Malco Products, SBC, was founded in 1950 by a sheet metal salesman who saw an unmet need for specialty sheet metal fabrication tools. “He actually invented most of the core tools that we still sell today,” explains Malco president and CEO, Mardon Quandt. “Then he had four sons that got involved in the business.”
By the third generation, the family-owned company made a conscious decision to start phasing out its pedigree. “With the long-term goal of turning over the company to the employees,” Quant says. At the end of last year, Malco celebrated accomplishing that feat with the announcement that it was now a 100 percent employee owned company.
“That was a big step for our company,” says Quandt, and there is more to come. “I think employee ownership really gets that focus on what can we do to make this company succeed, and we are all in it together to do that,” like an extended family.
As an employee-owned company, how does that affect the decision making process?
Basically, we still have various decision levels within the company. That doesn’t mean that everyone decides every decision. That’s still being done by the board of directors and upper management, those type of decisions. But what it does do is drive home thinking like a business owner.
So it is more about engaging the employees to inform decisions?
Yes. We are doing a lot of education, open book management, and we share our financials with people every month so they can see where we are at. And then we point out what are things that you can do as an individual or a department to help us improve those numbers. And I think that’s where we’ve really seen the ideas coming from people because they are involved in the day-to-day things that can make us successful.
How many employees does Malco have today?
We have 160 employees — 151 of those employees are in our Annandale, Minnesota location, and we have nine employees in our new Nebraska location.
Speaking of your new location in DeWitt, Nebraska, Vise-Grip closed that factory in 2008 and moved operations to China. Why was it important for Malco to manufacture its Eagle Grip line there?
We looked at a number of things, but I think what really attracted us to that particular location is that it used to produce the Vice-Grip tools. And so we felt there was still some expertise there from people who had worked in that plant previously and ran a lot of those processes. And actually eight out of nine people we hired used to work in that factory.
We are working on developing locking handle pliers, welding clamps and seamers out of that facility with an emphasis on American made.
On the subject of passing along expertise, how is Malco handling the generational transition as a manufacturer?
One of the things that we have implemented (is) a phase-in retirement program where an individual can take a three year period of time to gradually reduce their work hours. So it’s kind of a win-win for us. They can transition easier into retirement but at the same time train their replacement. And so that’s been really helpful for us and we do that at just about all levels of the company.
Malco has grown to a fairly large operation since you became CEO in 2013, but it still seems to operate like it’s a small shop. Is that by design?
Very much so. I think the founding family kind of started that from the beginning. We’ve never had a union shop because it’s always been very competitive wages and very good benefits. Again, with the idea of turning the company over to the employees, that was already communicating how much they value the employees and that was one of the first things, when I started working here, I saw that, too.
In what ways do think Malco makes itself attractive to a younger generation?
I think a lot of it is just opening up people’s eyes to the opportunity. I think manufacturing has a perception of being a dirty job when really, with technology and everything, manufacturing is changing. There’s a lot of need for innovation, technology, and so it’s not just a repetitive boring type of job in a dirty environment.
That was one of the things that attracted me to Malco, and that’s just an example of the opportunities that can happen in an organization like ours.
In other words, manufacturing is changing and Malco is proof of that.