Volume 45 Number 10
Executive Q&A: Bottled Water -- Dispensing Magic with Tomlinson’s Strunak
Not many people in their 40s or older can say they’ve worked at the same place since they were a teenager. Gary Strunak is an exception. A Cleveland native, he started as a supervisor for Tomlinson Industries in 1979 at age 19. Today, he’s national sales manager for the No-Drip Division, which specializes in valves, faucets and dispensers for the water cooler, water bottle, coffee and food service industries.
The years between have been an evolving adventure.
Strunak points out Tomlinson, founded in 1911, began as a manufacturer’s representative of large control valves for steam, water, oil and plumbing applications--heavy brass and stainless steel parts. In 1948, it shifted to manufacturing faucets and fittings for food service. In the late ’60s, with emergence of the office bottled water cooler, it found a new market that’s only grown as that market has expanded rapidly into the home and point-of-use (POU) coolers. Food service applications for the No-Drip Division also grew rapidly to include major restaurant chains--condiment dispensing units, tea brewer faucets, wishbone dispensers on coffee urns, etc., as well as bag-in-a box applications such as for wine, syrup and soap.
In August 2001, Tomlinson bought the Pro-Flo product line and, in early 2002, it picked up the Quad-Flo line as well. The first involved water fountain bubblers, projector heads, cartridges, cartridge holders/regulators and POU faucets from Pro-Flo Products, of Cedar Grove, N.J. The second involved bypass valves for water softeners, general liquid bypass, diverter systems and solar systems--available in 3/4" and 1" connections--from Hiller Engineering & Manufacturing, of Santa Barbara, Calif.
Currently, it’s test marketing a new residential ceramic-plug faucet line for in-home use--a first for Tomlinson--that it plans to have fully rolled out by 2004’s second quarter. It’s also pursuing industrial applications for its dispensers and famous Touch Guard faucets from janitorial supplies to medical applications. It’s the Touch Guard faucet that sparked the boom at Tomlinson, by providing a safety feature to help prevent accidental dispensing of hot water or other liquids. Customer liability issues in the late ’80s-early ’90s served as the impetus for the change, while the Americans with Disabilities Act prompted additional ease-of-use innovations. Still, Strunak said he sees future modifications ruled by aesthetics.
“On faucets, you’ve got to have a lot more color (and finish) options,” he said. “And the old clunky, square coolers everybody had are now molded plastic and very sleek with little buttons. They’re gorgeous. To me, that’s the direction the industry is going, even in some of the more commercial stuff.”
Like many companies, Tomlinson has felt the impact of the recent recession. Strunak expects the biggest challenges to come from residual effects of a stagnant economy that’s lost so many manufacturing jobs and ongoing competition from overseas copycats.
Before we get to the interview itself, here are a few facts on Tomlinson Industries
Management: Mike Figas, president; Lou Castro, executive vice president; Gary Strunak, No-Drip national sales manager
Revenues: $10-30 million, growth under 1% in 2002--down from 6% prior to 2000.
Operations: Two divisions--No-Drip Division and Food Service Division. Three buildings in Cleveland and one in West Bend, Wis.
And now for the interview:
WC&P: How long have you been in the business and how did you get started?
Strunak: In 1911, the company was started. This is Tomlinson Industries. They were originally a manufacturer's rep for large valves and related controls for steam and water, oil water, urn cleaners, plumbing closets—things like that. Big heavy, all brass and stainless steel parts. Then, in 1948, they shifted from being a rep to being an actual manufacturer of the faucets and fittings, mostly for the food service industry. And that was basically the backbone of the company for many years. You know, dispensing coffee and chocolate and syrup and wine and soup, and so forth. Stock pot faucets and what have you. And then, when the water cooler started to catch on, probably in the late '60s into the early '70s, is when it started to emerge.
WC&P: I'm thinking of the Rock Hudson/Doris Day movie era…
Strunak: Yes, that's about right. We got contacted by those companies. And, initially, it was very small. I mean I can remember the original IBWA shows, it was just a table and we'd spread out a few samples. We only had a couple different models at the time that were used by Elkay and Oasis for coolers. The nice thing back then, they were all tan. You didn't have to worry about all these different colors and shades—almonds and beiges and…
WC&P: Other bizarre colors more difficult to fathom by name.
Strunak: Yes. Everything was tan and all we had to worry about was the blue handle for cold and the red handle for hot.
WC&P: In our "Creative Marketing" column, which David Martin puts together for WC&P, he reviews those events where your products are strongest and can wax on sometimes about the various color schemes available. We generally go back and clip it out because after the first mention of 15 or 20 different colors and finishes, it can lose the reader.
Strunak: Oh, yeah. And it was a lot simpler back then. I tell you that. It wasn't even a particularly attractive color. I don't know where that tan came from, but they all had it and it was easy for us to match. I liked it then, because then all we had to worry about were red, white and blue handles for whichever inlet they wanted. Then, a few years ago, we bought part of the Pro-Flo line out of New Jersey.
WC&P: I recall.
Strunak: This is the projector heads, the cartridges, the bubblers, the reverse osmosis lead-free faucets and the glass fillers—and they're all either lead-free brass or stainless steel. That kind of went in line with the water industry that we were supplying to anyway. And, then, finally about a year and a half ago, we bought the Quad-Flo line out of California (from Hiller Engineering & Manufacturing), which are bypasses for water softeners and so forth. They can be used either in the home or commercially.
WC&P: So, that would have been in 2002?
WC&P: They were out of where?
Strunak: Santa Barbara. It was just a small one-two man operation. Those kind of fit in well, the Quad-Flo and the Pro-Flo. You notice we're kind of getting into the plumbing industry a little bit.
WC&P: How many products are in Tomlinson's catalog now?
Strunak: Well, you've got all the cooler faucets, obviously—a whole group of those. Then, you've got the various components that go with it. For example, if you want to make it a safety faucet, so people don't accidentally dispense hot water.
WC&P: Children, for instance.
Strunak: Right. There's the TouchGuard mechanism to prevent that. You've got the cup trip handle, which is used more for compliance with ADA (Americans with Disabilities Act) laws. You can just push the handle back and dispense water when you need it.
WC&P: I've got to tell you we've got a new cooler in-house. It's only a week or two old, and I still haven't figured out how to get hot water. Those things work. I thought I'd have some tea… well, maybe not.
Strunak: Oh, yeah, it's funny. At least, there's no need to sue anybody. I was just talking to somebody here at work and he was telling me how a daughter and her new dog came visiting. They have a cooler in the family room and the dog watched the people go get themselves water by pressing the handle. Sure enough, the dog went over and pressed down the handle with its paw to get water. Incredible…
WC&P: That's pretty funny.
Strunak: So, we've got all the water faucets. We also developed about eight or nine years ago a self-adjusting water cup dispenser. Again, we were dealing with the Sunroc's, the Elkay's and the Oasises…
WC&P: Pretty hefty lineup of customers.
Strunak: We would supply them the water cup dispenser along with the faucets. And it had a nice clear tube, so you could see when you were running low. It also has fingers on the bottom that adjusts to whatever size cup you're putting inside. So, if your customer changes cups, it doesn't really matter. You don't have any adjusting to worry about. That's another product line. Then, like I said, the bubblers, projector heads, glass fillers and RO faucets and the bypass—we've got quite an industry for us.
WC&P: Yes, I see. Well, how did you come on board?
Strunak: Me personally?
Strunak: Oh, I was hired as the faucet assembly foreman in 1979. Of course, I was only going to stay here for a few months because I was only 19. It wasn't going to be a long-term job.
WC&P: That's a long time ago—1979.
Strunak: Yes, well…
WC&P: And, today, you're national sales director for the No-Drip Division. How many different divisions does Tomlinson have?
Strunak: We have No-Drip and we also have a Food Service Division, that supplies more to restaurant equipment houses. These are things like soup kettles, steak platters, and cup dispensers—things like that.
WC&P: Yours deals with all the water treatment equipment?
Strunak: Right. I think ours is like 70-75 percent of the business currently. I spent two years building the faucets; then, I spent about a year in the shipping/receiving area learning that part of the business; then, I came into sales.
WC&P: I'm flipping through your website as we're talking and noticed Marsten Wood Products. You make all those child high chairs and booster seats that you see in all the restaurants.
Strunak: Right, that's the latest division that's been added to the Food Service line.
WC&P: All the different cast iron platters for fajitas, etc. That's a pretty wide breadth of products. I had no idea that Tomlinson was into the rest of that.
Strunak: You're all over the map with that kind of stuff, true.
WC&P: But it all ties in with water treatment or food service equipment for consumables. Tell me a little bit about what else is new at the company if you could.
Strunak: OK. As I mentioned, the purchase of Pro-Flo and Quad-Flo are probably the two newest additions. We also have developed a new faucet that's used more for home use. This is actually for new home construction where they put a water purification system in. I mean it's just barely making the market now. We're going to the ceramic plug style, which we've never done before. That's brand new for us. And it's very graceful looking with several different finishes, brushed and stainless and different colors and so forth. It's really going to get us into the home market for the first time with something you'd have on your kitchen sink.
WC&P: What's the goal for that, i.e., the rollout?
Strunak: We're just getting started with that, so I would say probably the first quarter of next year.
WC&P: By the WQA show, in other words.
Strunak: Hopefully. That's what we're shooting for.
WC&P: Those are going to be more the standard type faucets in the home that will have filtration built into them.
Strunak: Yes, it will be worked in conjunction with a filtration unit. We'll have to set the standard for 3/8ths fittings and so forth underneath.
WC&P: It matches you up with the Deltas, etc.?
Strunak: Right. A real new area for us. It kind of fits in with where we've been going.
WC&P: They come around at it from the other side where they've been doing general faucets for the home, while you've been working with companies making water treatment products and providing faucets for them. That would seem to give you an advantage.
Strunak: Well, at least we're familiar with it and we know the players. It's been somewhat of a learning experience, especially with the bypass valve. That's been a little bit different niche for us to learn.
WC&P: What was the motivation there?
Strunak: With the Quad-Flo, we just felt it fit in with the Pro-Flo line. It was kind of the same types of calls. And the company was just in limbo. It was a nice little addition.
WC&P: How does your market area break down? Where all do you target products? Where all do you distribute?
Strunak: We've obviously been with all the bottled water cooler dealers for a long time because of our association with, again, Sunroc and Oasis and Elkay. We will sell to all the independent dealers because a lot of times the OEMs don't really want to mess with small orders. Some guy needs 12-15 faucets. We'll be glad to handle those types of orders. And we're also working with some of the master suppliers as far as people who sell to plumbing stores and so forth—the bypass valve, the some of the reverse osmosis… A lot of the water companies—we sell to the Culligans and the Suntorys and the chains.
WC&P: All of these are companies that are going to be in the larger booths at the IBWA show, which this issue will be going to—the International Bottled Water Show in conjunction with the Worldwide Food Expo for the first time.
Strunak: Also at the International Builders Show, the WQA had a pavilion there and there were quite a few people. It was kind of interesting. They had a pretty decent showing it looked like. And the new products that we have would fit more with that than with some of the other things. I don't know if they're going to do it again.
WC&P: It alternates between a couple different cities, I recall. Chicago's one of them. I thought Dallas was another, but I could be mixing it up with the hardware show or the appliance show.
Strunak: I know it was in Las Vegas last year and it was a huge show. It seemed to be really well attended.
WC&P: How much of your business is in the Unites States vs. international?
Strunak: I would say probably 70 percent is domestic and the rest is international. We've been shipping overseas since the 1950s. We won the E award and then the E-Star award from the government.
WC&P: Energy efficiency.
Strunak: No, it's an exports award.
WC&P: How fast is international growing for you?
Strunak: It's kind of plodding along right now. I think it's moved faster in previous years than it is right at this time.
WC&P: There's somewhat of a limbo in that sense globally, it would seem.
Strunak: Right. It's not a real growth period.
WC&P: Are there particular markets that you target?
Strunak: Not really. We ship all over. We ship to Europe. We ship to Canada, Mexico, the Pacific Rim, the Middle East…
WC&P: It would seem as if you're in a number of different market niches in the United States, which we haven't discussed. If you look at the bubblers, which go on school and office water fountains, that would seem to be more institutional.
Strunak: Sure. It really breaks down, not just in the water industry either. We sell to the bag-and-box industry and people that dispense ketchup, cleaning solvents, container companies and… We even have virtually a disposable valve for a dispenser for the bottle of water you put in your refrigerators. That's a big mover for us among people that buy one-gallon bottles.
WC&P: Living here in Arizona, you know all sorts of different bottle products from porcelain or ceramic carafe dispensers to the square jugs for refrigerators. Water treatment products start from the basic and moving up the chain depending upon your standard of living.
Strunak: Those jugs of all sizes are a big market for us. People buy them at Kmart, Target or Walmart, take them home and fill them with water or Kool-Aid, whatever. It's a big mover. On the other end of the spectrum, one of the most interesting applications I've run across over the years is in countries like Haiti.
Strunak: Yes, there are volunteer groups in different areas. There's one in Denver, for instance. What the do is they put together packages so that people in some of the less developed countries can have better drinking water. By doing this, for example, they'll drive around to Kmarts on their own time and collect these 5-gallon pails that people throw away. They get them sterilized and clean. Then, a few times a year, they go over to a country like Haiti that has real water problems.
Strunak: What they do is put one bucket on top of another with a charcoal filter between the two. They fill up the top bucket with whatever the river or well water is—wherever they're getting it from—and it slowly goes through to the bottom one such that it's drinkable. They put one of our valves on the bottom bucket by drilling a hole and slipping a faucet in to dispense drinking water out of that.
WC&P: I picked up a similar unit for my sister that was stainless steel from the old Marathon Ceramics division of Mountain Safety Research (MSR), which makes all the portable camping filters.
Strunak: Yes, same basic idea. They make what they consider production lines down there. They get local people to actually put this whole package together from the component parts. That's how these people drink.
WC&P: We've run "World Spotlight" columns on a similar program (see "Lending a Hand in Hait," November 2001: www.wcponline.com/column.cfm?T=WS&ID=1242). It's a nice little innovation and one that doesn't complicate matters with too much technology, which is oftentimes one of the difficulties in getting effective, self-sustaining water treatment into these areas.
Strunak: Yes. I mean it's not costly, it's not real fancy—but evidently it does the job.
Strunak: It's kind of interesting too because we may not think about this kind of thing in the U.S.
WC&P: True. It also ties in a bit with our next question, which is tell us an interesting anecdote or story about your experience in water treatment. Are there any other stories you'd like to share?
Strunak: The funniest one—when I think of anecdote, I always think of a funny story—was several years ago when the WQA show was down in San Antonio. We were coming out at the time with a new deck faucet.
WC&P: Which is?
Strunak: Like a glass filler faucet. It would go on the kitchen sink at home in your house. What we did in order to display it effectively was went out and bought a sink and made a cabinet around it and we hooked up the water from the trade show. But, in order to get the water to go through it, we had to hook up a pump to it to create pressure so, if somebody tried the faucet, they'd see how the flow would work and so forth. Everything was moving along smoothly. Except when the show started early on Saturday morning, we went in to get things going. It was about 9 o'clock. I don't know if the pressure had built up overnight or whatever, but it blew the faucet off the sink. And the water was flying about 18-20 feet in the air. It came cascading down in every direction. I mean it drenched us. It drenched all the booths around us.
WC&P: How did that fly with your neighboring booths?
Strunak: You wanna talk about getting dirty looks. Anyway, it was kind of a funny thing, once we got it shutoff. Of course, it was a new display so you're scrambling to find where the off switch is.
WC&P: In other words, it took a bit longer than a moment to turn off?
Strunak: Oh my gosh, your face was beet red. I thought that was a good story and it was the first one that popped into my mind.
WC&P: We see you at a lot of the shows that we go to, and we attend about two dozen a year. You generally do a lot of support for the regional shows and I assume they support you. We've had a lot of issues coming up in the last couple years regarding shows and the changing nature of attendance. Do you have any insights on that?
Strunak: Not really. I've always thought the WQA show and the IBWA show should both go to two-year formats and just take a year off in between in alternating years. Because between October and March you just don’t see too much change. The shows are similar enough that you don't notice much difference. I think you'd have better attendance with a show that's every two years than when you do when it's every year.
WC&P: There was even some suggestion last year when there was the idea floated about creating a Bottled Water Section at the WQA which seemed to be advance groundwork for announcing a merger between WQA and IBWA. But with the Worldwide Food Expo coming up and the merging of IBWA show into that, what are you anticipating?
Strunak: I'm interested to see how that goes. We have a booth, of course, there. And I have no idea what to expect with that combination. It's going to be interesting.
WC&P: Kind of new ground for everyone.
Strunak: And we also have the Food Service Division to kick in (since there's a food industry complement at the event) and I'm not sure if that's going to be a nice tie-in or not. It's going to be interesting to see how it all comes together.
WC&P: What other shows does Tomlinson go to that wouldn't necessarily be thought of for water treatment equipment?
Strunak: We do the National Restaurant Association show, we do the NAFEM show—North American Food Equipment Manufacturers. We do packaging shows—a lot of those now because, like I said, those containers that you put in your refrigerator, those are big business for us now. Liquid soap, wine and so forth. Some of the coffee shows, that's still a real hardcore part of our business.
WC&P: What are the big coffee shows these days? I kind of lost track after one of them merged with NAMA.
Strunak: You've got the office coffee show that's in Boston usually—National Association of Coffee Roasters or something like that. We'll still do those. And, like I say, we did the plastics show recently—it was back in November in Chicago—just to see what's going on in that industry. And, again, you have people that do blow-molded bottles and so forth, which we can fit in with well.
WC&P: Or just about any related dispenser-type applications.
WC&P: You were tossing out a few of the dispenser applications that included. I assume that if you're doing soap, that's a huge market for janitorial supplies.
Strunak: There's a lot of things you might think of…
WC&P: Yes. If you're doing ketchup, there's mustard and a lot of condiments for the fast food market.
Strunak: You've got salad dressing…
WC&P: If I go to McDonald's and I see a dispenser there for ketchup, is that your product?
Strunak: Uh-huh. And if you look at the coffee urn in the back, the wishbone shaped handle you pull toward you—that's ours. The ice tea brewer has our faucet on it. All that, sure.
WC&P: I would assume it would be similar at Burger King, Wendy's or any fast food place really?
Strunak: Oh, sure. It's like I said. It's been the backbone of the company for a long time and the industry standard, pretty much.
Strunak: Another market is battery acid. We've been quoted on dispensing photo chemicals. And then, you've got the medical field. There's a whole lot.
WC&P: What's in the medical field?
Strunak: Oh, they dispense everything. There's all sorts of things in bags and containers, pretty good size containers—saline and so forth—that they're dispensing out of those.
WC&P: An interesting application I noticed this summer while on vacation was at the Indiana State Fair in Indianapolis this August. All around the area where livestock was there were posted dispensers for a disinfectant gel.
Strunak: Oh, hand sanitizers, yes.
WC&P: I thought it was very ingenious considering what we've heard about E. coli, county fairs and petting zoos, etc. It's very appropriate. I don't know if you do any dispensers in that vein.
Strunak: Not necessarily, but we don't always know where our products are being used sometimes. People buy valves for this and that. They don't always tell us specifically what the application is. It may sound strange, but it's true.
WC&P: Where would you say that Tomlinson is going? What direction? What goals do you set for yourselves?
Strunak: We're trying to head a little more into the industrial area, as opposed to food service. We're very established there.
WC&P: How do you define industrial?
Strunak: Like more into the hand sanitizers or cleaning solvents or janitorial supplies.
WC&P: Dispensers for those…
WC&P: Have you created any new business divisions or how is it set up internally to pursue that?
Strunak: Basically, we supply them either something that already exists or you modify an existing product toward their specific requirement. For example, you know, safety handles—that's a biggee in that area. You've got caustic liquid inside. You don't want it accidentally dispensed. So, what you do is take the basic faucet, but you add a safety handle so they can't inadvertently be knocked open.
WC&P: I would imagine you also need to have your engineers a little bit more aware of potential compatibility issues with the materials?
Strunak: Sure. 'Cause they'll call up and say, "Hey, can we dispense X, Y and Z." And you've never heard of what X, Y and Z are.
WC&P: Let me go check that out first…
Strunak: Right. So, you say, "We'll get back to you on that." That's true in the medical field, too.
WC&P: Which one are you looking for as far as better growth? Medical sounds like a world unto itself.
Strunak: They're kind of almost coming together. As long as we focus on the container industry and so forth, oftentimes, the packaging and medical industries are in the same trade shows. They may be in different halls, but they kind of overlap each other.
WC&P: What's the overall growth that Tomlinson's been experiencing in recent years?
Strunak: Well, up until the last couple years, we were going along just fine. But since Sept. 11, it's been fairly flat.
WC&P: What things have been affecting that?
Strunak: Just, you know, the same thing affecting everything. The established customers are barely maintaining their ground.
WC&P: Everybody's been sort of holding off for a couple of years.
Strunak: Yes, nobody's setting the world on fire right now.
WC&P: What do you see as necessary to turn it around? What are indicators that you look for?
Strunak: Well, to me it's always new items. We're blanketing every industry we can think of with what we have. For example, this new faucet is going to be used in the home. That's going to be a nice fit. It's a nice new item to really kick us into a new area.
WC&P: Are these similar patterns you see in your market niche? What do you see your competitors doing? I assume you're all kind of in the same situation…
Strunak: Yes, well, the thing with most of our competitors is most of them are copyists than anything else (except for a few). We're sitting there, we've established the market and we're the brand that everybody's familiar with, since we've been supplying (them) for 50 years. Basically, they come along and copy what's already worked and we've already worked out the bugs with respect to. It's not so much that they're getting real aggressive as far as something new. It's more of a wait-and-see attitude.
WC&P: I think I've heard about some that are looking at that homebuilders/new home market as well. It's an open niche that's been waiting a bit to be exploited, correct?
WC&P: Tell us a little bit about a challenge you or your company faced and how did you overcome it?
Strunak: We got several calls—and this went on over a period of time—regarding people getting scalded by water. You know, these water coolers obviously have one side with cold water for drinking; but you would also have hot water for people that wanted tea or instant coffee, whatever. And, especially, kids would push that handle and burn themselves. Of course, there's all sort of liability issues. Everybody down the line would get a lawsuit, notification of this and that… The other thing, we wanted to be able to solve that without having to go through any sort of major retooling on the part of the cooler manufacturer or us. Our engineering people came up with what we call the Touch Guard, which basically is a safety handle. Instead of just flipping it, you actually have to press the parts together and then engage it for flow. Boy, did that make a huge difference.
WC&P: When did that come out?
Strunak: It was several years ago now. Initially, my own personal feeling was, "Ah, nobody will ever buy this." But we can't make them fast enough, because it really solved the problem. All of a sudden, anybody that made any sort of cooler or hot liquid dispenser, they literally automatically put that on. They would not put anything on other than that Touch Guard handle, since it really eliminated a vast majority of their liability problems.
WC&P: It sounds like it roughly came out roughly the same time as we started hearing about these lawsuits with respect to hot coffee, etc., such as the one at McDonald's Restaurants.
Strunak: Maybe even a little bit before that it was a concern. The nice thing when we redesigned it, we didn’t have to really change the faucet. It was more of a handle change, as opposed to anything else. So the other manufacturers liked it because they didn't really have to do anything. We solved the problem on their behalf without them having to change any of their machinery or any of their tooling. And it just involved a simple retrofit on existing models. It was very effective.
Strunak: Then, of course, when the ADA passed, we had just the opposite problem. We had to make the faucet more user friendly. That made an interesting challenge coming from the other direction. We were able to come up with what we call a cup-trip handle, which is you just push the cup against it. That makes for one-hand operation. And, again, it's only a handle change. You didn’t have to do any retooling or any major changes for the OEMs. Those were two big problems that came along over the years—a couple years apart, obviously—on opposite ends of the spectrum. The way this faucet was designed, a handle change was able to solve both problems.
WC&P: With respect to revenues, generally, where would Tomlinson fall?
Strunak: We are private, so I'll say we're a medium-sized company between $10 million and $30 million.
WC&P: And if you were looking at your percentage growth rate per year, what was it last year?
Strunak: I'd probably say it was under 1 percent. We've had a couple rough years.
WC&P: When were your best years?
Strunak: Up until then, we were clipping along I think at 6 percent.
WC&P: Up until about when, 2000-2001?
Strunak: Right. It was the same thing everybody got caught up in. When it flat, it went flat across the board…
WC&P: Who owns Tomlinson?
Strunak: The old Meyer Dairy Co. family.
WC&P: So, the president would be?
Strunak: His name is Mike Figas.
WC&P: Second in command?
Strunak: I guess Lou Castro, the executive vice president.
WC&P: Who heads up the No-Drip Division? Is there a general manager?
Strunak: No, not really. I head up sales and our factory is kind of mixed between the two product lines.
WC&P: How many people does Tomlinson employ now?
Strunak: I think we're at about 180.
WC&P: Are these all in one facility?
Strunak: No, we've got a couple of buildings here in Cleveland and we have a small factory up in West Bend, Wis. They make the faucets that are used on the percolators like Regal Ware and West Bend for home percolators.
WC&P: I would assume a lot of your competition—although there are a few I know of domestically—would come from overseas these days. How do you deal with that?
Strunak: That's kind of a challenge. You've got design patents and so forth in place. And you have to decide when it's worthwhile to pursue it or not. Some of these copies are so good, you can hardly tell the difference. The biggest problem we've had is we'll get a call from a customer that says, "Y'know, your faucet is leaking. I'm having problems with it." And we test all of ours. They're tested before they're shipped. So, it's unusual to have that. The first thing you do is tell them to send it in. It turns out it's not ours. Usually, we can tell once we see the inside plunger. But the copies are so good, oftentimes they don't know the difference. It hurts your reputation because the fact is, when you ship it out, it's not going to leak—but these other ones that look so much alike do. And oftentimes a customer that may go overseas ends up coming back to us because it costs them more money with the service calls than it's worth. But it's an ongoing, kind of an evolving battle. When do you stop it, when do you call the lawyers and so forth…
WC&P: From your perspective in the market, where do you see the industry as a whole going?
Strunak: From our end of it, I think aesthetics are going to be a big deal in the future. It's not enough that something just functions. It's got to look really good. You look at these faucets now—the sink faucets and the RO units and so forth—and everything's got to look more contemporary, sleeker, nicer. You've got to have a lot more color (and finish) options like we talked about earlier in contrast to when the cooler faucets were all tan. Try and get away with that now! I think that's the direction the industry is going—making really nice looking equipment.
WC&P: The designers will be called in.
WC&P: I went to an event in Paris a couple years ago, Aqua Expo, and across town there were a couple of other shows, one of which was a kitchen-and-bath industry show. You can imagine what you see here in the states, but when you go to Paris—they take it up a notch or two with respect to luxury. Wow!
Strunak: Oh, it's gorgeous. And I see us in the United States going in that direction. You have to. I mean this stuff is beautiful looking. And that's just as important now as anything they do functionally, I think.
WC&P: It's a way to differentiate your product.
Strunak: Sure, look at the coolers. The old clunky, square coolers everybody had are now molded plastic and very sleek with little buttons. They're gorgeous. To me, that's the direction the industry is going, even in some of the more commercial stuff.
WC&P: There was actually one cooler in the Paris show that was designed by a famous artist there. That was somewhat the hit of the show. It was a brushed metal piece that looked ultramodern with a nice sheen to it.
Strunak: That's what you've got to do—you've got to catch people's eye.
WC&P: Tell me, what's the one hot button issue that you see facing water treatment dealers or the industry that you think will have the most impact over the next few years?
Strunak: It's the same thing that we talked about. I think the export items coming in, at least from our end of it—a manufacturing perspective, is definitely the concern. It really is. And I don't know if legislation is the answer or whatever, but that's certainly the issue from our point of view that's really tough.
WC&P: You hear about other industries—semiconductors or steel—that are able to, through critical mass of their market breadth, get the U.S. trade representatives to step in on things like that. I've never heard of any international trade disputes that rise to that level within our industry, though. It's more of a generalized issue.
Strunak: Yes, it is. And with organizations like IBWA and WQA, maybe it's time to really buckle down. Because, I tell you, it's not easy…
WC&P: You also hear the pump and filter housing manufacturers raising the same issues. At the same time, you see a lot of business coming from Asia. And we hear the quality has improved dramatically.
Strunak: Yes. It's just one of those things. We created the market, nobody what anyone says. The market is still here. This is where the consumers are. This is where people are going to buy the items and so forth. But people have got to have the money to buy the items, no matter how inexpensive they get. You can take a water purifier and cut it in half—but, if people don't have jobs in the first place to be able to pay for them, it doesn't matter how cheap you make them.
WC&P: That ties back to what you were talking about earlier with respect to the general plodding nature of the overall economy these days.
Strunak: Right. People have got to be able to buy whatever. And you keep taking away these manufacturing jobs and so forth—what are you going to do? Yes, it's a lot cheaper than it used to be, but that still doesn't mean it's not going to just sit on that shelf if people can't afford to buy it. I think that's the biggest issue for a long time.
WC&P: That may be true. Some economists have indicated the long term economy with a return to deficits and expanding national debt may not be as promising. Generally, in the past, it's been the U.S. consumer that's brought us out recessions. So, it may be a valid point to suggest. Recently, there was a report that out of over nearly three million jobs lost in the past few years, nearly two-thirds were in manufacturing. Those are oftentimes the higher paying jobs that put kids through college.
Strunak: I was even reading about job losses at companies like McDonald's. It used to be said, when times were tough, you'd go flip burgers. But I guess that McDonald's is trying to automate so much that they're going more robotic in the future.
WC&P: I was a burger flipper. I worked at the McDonald's right near my high school.
Strunak: Well, you won't have that option anymore. I understand they're working on machines that will do all the cooking, so you'll just need people to load the machines and exchange the money.
WC&P: I've got to tell you that's going to be sad for teenagers, because you learn a very good work ethic at McDonald's, i.e., the mantra that "if you've got time to lean, you've got time to clean…"
Strunak: You do. And it's still work. It's still gas money, cigarette money, whatever you're looking for. You say to yourself, "How many of these jobs can disappear and we still keep going?"
WC&P: These days we might want to modify that to gas or makeup money.
Strunak: Oh, right. But really it's cell phone money now. When I was there, it was different—a little change in generational values there.
WC&P: It probably involved beer money, too, but we won't get into that.
WC&P: And you started there at Tomlinson at 19, too. That's a long time.
Strunak: A lifetime, my friend. Hard to believe…
WC&P: What was it like your first week on the job?
Strunak: Nobody gave me more than a month. You walk into a factory situation at 19 and you're supposed to be the supervisor. And, of course, these people have chewed up and spit out supervisors for years. It was just one of those things where you couldn't sleep. You couldn't eat. You were trying to learn so much in such a short period of time. It was wild. It was quite a whole different environment from anything I'd ever known. I worked at a machine shop before I came here. You just kind of went to your machine and drilled your holes and did your thing. Nobody bothered you. It's been quite a learning experience. But, I'll tell you one thing from the sales end of it, having had that factory experience was unbelievable. You know exactly what everyone's talking about if you have to take something apart, clean it, put it together. It's so much easier. I still spend a lot of time out there going back and forth since you can't always remember. One thing may be different from another, so you go up and hold one in each hand and compare it. It's really good experience if you can start that way.
Join us next month for an interview with QMP Inc. President Freddy Vidal.