OTISBURG, OH- Faced with near-zero sales and operatin losses of over $9 million, the Safety-Flo Corporation, venerated manufacturer of heavy equipment and military supplies, plans to shift production to kitchen and home appliances, a company spokesperson said.
“We needed to move into a more dynamic field,” said CEO and company president Carl Spemmins.
“There are a lot of companies out there making home appliances, yes, but we’ve got something none of them have- industrial engineering. We can deliver a toaster that’s as at home in your kitchen as it is on a factory floor, operating continuously.”
Hobbled by a series of wrongful injury and death liability suits, pressure from lower-cost manufacturers in Asia, and the cancellation of several long-term contracts, Safety-Flo reported a charge against earnings of $9.4 million in 1998, up from $4.8 million in 1997. The family-owned company last turned a profit in 1974.
This fall’s new product line features heavy-duty toasters, popcorn machines, electric toothbrushes and a home whirlpool unit. Analysts have expressed skepticism that the devices, most of which weigh upwards of 75 pounds and require industrial electrical service, will be met with much demand. Nonetheless, more models are on the drawing boards, according to Spemmins.
The new products have generated a lot of excitement within the company. Spemmins cited increased worker attendance and productivity since manufacturing of the new lines began.
“It’s like we’ve been lifted out of a twenty year depression,” he said. “I visited the factory the other day and there were more workers there than I’d ever seen. And materials- we’re discovering stocks we didn’t even know we had. We’ve got enough cold-rolled [steel] to lay 10 gauge sheet [metal] from here to Youngstown and about a third of the way back, if you can picture that.”
Citing recent consumer trends toward more rugged goods such SUVs and “sports” editions of personal electronic devices, Spemmins is confident that Safety-Flo’s new strategy will turn the company’s fortunes around. “These machines are tough,” he said. “We’ve got the humvee of popcorn poppers here. And built to last too. You know that old ad about the Maytag repair guy being lonely? Well Safety-Flo doesn’t even have a repair guy.”
The new products will be introduced on the east coast sometime this summer.
The decision to change the company’s focus was propitiated by the recent expiration of a World War I contract to manufacture portable command tower for the U.S. Army. Apparently overlooked by decades of appropriations committees, the contract remained in force from 1911 until this year. It is not known if the twelve-foot high structures, which were designed to give field commanders elevated views of the battlefield, were ever used. Although records before 1949 were destroyed in a fire, Safety-Flo estimates the Army bought about 800,000 towers over the 88-year contract period. Adjusted for inflation, the towers cost an average of $1312.38 each.
“We’re looking for other applications for the product,” Spemmins said. “Band leaders, lifeguards, anyone who wants to be above the crowd. “They may have law enforcement applications, particularly in New York. Possibly they could be used at weddings.”
Safety-Flo also faces the final expiration of a patent that has long been a source of cash for the company- that for the common doorstop. Originally designed as part of a braking system for a spring-powered car, the part proved ideal for holding the factory doors open on warm days. The cars, which required a horse and treadmill system to wind up, were never popular, but the Safety-Flo Door Arresting Device was a huge success, bringing the company $122,000 in revenue in 1919, the year it was introduced. Patent lawsuits and royalties have brought the company a steady income since then, reaching $2 to $3 million a year over recent decades. The patent will expire on January 1, 2030.
The company has been ahead of its time in some ways since it was founded as a steamfitting company called Efficiency-Flo in 1902. Founded by Halyard Spemmins, a retired steamfitter and inventor, the company has held hundreds of patents, including those for the portable cordless telegraph and phonograph-based audible traffic signal. Spemmins and his then twenty-five year old son, Rutger, began by working as subcontractors on government steamfitting and ventilation contracts. When World War I broke out, the father and son were quick to apply for wartime production contracts. Out of 72 different applications, they were awarded three, one of which was to manufacture the profitable command towers.
It was this turn of fortune, along with the company’s 1919 doorstop breakthrough, that gave the elder Spemmins the funds to pursue some of his other ideas, including the controversial “oil blasting” method of petroleum exploration. Although he did eventually find oil, nearly all of it burned after an explosion that killed seven employees and damaged most of the company’s equipment.
It was out of this disaster that the company’s focus on safety was born. Spemmins changed the firm’s name to Safety-Flo and had employees create one of the nation’s first employee safety programs. It was then that the company’s motto, “Where Safety comes Second only to Pride”, was coined, allegedly by a union representative.
“You find the theme of safety and quality in all of our products,” said current CEO Spemmins, who is Halyard’s great-grandson. “In fact, we’re considering changing the motto to ‘where safety is second only to pride and quality.'”
