firm can put together a basic website for $250 and is aiming to grow its client roster quickly.
“The way websites are built…has changed,” he says. “It doesn’t have to be thousands of dollars to do this.”
FreshySites expects to grow its customer base to 200 by the end of the year. The firm is also likely to add another employee in 2013, Giordano says.
The company’s price points open the door to businesses that might have been able to afford a Web presence previously, he adds. And he says that just because the company offers an inexpensive product doesn’t mean it’s of poor quality.
Giordano’s background is in advertising and marketing. While working in that space, he says he saw the need for Web design aimed squarely at small companies that don’t have massive budgets.
The new office is also a key part of FreshySites’ strategy.
“We want customers to be able to come in and meet with us and feel comfortable stopping by the office,” Giordano says. “If they have a request, we want them to stop by. We want to put a big public face on it. We want to get to know our customers.”
FreshySites is not focusing on any specific industry niche, but rather concentrating on its geographic market. Eventually, that will mean expanding with offices in other cities, which could include Syracuse, Rochester, Albany, and Scranton, Pa.
The headquarters and much of the development work will remain based in Binghamton, but sales and support staff will be located in other cities, Giordano says. If things go well in 2013, he adds, the company could be looking at another location by the end of the year.
Giordano co-founded FreshySites with Vincent Consumano, who grew up in Manassas, Va. Giordano and Consumano, who works from Fairfax, Va. now, were roommates at Virginia Tech.
Contact Tampone at ktampone@cnybj.com
After the Newtown tragedy: Shooting from the hip
On the morning of Dec. 14, 2012, 20-year-old Adam Lanza fired four bullets into his mother’s head. Nancy Lanza was at home in her Newtown, Conn. residence, lying in bed clad in her pajamas. Lanza then drove to Sandy Hook Elementary School where 456 children were enrolled. At the school, he killed 20 children and
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On the morning of Dec. 14, 2012, 20-year-old Adam Lanza fired four bullets into his mother’s head. Nancy Lanza was at home in her Newtown, Conn. residence, lying in bed clad in her pajamas. Lanza then drove to Sandy Hook Elementary School where 456 children were enrolled. At the school, he killed 20 children and six adults with his mother’s Bushmaster rifle before committing suicide.
On the day of the shooting, President Barack Obama gave a televised address to the nation in which he said: “We’re going to have to come together and take meaningful action to prevent more tragedies like this, regardless of the politics.” The president’s response to Newtown came on Dec. 19 when he formed a gun-violence task force led by Vice President Biden. A month after the shooting, President Obama announced his solution to mass killings: increasing the nation’s gun-control laws to include universal background checks, an assault-weapons ban, and limiting the capacity of magazines to 10 cartridges.
The president’s “meaningful action” comes in the form of a single-issue, legislative answer to mass killings. It is simple, reflexive, and short-sighted. It responds to the emotional repugnance at the murder of children but ignores the root of what is a complex problem. The president disregards research on the relationship of guns to violence; our policy toward mental illness; the nation’s cultural deterioration; the squeezing out of societal institutions by government; the impact of movies, television, video games, and music; the media’s role in reporting these incidents; and school security.
A background report published by the Heritage Foundation in January offers guidance in solving what is a complex problem, beginning with the relationship of guns to violence. The short answer is that gun ownership does not correlate with increased violence. If it did, the rate of national violence in rural areas where gun ownership is high would exceed that of urban centers where gun ownership is low. Also, the black community suffers from disproportionate violence even though its gun ownership is far lower than in the white community, which has less violence. Further, localities that permit right-to-carry laws have seen a decline in murder and other violent crimes. In short, if gun-control laws were a panacea, cities like Washington, D. C., Oakland, and Chicago, noted for their strict gun-control laws, should be safe places, but the opposite is true; they are among the most dangerous in America.
In addressing the nation, the president failed to mention that America tried a weapons’ ban on assault rifles starting in 1994. The ban sunset 10 years later, at which time a study commissioned by the U.S. Department of Justice concluded there was “… no discernible reduction in the lethality and injurious of gun violence.”
International statistics also show no correlation between guns and violence. The Swiss own three times as many guns per-capita as their neighbors in Germany, yet the Swiss have a lower murder rate. Other countries like Israel, New Zealand, and Finland have very high rates of gun ownership, yet report low murder rates. Meanwhile, Russia, Brazil, and Mexico have strict gun-control laws, but higher rates of violence than in the U.S. The only exception seems to be Japan, which has both strict gun-control laws and a low incidence of violence.
By focusing on gun control, the administration avoids addressing any serious questions about our national policy toward mental illness. In 2000, the New York Timespublished a study of 100 “rampage murders” that occurred over several decades. The report concluded that 48 percent of the murders involved perpetrators with a formal diagnosis of mental disorder and that more than half of these had histories of serious mental problems. More recently, Seung-Hui Cho who killed 32 at Virginia Tech, Howard Unruh who murdered 13 in Camden, N.J., Jiverly Wong who killed 13 in Binghamton, and Jared Loughner who killed six in Arizona all suffered from untreated schizophrenia. According to the National Institute of Mental Health, 7.7 million Americans currently suffer from schizophrenia and bi-polar disorders. At any given time, almost half are receiving no treatment. The risk of schizophrenics committing homicide is 10 times greater than the risk from the average citizen.
A discussion of our policy to encourage de-institutionalizing psychiatric patients is very much in order. The trend began in the 1960s with the creation of federally funded mental-health centers and accelerated in the 1970s when the U.S. Supreme Court raised the burden of proof for involuntary civil commitment. The court also expanded the rights of the mentally ill to refuse treatment. In the past, it may have been too easy to commit an individual involuntarily; now it’s too difficult. Society needs to find a balance that protects the rights of both the individual and society.
The country also needs to address cultural issues. Research has long told us that the family is the building-block of a flourishing society, yet four children of every 10 are born out of wedlock, with the rate in some minority communities reaching more than seven of 10. We know that adolescents who do not live in intact families exhibit more “psychologically affective disorders.”
We also know that married fatherhood is the single most reliable indicator for socializing males and that neighborhoods where adolescents live in intact families are less likely to experience violent behavior, like carrying weapons or fighting. Where is the discussion of the collapse of marriage and the rise of single-family households? Where is the discussion of violence and other risk factors resulting from these single-family homes?
If strong families are the first line of defense against violence, our civic institutions are the second responders. Again, research shows us that religious practice can have a powerful impact on maintaining stable, intact families and supporting the healthy development of children. Religious families tend to enjoy lower levels of conflict and higher levels of marital stability. The frequency of religious attendance at a house of worship is a better indicator of parental involvement than either employment or income.
America also boasts a multitude of civic organizations to channel youthful energy into productive channels. While traveling through our country in the 1830s, Alexis de Tocqueville noted the ubiquity of religious practice and the plethora of groups that sprang up voluntarily to deal with community needs. Today, the space between the individual and government is being squeezed by the unrelenting expansion of government, where one-size-fits-all is the answer to all of our problems.
Where is the discussion of any impact violence in our media plays? It doesn’t take a professional to recognize the increase in violence in our movies, television, and music. Last year in the video-game industry, five of the 10 top sellers were based on not just death and violence but on torture, mutilation, and sadism. What is the effect on those prone to psychological disorders who spend hours viewing the media or listening to hateful music? Families, parents, and community leaders all have a duty to protect their youth from excessive consumption of violence. Does this mean creating different rating systems? Does it mean leveraging the free market to put pressure on the producers of violence?
And speaking of the media, what is the role of television, radio, newspapers, magazines, and websites in reporting these tragedies? Does the 24/7 reporting, which transmits more speculation than facts, magnify the celebrity status of mass killers and feed their need for attention? We know that copy-cat killings are as old as the media, dating back to Goethe’s 1774 classic “The Sorrows of Young Werther,” when the novel caused a rash of copy-cat suicides. What is the role of the media? Should the industry show more restraint?
And where is the discussion of the idea offered by Wayne LaPierre of the NRA to provide armed guards at our schools? Or should we arm teachers and administrators in the schools? Why is the suggestion dismissed out of hand when mass-killers so often select schools as their venue for violence? Our society accepts armed guards in banks and on airplanes. Other societies like Israel have armed guards at every school. If the idea has merit, let’s at least discuss it before dismissing it.
In retrospect, we learn that Adam Lanza came from a single-family home. He drove to Sandy Hook Elementary School armed not just with a rifle but also three other guns, which makes the question of the number of rounds in a magazine moot. We know that he avoided attracting attention and was uncomfortable socializing. Lanza’s brother told law-enforcement officials that his brother had a personality disorder. We also know that the Newtown shooter played violent video games for hours at a time.
If President Obama were serious about taking “meaningful action” to reduce the problem of mass killings, he missed the opportunity to have a thoughtful, national discussion of all the issues. Instead, he gave us a shallow, narrow, reflexive response intended to show the voters that government was reacting. Perhaps the populace will feel safer if we pass more gun-control legislation.
Until the next mass-killing.
Norman Poltenson is publisher of The Central New York Business Journal. Contact him at npoltenson@cnybj.com
Report outlines economic-development path for legacy cities including Syracuse
For legacy cities such as Syracuse, regional decision-making and working with major institutional anchors like universities are important economic-development strategies, according to a new report.
Greystone announces new office locations in Boston, NYC areas
FAYETTEVILLE — Greystone Envolutions, LLC, an environmental-engineering and consulting firm headquartered in Fayetteville, has kicked off 2013 with a pair of new offices and some
Cornell student-run restaurant begins second semester in business
ITHACA — A student-run restaurant at Cornell University, called Establishment at Statler, will start its second semester of operation next week. Establishment at Statler first
High-end audio brand McIntosh expands its global focus
BINGHAMTON — On Oct. 8, 2012, Fine Sounds SpA of Milan, Italy bought 100 percent of the stock in McIntosh Laboratory, Inc., located at 2 Chambers St. in Binghamton. The seller was D+M Group, a company formed in 2002 and headquartered in Mahwah, New Jersey. McIntosh, a global leader in prestige home-entertainment and quality audio
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BINGHAMTON — On Oct. 8, 2012, Fine Sounds SpA of Milan, Italy bought 100 percent of the stock in McIntosh Laboratory, Inc., located at 2 Chambers St. in Binghamton. The seller was D+M Group, a company formed in 2002 and headquartered in Mahwah, New Jersey.
McIntosh, a global leader in prestige home-entertainment and quality audio systems, conducts all of its research and development and manufacturing at the Binghamton site. An entry-level system starts at a few thousand dollars and reaches $800,000 for a high-end system.
Fine Sounds is a holding company that owns a stable of quality audio producers: Sonus Faber, an Italian company that builds loudspeakers; Audio Research Corp. in Minneapolis, which manufactures vacuum-tube and solid-state electronic audio components; Wadia Digital, also based in Minneapolis, dedicated to digital-audio reproduction; and Sumiko, a Berkeley, Calif.–based importer and distributor of quality audio components. Fine Sounds, in turn, is owned by Quadrivio SGR, an Italian private-equity firm managing a family of funds in excess of $300 million. The middle-market firm is authorized by the Bank of Italy and independently managed.
“The acquisition represents a strategic direction for our company to be a leader in the international, luxury-audio arena and to have products that are the best in the world in their category,” Mauro Grange, CEO of Fine Sounds Group, said in a news release. “With the distribution synergies we will have with our other outstanding brands, McIntosh will be positioned for substantially accelerated global growth … McIntosh will help strategically strengthen our brand portfolio, allowing us to have a broader product offering … [presenting] customers a complete solution,” Grange concludes.
The McIntosh Laboratory story
The company story begins with Frank H. McIntosh, who began his career with Bell Telephone Laboratories. During World War II, he was head of the radio and radar division of the War Productions Board, which led him into a post-war business requiring high-power, low-distortion audio amplifiers. Dissatisfied with what was then available, McIntosh launched his own company in 1949 in Silver Spring, Md. In 1951, the company relocated to Water Street in Binghamton and in 1956 moved to its present Chamber St. location. The McIntosh name gained international fame when its products were used at President Lyndon B. Johnson’s inauguration speech, the Woodstock Festival in 1969, and concerts by the Grateful Dead in 1974, where their amplifiers were called the “wall of sound.” Japanese audio-maker Clarion bought the firm in 1990 and sold it in 2003 to D+M.
Charles (Charlie) Randall, the current McIntosh president, says the company “… employs 140, of whom 132 are employed in Binghamton … Annual revenues total $40 million to $50 million, and exports represent 55 percent of the revenue … We use a distributor/dealer network to sell our products, of which 97 percent are bought by residential customers … [We] currently have 43 distributors representing McIntosh in 80 countries … The site has two buildings: the manufacturing facility which is 80,000 square feet and the research-and-development building which is another 10,000 … The company owns the real-estate.”
Randall says, “McIntosh holds 43 patents and 34 trademarks. Our R&D team includes 21 dedicated employees, including 11 engineers with specialties in electronics, acoustics, software, mechanics, production, and quality-assurance … One of the advantages our company has in attracting outstanding engineering talent is that we are small enough that our engineers are involved in the entire process from concept to [execution], unlike a large company where they may only work on a piece of the project.”
Randall himself is an electrical engineer who interned at McIntosh when he was 19. After graduating from the Rochester Institute of Technology, he joined the company full-time and was appointed CEO in 2001. He is celebrating both 28 years with McIntosh and his 50th birthday.
Randall has a clear demographic profile of his customers. “We target affluent people, those with expendable income … We’re marketing to architects, contractors, and those people who are building $5-million homes and buy yachts … That’s why we’re sponsoring a car auction at Amelia Island and events at Pebble Beach … You don’t have to spend $20,000 for a watch or more for one of our systems unless you are looking for the best … When you are 45-55 years old and the kids are out of the house or graduated from college, you think about buying something for yourself … When you were younger, you appreciated good music and now you appreciate quality,” says Randall.
Since the days of Frank McIntosh, who demanded perfection, the firm that bears his name is consumed with controlling its quality. That’s why Randall refuses to send any of his work overseas; he insists that everything be done at the Binghamton plant. The vision of perfection, of producing the best quality, begun 64 years ago is alive and well at McIntosh.
“The company is set to continue growing,” says Randall. “Our exports have climbed at least 10 to 12 percent each year, and now we’re positioned [with the new ownership] to leverage our marketing and distribution globally … Our future is bright.”
Contact Poltenson at npoltenson@tgbbj.com
Chobani: keeping its foot on the accelerator
NORWICH — “Our cows are working overtime,” New York State Senator James L. Seward (R–Oneonta) was quoted as saying at the New York State Yogurt Summit held in Albany in August 2012. Seward, who represents the Senate district in which Chobani is located (Chenango County), offered his comment following Gov. Andrew Cuomo, who boasted that
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NORWICH — “Our cows are working overtime,” New York State Senator James L. Seward (R–Oneonta) was quoted as saying at the New York State Yogurt Summit held in Albany in August 2012. Seward, who represents the Senate district in which Chobani is located (Chenango County), offered his comment following Gov. Andrew Cuomo, who boasted that New York’s yogurt industry included 29 plants, consumed 1.2 billion pounds of milk annually, and employed over 8,000 people. Sheldon Silver, the State Assembly Speaker (D–Manhattan) who is not known for hyperbole, thought that the state could become “… the yogurt capital of the United States, if not the world.”
Explosive growth
Driving this yogurt explosion is Chobani, Inc., headquartered at 147 State Highway 320 in Norwich. The company controls 50 percent of America’s Greek yogurt market, according to Nielsen Co. data and 17 percent of the total yogurt market according to Chicago-based research firm SymphonyIRI Group.
Chobani, founded by Hamdi Ulukaya, delivered its first 200 cases in 2007. “Today, we ship two million cases weekly,” according to Chobani’s chief financial officer, James McConeghy. Annual sales have rocketed from $1 million in the first year of shipping product to over $700 million by the end of fiscal year 2012.
McConeghy projects sales “… of more than $1 billion dollars for 2013, as a new $450-million, 1-million-square-foot plant in Twin Falls, Idaho comes on line.” The plant officially opened on Dec. 17, 2012 and has the capacity to equal the 3 million pounds-per-day of milk consumption of the South Edmeston, New York facility. In 2012, Inc magazine clocked Chobani’s revenue growth at 2,662 percent for the preceding three years.
Chobani’s growth is all the more surprising when you consider the company mixes milk and cultures in New York, not the Internet and software development in Silicon Valley. No company in history has scaled up more quickly except for the daily-deal web company Groupon (NASDAQ: GRPN), which required extensive venture-capital investment and has had difficulty generating substantial profit.
“Chobani is very profitable,” said Ulukaya last August at a luncheon held at the Century Club in Syracuse. The company has grown with no outside investment, “relying on conventional bank loans and cash flow,” says McConeghy. Bank of America is the firm’s lead banker. Bloomberg’s “Billionaires Index” now includes Ulukaya, who is the sole stockholder in Chobani, with a net worth of $1.1 billion.
Chobani began as Agro-Farma, Inc. in 2005 when Ulukaya bought a shuttered Kraft yogurt plant in South Edmeston with the help of a $700,000 SBA loan. Starting with just five employees, Chobani now employs 2,000 with 1,300 in Central New York. Besides its New York and Idaho locations, Chobani bought Bead Foods in Melbourne, Australia in July 2011, an award-winning yogurt and dessert maker, and established Chobani Australia. The company regularly ships its products by air to England, where it is distributed in a number of retail outlets. McConeghy says “we’ve had a good reception both in England and Australia.” Chobani also distributes its products to Canada. He adds that the company now “… owns more than 2 million square feet of space.”
Secrets of success
Some of Chobani’s meteoric rise can be attributed first to timing. Greek yogurt is the hottest product to hit the food market in years, according to Robert Ralyea, senior extension associate at Cornell University’s Food Processing and Development Laboratory. Greek yogurt now makes up 36 percent of the $6.5 billion in total U.S. yogurt sales, according to the investment firm AllianceBernstein.
Second, Ulukaya aggressively expanded his production and marketing to meet the growing demand. Third, he doesn’t believe in customer research, preferring to listen to the consumers directly and insisting that feedback and complaints come to his smart phone. Fourth, America’s king of Greek yogurt is a perfectionist. He spent two years developing his product before he released it, insisting on using the traditional straining process of his native Turkey, using only real fruits, and ensuring a probiotic, natural product — either low in fat or with no fat and hormone free. Chobani yogurt is also gluten-free, and free of corn, nut, and soy allergens. Ulukaya even oversaw the design and manufacture of the containers into which the yogurt would be poured.
Chobani’s success also depends on offering variety. In January 2011, the company released Chobani Champions, its first option to the standard six-ounce cup. Champions packs two ounces of low-fat Chobani yogurt and fruit puree in a tube, eliminating the need for a spoon. The product is targeted to kids. In June 2012, U.S. Senator Charles E. Schumer (D–NY) announced a plan to make Greek yogurt “… an affordable, healthy (sic) option for public-school meals.” Chobani has also introduced Chobani Bites, a 3.5 ounce, four-pack container of its yogurt with 100 calories or fewer and Chobani Flip, a square yogurt package containing nuts, dried fruit, and granola for mixing.
Variety doesn’t just come in packages. Last year, Chobani opened a Mediterranean yogurt bar at 150 Prince St. in New York City’s SoHo district. McConeghy says the “store is a big hit … we get a lot of foot traffic,” offering different toppings for customers to create their own blends. McConeghy is non-committal on calling the SoHo store a pilot project or the beginning of a retail chain. “The SoHo store is a test,’ says McConeghy. “We want to expose people to Chobani.”
McConeghy also attributes Chobani’s success to the employees, whom he describes as “passionate, hard-working, and dedicated to growing the company.” In particular, the CFO cites the leadership team at Chobani: Ulukaya, CEO and president; Kyle O’Brien, executive vice president of sales; Halil Ulukaya, VP of operations; Grace Simmons, chief of staff and VP of strategic initiatives; Nicki Briggs, director of communication; John Heath, senior vice president of innovations and interim chief marketing officer; and Craig Gomez, head of global HR
McConeghy is clearly a key employee on the Chobani team. His 30-year career in business includes being the vice president of finance at Bausch & Lomb and a principal at Signet Management, LLC. McConeghy is a CPA who also earned his MBA at the William Simon Graduate School of Business at the University of Rochester. He started at Chobani three years ago as the interim CFO, before assuming the title.
Hamdi Ulukaya came to the U.S. in 1994 to learn English and to take some business courses. He started in business making feta cheese at a plant in Johnstown (Fulton County) when he saw an ad in 2005 for the closed Kraft plant. Convinced that Americans could enjoy Greek yogurt as a snack, a side dish, or as an ingredient in cooking, Ulukaya bought the Kraft plant, planning to scale up.
His success and that of the other state yogurt makers has strained New York’s current capacity to supply raw milk. Because Greek yogurt requires three times as much milk as non-strained yogurt and Americans are devouring Greek yogurt, “the state has a five percent milk deficit,” Ulukaya said at the August 2012 luncheon in Syracuse. Dairylea, a milk-farmers co-op headquartered in Syracuse, supplies most of Chobani’s milk. The state is encouraging its dairy farmers to increase their herds to keep up with demand
Ulukaya is poised to make Sheldon Silver’s dream a reality: New York as the world’s yogurt capital. At age 40, Ulukaya has the energy, money, marketing savvy, and organizational talent to remain the U.S. market leader and the ambition to be the world leader. But Chobani does face headwinds.
Challenges
First, there is competition from major yogurt makers like Fage, Dannon, Mueller Quaker Dairy (a joint venture between PepsiCo and a German dairy company), and Yoplait to potentially displace Chobani’s lead. McConeghy’s response is that “there is plenty of room for all the competitors to grow. Americans consume only half the yogurt of Canadians and one-sixth the yogurt of Europeans.” Second, Chobani has to constantly battle for retail refrigerated space as it offers new products and steps up its production. Third, the company faces a continuing problem of whey disposal. Whey is a thin, acidic liquid by-product of the yogurt process. Chobani currently pays area farmers to take the whey and use it as fertilizer and as a feed supplement. The company is in contact with New York state and with research groups to find alternate uses of whey such as conversion to biogas or bio-plastics.
Fourth, Ulukaya’s ex-wife, Ayse Giray, sued the yogurt-maker last August in New York state court, according to multiple published reports. She claimed that the couple launched a cheese-making operation in 1997 called Euphrates using her credit and a $200,000 investment. Ayse and Hamdi remained business partners after the divorce in 1999, and she claims that she gave Hamdi another $300,000 between 2002 and 2003 to help expand Euphrates into other dairy products. The ex-wife is claiming a 53-percent stake in Chobani, according to the media reports.
Full speed ahead
Ulukaya has been generous to the community. “He set up the Shepherd’s Gift Foundation (Chobani is the Turkish word for “shepherd”) and annually gives 10 percent of the company’s net profit to dozens of organizations,” says McConeghy.
Ulukaya has clearly taken Chobani from a boutique maker of Greek Yogurt to a national powerhouse and, in the process, put New York state on the yogurt map. He has created an industry and attracted a growing field of competitors to help quench America’s growing appetite, which at this point appears unlimited. While no one can predict the future, there is one thing that is predictable: Chobani is not putting the brakes on anytime soon.
“The company is innovative, aggressive, and nimble,” says McConeghy as he tries to stay ahead of the curve of a company experiencing rocket-like growth.
Contact Poltenson at npoltenson@tgbbj.com
Meier Supply opens new headquarters
CONKLIN — “We’ve only been in our new headquarters building about four weeks,” says Frank A. Meier, Jr., president and CEO of Meier Supply Company, Inc. on Feb. 7. “We needed to add another 20,000 [square] feet to our [former] headquarters and distribution center in Johnson City, and the addition would have used up our
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CONKLIN — “We’ve only been in our new headquarters building about four weeks,” says Frank A. Meier, Jr., president and CEO of Meier Supply Company, Inc. on Feb. 7. “We needed to add another 20,000 [square] feet to our [former] headquarters and distribution center in Johnson City, and the addition would have used up our available acreage to expand further.” The company headquarters is now located at 275 Broome Corporate Parkway in the town of Conklin.
The other impetus to move was Meier’s memory of the 2006 and 2011 floods. The 2006 flood was “devastating … It cost the company $1 million at a time when we had no flood insurance … The flood hit in July during our busiest season, but thanks to our employees and our suppliers who expedited delivery and extended payment terms we were back up in a week … That flood, which was supposed to occur once every 500 years, got us thinking about moving … The flood of 2011 convinced us,” says Meier.
Meier Supply — founded in 1957 by Meier’s grandfather and father who bought the refrigeration division of W. A. Case, Inc. in Johnson City — is a wholesale distributor to the refrigerant, heating, and air-conditioning industries. The company furnishes supplies and equipment as well as training from its 17 locations throughout New York and Pennsylvania. Meier Supply represents leading industry brand names such as Ruud, Mitsubishi, and DuPont.
Frank A. Meier, Jr. joined the company in 1975, when “my father convinced me to give up my carpet-installation business. At the time, Meier [Supply] had seven employees, and we did $1 million in [annual] revenue,” notes Meier. By 1995, when Meier, Jr. assumed the presidency, the company posted sales of $11 million. In 2008, sales had grown to $25 million and “… the company’s 2012 revenues were over $50 million … We project 8.5 percent growth in 2013 … The company currently employ 156 … [of whom] 71 are in Central New York … The new headquarters and distribution center, which was formerly the Dick’s Sporting Goods distribution center, has 90,000 square feet with 30-foot high ceilings and our 16 branches [each] average 10,000 square feet … [Because of our growth], we now stock over 15,000 items … The company’s goal is to own all of the real estate, although we typically start new branches by entering into a short-term lease before deciding to buy,” Meier explains.
Despite two floods in five years, Meier Supply’s sales grow unabated, “… except for a blip after the first flood”, says the company CEO. “From my start at the company until the early 90s, our growth was largely due to acquisitions. Since then, the growth has been organic as we look for opportunities … which usually come through our networking with vendors and customers …Right now, we’re stretched about four hours [in each direction] from our distribution center … Further growth will require adding another distribution center, which is a major move … The fastest part of our business growth today is HVAC, which has grown from zero to 40 percent of our business in [just] 20 years.”
Frank A. Meier, Jr., 58, is not the only Meier working at the company. His brother Michael, 53, who is the vice president and chief operating officer, and his first cousin Dale Norton, 48, who is the corporate secretary/treasurer and vice-president of sales, also represent the third family generation to run the business. “My two sons, Frank and Anthony, and my brother’s daughters, Nicole and Trisha also work at Meier [Supply], representing the fourth generation,” says Frank A. Meier, Jr.
Meier attributes the company’s successful growth to a number of factors, including the conversion of family stock to an employee-stock-option plan (ESOP) in 1992. “At that time, some family members were looking to divest their shares in the business,” he says. “The company purchased their shares and divided them among the employees … For us it worked out great; there was only one year the company stock didn’t appreciate,” he says of the ESOP conversion. “Today, the employees own 65 percent of the company with the Meier and Norton families owning the balance. Our goal is to reach 100 percent [employee ownership] … The ESOP really helps us to attract talent at the company, and it’s a great retention tool,” declares Meier.
“A big part of our success is the training we provide our customers,” he adds. Meier Supply opened a Mitsubishi-approved Training Center (MATC) in late 2010, one of only six in the country to introduce and explain new and greener products to the industry. MATC is part of Meier University, set up in 2008 to provide ongoing training to the HVAC industry. In the first four months of 2013, Meier University has scheduled seminars in Syracuse; Williamsport, Pa.; Binghamton; Allentown, Pa.; Albany, Rochester, and Conklin, according to the company Web site. “We have a full-time, technical trainer … He travels regularly and works with our customers,” says Meier.
Meier Supply is not only focused on customer training but also on employee training. “We formed the Meier Core Development Group, comprised of 16 highly talented, aggressive, and motivated people across our company. We meet two or three times a year for special training sessions at which we focus on personal development, communication [skills], negotiating, marketing, and sales,” avers Meier.
While focused on the financial success of the company that bears his family name, Frank A. Meier, Jr. is also focused on the question of succession. “We are working with [Paul] Fusco, who heads up the ESOP practice at [the law firm] Boylan Code, LLP located in Rochester, on the question of an ESOP succession … Transitioning from the third to fourth generation with an ESOP is complicated,” says Meier.
Meier has been active in national industry organizations and is a member of the Key Wholesale Group. “This group is made up of 23 of the best, independent distributors in the country … [We] work … together to provide a united front [to compete] against national accounts … [because] we buy our products in bulk … None of the members competes, since we serve different franchised areas,” says Meier.
Meier Supply works with M&T Bank for its banking needs, Coughlin & Gerhart, LLP. for legal advice, and Johnson, Lauder & Savidge, LLP for accounting services.
Contact Poltenson at npoltenson@tgbbj.com
Marchuska Brothers: hands-on builders
ENDICOTT — Bernard J. (Bernie) Marchuska graduated from Marywood University in Scranton in 1993 with a degree in biology and was admitted to the University of New England College of Osteopathic Medicine. Marchuska chose building medical offices rather than practicing medicine, while retaining the holistic, osteopathic view of a hands-on approach in dealing with patients
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ENDICOTT — Bernard J. (Bernie) Marchuska graduated from Marywood University in Scranton in 1993 with a degree in biology and was admitted to the University of New England College of Osteopathic Medicine. Marchuska chose building medical offices rather than practicing medicine, while retaining the holistic, osteopathic view of a hands-on approach in dealing with patients (in this case, clients). So, he opened a construction business after graduation.
Marchuska, a member (president) of Marchuska Brothers Construction (MBC), LLC, builds more than medical offices. He and his brother Justin also include commercial offices, airport renovations, educational facilities, retail plazas, and residences in their portfolio. The company is located in a 5,000-square-foot headquarters building at 436 Airport Road in Endicott.
MBC and its subsidiaries — Marchuska Glass, LLC and Marchuska Productions, LLC, a real-estate development company — employ 20, including the owners.
“The companies generated $5 million in 2012, and we anticipate the same volume in 2013,” says Bernie Marchuska. “Twenty- five percent of our work is residential and the remaining 75 percent is commercial, which includes our government projects … MBC buys only 17 percent of the Marchuska Glass production while outside customers buy the [remainder] … The glass business is growing 15 to 20 percent annually, with demand for store-front glass, insulated-glass units, custom shower doors, glass enclosures, and, of course, glass repair.”
In addition to its construction and glass business, MBC also consults on land development and building projects, produces custom cabinetry and millwork, specializes in flood damage, and contracts with national corporations to maintain their premises. “For the past 15 years, we have repaired local restaurant chains like Ruby Tuesday and T.G.I. Friday’s, as well as large retailers like Barnes & Noble, Wegmans, and Pizzeria Uno … MBC has three people on staff dedicated to respond … They can fix any problem,” says Bernie Marchuska.
MBC markets to an area 100 miles west, north, and east of its headquarters. To date, Marchuska has not focused on work in Pennsylvania. “We’re very aggressive in our marketing … not through advertising but in our pricing and scheduling … Our work comes through word-of-mouth, with 80 percent repeat business,” says Marchuska.
Bernie Marchuska brings a number of specialty skills as well as long experience in the construction business.
“My father was an industrial-arts teacher. Every summer, I helped him rehab apartments. I was cheap labor … I’m also a registered locksmith, a specialist in making 18th-century Philadelphia furniture, and knowledgeable in plumbing, electrical [work], carpentry, roofing-and-siding, and flooring,” he avers.
The Marchuska team
Bernie and his brother Justin are equal partners in all the companies’ ventures. Justin’s background is in construction management for both commercial and residential projects. He holds a degree in building-construction technology.
Melody Harford and Alton (Tony) T. Butkewich round out the MBC management team. Harford is the office manager who holds a degree in financial services from Broome Community College and had 19 years of banking and management with the former Binghamton Savings Bank. Butkewich holds degrees in industrial and mechanical engineering from SUNY and from Pennsylvania State University. He performs both estimating and project-support functions.
Commenting on key company vendors, Bernie Marchuska says “… we work closely with a number of banks, but in particular with Peoples Neighborhood Bank (headquartered in Hallstead, Penn.) … MBC also relies on Hinman, Howard & Kattel, LLP. and Coughlin & Gerhart, LLP. [Binghamton law firms] for support in our real-estate contracts, corporate work, and bonding … And we rely on Dannible & McKee, LLP (Syracuse) for our accounting.”
Marchuska’s only regret is that he spends too much time “… handling paperwork when I would rather be building something and meeting with clients.” The hands-on approach that Marchuska brought to the business when he incorporated 20 years ago is still the driving force behind the company’s success.
Contact Poltenson at npoltenson@tgbbj.com
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