July 2004: Volume 46, Number 7
Gleaning Wisdom with Blue-White`s Gledhill
by Carlos David Mogoll?n, WC&P Executive Editor
Fresh from his tour in the U.S. Army, Robin Gledhill joined Blue-White Industries in 1970 in the service department of the California-based specialist in chemical feed injection and flow metering equipment.
At the same time, he went to school at Golden West College using the GI Bill to earn his degree in 1973. With diligence and dedication, he moved up the ladder at the company and was elected president in 1997.
Blue-White was founded in 1957 by Oswald 'Ozzie' King, who was well known at the time as a commercial pool builder. Gledhill notes that, left to his own devices, King developed numerous products out of necessity during his years in pool construction. Among those were the pumps and flow meters that have anchored the company.
'From there, it grew into the industrial and medical sectors and all kinds of areas,' Gledhill said.
Ozzie passed away in 1998. But his wife, Frances, is still CEO, their son heads up manufacturing and their daughter manages advertising for Blue-White. The company—like most who felt the effects of the recent recession—is coming off a few bad years, but took the time to position itself for growth. Thus, Gledhill talks about a percentage jump in sales in double-digits this year and optimism for better times.
'I think it's going to be good,' he says. 'It's an election year. I think we've been through—I don't care what the government says—a three-year recession. And that should be followed by a minimum of five years of stable growth, barring any unforeseen terrorist issues.'
Gledhill laments how many U.S. manufacturing jobs were lost in the last few years and touts his company's efforts to keep from outsourcing work through innovation and automation. After letting staffing fall back to 65, Blue-White is nearly back to its peak of 75 employees. But those numbers mean little compared to production, because it has always focused on high-tech manufacturing to be more efficient and cost-effective. Much of the resulting equipment allows one person to do the work of four.
Gledhill says, 'We've really lost a lot of blood as an industry. And it's just so nice to see it coming back. It's nice to see magazines getting a little thicker. People are placing ads... But going through a recession like this is really good for us, in a sense. It's just like taking bad medicine. In every section of your business, you become more efficient. Virtually every section, there isn't one area that isn't scrutinized.'
About 45 percent of Blue-White's business is in pumps with 55 percent in flow metering, but that's cyclical and may flip-flop if the high-tech industry-semiconductors, computers, microelectronics, etc. is up or down. High-tech production requires more flow and sensory control to assure ultrapure water in manufacturing processes. But Blue-White's pumps also assure precise dosing of various chemicals used in water treatment, whether chlorine, algaecides, biocides, slurries, activated alumina, etc. Then again, fluids dispensed may be for other uses as well such as soaps and waxes for car washes or nutrients for advanced agricultural irrigation. Aside from residential applications, its equipment is used in just about any commercial/industrial setting from boiler feed to cooling towers.
Gledhill likes to say this requires a lot of sophistication, both in how Blue-White's products are made and instrumentation required in them. Still, with ongoing growth and development worldwide, marshalling water's limited resources to make the most of what's available will become even more important, requiring even greater sophistication. That makes him very positive about the industry’s future.
Before Gledhill's full interview, here's some background on the company:
5300 Business Drive
Huntington Beach, CA 92649
Tel: (714) 893-8529; Fax: (714) 894-9492
• Frances King, CEO
• Robert 'Robin' Gledhill, president
• Ron King, vice president of manufacturing
• David Koch, sales and marketing manager
• Jeanne Hendrickson, advertising manager
Revenue: $10 million-plus annually
Operations: A leading manufacturer of diaphragm and peristaltic style chemical metering injectors, variable area flow meters, electronic meters and flow totalizers.
And now for the interview:
WC&P: How long have you been in the water treatment business and how did you get started?
Gledhill: This question is assuming I’m the founder. I can tell you I'm not. I'm the president of the company. But it was incorporated in 1957. And our founder is the late Ozzie King, or Oswald King. He is Jeanne's father. He passed away in August of 1998.
WC&P: When did you come on board at the company?
Gledhill: I was elected president in 1997. I started with the company in 1970.
WC&P: As what?
Gledhill: I started in the service department. I'd just gotten out of the military.
WC&P: Tell me about, if you could, the transition at the company over that period of time?
Gledhill: In the early years, Blue-White was primarily a manufacturer of swimming pool related products. Mr. King was a commercial pool builder of notoriety and, in the '40s and '50s, he oftentimes was left to his own devices when it came to developing products. He was very intelligent and came up with a lot of products out of necessity. That's how we developed our basic product line, which would be chemical feed pumps and flow indicating devices. From there, it grew into the industrial and medical sectors and all kinds of areas.
WC&P: How has the company grown in terms of people?
Gledhill: Well, of course, you can imagine in the early years there were just several people. Blue-White has grown nicely through the years with a very consistent growth rate. And right now, we currently employ around 73 or 74 people.
WC&P: At the point when you started in 1970, roughly how many people were there? Oh, and I should ask which branch of the military did you serve?
Gledhill: Oh, I was in the Army. I was a medic. I was drafted.
WC&P: Did you serve in Vietnam?
Gledhill: No, the Vietnam War was raging at the time and, oddly enough, through other parts of the country and they sent me to Korea. So, in 1969, they shipped me off to Korea. We take care of a certain part of the perimeter on the 38th Parallel and we patrol it for like 13 miles or something like that.
WC&P: I have an uncle who was in Korea in the U.S. Air Force during the Vietnam War.
Gledhill: Really. So, there I went. People say, 'Gosh, you were drafted in 1968? Oh, man, what was it like in Vietnam?' And I can honestly say they shipped me somewhere else. But, anyway, I wasn't a conscientious objector. I had no problems going to Vietnam. I was just lucky. Still, I think we're building a foundation here on something that bothers me as a president of a manufacturing company. You can't measure the strength of a company by the number of employees that you have. I'll tell you why. Our business has gotten so competitive that we have to really work smart. And that's to develop machinery and processes that require fewer people, not more people. If you were to walk through our plant, I can show you machines that can do the work of between four and six people. It takes an enormous expenditure of capital to get this kind of machinery in a business.
WC&P: How big is your plant?
Gledhill: Fifty-thousand square feet. So, when I started with the business, we had maybe 12 people. But every product we designed or were engineering, we always try and think of the fabrication and how we can do without just throwing a lot of people at the job. And I'm not talking about outsourcing. I have very strong feelings about that.
WC&P: Such as?
Gledhill: Well, such as I think that outsourcing works wonderful for a lot of people, but over the long term, it can be harmful for your business. I think in the short term, most company presidents are focusing on bottom lines. They have to answer to their shareholders, board of directors, etc. Oftentimes, though, you go for the quick gain by jobbing certain things out and you tend to lose control of quality. And then your products start appearing in other countries that you had no intention of them being developed.
WC&P: I think we've seen that in particular in the pump industry.
Gledhill: Pump industry, very much so.
WC&P: We've heard of a number of Asian manufacturers where production was outsourced to and then, a few years later, copycats began to appear.
Gledhill: Yes, little cottage industries show up in the country you were outsourcing to. Still, I'm certainly not here to cast aspersions. I'm just pointing out what I see. I've really fought to keep most of our manufacturing here in the United States. And I think it takes a little more sophistication—it truly does—and creative ways of doing things.
WC&P: For example, going a little more high-tech so that you make sure your efficiency on that level competes with the advantages of lower-cost labor on a foreign level.
Gledhill: Exactly. Because we think that our people are every bit as bright over here. I don't even think you should say that because it implies that there's some question about it. But there are a lot of people here who can do printed circuitry. And there's a lot of people here that have so much expertise. You just have to tell them, basically, what you're willing to spend on it. And before you embark on it, you kind of get this thing worked out. You keep reworking and refiguring and you manage.
WC&P: Well, part of the reason we chose Blue-White to do this particular month's 'Executive Q&A' column is because we've got a sub-theme of this issue on chemical feed and pumps. And that's sort of the core of your business, is it not?
Gledhill: Chemical feed pumps, yes, it is our core. But Blue-White really—if you analyze our company—we're two companies in one. We make flow instrumentation and that is certainly a growth industry also. But there's not really a tie-in with the two. In other words, with every pump you sell, you don't sell a flow meter. You could, I suppose, but they're both ground-up manufacturing.
WC&P: Tell me if you could what sort of percentages you have on both sides of these businesses and what kind of growth rates you see as well.
Gledhill: Typically, in the instrument industry, there's a lot of tie-in to the tech industry. Whenever you see the tech increasing and growing, you can count on flow instrumentation to grow alongside of it.
WC&P: Because they're going to need to have more controls and monitoring capabilities inherent in production in that industry.
Gledhill: They do. They need control. They need to have eyes into their system. And, in the pump industry, it is a lot more—you might say—diversified. It can be used in agriculture, certainly in swimming pools for chlorination, the car wash industry for pumping soaps and wetting agents and waxes. Did I mention the ag industry for nutrients and pH control? So, it's so diversified, the pump industry; but if you're looking for a dynamic industry, I would say the flow meter industry is more. Still, it can be kind of spiky.
WC&P: Well, the high tech industry is influenced a bit more by ebbs and flows in capital expenditures and the general economy...
Gledhill: Good point. And you can almost track the instrument sales by that. The pump industry seems a little more resilient. When the economy is going sideways, you still have fairly consistent pump sales. You don't have high highs and low lows. You have more consistency.
WC&P: How much of your business is split this way? Is there a percentage that you offer on what you’re doing in pumps compared to the overall business?
Gledhill: I would say that we're probably 45 to 55 percent. It's so close it's unbelievable. It might even be like 48 percent pumps and 52 percent flow meters. And they've kind of been jockeying back and forth for position, the two products. So, any given year, one could take over the other.
WC&P: Right, depending on what economic drivers are prevalent at the time.
Gledhill: Like the tech industry will drive the instrumentation. I keep mentioning the tech industry...
WC&P: When you say tech industry, you're referring to what?
Gledhill: Solid state circuitry, semiconductors, computers—anything that has that involvement. What's good for Cisco is good for Blue-White. What's good for IBM is good for Blue-White. What's good for Apple is good for Blue-White. Hewlett Packard is good for Blue-White. Although we don't sell to those companies direct—we sell through wholesalers. And typically those are their customers.
WC&P: How would your products be employed with theirs on what type of systems?
Gledhill: Measuring deionized water, because they wash a lot of circuitry with ultrapure water. RO systems, cooling water...
WC&P: For microelectronics of any sort?
Gledhill: Yes, they use them all over the place.
WC&P: OK. Now, when you look at any particular niche in which your products are used, you’ve got on your website: irrigation, greenhouse, car wash, water treatment, commercial pools...
Gledhill: Yes. If you were adding a rinse to a piping system and you had some valuable crops that you were growing, wouldn't you want to know what your flow rate is.
WC&P: Particularly if I lived in Arizona as I do. There are some hydroponic tomato growers out here that are actually from Europe that have actually very sophisticated systems in how they grow basically organic tomatoes.
Gledhill: There you go. With the use of a flow meter, you know precisely how much nutrients you are going to add. And the world is becoming a lot more sophisticated. Of late, we've had our dose of developing countries... But, typically, it's so much more sophisticated.
WC&P: It's kind of like what you were saying in how you view keeping the majority of your operations here in the states instead of outsourcing them. If we look at the concept of water as not necessarily a limited resource but one constrained by population, growth and what's available—then we have to learn how to use our resources smarter if we're going to continue to grow. That involves what you're talking about, raising the level of technical sophistication so that everything is done more efficiently and cost effectively.
Gledhill: There you go. You've just made a good point. They use instruments anywhere—pressure gauges, flow meters, level gauges, etc.—to be more efficient on whatever you do. Imagine driving your car without a gas gauge. You could, but I'm not sure how efficient you'd be.
WC&P: You might be doing a lot of walking.
Gledhill: Yes. Exactly. So, it's just to enable industry to do a better job of what they're doing.
WC&P: Well, tell me something about your company in terms of what's new? What are some of the new things that have been happening or new products you're introducing?
Gledhill: There's always, in manufacturing, the question: What's in the pipeline? Customers seem to be very interested in what's new. And, for obvious reasons, they just want to know what you're coming out with. 'Don't tell me about the products you made yesterday... What's new?' One of the challenges with chemical feed pumps is you could get a flow chart with a feed pump, a feed rate chart, and we can tell you that the pump will pump 1 ounce an hour at 30 psi. We've tested it in the laboratory, using water. But you may not be using water. You're pumping something that has a viscosity like light oil. And you're pumping against pressures that vary. One day, it might be 40—another day, it might be 80 pounds. So, our guidelines that we send you when we send the pump are only guidelines. What we've developed is a micro-flow meter that fits on your discharge tubing or it can fit on your suction tubing. It measures precisely to the milliliter or cc or gallons or ounces. It'll tell you exactly what the pump is doing with an LCD readout. Now, you can tie that into a flow meter so that the pump will pump precisely. You can set the pump to pump, say 6 ounces a minute or 6 ounces an hour.
WC&P: It would all be dependent upon what your specific production needs are?
Gledhill: Exactly, so you can plan for precise amounts. Still, what this will do is that you can get close using the feed rate charts that most pump manufacturers provide—but now, you can nail it. And you can give this readout to be cumulative. Now, let’s say you're selling a chemical. Now, you can go in at the end of a week and see how much chemical has actually passed through this feed pump. So, we're just offering people an accessory that can be used on a chemical feed pump that keeps track of what the actual feed rate is.
WC&P: Would this be the Digi-Flo F1000/F2000 Series?
Gledhill: We're taking a similar concept, but we've downscaled it and instead of using a certain sensor, we're using something else. This one employs a little more use of infrared.
WC&P: What variety of expertise do you have to collect in-house to be able to have all these various technical capabilities?
Gledhill: A company like Blue-White has to be very strong in engineering. We pride ourselves with having a good marketing and sales team, but we're heavily weighted in engineering and R&D. If you were to come through here, you would see people in labs testing and soldering. In our R&D department, they would be machining little widgets—left-handed ones, right-handed ones. They're taking them into the engineering department for evaluation. There's an awful lot of that going on. We're heavily weighted in the technical end. And we try not to dwell on what somebody else has done and try to do what we do. We have an electronic engineer, a mechanical engineer, basic engineering technicians, etc.
WC&P: Geographically, what would be the concentration of your business in the states vs. overseas?
Gledhill: Well, the tech industry typically lies in pockets. Of course, there's a huge one in California. You know Silicon Valley.
WC&P: Also in the Massachusetts area.
Gledhill: Massachusetts, yes. Areas in North Carolina—you know, research areas. And Texas also. I can probably name every state, if you let me. Those are the ones that jump out at you. The Midwest tends to be more of the heavy industry. Of course, the first thing you may think about is automobiles, which is certainly significant.
WC&P: Also agriculture.
Gledhill: Agriculture, oh my gosh. That's the feed growing belt of the growing, the grain areas of Michigan and Kansas and Indiana...
Gledhill: Exactly. But those tend to be kind of pump places. And Florida tends to be a pump area. And of course, then you have to think of another area. What area did Blue-White cut its teeth in?
Gledhill: The pool industry, of course. What's big in that? Florida and the West Coast.
WC&P: The Sun Belt, generally.
WC&P: Blue-White is an international company. What's the percentage there?
Gledhill: OK, you want to talk international. Although China... strike China. Let's say Asia. While Asia is the oldest civilization that I guess we know of—people may argue otherwise—oddly enough, Asia uses an awful lot of products, American products.
WC&P: Well, in the news now is the issue of oil prices largely being a product of demand in China because their economy is running so hot.
Gledhill: They're economy is going gangbusters.
WC&P: That means they need just a little bit—or a whole lot—of everything.
Gledhill: They need products. While they make a lot of products, they typically buy a lot of products too. So, we take a lot of pride in shipping a good amount of our products, probably in equal amounts of chemical feed pumps to flow meters, into Asia. We're talking about in Singapore, into the Philippines, Hong Kong...
Gledhill: Oh, Malaysia is a very good area. Indonesia can be good. So, yes, we take all of that seriously. Our international department is very busy, if you were to work here.
WC&P: Is there a percentage of what is being done in Blue-White overseas that's customarily given out?
Gledhill: Well, there's a typical ratio. You like to do about 25 to 30 percent international business. That's a good indicator. Presently, we're doing about 15 percent of our business international. But it’s a strong 15. We'd like to sell more in Europe, but the Europeans have an awful lot of products. They have a lot of metering pump companies and quite a few flow meter companies.
WC&P: The Germans and Swiss do pride themselves on precision.
Gledhill: They do. While we feel our products are every bit as good as theirs, they do have some homegrown products. Although we do sell into Western Europe, we'd like to sell more. We have to, I think, work a little harder.
WC&P: I notice you also separate out on your website Mexico and Latin America.
Gledhill: Absolutely, great countries there. We have our literature in Spanish. We think it's important. They're our neighbors. And we take a lot of pride in having distributors throughout Mexico—as well as Costa Rica and Nicaragua and Colombia...
WC&P: Do you go as far south as Brazil, Argentina and Chile?
Gledhill: Absolutely. South America, we'd like to do a better job there.
WC&P: Well, you know, our sister magazine, Agua Latinoamérica, specializes in the region and we're trying to help out there as well. Another thing we like to ask is, in the breadth of a person's business life, they run across a variety of situations. Some of those can be strange, funny or just a one in which they learned a lot. As such, we'd like to know if you could share an interesting story or anecdote about your experience in water treatment?
Gledhill: Gosh, I wish I could think of something amusing. I'm usually the one that makes these jokes at get togethers and easily could provide you with something funny. I would say that there's a lot of temptation when you sell internationally to extend credit. They tempt you with nice big orders. But, especially, when you're trying to grow the business, you oftentimes have to avoid those types of temptations—or approach them prudently.
WC&P: And your lesson on this would have been from?
Gledhill: I'd have to name names and I don’t want to do that.
WC&P: You could just mention countries and the situation.
Gledhill: Well, there was a huge order—one of the biggest we've ever taken—and it was a distributor in Mexico and we had agreed to a letter of credit. Little did we know the letter of credit was a 120-day letter. That was somewhere buried in the fine print. And for an order the size of what went out of here, having to wait that long with the feeling that somebody actually got that by you—as it approached the 120 days, you're kind of wondering if indeed you're going to get your transfer. Of course, it did work out. It was many years ago. And we're a lot more careful now. One thing also, when you talk about outsourcing, your magazine is going to be read by a lot of people outside of this country, and the last thing I want to do is upset them. I know you can't please everybody. There are certain things you cannot help but outsource. That would be like plastic materials, plastic rod, plastics that you buy. Usually, that stuff is done overseas.
WC&P: Right, the raw materials.
Gledhill: Exactly. I don't want people in Jakarta reading this and thinking, 'Blue-White, we don't want them.'
WC&P: I think that everyone kinds of recognize what the competitive nature of certain markets are. I believe they're very aware of that overseas as well. One of the things we've been told by various sources is that, while in the past parents and grandparents may have referred to getting product from Japan that were chintzy little toys. Well, what are they producing today?
Gledhill: High tech. The machines that we buy that can do the work of four people, typically are Japanese. This is big CNC equipment, machine tools, etc. We make them in this country, but they're a lot more expensive.
WC&P: The point I was going to make was that in the same sense in our industry, you may have seen pumps or RO systems coming out of Asia about 10-20 years ago, that might have been questionable as far as quality. Did they perform as well as an American-made product. Today, we’re told by most, that's not necessarily the case anymore. Most of these producers are very sophisticated and the product coming out of there is very good.
Gledhill: Yes. For example, would you consider buying a Kia 10 years ago.
WC&P: Probably not.
Gledhill: Now you might look at it. It may not be your dream car, but they're made alright.
WC&P: And when you look at a 10-year/100,000 mile warranty, that makes you think twice. That means somebody's willing to stand behind its quality for that long.
Gledhill: We're really faced with fish-or-cut-bait in this country when it comes to developing new products. And I tell you what, I draw a lot of strength in seeing what the Germans have done through the years. They have a higher burden rate than we do here with their elaborate vacations and the job security they offer, etc. And they manage to stay very active in manufacturing because they have developed a reputation for having very good quality. You buy a German product and you know it's going to be good. And we have to recapture that American-made perception of excellence. So, I'm doing everything I can. And I have a lot of people that feel the same way I do that work here. We want people to recognize the quality. When you pick it up, you know that it's just way overbuilt. It's just made so well that it's unbelievable. Now, absolutely, other people are going to develop that kind of quality that you just alluded to, but we keep trying to change. If you copy us today, it's going to be last year's product.
WC&P: Because you've got things in the pipeline.
Gledhill: We've got things in the pipeline all the time. And whatever we're selling today, we're trying to improve tomorrow. There's no product that we're completely satisfied with. None. We're always improving.
WC&P: Tell me 'we haven't even mentioned at this point' how much of what Blue-White does is actually in water treatment?
Gledhill: Well, it's all relative. Let's use the term processing industry. Water treatment would be in there also. Think of a boiler treatment or cooling tower treatment or dishwashers using rinse agents. All that is involved in treating water.
WC&P: But your products are used on other fluids also, correct?
Gledhill: Yes. For example, when you take your car to a full-service car wash, somehow or other soap has got to get onto your car. And it could be just a passive-type venturi, but more likely it's a positive displacement feed pump, because you get precise dosages per car. Then, when you get to your polish wax, that's also put on by a feed pump, more than likely. Or your under-body cleaners. Is that real water treatment? I would think so. You're treating water for some effect.
WC&P: How do you—in the context of your business—define water treatment, since there's a specific link on your website that says, 'water treatment'?
Gledhill: Well, I would say that I kind of index it to what is generally thought of as water treatment. And that would be pumping disinfectants, chlorine, algaecides and any number of water treatment chemicals. But I tend to personally take a much broader description or definition. And that would be just whenever you change or add something different to water.
WC&P: What's a major challenge that you or your company faced and how did you overcome it?
Gledhill: Can you be specific? Probably a good question would be, how did you weather the recession?
WC&P: That's true.
Gledhill: Yes, and it's serious. Now, I know your industry, the printing industry, that was brutal. And I think the industry is just finally climbing back out of that.
WC&P: Yes, you saw pretty much any trade magazine—or magazine in general—take a hit.
Gledhill: Well then, you and I could share some experiences, because manufacturing was hit equally.
WC&P: Particularly in the high-tech industry.
Gledhill: The manufacturing sector was hit first and I started seeing it first in July of 2000. This has nothing to do with politics. That’s exactly when I started seeing it. Then, there was the buildup to Y2K and then the falloff right after that. Then we started seeing the economy sliding. And the bigger you are, the more you track the economy.
WC&P: We started seeing a couple of other things. We started seeing blips as far back as the Asian Flu, because a lot of companies were heavily invested in China and Asia and were putting a lot of money into starting or expanding operations there. So when the Asian financial crisis happened, it hit their numbers hard. We saw a change with a few key companies. Then, the year after, you had the Russian financial crisis, then the near Brazilian financial crisis... These may have affected only a few companies, but they were key players. That's not to mention the problems created in 1999-2000 by class action lawsuits in California related to lead-bearing brass faucets either.
Gledhill: Wow, so you actually see it from even a broader perspective than I do. I saw it later and that was exacerbated by 9/11.
WC&P: And the affects from the bursting of the Internet bubble...
Gledhill: Oh, yeah, the bubble. I didn't even mention that.
WC&P: You were talking all those high-tech companies, all those computer and software companies who quit selling or buying.
Gledhill: They quit buying. I think they all said to themselves, 'We're not out of business, but we're certainly not going to be buying any more stuff for expansion. And we're going to keep what we have and use it.' So, anybody that supplied stuff into those industries were seeing diminished returns. And it was awful. It was awful. I think that it was the fifth recession that I'd ever been through in my life with Blue-White and it was the worst. But I think we're finally out of it.
WC&P: We noticed it begin to stabilize last year and then get soft and now it's evened out and looking up.
Gledhill: It would get good and then... Now, we're putting together back to back months that are excellent. I'm not saying they can't be better.
WC&P: Our page count is starting to go back up.
Gledhill: Yes, and we've seen it. We use simple questions like: 'Hey, UPS driver, how many packages? Are you up many?' That's a good indicator. And the package company who you buy boxes from is another.
WC&P: Well, how did you survive this? What did you do?
Gledhill: The better-run companies have to cut their staff when they expect kind of a prolonged downturn. It's nice to say, 'Well, we'd like to keep everybody and weather the storm.' But well-run businesses have to cut. And we did. And I'm happy to say that we've added probably one person every two months now.
WC&P: What was your peak employment?
Gledhill: Seventy-five. And we got down to 65. Now, we're going back up.
WC&P: From your perspective in the market, where do you see the industry going—the water treatment industry?
Gledhill: I see that we're in a position now where we no longer need to be taking market share from other manufacturers in order to grow. I think we can actually see some growth just by an expanding market. I don't mean to say we wouldn't want to take market share from other people. We're not that nice. But I'm seeing the market growth to where I'm more confident.
WC&P: What were some of the percentages you've seen for the last few years and how they've changed?
Gledhill: The last few years wouldn’t be fair, because the economy's just turned around.
WC&P: That's why I asked for a comparison. Say in the late '90s, what was the growth rate?
Gledhill: I would say that we were growing at a significant single digit. That would be anywhere from 5-9 percent. And then, it just completely dropped off. And we actually had retreated a bit, without giving you numbers. And now, we're posting very low double-digits in actual units, which is really significant.
WC&P: How do you think things are going to look for the rest of the year?
Gledhill: I think it's going to be good. It's an election year. I think we've been through—I don't care what the government says—a three-year recession. And it should be followed by a minimum of five years of stable growth, barring any unforeseen terrorist issues.
WC&P: It's a good caveat to add in these days and times.
Gledhill: Uh-huh, it is.
WC&P: Are there things specific to our market that you see potentially happening or affecting that outlook?
Gledhill: I don't know what you mean.
WC&P: Are there specific factors shifting in the water treatment industry or unique to this market that can affect that one way or another? It can be regulation, competitive issues, consolidation, deconsolidation...
Gledhill: I think when you go through an exceedingly difficult recession, especially in the manufacturing sector. You can talk recession to somebody that's in home mortgages and they'll look at you as if you're crazy because they've had a wonderful three years with lower interest rates and all the refinancing. But when you talk about manufacturing, it becomes a lot more serious.
WC&P: The numbers that have gotten tossed around are between two and three million jobs lost.
Gledhill: Exactly, and so much of it came from our industry. So, we've really lost a lot of blood. And it's just so nice to see it coming back. It's nice to see magazines getting a little thicker. People are placing ads. We've seen our advertising department, Jeanne Hendrickson, has gotten more ambitious advertising campaigns. We see more stuff we're doing on the web. But going through a recession like this is really good for us, in a sense. It's just like taking bad medicine. In every section of your business, you become more efficient. Virtually every section. There isn't one area that isn't scrutinized.
WC&P: Yes, we've kind of had to do the same thing here. It's kind of interesting in the sense that we do a magazine with probably half to a third the staff of some of our competitors.
Gledhill: There you go. You're working smarter. But if I ask you, well how big is your company—how many people? What I'm trying to do is put a value on your business by how many people you hire. But you see you probably run circles around people that have half the staff.
WC&P: We try to.
Gledhill: That's the point I'm trying to make about Blue-White. We're an exceedingly efficient company. To work here is a lot of fun because you can do so many things.
WC&P: It keeps you agile and on your toes.
WC&P: What's the one hot-button issue facing water treatment dealers or the industry that you think will have the most impact over the next few years? Time to get out your crystal ball...
Gledhill: If I manufactured ozonators, I'd say the elimination of chlorine. But I know that's nonsense. I'd just say better controls for processes, more sophistication in whatever anybody is doing. Controlling chemical usage. Turnkey processes. I would say automation. Swimming pools now have monitors for adjusting the pH and checking the chlorine residuals. It's just incredible.
WC&P: Not as much getting down on one knee and drawing a sample.
Gledhill: You still have that. But more of the public pools are going to different levels of controls. It really creates opportunities.
WC&P: You could take that concept and extrapolate to say as companies’—like yours—manufacturing processes get more efficient and cost effective, it means that the type of technology that you provide is less expensive and, thus, more available to a broader group of industries or people.
Gledhill: I couldn't have said it any better. But if you're looking for a hot-button—and I'm just thinking you've probably heard this a thousand times—for us, it's the Internet.
WC&P: We haven't heard that in a few years actually.
Gledhill: Although we sell through distribution, the Internet enables people in any part of the world to find us. You can be in Bombay, India, or Kuala Lampur, Indonesia, or in the Czech Republic. You go to our website and download any information you want without sending a letter that may not get here and then us having to fill an envelope and mail it to you. And it's been absolutely phenomenal. It doesn't matter where you are. If you have access to the Internet, you can go to our site.
WC&P: Well, I know that we've updated and expanded the offerings on our website to a great degree and we get a lot of attention through that. And the vast majority of questions that we get in from it are either from consumers or overseas.
Gledhill: Of course. And I'm going to ask you a question. I don't know if you're a Laker fan?
WC&P: No, I was born in Indiana, so I'm a frustrated Pacer fan about now.
Gledhill: OK, a Timberwolves fan, whatever. But if you want to read an article on it, you can type in the Timberwolves and click and read the most current articles written by the New York Times, the L.A. Times or any publication. Instantly, you can read fresh articles without having to go and buy their newspapers. That's magic. The same goes for us as far as our products go. People can get the most current information on our technical website. It's just incredible. So, I see that as probably that magical thing you were talking about. That's not to say that advertising in your publication isn't wonderful. That's a must.
WC&P: There again, our job is to try and put that advertising in front of as many decision-makers as possible, whether through our website, through the publication or us going to trade shows and presenting both there. That's what creates the value for you as an advertiser.
Gledhill: It's somewhat distressing to hear that trade shows are falling off in their popularity. I don't know if that's a good thing or not. Trade shows are a wonderful venue. But perhaps they were getting too expensive. That may be getting off the subject...
WC&P: Yes and no. It goes into what one might look forward to next year with the Water Quality Association beginning an alliance with the Aquatech RAI people.
Gledhill: That would make more sense. But we tend to think that we would rather put more dollars in print ads than send someone to a trade show for a minimum of $10,000. How much advertising can that buy you?
WC&P: I like to hear that. Still, it all depends on where you're buying your access and to who. Will this trade show put you immediately in front of a lot of decision-makers who will immediately be able to influence purchases of your product. It's all usually a tradeoff from here to there, with business people like you seeking the most effective mix.
Gledhill: You can’t eliminate any one of them if you're smart.
WC&P: Each of them has their value and strength. It's a question of leveraging and choosing between them to the best of your ability. Give me a closing statement, if you could.
Gledhill: Something profound?
Gledhill: I don't have anything. What you see is what you get. No, seriously, I would say just that the key to our success is just working very hard, but working smart and trying to move forward every day. Try not to dwell on things that take you away from the business that you're doing.
WC&P: There's a couple of follow-up questions I'd like to ask. One is, where are you a native of?
Gledhill: I was born and raised in Santa Monica. We moved to Orange County because it was less developed.
WC&P: Who are the top people at Blue-White that we would want to list if we were to list the management?
Gledhill: First of all, you'd have to mention Mr. King's wife, Frances King. She's our CEO and very active in the business and runs a heck of a board meeting every quarter. Of course, Ron King is our vice president of manufacturing. He's the one who keeps all of our engineering humming. Then, David Koch is our marketing manager. And certainly, you want to mention Jeanne Hendrickson as our advertising manager. She's on our board of directors—although she owns her own business, Blue-White Advertising, she's an integral part of this business.
WC&P: And how do I spell your last name?
Gledhill: My first name is Robin. My real name is Robert, but they've called me Robin for years. My last name is Gledhill. I've been with the company since July of 1970 and I graduated from Golden West College (in Huntington Beach) using the G.I. Bill. But that's not important to anybody.
WC&P: Well, sometimes it works its way into the profile portion.
Gledhill: And you just stayed focus on what you're doing. And just been lucky and worked my way up the ladder here.
WC&P: How do we want to refer to revenues at Blue-White?
Gledhill: How about this? We have a 4-A-1 Dunn & Bradstreet rating. We just got that a week ago.
WC&P: What's that mean?
Gledhill: 4-A-1 means $10 million and over in revenue a year. And before they'll give you that rating, you have to have that over $10 million revenue for more than three successive years. So, when I tell you we do in excess of $10 million a year, that has some meaning. We'll cross over into $11-12 million, you know.
WC&P: OK. Thanks for your time.
Join us next month, when we interview Jim Baker, president of AmeriWater Inc., of Dayton, Ohio, and a past WQA president, in the “Executive Q&A” column.