A local manufacturer of radio frequency welders and heat sealing equipment has seen its workforce more than double in the last two years thanks to diversification and exports.
Thermex Thermatron sold more than 50 percent of its machines outside of the United States last year, more than double its export business in 2013.
The company employs 15 full-time production workers at its 10501 Bunsen Way facility, and another 10 temp-to-hires. In early 2014, it employed a total of 10.
“Almost all (is) being driven by our export growth,” said President and CEO Ray Lund.
City officials said the company’s export growth serves as an example for how Louisville-area businesses can capitalize on sales outside the U.S. to thrive in a competitive global market. And, they said, the Louisville/Lexington region already has exceeded its goal to grow export business by 50 percent — two years ahead of schedule.
A few years ago, Thermex supplied its products primarily to the auto industry. For example, automakers use the company’s heat sealing equipment to attach warning labels to seats. The companies also use Thermex’s industrial microwaves to dry ceramic parts.
But during the most recent recession, Lund said he realized that to thrive, Thermex needed to diversify into other industries.
His plans coincided with the creation of an initiative by the mayors of Louisville and Lexington to boost imports of local products, from bourbon to ceiling fans and disco balls. With the help of a $4,500 grant from JPMorgan Chase, Lund said Thermex officials attended a medical industry trade show and secured a “very sizable order” for one of its presses, which ultimately was shipped to Mexico. Thermex officials have attended two other medical trade shows since then. And since 2012, its sales of radio frequency welders to the medical industry have increased more than tenfold.
Medical supply makers use the radio frequency welders to seal blood or IV bags, colostomy and enema bags, air and water mattresses, and other products.
About 50 percent of the company’s business now comes from the medical industry. The auto industry generates about 30 percent. The remaining 20 percent is generated by a variety of industries including the aerospace industry, for which Thermex makes 800-ton presses that turn paper into components for light but durable airplane flooring.
Lund said Thermex’s export success has been boosted by growth in the medical supply industry and its focus on increasing automation to drive down costs. And thanks to connections Thermex officials made at trade shows, the company also has identified new applications for its machines — though he could not disclose those because of confidentiality agreements.
Most of the company’s exports go to Canada and Mexico, Lund said, and usually to companies whose headquarters are in the U.S. The weak Mexican currency makes the purchase of U.S. products prohibitively expensive, he said.
Louisville Mayor Greg Fischer and Lexington Mayor Jim Gray in 2011 launched the Bluegrass Economic Advancement Movement (BEAM), a strategic partnership to foster economic development in 22 counties near the two cities.
In 2012, the mayors announced that they planned to increase exports from the area by 50 percent within five years, in part because research had shown that exporting businesses “grow faster and can afford to pay their workers better than non-exporting firms.”
Fischer announced on the Thermex manufacturing floor today that BEAM had exceeded its export goal already.
The BEAM area makes great products that should be shipped around the world, Fischer said, but sometimes small businesses do not view themselves as exporters. The BEAM initiative helps small businesses identify international markets and provides advice on how to overcome export challenges.
Paul Costel, JPMorgan’s president for the Kentucky market, said the company has supported the initiative because it will improve the region’s vitality and success.
The U.S. share of the planet’s gross domestic product is about 16 percent — and that means 84 percent of business occurs elsewhere.
All companies are competing globally today, Costel said. And companies are either already exporting — or they will be exporting soon if they want to stay relevant.
The BEAM area last year accounted for more than half of the state’s exports, which exceeded $28 billion. Fischer today announced a new export goal for the BEAM region: another increase of 50 percent. This time, in four years.
Lund said he expects Thermex Thermatron’s export business to continue to grow.
The company is hiring, he said, especially electricians, welders and fabricators. Depending on their qualifications, they can earn between $15 and $20 per hour. Applicants should email [email protected]