Miel, R . (September 11, 2006). Primera Gets Back to Basics. Automotive News. V81, I6220, p26bb

When Noel Cuellar and Ethan Barde began Primera Plastics Inc. in 1994, it was just the two of them, splitting time between running presses and making deliveries. The injection-molding company grew, adding people and presses. In 2003 it moved into a new building here. Employees numbered 140.

Then Primera hit the wall. "We crossed the $15 million mark in sales, but we were still struggling to pay the bills," Cuellar said. "We'd look around and see that sales were good but had to ask why we weren't making any money." Cuellar and Barde called for help — and set Primera apart from most other companies facing problems. "Typically, it's a bank that calls us in because they're worried about their investment," said Doug Wilterdink, managing director of restructure and turnaround for the consulting group BlueWater Partners LLC, of Grand Rapids, Mich., which worked with Primera. "Noel called us, which is a bit unusual. We usually get involved when there's a crisis, and we're constantly telling people that that's the worst time to try and do a turnaround because your options are limited. "Our conclusion with Primera was that it was fixable."

Solid ground After bringing in a professional manager to run the shop floor and changing its business outlook to track finances based on cash flow rather than sales, Primera is back on solid ground. The company bought two new presses this year and paid cash. It expects to add a third before year end. Primera is dropping some contracts and adding business that brings in more cash. Customers are coming in earlier to collaborate on future products, Cuellar said. Primera is looking at alliances to expand into Mexico, and its sales are on track to reach $21 million this year.

It has not been an easy journey, though. Calling in BlueWater — and supply-chain specialists DemandTec Inc., of San Carlos, Calif., to troubleshoot inventory issues — meant listening to harsh advice. "It wasn't pretty to have people come in and tell you everything you do wrong," Cuellar said. Barde and Cuellar also bought out a third partner who did not agree with BlueWater's suggestions.

Business 101 Primera relearned how to do business, Wilterdink said. By switching to a cash-flow business model, the company learned to work within strict 13-week budgets, showing where every dollar came from and went. Primera also followed a long-term system taking in the cost of debt and capital improvements.

And it hired Bob Buresh, a former executive with Prince Corp. and Clarion Technologies Inc., to oversee operations. Buresh brought a new outlook. Cuellar had thought Primera needed a new press. But Buresh found that the company was not using its existing presses to their full capacity. By improving cycle times, Buresh freed more press hours than the company needed, Cuellar said. Consultants from DemandTec, which supplies management software, helped streamline Primera's inventory process and reduced its warehouse holdings by $300,000.

The company also worked with its bank to provide free personal financial planning classes to employees — reasoning that if the hourly workers understand more about their own checkbooks, they can better understand the changes going on throughout the company to improve the bottom line. Primera had to learn to turn down contracts that would eat up press time without returning a profit, Cuellar said. But it has won business that is expected to bring long-term benefits.

The company supplies injection-molded housings for automotive mirror manufacturer Gentex Corp. Primera just launched a series of parts for a new General Motors vehicle. The turnaround will not end just because things have become more comfortable at Primera, Cuellar said. The company knows it must make continual adjustments if it wants to survive in a manufacturing climate that is always changing. Noel Cuellar and Ethan Barde knew that changes were necessary for their company to grow.