Global Fastener News

1982 FIN – Allied Products to Continue Consolidating

August 14
00:00 2013

August 20, 1982 FIN –Allied Products Corp. will continue to “consolidate”—shrink—its fastener operations to fit its view of the future of U.S. industry in general.

It’s not just fasteners: Chicago-based Allied is doing the same thing in its other product lines.
Bogged down in the depressed Midwest automotive and agricultural markets, Allied has lost money for three consecutive quarters, reporting a $1.1 million loss on sales of $120.8 million for the first six months of this year. It has cold off three businesses, cut employment by 25% and trimmed wages over the past 18 months.
At the same time, some top management shifts have been made. Richard Drexler, 34, has succeeded his father, Lloyd Drexler, 64, as president.
Lloyd Drexler has been elected chairman of the executive committee. Richard Drexler will continue to serve as chief operating officer, a position he has held since March. He will have responsibility for day-to-day operations of the company while his father and the current chairman, S.S. Sherman, 64, will supervise the company’s investments and equity participation and planning its future.
Richard Drexler told FIN a bit about that future in the fastener business. “We, as a company, have consolidated in our farm implement business, going from three plants to two, and that’s why we’re profitable. We’ve gone from three chemical plants to two. In that instance it was to maintain a certain level of profitability.
“In the fastener industry, we are consolidating so we will have a smaller, more profitable unit. We have closed two plants in the last six months (Phoel New England in Torrington, Conn., and Great Lakes Screwin Chicago). As far as we are concerned, we are not contemplating any further consolidation at this time.”
Allied Products has three fastener manufacturing operations: Phoel Fastener, in Chicago; Accurate Die & Stamping, in Chicago; and Wolverine Bolt, in Detroit. It also has Sterling Bolt, a distributor, and International Fastener, as importer.
“There are certain consolidations occurring within distribution, also,” Drexler says. “These involve shrinking these operations down to a smaller size—store fronts in some instances. Their consolidation will occur at the end of this year or the beginning of next year, more than now. We are concentrating first on the manufacturing.
“I don’t think we will get to less than three fastener manufacturing plants. As for distribution plants—we will consolidate two or three of these. There will still be a Sterling bolt, but instead of three branches, there might be two, and so on.
“What we are trying to do is break even on a much lower sales volume, on the theory that the United States industrial base will never again be what it was before.” ©1982/2013 Fastener Industry News
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