Waterbury Companies - A Time For Growth

Good things come to those who wait. At least that has held true for Waterbury Companies of Waterbury, Conn. It has been more than 30 years since the diversified manufacturer of metals, pest control and hygiene products, was a private corporation, directing its own strategy and its own future.

But today the company again claims that distinction. A small group of investors, in August, completed proceedings to privatize the organization. As a result, this manufacturer of innovative professional pest control and hygiene products is moving forward in a new direction, and at the same time is preparing itself for an increasingly competitive marketplace.

THE PAST 200 YEARS. The company, which has been manufacturing high quality metal buttons for close to 200 years, also makes hygiene products (sold under the TimeMist brand name) and a full line of professional pest control products sold under the well-known CB (Cline Buckner) brand name. Products such as Drax Ant Bait, CB-80 Extra Insecticide, and the Aurora 360 Fly Trap, are just a few of those carrying the CB name.

How the company evolved into such a diversified organization has something to do with the company’s long history, as well as its future goals for growth. Waterbury Companies got its start as the Waterbury Button Company, which was founded in 1812.

In its early years, in addition to buttons, Waterbury was also a major supplier of plastics and metal products for other operations. “We supplied all of the major manufacturers in the United States with injection moldings and metal stampings,” explained Carl Contadini, president of Waterbury.

In 1965, the company was purchased by Talley Industries, of Phoenix, Ariz., starting a new chapter in the company’s history. Waterbury would now be operated as a subsidiary. Furthermore, it was the first acquisition ever for Talley, a government-oriented manufacturer of missile, armament and submarine systems. While the two companies shared a military background, they had far different products and even more dissimilar cultures. “A lot of people [at Talley] liked Waterbury because it had a nostalgia effect,” explained Contadini, “but it didn’t really fit the Talley mold.” As a result, the company didn’t receive the support or understanding that other Talley Divisions did.

The company entered into the fields of hygiene, sanitation and eventually, pest control, after Talley sold its clock-manufacturing company. The TimeMist line of hygiene products was then transferred to Waterbury, which had manufactured most of its components. “Once Waterbury got the product lines from TimeMist, we started to market products, which caused this whole evolution of Waterbury Companies,” Contadini explained.

Waterbury became more involved in the pest control industry in 1984, after purchasing Cline Buckner. The company had been searching for an aerosol-filling operation for its TimeMist line, so it could fill its own cans. Cline Buckner, an aerosol-filler and marketer of professional pest control products, was up for sale, and it fit the bill.

The future changed again for Waterbury in early 1998, when Carpenter Technologies of Reading, Pa., acquired Waterbury’s parent, Talley, in a hostile takeover. But the takeover wasn’t all bad news. “We found an opportunity for Waterbury to go out on its own,” Contadini explained. Carpenter offered Waterbury the option of either buying itself out or being sold in the open market. Waterbury secured a number of investors, who on Aug. 14, finalized a deal that privatized the company.

The new organization will allow the company to make its decisions on a local level, something not always possible when the company was under the Carpenter and Talley umbrellas, Contadini noted. “We have the support and the funds and the investment we need to grow this business to be a substantial player in the pest control industry,” he said. Furthermore, the company will strive to build on its strengths to find its own niche in the industry.

But even before going private, Waterbury Company had made changes in its strategy, introducing new products with an eye toward innovation. In late 1997, the company hired Dr. Mohamed Rachadi as vice president of research and development. Rachadi, who had extensive experience in the pest control industry, was charged with looking for new opportunities in the professional market. Today Rachadi is also vice president of the Professional Products Group. “It’s remarkable how fast the industry is changing,” Rachadi says. “With our new organization we can react to those changes very fast, and stay tuned with the trends.”

NEW COMPETITION. In previous years, the company was known as an important supplier of aerosol products. Today, Waterbury offers a much wider range of products, from baits to flying insect control devices. And because of this new strategy, the playing field has changed for Waterbury. “There are dozens of manufacturers out there,” says Contadini. “They all have products which do the same thing, but I don’t know who has the portfolio of products we have.”

An important development in Waterbury’s history occurred after the industry was called upon, in the late ’80s, to remove ozone-depleting substances from aerosol products. A number of manufacturers quickly changed their formulations, introducing water-based aerosol formulations to replace their solvent-based predecessors. PCOs eagerly bought these products but quickly learned they weren’t as effective as the originals.

Waterbury Companies, meanwhile, striving for an innovative solution to the problem, decided to research the problem more fully before introducing a substitute. “We said ‘let’s do what we think is best,” Contadini recalled. “‘It may be more expensive to do it that way, it may be a little more risky. But if we can emerge on the other side, we will separate ourselves from the pack.’” Which is essentially what the company did. In 1996, after two years of research, the company introduced the first new solvent-based system, CB-80 Extra.

Richard Crowder, vice president of agricultural products for Waterbury, was instrumental in encouraging the company to develop the product. “We knew that the aerosol had to be of value to the industry, and we did not want to compromise that value,” he said. “When we did make a replacement, we made it with a product that was equal or better quality than the product we had.”

Developing the product was a tough mission, but the company persevered, focusing more upon the ultimate goal than upon every move their competitors were making. Besides costing more in both time and money to develop, says Contadini, CB-80 Extra also took longer to register. “Because we weren’t the first in the marketplace, we paid a little price,” he says. “But I think we’ve overcome that now,” he says. “Our sales are much higher in this category than they were in the old products.” Today, the company offers an entire line of aerosol insecticide products that contain no 1,1,1-trichloroethane.

LONG-TERM COMMITMENT. Although many in the industry would say growth in the pest control market has been relatively flat, the executives at Waterbury are more committed than ever in growing their share of pest control business. “We look at pest control as a growth market,” Contadini said. “We’re going to get that growth by bringing new innovative products into the marketplace, and by bringing safer products.”

The increase in the number of do-it-yourself pest control products available to consumers has been a concern for the industry, Contadini said, but this trend may actually prove to be beneficial, he added. “I think as time goes on we’re going to see more regulations and more restrictions to the consumer end of the business,” he said. In the future, he explained, more consumers will realize that leaving pest control to the professionals is the safest and most effective way to eliminate pests.

One of the company’s most pressing goals is to help the industry grow the professional pest control market. And the company’s new CB Business School, to be launched this month, is a direct answer to that need. The program is designed to help PCOs grow their share of business in the residential market, and to attract new customers to the industry, says Rachadi. “Based on industry surveys, we know there is room to grow,” he said.

Specifically, the CB Business School will provide business marketing information for technicians in an innovative format. Sponsored by Waterbury in cooperation with its distributors, the program will also highlight PCOs’ professional knowledge and the benefits of integrated pest management.

“This is going to be more for the frontline people who are communicating with the customer on a regular basis,” Rachadi said. “Together with our distributors and the pest control companies, we can really put a program in place that will help penetrate that residential market,” he said.

The company’s new bait products, which will be launched this month at the NPCA’s Pest Management ’98 Convention in Nashville, also reflect the company’s emphasis on IPM and pest prevention. The company will be introducing two new baits for cockroaches, and two new baits for ants.

The new CB cockroach bait will be marketed under the trademark CB-Attrax. According to Rachadi, the product was developed based on published research about the varying feeding preferences of cockroaches in the field.

More than three years in development, CB-Attrax contains the active ingredient boric acid and utilizes the same philosophy as Waterbury’s popular Drax ant bait. Attrax, like Drax, consists of a dual syringe bait containing two formulations: a protein-based bait and a sugar-based bait.

“Roaches do like protein and roaches do like sugar,” Contadini said. “And we decided to find the most innovative way to get roaches to like either one of these ingredients, while at the same time use something we’re very experienced at, and that was the use of boric acid.”

The company remains committed to the use of boric acid, in addition to other active ingredients, because it is so reliable. But Contadini is quick to point out that while boric acid is an important part of Waterbury’s portfolio, there are a number of other products, utilizing other active ingredients, now in development.

The original Drax ant bait taught the company an important lesson about innovation, and the product remains one of the company’s top selling products. The company’s new ant bait products, Drax Liquid Ant Bait and the CB Delivery System, will be released in late October.

A BRIGHT FUTURE. It seems the company’s efforts toward innovation have been paying off. With annual sales of more than $40 million, the company has grown by more than 15% a year, Contadini says.

As far as the future is concerned, Contadini and Rachadi are keeping a tight lid on what may be ahead. Still, they hint that part of their strategy will hinge upon the current industry trends. Increasing consolidation, at all levels, is one important factor. Therefore, providing value to distributors is one area in which Waterbury will focus its efforts. The company also remains committed to bringing new, innovative and safer products to the marketplace. “We have a lot of new products in the pipeline that are in different stages of development,” Contadini said. Along with those products comes a future of growth.

“What you’ve seen in the past from Waterbury will increase ten-fold,” Contadini said. Eventually, he hopes, the company will have grown enough to return to the public domain. But first things first. Being private has definite advantages, and Waterbury will take the time to capitalize on them.

The author is managing editor of PCT.

Sidebar: THE WATERBURY BUTTON: A LITTLE PIECE OF HISTORY

When the Titanic sunk, we were already 100 years old,” said Sal Geraci, plant manager for Waterbury’s Button Division. It’s a notable event in Waterbury’s history, because the company did in fact make buttons for the White Star Line, the company that operated the great Titanic.

Waterbury Companies, which today employs 260, got its start as the Waterbury Button Company, founded by button-maker Aaron Benedict in 1812. The company produced brass uniform buttons for U.S. Army after their British supply was interrupted by the War of 1812.

The company continued to make buttons over the years, supplying both the Confederate and the Union Forces with buttons for the uniforms in the Civil War. It is the only metal button manufacturer to have supplied buttons to every American Army since 1812. Over the years, the company kept to its tradition of producing high-quality, detailed metal buttons, and has built up an inventory of more than 15,000 hand-carved dies. These dies are used to produce buttons for use by military organizations, police and fire departments, international corporations, railroads, airlines, and college institutions, to name a few.

In recent years, the company was asked to make reproductions of the White Star button for use in costumes for the movie, Titanic. And in August, with great fanfare, replicas of the original White Star button, copied from the original White Star die, went on sale to commemorate the famous ship. The release of these replica buttons was timed with the release of the Titanic video.