Partly employee-owned Bucks firm specializes in fluid transfer
New Age Industries, in business since 1954, makes high-purity tubing and house products and also provides automated identification and tracking solutions.
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KEN BAKER, 61, of Ambler is CEO and majority owner of New Age Industries, in Southampton, Bucks County. The family business makes and sells high-purity plastic tubing and hose as well as sanitary fittings and hose assemblies for the food-processing and pharmaceutical industries. The firm is 40 percent employee-owned and expects $40 million in revenue this year.
Q: What's New Age do?
A: We're an industrial-grade manufacturer of plastic and rubber tubing and hose for food processing. We have a product group that makes plastic and rubber tubing and hose for the pharmaceutical market. A third product group is a distributor of radio-frequency-identification tags for tracking objects on a pharmaceutical-factory floor or in a medical office.
Q: Your customers?
A: Our products are used by food processors who make milk-shake machines. Just about every McDonald's milk-shake machine around the world has our tubing in it. A lot of our silicone tubing is used in coffee machines. We sell Teflon tubing to chip manufacturers who make integrated-circuit chips. GSK, Merck and Sanofi are also customers. We sell direct in the U.S. and also wholesale through distributors overseas.
Q: You became an ESOP company in 2006?
A: I wanted a high-performance company and knew I wouldn't get to that level until employees had a stake in it. An employee works a bit harder, thinks a little differently, if they own a piece of it.
Q: Your father started the company in 1954. What's the secret sauce?
A: Knowing your customers, treating them with respect and giving them what they want when they want it. We ship 98 percent of orders in stock same day. A lot of small companies don't believe in taking their cash and putting it on the shelf. My father always said: "You can't sell out of an empty wagon."
Q: The value prop?
A: We think ESOP is absolutely one. It has created $21 million of value for 120 employees in the ESOP retirement trust. The share price has gone up 638 percent since 2006. Sales have more than doubled since 2006. We're also a green company and have more than 4,000 solar panels on our roof. I wanted to become more sustainable. We've lowered our energy bill by more than $10,000 per month.
Q: Your competitors?
A: One is Saint-Gobain, a French firm. They've tried to buy us several times. That's not what I want to do. When I sell my stake, I'm going to sell all of it to the employees.
Q: What's next?
A: We're opening a 40,000-square-foot building on our site and adding 25,000 square feet of space.
Online: ph.ly/YourBusiness