Milwaukee-based Chrysalis Packaging & Assembly Corp. (Chryspac), expanded into the Chicago area last fall, and its revenues have doubled as a result.
The Chicago Minority Business Development Council named Chryspac supplier of the year in April, a nod to Chryspac’s growth and success since its 2001 founding. The company does inspections of finished products from original equipment manufacturers (OEMs), assembly work and packaging.
After company president William Beckett started the firm, located at South First and West Becher streets on Milwaukee’s south side, Chryspac had a successful first few years – with $800,000 in revenues in 2001 and $1.9 million in 2002.
But the national economic slowdown that followed the Sept. 11, 2001 terrorist attacks dropped the firm’s revenues to about $900,000 in 2003 and 2004. About 70 percent of Chryspac’s business was with one customer until 2002.
Today, that client represents only 30 percent of Chryspac’s Milwaukee business. The company now has 27 other Milwaukee clients and 11 Chicago area clients, one of which is Melrose Park, Ill.-based International Truck and Engine Corporation.
The company expects $2 million in revenue this year.
"The reason we are in Chicago is because of a person, not me," Beckett said. "I just said, ‘OK, let’s go for it.’"
Beckett met that person, Donna Firman, last year through his wife Tina Kelly-Beckett, who is Miller Brewing Company’s supplier diversity manager. In her work with her previous employer, Firman impressed Kelly-Beckett so much that she was the first one to come to mind when Chryspac was looking for a joint venture partner.
Chryspac sought a joint venture partner to bid on a multi-billion dollar Milwaukee project in 2005. Though the project didn’t pan out, the relationship Firman and Beckett spawned would later prove fruitful. Last April, Firman became available and approached Beckett to work for Chryspac.
"I said, ‘I can’t afford you," Beckett said.
But Firman offered to work pro-bono for 30 days to demonstrate what she could bring to Chryspac.
"And I said, ‘That sounds like a deal to me,’" Beckett said.
Firman now services as vice president of operations for Chryspac.
"I just sort of kept traveling around with Chryspac, really setting my goal on working for the company," Firman said. "I went to a trade show and called on some prospects, one of which was International Truck."
On Aug. 31, 2005, International called upon Chryspac to handle an emergency situation the next day.
When a supplier provides a product, some of which may have defects, to an OEM, like International, the OEM may hire an inspection business, such as Chryspac, to check the product.
"Well these parts were on the production floor, ready to go on the assembly line, when they discovered the problem," Beckett said. "Because everything is just-in-time these days, they couldn’t afford to let them go to Milwaukee (for inspection), take a day for us to look through them and ship them back because their line would go down."
Firman quickly organized a small team to handle the emergency inspection at International. She went to Target, shed her business attire, and purchased khakis, a polo shirt and tennis shoes so she could do the intense work of inspecting International’s parts.
"We were able to pull a team of great people together very quickly, went into the plant, did a bang up job the first week and moved on from that first week," Firman said.
"(International) asked us to do another job and another one so we started hiring people to do these jobs because we had a little lead time," Beckett said.
Then International asked Chryspac to establish a plant in Chicago. Beckett asked how much work Chryspac could look forward to if he expanded into the Chicago marketplace and International responded with a minimal $1 million dollar offer.
So, Chryspac occupied a temporary 5,000-square-foot space in Illinois for four months. Then in April the company moved into a vacant 20,000-square-foot warehouse that it is leasing in Melrose Park.
The new location houses nine full-time employees in addition to Firman and Beckett’s niece, Emily Beckett, who is production coordinator at the Chicago plant.
Beckett said he anticipates more than $1 million in revenue at the Chicago plant from International and 10 companies that International referred Chryspac to.
Beckett said the Milwaukee and Chicago plants are collaborating and the expansion has allowed him to hire a full-time quality manager for the Milwaukee plant.
"The business plan I wrote for the company seven years ago is different from the one we’re actually on," Beckett said. "It’s an entirely different journey. It’s frankly better than the plan I wrote and I thought that was a pretty good plan."
The International Organization for Standardization certified Chryspac almost three years ago and the company has successfully passed through its second audit.
"We continue to improve our procedures, training and quality," Beckett said.
The systems, discipline, procedures and rigor Chryspac offers sets the company apart from other quality control companies, Beckett said. Training and retraining is an important part of Beckett’s commitment to quality as are reports generated for internal and external client use.
The majority of his staff and all but one manager are women.
"We found women are really good at the tedious (inspection) work, whereas men need to move around more," Beckett said.
The next step for Chryspac is expanding the two plants.
"We are really focused on expanding not just the business we’ve already done but to expand into warehousing and distribution in Chicago," Firman said.
Expansion through diversification of services and client-base will be the Chicago plant’s focus for the remainder of the year.
The thrust in Chicago is the result of warehouse fulfillment distribution, Beckett said. Chicago is the distribution and transportation hub for the Midwest, a big manufacturing area.
"That’s one of the reasons we want to be there," he said. "This whole logistics shift from basically all your supplies and parts coming from this area to going overseas and coming back is creating new opportunities. The patterns the movement of freight is changing dramatically."
To play into the pattern of freight movement, Chryspac purchased a truck in Chicago to handle shipping. Its Milwaukee plant utilizes independent carriers but is watching for an opportunity in the Milwaukee market to utilize trucks.
"This business could be considered a commodity but we’ve taken that commodity piece out of it and ratcheted up the level of professional management and the services we can provide – that’s what makes it all work," Firman said.
The Chicago Minority Business Development Council hosted the Chicago Business Opportunity Fair in April and awarded Chryspac supplier of the year for a company between $1 and 5 million in revenue.
Beckett employs a large number of Latinos, whom he said are legal immigrants, and demonstrates his ability to think globally, packaging his company in a worldly view.
"The one thing I most regret is not having a big impact on something, particularly with respect to the quality of life for minority individuals, the disenfranchised, the invisible people," he said.
"A lot of the labor intensive is going to China, Mexico," he said. "We provide an intermediate option for a lot of companies."
Even though the labor costs are lower, not everything can be done as cost effectively in Mexico because of factors like transportation, shipping, just in time and quality, Beckett said.
"You can’t do everything overseas, we fill that niche," he said.
"The workforce here (in Milwaukee) really reminds me of history in the making," Beckett said. "When I was in school reading about immigrants it was not a tangible thing at all. This makes it very tangible. Most of our workers are recent legal immigrants."
The benefits these workers have on the U.S. and Mexico’s economy are clearly seen, he said. Beckett’s perspective is global and he said he constantly evaluates how and where Chryspac fits in.
"A lot of them have families in Mexico that they send money home to," Beckett said. "It saddens me a little bit. As an African American, that tie to Africa was cut and I wonder what Africa would be like today if we were employed, got paid and were able to maintain our families and relationships back home in Africa. But that was broken."
Chrysalis Packaging & Assembly Corp. (Chryspac)
Address: 2107 S. First St., Milwaukee
Service: Packaging, assembly, inspection, bundling, quality control
No. of Employees: 30
Revenues: More than $2 million
Web site: www.chryspac.com
