At the suggestion of Julie Foster, Director of the Ravalli County Economic Development Authority, the general manager of a successful manufacturing and shipping operation with facilities in the Victor area and in Hamilton, John Huffman, made a presentation to the Hamilton City Council about the difficulties involved in operating a growing business in the valley and how those problems are compounded by the fact that the new owner of the business is operating on a global scale.
The current business, called Vesta, a Lubrizol Company, is a medical device manufacturing business specializing in silicone processing technologies. It offers design and process assistance to some major companies including Johnson & Johnson, Avid and Aeolian Electric. Its facilities in the Victor area and in Hamilton are FDA registered facilities and meet the certification requirements for producing medical devices.
The devices, once designed and produced, are distributed to various places all over the nation and in 15 countries outside the U.S. They currently produce about 500 different devices and produce a little over three million devices every year. Huffman said the products get implanted in the human body for long and short-term applications.
“That can be anywhere from one minute, to the lifetime of the patient,” said Huffman.
He offered a thumbnail history of the company which began as a small manufacturing start-up with no venture capital involved in 1997. A 15,000-square-foot facility was built on some agricultural land located off of Highway 93 near Woodside. It houses the company’s main office and both manufacturing and shipping operations take place there.
After about 14 years of successful operation, the company expanded in 2006 and acquired an additional 8,000-square-foot facility in Hamilton. Additional manufacturing and shipping are also done in that facility. In total, the company currently employees 80 people. According to Huffman, 70% of the employees are high school graduates and 30% are professionals, usually with four years or more of college education.
The company continued to do well and in 2011 was purchased by Milwaukee, Wisconsin based Vesta. Vesta was subsequently acquired by Lubrizol, a Berkshire-Hathaway owned business headquartered in Cleveland, Ohio.
Now owned by a global company with manufacturing locations across the U.S. and into Asia, and South America, Huffman’s task, he said, is “to convey to the outside world that we don’t still ride horses to work in Montana, that we have a good talented professional workforce here.”
“We do have a talented work force here in the Bitterroot Valley,” said Huffman. “A lot of our engineering firm is out of Montana State University and a lot of our employees are approaching 15 years with the company. It’s been exciting to see.”
Another reason for the company’s success, he said, is that they are leaders in quality processing and innovation.
“Some of the processes we’ve generated here in the Bitterroot Valley, no other companies in the world are doing,” said Huffman.
Another thing going for the Bitterroot Valley production sites is the continuing strong financial performance of the operation which has risen by 12% annually for the last six years.
“That’s impressive for the line of work we are in,” said Huffman.
Unfortunately, though, the operations here are facing some difficult obstacles if they want to continue to be a growing asset in the grand scheme of things, the biggest being simply the cost of expanding their facility base here.
Huffman said that about three years ago they began looking into a potential 30,000-square-foot expansion of the existing facility in the Victor area. What they discovered was a monumental expense.
First off, he said, as soon as you have more than 24 occupants in the facility, state law requires that a public water system be installed. Not only that, it is going to require a 50,000 gallon, buried water tank to provide two hours of fire suppression in case of fire at the facility. The installation of a public septic system requires the acquisition of easements on adjacent land on which to install it. A four-inch gas line would have to be installed from the highway at Woodside and more electricity would have to be brought in.
Not even counting the cost of the building, he said, the cost of the necessary infrastructure was estimated at $1.5 million. As a result, the project was put on hold in 2017. He said the challenge within the company was the competition in adjacent states and in big cities with existing infrastructure where you don’t have to invest $1.5 million to build the facilities you need.
Huffman said that, in the meantime, several significant projects had come their way, one representing close to $28 million in revenue.
“It took us over 18 years to get to the point that we bring in a project like this, but it couldn’t be handled here in our facilities, so it was transferred to the Wisconsin facility,” he said.
Huffman said he wasn’t trying to present a sob story and say “poor us.” He said he was sharing this with the Council so that they could better understand his circumstances and the difficulties they were facing because any business starting here in the valley is facing many of the same obstacles if they are successful and grow.
He said he was just asking the council “for your continuing support and, in that, to offer ideas and potential solutions regarding infrastructure in Ravalli County.”
“We want to stay here and continue to grow and offer more jobs but we can see the direction the company is going,” he said.
He said the second thing he would ask the council is from the future planning standpoint, to understand and discuss how local businesses will continue to be able to grow, especially as occupancy continues to increase at their facilities.
“Once you are over 24 occupants it’s a whole new ball game,” he said. He said businesses need to be educated about the importance of building in places where they can continue to grow. He said if his company had been aware of the limitations, they would have looked for a more strategic location to start the company. He said that Ravalli County needs to look towards the future and develop the infrastructure utilities for businesses in strategic locations.
“Manufacturing is a good option for producing jobs in a community,” said Huffman, “but they need the opportunity to grow. So again, the task that I have in selling Montana as where we want to be, is where we are up against the Milwaukees of the world with the 5,000-acre industrial parks.”
He said that he was just trying to be open about his position.
“My goal is to try and find a solution where we can just continue to grow here,” said Huffman.