It’s late afternoon, right around the time of the shift change at Baker McMillen Co.
Few employees are around, but the din of the drills, sanders and cutting machines makes the plant seem alive with activity. Baker McMillen Co. makes hundreds of hardwood products, many you’ve seen while strolling the orange aisles of Home Depot: table legs, dowel rods, stair parts, shelving and cabinet knobs.
With that much wood cut, shaped and sanded every day, the plant is pungent with sawdust.
Baker McMillen president and owner Bill Kimmerle makes his rounds. He stops at work stations, shakes hands with his employees (whom he calls associates), and explains to a visitor what this or that machine does. He is asked about one of his competitors, which phased out production of wood vacuum cleaner rollers when the work was shipped out to China, and nearly stops in his tracks.
“Let me say I’m optimistic about the growth of our company because we will grow in whatever climate we have to grow in,” Kimmerle says. “But ultimately for the U.S., I’m very concerned about manufacturing in the U.S., and the impact of Chinese goods and services coming into the U.S. That’s one of the things that keeps me up at night.”
Despite looming foreign competition, Stow-based Baker McMillen continues to grow, each year improving on the last. The family-owned business closed 2002 with more than $30 million in sales and 225 employees. In 1975, sales were about $650,000 and there were 19 workers.
Kimmerle keeps Baker McMillen growing, not by dropping prices to beat out foreign competitors but by finding that elusive niche product. The company finds those products by acquiring the right companies at the right time, and it listens to its customers to develop new products.
That philosophy may be common sense — but it has legs. Baker McMillen has been in business since 1874, making it the oldest company in Summit County and one of the oldest in the state.
“You don’t want to be the low-price leader,” Kimmerle says. “You want to have a specialty where you become important to your customers.”
Shopping spree
Fifteen years before Kimmerle joined Baker McMillen, the company looked as if it would quietly shut down without notice, just as so many mid-range manufacturers did in the mid- to late-1970s. It had only two major customers, one of which was costing it money.
That’s when Rich Miller, who ran injection molder Rehrig Pacific Co. in Erie, Pa., bought the company and began to turn it around.
Miller’s first step was to dump the money-losing customer, which left Baker McMillen producing vacuum cleaner rollers as its sole product. Miller knew the danger of relying on one customer and one product, and began to look for acquisition candidates.
His first, in 1982, was Crook Miller Co. in Hicksville, which produced wooden handles for gardening tools. Miller turned the company around in about a year and made it into a profitable division.
The second, and more significant, acquisition was Waddell Mfg. Co., in Grand Rapids, Mich., in 1987. Waddell was losing money, and its owners sold it to Miller at a bargain price.
Enter Kimmerle, Miller’s son-in-law, who up until that point had been an engineer in a research lab for Babcock & Wilcox doing top-secret energy and defense work for the U.S. government. Making the jump to a radically different field and culture concerned Kimmerle.
“I agreed to stay for one year, and either one of us could pull the ripcord at any time,” Kimmerle says. “That first year went really fast, and at the end of the year we talked and I agreed to stay another year. Ten years later, I bought the company.”
Using his engineering skills, Kimmerle eliminated inefficiencies at the Waddell plant until he and Miller decided to move the operations down to Stow to further reduce overhead and personnel costs. Since the takeover, Waddell has grown 12 times its size in 1989 thanks to customers like Home Depot, Ace Hardware and Lowe’s, where Baker McMillen sells unfinished wood products under the Waddell brand.
Kimmerle helmed the most recent acquisition in 1995, after he moved up to the position of vice president. At several trade shows, he met and befriended the owner of Phoenix Millwork in Beaumont, Texas, which produced wood trim items for Victorian homes. Phoenix’s owner told Kimmerle he was ready to retire and wanted to sell the company.
Kimmerle was intrigued, but an Illinois manufacturer beat him to the punch. Then it walked away from the deal on the closing date. The next day, the Phoenix owner called Kimmerle to see if he was still interested.
Three months later, Baker McMillen bought the company for the asking price.
Kimmerle’s acquisition checklist is remarkably simple. First, he’s not interested in buying competitors; he would rather beat them in the market. Second, the candidate must have a niche product, which follows Baker McMillan’s secret for longevity. And third, it must have a great potential for sales growth.
He determines that by calling customers to see if there’s a long-term interest in buying from this company. That research helped him close on the Waddell buyout.
“We look at at least one acquisition a month,” Kimmerle says. “The only way you can have opportunities is to look at opportunities, so we look at them a lot, but they don’t always make sense for us.”
Level the playing field
Every company has its share of missed opportunities, and Kimmerle keeps a reminder of one of the big ones that got away from Baker McMillen long before he was even born.
It’s a wood and metal level tool the company made in the early 1900s. It later sold the patent rights to a small tool maker in New Britain, Conn., called Stanley. About 100 years and $2.6 billion later, Stanley reigns as the world’s tool king.
But Kimmerle tries not to think about that. He’s too busy creating new products that he hopes will catapult the company to the next level of success.
“New products and acquisitions is really how we fuel our growth,” he says. “The lifeblood of any company is new product development, keep churning out new ideas.”
Baker McMillen’s new product development follows its acquisition and management philosophies — it must be a niche product. In other words, Baker needs to corner the market on whatever product it releases. Most ideas for new products, not surprisingly, come from customers.
“Our customers tell us what they want,” Kimmerle says. “Ace Hardware, they were the ones who told us they were having trouble with their table leg supply, and we said, ‘We can do table legs.’ Now we have the whole U.S. market. We used to have four competitors They all died.”
But that doesn’t mean abandoning old products is always the right move. Baker McMillen’s Crook Miller division witnessed a spike in business due to a resurgent demand for wooden handles on hand tools. Plans are in place to produce its own line of tools instead of just producing the handles for a toolmaker.
“Most toolmakers moved to the fiberglass handles or steel, but what we’re hearing from the people who use the tools is that the fiberglass is hard on the hands,” Kimmerle says. “People like wood.”
The Great Wall
Kimmerle doesn’t hide the fact that Baker McMillen outsources some of its work to manufacturers in China. Market pressures have unfortunately dictated that, he says.
What he says keeps him up at night is wondering where manufacturers like him will be in 10 or 20 years if the trend continues. One need look no further than 12 miles up Darrow Road to Glenwillow to Royal Appliance. Royal, which for years outsourced its manufacturing to China and Hong Kong, was acquired in December by Hong Kong-based Techtronic Industries Co. Ltd.
That’s why, when he’s asked about the future of Baker McMillen, Kimmerle responds with hesitation that can be best be summed up as “looks good … for now.”
“If you take all the manufacturing out of the United States and move it to China, who is going to be purchasing the services from the service sector?” Kimmerle says. “We’re sourcing product to China because we’ve got to be profitable, but from a national interest standpoint, where are we going to be?”
Kimmerle is working with state Sen. Kevin Coughlin, (R-Cuyahoga Falls), the Akron Chamber of Commerce and the Ohio Manufacturers Association to slow the decline of manufacturing jobs in the United States. He hopes to start a nationwide groundswell of support to influence those in power to seriously consider what the country would look like without a manufacturing base.
“Other manufacturers I’ve talked to all feel this way,” Kimmerle says. “Nobody really knows what it’s like except for the guys who are running these companies. And they’re so busy running their companies, they don’t have time to go out and broadcast this.”
“Tariffs aren’t the right way to go because that’s protectionist,” he continues. “There’s got to be some way to solve this problem, and if I don’t do something, then who will?”
It’s ambitious, but it’s hard to imagine a company better suited to take on the challenge. How to reach: (330) 923-8300
