Milwaukee-based Perlick Corp. named Dick Palmersheim as its new chief executive officer in early October. After a few weeks on the job at the manufacturer of custom bar and refrigeration equipment, Palmersheim talked with BizTimes Milwaukee about what drew him to the company, finding avenues for continued business growth and leading a fifth-generation family business.What attracted you to the position at Perlick?
"I'm originally from Milwaukee, grew up in Milwaukee and in so doing you become familiar with those iconic brands and companies in the Milwaukee area that have been around forever. When I was approached to initially be on the board of directors for Perlick and then ultimately the CEO position, I was very familiar with Perlick as a company, it's a great employer to work for in the area and one of those iconic brands that has originated out of Milwaukee so those were some of the starting factors."
[caption id="attachment_363542" align="alignright" width="432"] Dick Palmersheim[/caption]
"Some of the other pieces that very much attracted me is the fact that it’s a family company. It’s been around for over 100 years. It’s in its fifth generation now of ownership and management engagement of the company. Having worked for family companies in the past with most of my career spent at SC Johnson, I’ve come to realize the unique and very special advantages and benefits that a family company offers versus other types of companies. Family companies, they manage from generation to generation whereas public companies manage from quarter to quarter. That gives a family company, in my view, a lot of unique advantages that are leverage-able in the marketplace, so that was a very key factor that was attractive to me. The family culture and family values that the Molinari and the Bergum families continue to infuse within the organization are very attractive and make this a special place to work."
"And then last, but not least, the Perlick brand is one of those iconic brands in the industry that is very widely recognized and is viewed as a brand that is high-quality, reliable, durable, innovative products within the brand. So the strength of the brand, the strength of the products, the breadth and depth of usage of the products and the passion of the people in the organization are what attracted me."
Did you feel like your background really fit in well with where Perlick is at?
"Yes, it absolutely did. My background has been largely with family companies but also with public companies, but the common denominator across those experiences has been companies that have grown based on the strength of their brands, the strength of their products and the ability to innovate within their channels, the values of the company that drive passionate employees and engaged employees, those are all common denominators of my background experience, so as I looked at the Perlick opportunity I looked it as a great fit to leverage those background experiences to the future success of Perlick."
How have the first few months been and where to from here?
"It’s been a great experience meeting all of the associates in the company, getting to know them and understand their views of where the future opportunities are for Perlick and the issues that we need to address moving forward. I'm in the process of trying to learn more than 300 names, which is still very much work in process, but certainly my goal is to not just know the names of all the employees but know who they are as people and what motivates them to come to work every day. That's been a large part of the last three weeks as well as meeting customers and understanding what makes the business tick. It’s been a lot of hours spent, a lot of time spent, but every minute of it has been very fun and enjoyable."
What's the strategic approach going forward in the next year or so?
"We're in the process now of working to put together our strategic plan. This is the midst of that strategic planning cycle so we have a lot more work to do to define the future direction and define the strategic plan that is going to get us there. …"
"Some of the key areas we're working on driving right now, we've got a very, very innovative line of high-end premium luxury refrigeration products that were launched about a year ago and they’re gaining in the marketplace from appliance dealers and high-end luxury home designers. The refrigeration products span standard refrigerators that are in the column segment, our heritage on the residential side has been in under cabinet refrigeration and a year ago we launched into full-size column refrigeration, full-size column freezers and full-size column wine reserves. Those products have been well received in the marketplace, but our focus over the coming months is to continue to establish those products in the market and develop the distribution channels and the awareness of those products within the marketplace."
"In the meantime as well we have some innovative products coming out on our commercial side targeted towards bars and restaurant owners so we'll be launching those in the first quarter of next year."
"Then last but not least, one of the really fun and interesting parts of our business is what we call the large venue business, that comprises sales of beverage and bar equipment and beer dispensing systems into stadiums and other large venues. For example, one of the recently completed large venue targets that when you walk through it you see Perlick equipment everywhere is the Fiserv Forum. (The arena) uses our refrigeration, our bar equipment and our beer dispensing equipment throughout the facility and we're moving forward on several other large venue opportunities around the country, including the Chase Center, which is the (future) home of the Golden State Warriors, Dickies Arena, which is an arena being built in Fort Worth, Texas, the L.A. Rams and Chargers stadium, the Las Vegas Raiders stadium and the Texas Rangers stadium. Those are big growth opportunities for which Perlick is a very, very favored vendor and very well-positioned in those businesses so those will be some of the key opportunities for us moving forward."
Do you see the opportunity as moving into more categories or is it more about growing the product lines you have?
"Those are the areas that we're working through as part of our strategic planning process to crystalize where our growth opportunities exist between more innovation in existing categories versus getting into new expansive categories versus international expansion as a third potential option for us. So we're working through what those strategic options and opportunities look like moving forward. As it relates to some of our core commercial businesses, we believe that there is going to be innovation opportunity within our existing categories and channels in the commercial side of the business, that's the bar and restaurant piece of the business. There’s also likely going to be innovation opportunity within some of our existing residential channels as well, but we're working through right now the balance between existing category and business innovation and new category expansion."
On the manufacturing side, how do you think automation and digitization, how is that going to impact production and operations in general?
"If you’re a manufacturer anywhere in the world, you can't ignore the very fast approaching wave of AI and automation in the manufacturing environment. It is certainly an area that is upon us and certainly an area that as a manufacturer we need to understand where that will fit in our manufacturing operation strategy moving forward."
What else are the biggest challenges for Perlick to overcome moving forward?
"Some of the challenges moving forward relate, in the near term, to the tariff situation and what that is doing to our product costs. We have in our product lines, as you can imagine in a bar environment or a refrigerator type of appliance, there's a lot of stainless steel in those products. I think it’s very commonly understood now that companies that are exposed to tariff-related cost increases as a result of utilizing a lot of those commodities in their products are exposed to issues around future profitability in that in many cases the channels cannot and will not take the price increases necessary to cover off those cost increases. So that's a key area, headwind, that we're working through right now in terms of how to mitigate those risks and how to maintain a profitable business moving forward, but it's presenting its own set of very significant challenges that we're grappling with over the next six to 12 months.
"Beyond that, the question that's on the table is what's going to happen with the economy and what's going to happen with the continued desire to build these large stadiums and event spaces that are a key piece of our large venue business, what's going to happen to the residential appliance market in the event that housing and remodeling slowdowns take place due to potential future economic challenges and then what's going to happen to bar and restaurant owners wanting to build out their bar equipment using our brand. All of those types of activities are certainly very prone to being negatively impacted due to a recession and those are the areas that we're trying to understand moving forward and plan for as we work our strategic planning process."
With it being a family company, do you feel an extra sense of responsibility in terms of managing to maintain that on top of the economic realities?
"I’m a big believer in servant leadership and that's what's guided me and motivated me and caused me to want to get into roles like I am now with Perlick. In that, I and my team have a responsibility to the employees of Perlick and to the family, to the employees to ensure that Perlick remains a great place to work and a place that their families can feel confident will represent an opportunity for them to have the jobs that will allow them to live the lifestyles that they want to live. And obviously to the family, the family is moving now into the fifth generation and is intending to keep this a family company for generations beyond. It creates an added sense of responsibility that is very, very consistent with what motivates me as a servant leader. So I don't view it as an added set of responsibilities that will be difficult to overcome, I view it as very, very consistent with the responsibilities I have as a servant leader. When you step back and you look at the family companies, a very, very small percent of family companies that make it to the third or fourth, let alone the fifth generation, it certainly reinforces the importance that my team and I have to ensure that this company continues to be great place to work and a viable organization to pass on to the future generations."