Brady's Got It Covered

June 16, 2008
| By Pete Daly |
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MUSKEGON — Bob Brady's manhole covers are different, but they aren't "green" — and that's an advantage.

The innovative covers are one of the reasons Brady was a nominee this year for the Muskegon Area Chamber of Commerce Entrepreneur of the Year award.

In recent years, the value of scrap metal has climbed so high that theft of manhole covers is a major problem in some cities. In Philadelphia, a university student fell into an open manhole at night, shortly after the cover had been stolen. The student was seriously injured and won a large lawsuit against the energy company that owned the manhole.

GMI Composite Covers are made of a material composed of fiberglass and thermal-set polymers. They are not recyclable, so no one bothers to steal them. They are also much lighter than cast iron, and have other safety features that cannot be found in metal covers. They are strong, too. A 50-pound manhole cover GMI makes is proven to hold 105,000 pounds before breaking.

Brady, a shareholder and CEO of GMI, said the company is one of very few in the world making composite covers. GMI began producing them about 15 years ago, and recently introduced its own brand of covers at a major U.S. tradeshow. Sales have increased almost every year, with GMI manufacturing more than 16,000 covers of all sizes in 2007. A potential customer in Europe is trying out some GMI covers right now.

GMI actually makes a variety of products out of composites, including chair springs for the office seating industry, a part for a major wind turbine manufacturer, moldings for locomotives, and a major part for the medical division of General Electric.

While 2007 was a fairly good year for GMI, according to Brady, he said in early June that business is down in 2008 “due to the recession.”

BRIEFLY
Name:
Bob Brady
Organization: GMI Composites
Title: CEO
Age: 57
Birthplace: Brighton
Residence: Muskegon
Family: Wife, Cindy, and two adult sons
Business/Community Organizations: Muskegon Area Chamber of Commerce
Biggest Career Break: "The company I was working for wanted me to pull up roots and move to an area that I didn’t want to go to, so I looked for other opportunities. And out of that, came this."

"Our customers are slowing down," said Brady, noting that sales of electrical insulators for meter boxes installed on new homes is down, along with the home construction industry.

However, the fact that GMI is even alive today after the last several years speaks well for Brady's management skill.

In 1983, Brady was just starting a family, and working as a sales rep for an Indiana fiberglass company. Then his employer indicated he would be transferred to Miami. Brady and his wife did not want to leave the Midwest, so he started looking for another opportunity. He suddenly found it when he made a sales call at George Morrell Industries in Muskegon. The founder of the company had died and the heirs were not interested in keeping it.

The Morrell company began in 1923, in the same building GMI still occupies today. Morrell made buttons and other supplies for the garment industry in Chicago. Known locally as "the button factory," it was still producing buttons into the 1960s. When Brady and a partner, Tom Soltysiak, bought Morrell in 1984, the small company was mainly producing electrical insulators. Around 1990, Soltysiak sold his share of the business to Brady, who has managed GMI since then.

The business grew with the development of new products. Insulated composite parts for electrical meter boxes were a key product. In 1999, GMI did almost $8 million in business — then globalization suddenly hit American industry head-on. By 2001, annual sales had dropped to half that of 1999, said Brady, because so much business "went to China and Mexico."

Brady, who had studied for a year in Japan while an Albion College student in 1970 and who shortly after that earned an MBA at the Thunderbird School of Global Management in Arizona, has long had an understanding of globalization issues. He said globalization is nothing new.

"It's just happening at a faster pace," he said.

GMI was forced to completely reinvent itself after 1999, said Brady. The company automated where it could, and became leaner and faster.

"We had to move from making simple, fast, repetitive parts to making larger parts in lower volumes on bigger equipment. We've been through a couple of major transformations through the years, and even though it was extremely difficult, I know that, in the long run, we're a much better company today because of it."

By 2003, the company was starting to recover from its slump. Last year sales were back up to almost $8 million, although GMI may not do as well this year due to the economy, Brady said. Forty-four people work at GMI now, compared to about 52 last year.

In 2003, Brady visited Chile, a country with a strong economy, where he heard the nation's chief economist predict that "BRIC" — Brazil, Russia, India and China — would dominate the world economy. But the economist also predicted that within 10 years, China would begin to lose its competitive edge.

Brady has already seen an indication that the prediction was accurate. GMI had previously bought machine tools from China. The last four large machine tools GMI needed were quoted by Chinese and Indian companies — but Viking Tool & Engineering in Whitehall got the order.

"We always were a manufacturing area and always will be," said Brady. "If I need something done, I can find it within a 50-mile radius" of Muskegon.

GMI is now making a large, key part for CT scanning machines assembled by GE. GMI's product is made of composites, while the same part had previously been supplied by a manufacturer in India, who machined it from solid aluminum. The Indian product cost more than GMI's composite product.

Much of America's economic trouble now is due to the weakness of the dollar overseas, in Brady's opinion, but he sees strength in the region’s small companies. When he came to Muskegon 25 years ago, the region was losing its foundries and other heavy industry. City officials then hoped for other big companies — "big payrolls" — to take their place.

"Since that time, they have realized that small companies — especially growing small companies — are more essential than trying to get a big plant of any kind," said Brady.

Small companies can adapt to change faster. One example is what happened at GMI when its management saw the price of gasoline jump — 18 months ago.

"We went to four 10s," said Brady, meaning four 10-hour workdays for GMI’s two production shifts.

Some employees have a fairly lengthy drive to work, he said. When gas was approaching $2.50 a gallon, Brady said he realized that for some employees, "their first hour on the job was just to pay for the gasoline to get here."

Setting up a four-day work week means one less round trip to work each week.

"It just seemed logical to me. I don't know why the federal government doesn't do it, where it can. Think of all the gasoline we'd save," said Brady. 

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