Manufacturing Success
Small MFC of St. Paul is Example of Industry’s Boom
DAVE BEAL

Manufacturing is on the rebound in Minnesota, but sometimes you’d never know it.

Frequently, the headlines dispatch bad news. Plant closings. Outsourcings. Downsizings.

That’s understandable. Often, the cutbacks that command so much attention involve lots of jobs at larger corporations. Many of the new jobs are at smaller manufacturers, companies so small that they fly under the radar. Often, they don’t even make products headed directly to retailers; instead, they turn out parts that go into other manufacturers’ final products.

Sometimes, their gains come much more in productivity than in jobs.

Case in point: MFC, located in St. Paul’s Midway.

This company, formerly known as Minnesota Flexible Corp., is flourishing.

MFC designs and makes customized industrial hoses, fittings and related products. It sells to a wide range of manufacturers including 3M, Cargill, Ecolab, Graco and General Mills.

MFC has always done the lion’s share of its business in the five-state Upper Midwest region, but it’s looking farther afield now. Two years ago, it began importing parts from Asia in order to better compete in today’s global economy.

And the company just wrapped up its first significant acquisition, buying Midwest Hydra-Line in Galesburg, Ill., for an undisclosed price. Top managers and their spouses toasted the deal last month during a dinner at Manny’s Steak House in Minneapolis.

The celebration was appropriate. The deal added 15 employees to MFC’s existing 27, and is expected to boost the company’s sales above $15 million this year. That marks an all-time high in both employee headcount and sales for MFC’s 37 years in business.

The number of jobs MFC has had in St. Paul has stayed about the same since the early 1990s, but its productivity here — as measured by sales per employee — has more than doubled since then.

“We’re churning out a lot more product,” says owner and president Will Stewart. “We’ve made money every year since I was involved.”

Stewart joined the company as an assembler in 1988. He bought the company from his father, George Stewart, in 2004.

Bob Isaacson, director of analysis and evaluation at the Minnesota Department of Employment and Economic Development, is not surprised to hear of MFC’s successes.

Isaacson cites data showing that manufacturers with fewer than 50 employees accounted for 20.7 percent of all Minnesota manufacturing jobs in 2003, up from 18.8 percent in 1998. Nationally, a similar trend prevailed.

Overall, the state’s manufacturing employment peaked at 399,200 jobs in June 1998, then fell to a low of 338,800 in March 2004. Two months ago, they were back up to 350,000.

“The smaller and midsized companies seem to be adding the employment,” says Isaacson.

Wayne Pletcher, CEO at Minnesota Technology in Minneapolis, estimates that Minnesota has more than 5,000 small manufacturers. He argues they don’t get enough respect. Thus, Pletcher has begun a campaign to boost their visibility.

“They are ever-productive, job-producing, community-building, quiet, stable, necessary and important,” he says. “They’re not only not appreciated. They’re not even noticed.”

Stewart, 40, runs MFC as part of a triumvirate that includes Terry Kelly, 44, vice president for operations, and Andy Larsen, 31, sales manager.

Larsen left MFC in 2000, in a loss Stewart calls one of his worst moments at the company, to take a job at a unit of industrial giant Eaton Corp. in Eden Prairie. In 2003, Larsen returned. That was one of Stewart’s best moments.

"You can make a bigger impact" at a smaller manufacturer, Larsen explains. “You really feel like you’re crafting something, putting your own mark on it.”

Kelly is a former Marine helicopter pilot who once worked at another large manufacturer, Ingersoll-Rand.

MFC’s product line may not be glamorous. (Kelly jokes about being driven by his desire to sell industrial hose.) But it’s a pretty good business, alive and growing right here in St. Paul.

Dave Beal can be reached at dbeal@pioneerpress.com or 651-228-5429.