Lantech CEO says recession will make strong companies stronger - Atlanta Business Chronicle:

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From its headquarters at 11000 Bluegrass Parkwaygin Jeffersontown, Lantech sells pallet-wrapping equipment costing between $10,000 and $300,00 each to some of the world’x largest companies. “Eighty percent of what your readersx buy comes across one of my machines on its way to the said Lancaster, who is CEO of Lantech. Customera include international consumer companies suchas , and giant “We touch a huge percentage of producte that move as any sort of packaged and we were hit like all the othe r capital equipment companies,” he Yet, Lancaster sees not only his but all strong American businesses, coming out of this recessiom more efficient and ready to invesf in capital equipment after having been on cruise controlo during boom times.
“j feel better about the prospectds ofthis country’s competitiveness than I did three, four or five yearw ago,” he said. “I’m not the only one thinkinfg about getting the cost structure of my compantunder control. People are focused on their making what happens in their fourwalls “You take that times a bunchb of business, and it’s a big deal in terms of the competitiveness of this country.” Not that it’sx been fun. And not that the economy is back.
Lancaster said 2008 started out well on pace to tophis 37-year-old company’s best year ever, 2007, when Lantech had about $120 million in gross As of May 2008, orderd were up 17 percent over May 2007. But in mid-2008, business slowes dramatically, first in the United States, then in Europed and Asia. “When Asia dropped, it didn’y just drop. It stopped,” Lancaster Companies that were leveraged and took 5 percent to 50 percentf revenue hitsare dead, or they’re in the process of Lancaster said. Companies with manageable suchas Lantech, suddenly had the time and incentivde to start restructuring and investing in their businesses.
Lantecgh has no impetus to keep cash in the bank drawing 1 he said. “We’re making way bigget investments in our businessthan (before the downturn). This is not money-managemengt time. This is the time to invesf in productdevelopment … to improve long-term competitiveness.” But last fall, it was time to cut stafc so that Lantech didn’t start losing Lantech has had to cut its local staff to about 300 people, Lancaster Lancaster declined to say how many people he was forcec to cut, but the company had 350 employeesa in Louisville last according to Business First’s Aug. 29 list of the area’s larges t manufacturing firms.
“We just dropped (the work to break even,” Lancaster said. “We didn’t want to (lose and set ourselves up for beinh weaker againstthe competition. We cut not to hold our profitabilitu percentage, but just to break even.” Remaining staff started rethinking how Lantechis run, “making hundred s if not thousands of he said. Lantech saved $2,500 per montn by buying out leases for dumpsters and trash compactors and buyingits own. Renegotiatint phone services savedanother $2,500. Consolidating off-sitw storage areas saved $9,000 per month.
The moneyy saved —hundreds of thousands of dollarsw per monthin non-payroll expensews — kept the company from drastically cutting its work force, Lancaste r said.