By Jamie Smith Hopkins, The Baltimore Sun
1:19 PM AKST, November 30, 2012
Drew Greenblatt's company has grown every year for the past six years — something many other firms, buffeted by the sharp recession, can't claim.
What makes that all the more notable: It's a manufacturer. In Baltimore.
With 35 employees, up from 20 five years ago, Greenblatt's Marlin Steel Wire Products is a small but notable standout in an area with devastating losses in the sector. Nearly half of Maryland's manufacturing jobs vanished in the past three decades, and in the city, the drop was 80 percent.
For all that, Greenblatt thinks manufacturing isn't doomed to shrink. He insists that the state could kickstart a lot more growth in the sector, if officials made it a priority.
"We're fooling ourselves by focusing on the federal government — we're like a one-company town, and it's shortsighted," he said, referring to the state's reliance on federal employment and contracting. "We have to have an alternative … and I think manufacturing's a great plan."
He's getting many opportunities to talk about that — and about manufacturing in general.
Greenblatt is on the new Maryland Advisory Commission on Manufacturing Competitiveness, chairs the Regional Manufacturing Institute of Maryland and sits on the executive committee of the National Association of Manufacturers.
In May, Treasury Secretary Timothy Geithner swung by Marlin Steel for a tour. On Nov. 14, Greenblatt testified before Congress. And last Monday, he was at a White House meeting of business people discussing the so-called fiscal cliff.
Greenblatt is so unusually ubiquitous for a small-company owner, in fact, that Inc. magazine — noting how often he's been interviewed by national media — wrote a piece about him a few weeks ago with the headline, "How an Entrepreneur Became the Go-To Spokesman for U.S. Manufacturing."
The 46-year-old Montgomery County resident has a vested interest in seeing the sector expand. More factories mean more potential customers for wire baskets and other products used for material handling, on conveyors and in pharmaceutical-plant clean rooms. Even better if the new factories are local.
But he's doing all right as it is. The company's revenue of $4.4 million last year was up 33 percent from 2008, enough to land Marlin Steel at No. 4,112 on this year's Inc. 5000 list of the fastest-growing privately owned companies. Marlin Steel also made this year's Inner City 100, a separate list of rapid-growth firms that is put out by the Initiative for a Competitive Inner City.
Greenblatt hopes for revenue in the $5.5 million to $6 million range this year, and it's not outside the realm of possibility.
"We just got our biggest order in company history," he said in his Southwest Baltimore building a few weeks ago, the boom boom boom of his robotic punch machine echoing continuously in the background. "The factory is very busy."
Vested interests notwithstanding, Greenblatt said the main reason he spends so much time talking about manufacturing is that he's "passionate about this." He calls the sector a vital source of jobs that pay middle-class wages. He doesn't want the country — or Maryland — to write it off.
"One of the reasons he's such a great spokesman for manufacturing is that he believes in the future — he believes in the future of manufacturing," said Mike Galiazzo, president of the Regional Manufacturing Institute of Maryland, which helps the sector with workforce development and other needs. "And he puts his money into it. Small companies ought to take note that this guy is not sitting there, saying, 'Woe is me.'"
When Greenblatt bought the company in 1998, it employed 18 people and made wire baskets for bagel shops. He moved it from Brooklyn, N.Y., to Baltimore — he's from the area, raised in Silver Spring — and expected business would be great. Bagel shops had multiplied across the country.
Then Chinese factories started selling bagel baskets for less than Greenblatt could purchase his steel, let alone manufacture his product. The low-carb (and thus anti-bagel) Atkins diet craze didn't help, either.
"We were hemorrhaging cash," he said.
The seed for change came about a decade ago, when a Boeing engineer asked Marlin Steel to make a different sort of basket, one that would hold an airplane part. It needed to be much more exact — and Marlin Steel could charge a lot more for it.
The light bulb went on. "Quality engineered quick" — that was the way.
Greenblatt took a company with measuring tools no more high-tech than tape measures, where plus-or-minus one bagel was a perfectly acceptable variation in basket size, and turned it into a producer selling to customers needing accuracy down to the 4,000th of an inch. These days, Marlin Steel has mechanical engineers, skilled craftsmen and more than $3.5 million in robotics.
"That has saved the company," Greenblatt said.
And produced better-paying jobs — not all manufacturing is family-supporting. When he bought the company, the bagel-basket workers earned minimum wage with no health benefits. Now, annual pay on the factory floor — which doesn't include the degreed engineers — ranges from $30,000 to $80,000. And everyone is eligible for health insurance.
Five percent of the company's labor budget goes to worker education. Greenblatt credits the company's good fortune to the highly skilled workforce such spending helps maintain, plus cutting-edge automation and a drive to sell far beyond U.S. borders.
Marlin Steel has customers in 36 countries — including China, where so much is made nowadays.
Gene Burner, president of the Manufacturers' Alliance of Maryland, which lobbies for the sector, said the distinction between small and big manufacturers has blurred over the past decade or two. International isn't just for the giants. The Internet makes it easier for the little guys to sell to South Korea — and for South Korea to sell to those little guys' usual customers.
"It's global competition, so whether you're big or whether you're small, it's still global," Burner said.
Greenblatt said he loves the competition. Some of his manufacturing activism is aimed at global trade — he testified in support of the U.S.-Korea Free Trade Agreement last year, eager to get rid of the tariffs that add to the cost of selling there.
Free-trade deals are always contentious, and so are some of the Maryland-specific changes he suggests.
Greenblatt thinks the state should be going whole hog on extracting natural gas — he pointed to the "fracking" boom in Pennsylvania, and factories opening or expanding in Ohio to build pipe for drilling. And he suggests Maryland take a hard look at its taxes, particularly ones aimed at higher earners that also hit small companies taxed on a personal level.
Both ideas would probably face an uphill battle in liberal Maryland — one gets cast as business vs. the environment, and the other as have vs. have not.
State Del. Heather R. Mizeur, citing health and environmental concerns, said in September that she would propose a moratorium on fracking in Maryland until the state studies "all the safety risks involved." And Maryland's General Assembly increased income taxes on higher earners in the last session, calling it necessary to avoid cuts to education and other programs.
Jeff Fuchs, chairman of the Maryland Advisory Commission on Manufacturing Competitiveness, said the group will look at the state's tax structure. Greenblatt also mentioned natural gas to him and he found it intriguing — though he warned that the issue is "complex." The commission's formal report isn't due for about a year, but Fuchs said the group wants to provide some manufacturing recommendations in February that could be acted on immediately.
"It's been made clear to us that this is something that is high up on the governor's radar," said Fuchs, who runs the Maryland World Class Consortia, a nonprofit that helps manufacturers and others operate more efficiently. "He wants to make sure we do the right thing by manufacturing in this state."
Greenblatt suspects Maryland would need to make significant changes if it wants to stop being counted out as a site for new factories. In the last three decades, as Maryland employers added more than 900,000 jobs overall, manufacturing shed 100,000. The state's rate of loss was far sharper than the country's as a whole.
Marlin Steel's owner thinks Maryland has important advantages to build on, if it wants to. Port, highways, railroads, universities — he thinks they're all great.
"We have a lot of things going for us," Greenblatt said. "This should be a manufacturing state. It was."