Rockford Products Corporation

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Rockford Products Corporation

707 Harrison Avenue
Rockford, Illinois 61104–7197
U.S.A.
Telephone: (815) 397-6000
Fax: (815) 229-4366
Web site: http://www.rpc-usa.com

Private Company
Incorporated: 1929 as Rockford Screw Products Company
Employees: 800
Sales: $15 million (2001 est.)
NAIC: 326199 All Other Plastics Product Manufacturing; 332722 Bolt, Nut, Screw, Rivet, and Washer Manufacturin

Based in Rockford, Illinois, Rockford Products Corporation is a worldwide manufacturer, importer, and distributor of fasteners, cold-formed components, and other industrial products. Although the company had become a multi-million dollar enterprise by the early 2000s, like many manufacturing operations Rockford Products has modest roots and is the result of one man’s idea.

Origins

By 1928 the city of Rockford, Illinois, was on its way to becoming one of America’s largest manufacturing hubs. It was near the end of that year when Swan Hillman, one of the city’s many industrial workers, held a meeting in his home to discuss the possibility of forging a new enterprise. Those at the meeting were receptive to Hillman’s idea, and on January 15, 1929, the Rockford Screw Products Company was formed.

With $142,000 in capital, the new manufacturing company began operations in Rockford in a facility on Railroad Avenue. The company’s first plant—a 60-year-old brick building—was approximately 12,000 square feet in size and housed ten to 15 workers. Rockford’s first board members included President O.G. Nelson, Vice-President Swan Hillman, Secretary-Treasurer Thorwald A. Madsen, and Works Manager David E. Johnson. The latter three men all were former employees of the Rockford based National Lock Co. Hillman was especially instrumental in Rockford’s early success and would provide valuable guidance over the years as the company grew and prospered.

In 1934 Rockford moved its offices and manufacturing operations to a vacant, 45,000-square-foot structure on Ninth Street. As the company prospered during the 1930s, it expanded this facility on several occasions in order to increase capacity. Beginning in 1934, expansions at this plant would occur every year during the 1930s except 1938. Expansion also occurred on Ninth Street in 1940 and 1947.

During the 1940s, with the United States embroiled in World War II, Rockford experienced exceptional growth and prosperity by shifting the lion’s share of its efforts to wartime production. Powered by 1,130 employees, the company supplied a consistent stream of screws and bolts for aircraft, trucks, tanks, and a variety of other military equipment. However, the aircraft market was especially lucrative. Rockford enjoyed a three-year stint as the nation’s leading aircraft bolt fabricator. According to the company, at one point it rolled out enough daily shipments of aircraft parts to fill two freight carloads.

Following more than ten years of success, Rockford constructed a second plant on Harrison Avenue in 1943. According to a 1955 Rockford Morning Star article, construction of the Harrison Avenue facility “was an expression of management’s confidence that the post-war years would bring even more business than the war years.” Rockford would expand this plant on Harrison Avenue several times to accommodate growth. One of the special features incorporated into the new plant’s construction was a railroad spur, which made it possible for the facility to be conveniently serviced by several railroads. At this time, Rockford produced somewhere between 5,000 and 6,000 different kinds of fasteners, the largest of which was a bolt 4.5 inches in diameter requiring a 23-pound nut. Its smallest product was a tiny screw that required a magnifying glass to be seen, 50,000 of which could fill a thimble.

In 1947 Rockford purchased an eight-passenger plane in order to better serve its growing customer base in other areas of the United States. Although the company would continue to prosper, by the close of the 1940s Rockford had temporarily scaled back its workforce to about 800, approximately 125 of whom were women. At this time, Nelson and Hillman still served as president and vice-president, respectively. In 1949 Rockford’s manufacturing facility on Ninth Street (Plant I) manufactured a variety of parts including aircraft screws, cap screws, socket-headed cap screws, setscrews, bolts, and pins. Plant II, located on Harrison Avenue, produced other parts including nuts, machine screws, sheet metal screws, and wood screws.

The Postwar Era

During the 1950s Rockford expanded operations outside of its hometown, acquiring a California-based distribution operation and dubbing the new subsidiary Rockford Screw Products Co. of California. Over the years, this operation would aid in the Rockford manufacturer’s West Coast distribution efforts.

Growth and prosperity continued as the 1950s progressed. By the time 1955 arrived, the company had devoted about $7 million over a ten-year period to expand operations and purchase new equipment. Rockford opened a third plant in 1954 at Harrison Avenue and Kishwaukee Street, which was mainly used for manufacturing fasteners for the aircraft industry, as well as specialty items. An addition to this structure in 1959 would almost double the plant’s size. It also was during this time, in 1954, that a profit-sharing plan for workers was instituted.

In December 1955, Rockford President O.G. Nelson died. Swan Hillman succeeded him as president and chairman. The company had evolved considerably since 1929, and Hillman was the right man to lead the manufacturing operation into a new era. That year, Rockford employed 1,300 workers with a payroll of approximately $7 million and supplied bolts and screws to a myriad of industries. In addition to being used in the manufacture of numerous home appliances, automobiles, electronics, and farm implements, the company’s wares were also available to consumers and other end-users via the hardware trade. During this time, Rockford first partnered with the National Auto Parts Association (NAPA) to offer packaged standard fasteners. More than 45 years later, the arrangement, which initially involved 1,128 parts, had grown to include more than 11,000 parts.

1960s–70s: Continued Success

Rockford continued its upward climb in the 1960s. By January 1961, the company employed approximately 1,400 workers. Late in the following year, construction started on a 32,000-square-foot building at Kishwaukee Street and Harrison Avenue that eventually would house the company’s administrative offices. The new building marked Rockford’s 30th expansion in 33 years. The $800,000 building was completed by March 1964, when 130 executives and office personnel moved from the company’s long-time headquarters on 9th Street to more elaborate surroundings. The new offices included a 150-seat auditorium, air conditioning, and a lobby sporting a decorative rotunda. In addition to the new structure, Rockford was awaiting installation of a $350,000 computer from IBM later that spring. Commenting on the new facility in the March 1, 1964, Rockford Morning Star, Hillman remarked: “We have lived in a warehouse for 35 years. This is the apex.”

Shortly after the company moved into its new offices, Hillman died. In June 1965, Ward Lidbetter—who had served Rockford as vice-president of operations since 1954 and as assistant president—succeeded Hillman at the helm of Rockford. At the time of his appointment, the company was using 36,000 tons of steel per year to achieve a monthly fastener production level of 325 million units.

By 1967, Rockford ranked among the nation’s five largest manufacturers of fasteners. The following year, a wholly owned subsidiary called Rockford Aerospace Products Inc. was established in California. The year 1969 marked 40 years of success for Rockford. The company, which now employed 1,755 workers and had grown to occupy more than one million square feet of space, achieved record sales that year, posting earnings of $1.9 million on $38.9 million in net sales. It also was in 1969 that the company changed its name to Rockford Products Corporation to reflect an expanded array of offerings. In addition, another subsidiary, Rockford International Inc., was formed. Located in the Centex Industrial Center in Elk Grove Village, Illinois, its purpose was to “import, warehouse, package, and sell foreign fasteners to meet growing demands,” according to the September 24, 1969, Rockford Register Republic.

Rockford Products began the 1970s on a high note. In fiscal 1970, the company recorded net sales of $39 million. With projected increases in the production of defense equipment, as well as spending on capital and consumer durable goods, a healthy market outlook existed for the company’s fasteners. By 1972, the firm was supplying nearly 2 percent of all fasteners used in the United States. The company’s product mix had changed considerably since 1929, when it mainly produced standard fasteners. By the end of 1972, specialty fasteners made up approximately 80 percent of Rockford Products’ output.

During the early 1970s President Ward Lidbetter and other executives spent much of their workdays at metal desks with other general office workers in order to facilitate good communication. In the December 17, 1972 Rockford Morning Star, Lidbetter revealed leadership’s mantra of the day, explaining: “Our basic philosophy is that success doesn’t come from brick and mortar and machinery. Success comes from the people. One of our assets, right from day one, was to be fortunate to have people with pride in workmanship who are willing to put forth effort.”

Company Perspectives:

Our basic philosophy is that success doesn ’t come from brick and mortar and machinery. Success comes from the people. One of our assets, right from day one, was to be fortunate to have people with pride in workmanship who are willing to put forth effort.

Rockford’s annual sales continued to rise as the decade progressed, hitting $53 million in 1973 and $68.3 million in 1974. However, in 1975, slowing economic conditions in such sectors as automotive prompted a series of layoffs at the company. A major change took place the following year when Milwaukee, Wisconsin-based Rexnord Inc. purchased Rockford for $34.6 million. At the time, Rexnord was a Fortune 500 company trading on the New York Stock Exchange and posting annual sales of more than $550 million.

After achieving sales of $87 million in 1978, Rockford Products ended the decade of the 1970s on another high note, posting sales of $100 million for the first time. However, it also was necessary to lay off a number of workers that year, which had not happened since 1975.

1980s: Economic Challenges

By the early 1980s, Gerald S. Broski had been named president of Rockford. The decade would prove to be a challenging one for the company, as the manufacturing sector was negatively affected by a sagging economy and increasing competition from foreign companies. Early in the decade, the company was forced to lay off employees, issue pay cuts, and replace annual cost-of-living increases with a merit system. By January 1983, staff had been reduced to 1,000 workers and orders had fallen approximately 50 percent below normal levels.

Other changes also were underway. In 1981, Rockford Aerospace Products was sold and operations at Rockford International were moved from Elk Grove Village, Illinois, to Rockford. The following year, Rockford Screw Products of California ceased to exist. By the 1980s Rockford’s customer base had changed considerably from past decades, when the aircraft industry represented the firm’s top segment. In the early 1980s almost one-third of business was attributed to the automotive industry, along with the automotive aftermarket (10 percent), and companies manufacturing appliances, recreation and farm equipment.

In 1984, John J. Rauh was named president of Rockford Products, and the company announced plans to expand Plant 3 on Harrison Ave. by 33,000 square feet in order to accommodate increased production of automotive front-end assemblies. The expansion was Rockford’s first in more than ten years and involved the addition of 30 employees.

By 1985, the company’s workforce numbered approximately 850, down from a high of 1,755 during the late 1960s. Late that year, company ownership changed hands once again. Through an employee stock ownership plan, a group of seven executives at Rockford arranged to buy the firm back from Rexnord.

In March 1987, the new board of directors fired President and CEO Jack Rauh. According to the March 7, 1987, Rockford Register Star, Rauh was released because “the company was not meeting certain agreements it had made with lenders.” Within a week of Rauh’s departure, a program to accelerate a $20 million debt payoff related to the Rexnord buyout was announced. It involved pay and benefit cuts that angered workers, causing approximately 75 percent of employees to walk off the job, a situation that was quickly settled. In April, shortly after Rauh was fired, the company appointed R. Ray Wood as its new president and CEO.

From 1990 to 1995, Rockford was able to expand its product line and execute a variety of targeted sales and marketing programs that helped to increase sales. In 1997, the company received ISO 9002 and QS 9000 certifications in recognition of quality. By the early 2000s, Rockford’s sales were still far below the levels it had achieved during the late 1970s. However, the company continued to make and import fasteners from its three plants in Rockford, Illinois. The company also began to reach out more internationally, joining Germany’s Altenlohn, Brinck & Co. and Japan’s Osaka Rashi to create the International Coldforming Alliance (ICA). According to the May 2000 issue of Appliance Manufacturer, the alliance allowed each member firm to share knowledge and resources and more effectively compete in the global marketplace.

Although many of the fastener industry’s dynamics had changed since Swan Hillman founded the company in 1929, Rockford’s 800 workers, each with a stake in the company’s success, remained committed to serving the needs of customers in the 21st century.

Principal Competitors

Textron Inc.

Key Dates:

1929:: Rockford Screw Products Company is formed.
1934:: Rockford moves its offices and manufacturing operations to larger facilities; expansion occurs on a regular basis during the 1930s and 1940s.
1944:: The company enjoys a three-year stint as the nation’s leading aircraft bolt fabricator.
1954:: A profit-sharing plan for workers is instituted.
1955:: Rockford partners with the National Auto Parts Association (NAPA) to offer packaged standard fasteners.
1967:: The company ranks among the nation’s five largest manufacturers of fasteners.
1969:: The company’s name is changed to Rockford Products Corporation to reflect expanded offerings.
1976:: Rexnord Inc. purchases the company for $34.6 million.
1983:: In a sagging economy, Rockford workforce is downsized and sales fall.
1985:: Seven executives at Rockford Products arrange to buy the firm back from Rexnord.