Strong and independent: Fabricator battles tough competition with teamwork

Some days, this dock could well serve as an archive of the largest and finest samples of architectural glass from around the world: Towering stacks, some weighing 25 tons, contain thick yet transparent lites from national manufacturers, plus rare finds from Europe and Asia. They sit on A-frames and wait to be hauled toward the cutting tables, the tempering furnaces and the silk-screen line. J.E. Berkowitz L.P. consumes tons of glass.

In an era of consolidation and vertical integration among all manufacturing industries—and as privately held or family-owned fabricators operating single locations get bought up all around—the 85-year-old Westville, N.J., company, its managers and employees, stand proud in their independence. A 9-year-old drive toward the kind of quality manufacturing that high-end architects demand, the added value that coated glass products offer, progressive workforce initiatives requiring close teamwork and state-of-the-art equipment support the company.

Straightforward strategy

There’s nothing complicated in President Arthur M. Berkowitz’s business plan: “We are in the commercial and architectural niche, primarily serving 10 Mid-Atlantic states, and have exported work and shipped into the Midwest and Southeast,” he says. “We concentrate on added-value products, incorporating heat-treating, high-performance coatings, silk screening and insulating glass units. Every job we do is custom, one time and not repeated. We serve the mid- to large-size glazing contractors. We also promote to the architectural community through involvement in the Construction Specification Institute [of Alexandria, Va]., and direct architectural visits. The relationships and name recognition are important in the decision-making process.”

Frederick E. Wallin, AFG Industries Inc.’s vice president of marketing, says, “Berkowitz is a fine company and a strong competitor in the commercial market. Arthur, as his dad before him, has also provided leadership in our industry.” Edwin Berkowitz, 79, serves as chairman of the limited partnership with his son as majority partner.

Constant evolution with the industry remains the challenge for a mature company, Arthur Berkowitz, 51, explains. “As new products are brought onto the market by float-glass manufacturers, we have to assess those products. When we think they’ll have an impact, we have to make sure that we invest in the training and the proper equipment and facilities to process them.”

Berkowitz travels constantly in an unrelenting international search for innovations to import from Europe and Asia, and examples of such evolution include equipment purchases to accommodate coated, low-emissivity and laminated glass.

In addition, during the last two years, Arthur Berkowitz has doubled the floor space assigned to the All-Glass Entrance Department, headed by Architectural Sales and Marketing Manager Michael Z. Nicklas, and added engineers to design a storefront system for his company and help customers develop applications for it.

Berkowitz also has mastered the concept of partnering with customers, eagerly offering other support services and products. “Our customers, the contract glaziers, are looking for more than a component lite of glass,” he says. “They want a system, not just glass and metal. We’re great believers in providing a product mix: glass, engineering, technical calculations, hardware.”

Providing systems also includes technical support to resolve issues such as compatibility, thermal-stress deflection and wind load, Berkowitz notes. “We have a vested interest in seeing that the job gets done well,” he says. “If our customer is successful, we’re successful, and we both get paid.”

Berkowitz sees three challenges before him: differentiating his company from the competition so that it remains the “preferred supplier;” remaining competitive in price without sacrificing quality or services such as credit analysis or “first-class inside customer service;” and providing growth opportunities for his employees in skill sets and compensation.

Larger competitors

Berkowitz constantly refines his strategy in the light of the outlook for the nation’s commercial construction market, and in the face of pressure from national and international competitors.

What is an independent? asks Nick Limb, partner with Ducker Research Co. in Bloomfield Hills, Mich. “Companies that are independent of integrated float-glass suppliers are certainly capable of holding their own, but if they are defined as family-owned, single-location businesses, then they are definitely shrinking in number and share as the market consolidates.” He estimates that the nation’s largest architectural fabricators, including AFG Commercial Fabrication, a division of AFG Industries Inc. in Kingsport, Tenn., Arch Aluminum & Glass Co. in Tamarac, Fla., Oldcastle Glass of Santa Monica, Calif., United Glass Corp. of Louisville, and Vitro America of Memphis, clearly command more than 50 percent of the commercial glass market, and “that share has grown significantly.” At the same time, based on a 2001 regional market study, “Berkowitz actually does pretty well in its region,” Limb says. Berkowitz declined to release other data from the study because of its age, and since federal data about glass fabricators in the region only dates to 2002, it’s difficult to get a clear picture of how many companies compete with Berkowitz in his region. He says the top contenders include a “strong but diminishing number of independents like ourselves,” such as the Solar Seal Co. of South Easton, Mass., and Rochester Insulated Glass Inc. of Manchester, N.Y., competing against each other and AFG, with locations in Massachusetts, New York and Virginia; Arch in New Jersey; Oldcastle in New Jersey, New York, Ohio, Pennsylvania and Virginia; UGC in Pennsylvania; and Vitro America in Virginia.

Drive for quality

Despite industry consolidation, “this company has built a reputation for quality over the years and that works in its favor,” says Scott Hoover, senior manager for architectural marketing at Pilkington North America in Toledo.

A significant quality initiative began in 1997, when New Jersey state officials offered 10 companies a cooperative venture leading to certification by the International Organization for Standardization in Geneva, a process that requires a company to overhaul and document its processes and customer service through teamwork. Berkowitz’ employees achieved certification in 18 months and have maintained that status since. Notable changes in performance as a result of certification include:

• Employee teamwork

• Customer-service training and customer forums

• Documentation of every manufacturing process now available via flat-screen monitors throughout the plant

• A strong commitment to continuous process improvement

• Outside audits every six months.

The people

When Berkowitz was in high school and attending Kenyon College in Gambier, Ohio, he worked on the production lines in the plants during summers to gain hands-on understanding of the business. He joined the company after graduation in 1976 with a liberal arts degree and became president in 1985.

Married for 20 years to wife Lisa, a substitute school teacher, the couple have three children, Emily, 19; Julie, 17; and Jacob, 14. In addition to being  a volunteer officer and division chairman for the Glass Association of North America of Topeka, Kan., Berkowitz has served as a volunteer officer of his synagogue and voices a strong liking for pastimes involving physical activity such as skiing, tennis, road biking and hiking.

He acknowledges that the hierarchy of family-owned businesses always involve a degree of informality not possible in more structured corporations. “Decisions get made quickly, right or wrong. I enjoy having capable employees that we both trust and empower to make these decisions. We try to treat them like family and attempt to demonstrate that we value all of our employees in every position.”

Besides Edwin and Arthur, no other family members currently work at J.E. Berkowitz. The company does not offer employee stock options, so what programs or incentives does Berkowitz have to retain mid-level managers? The boss asked some of his men:

Robert E. Price, director of sales, told the boss that he treats the business as if he were the owner. He likes the relations, remains comfortable with the family and has had the opportunity to mature and grow in the job.

Nicklas said he had come from the big corporate world at PPG Industries Inc., and now liked being part of the decision-making in a smaller company.

James Carroll, director of operations, admitted that the plant environment offers “ ‘no place to hide. You’re allowed to do your job and make your own decisions. We have less politics than at a big corporation, and the boss has an open door.’ ”

Regardless of what the managers and employees think of the company, however, they receive many incentives. Berkowitz offers bonus plans for nearly all employees. Line workers as well as managers gain for performance in nearly two dozen plans tied to revenue, earnings or square-footage production goals, safety, sales, attendance, the company annual performance or other indices.

About 130 employees belong to the International Painters and Allied Trades union. “We have a terrific relationship with that union,” Berkowitz says. “During the last several years, we’ve been pleased with its direction toward training and apprentice programs and we support it through dues.”

The New Jersey Department of Labor also provides instructors for a training program Berkowitz regularly offers to all employees. Topics range from English and math to computer skills, such as CAD instruction, and customer-service procedures.

Berkowitz provides a standard benefit package including salary, health care, life insurance and a 401K plan, and he says the company has very little turnover and favors full-time workers, with one exception: “I have a series of people here who are part-timers by choice either because of their age and their desire for reduced hours, or because of obligations at home or with their families.” These include a manager who operates the ISO program, the head of special projects and his father Edwin, who comes in three days a week.

The equipment

Berkowitz cuts and tempers glass panes; makes insulating glass units; creates edge work, holes and notches; coats lead-free ceramic frit spandrel and lead-free ceramic silk-screen panels; engineers all-glass entrances; distributes aluminum products from Kawneer Co. of Norcross, Ga., and heat-soaks glass to check for nickel-oxide inclusions.

Its five buildings on a sprawling site feature three automatic Billco cutting lines that handle 1⁄8-inch to 3⁄4-inch glass, and a Bottero automatic cutting line for laminated glass. Three TGL and Glasstech tempering furnaces, with capacity up to 96 by 192 inches, produce heat-strengthened or fully tempered glass to 3⁄4-inch. One tempering oven has been fitted with a LiteSentry on-line visual inspection system that measures optical distortion.

One oven will be replaced this summer by a Uni-Glass convection oven to conserve energy. The company received a small grant from Public Service Electric & Gas of Newark, N.J., to help buy the oven. In April, Berkowitz installed a Clean 20 water filtering machine. It has reduced use of water on two edgers by 90 percent, he says.

Three Lisec high-speed lines with robotic sealing, auto tabbing, gas filling, on-line bent spacer manufacturing and on-line edge deletion produce insulating glass units that regularly achieve ratings from the Insulating Glass Manufacturers Alliance of Ottawa, Ontario, Canada, and the Insulating Glass Certification Council of Henderson Harbor, N.Y. The company also has earned certified fabricator designations from Guardian Industries Corp. of Auburn, Mich., and PPG Industries Inc. of Pittsburgh.

Four automatic diamond wheel polishing machines, three high-speed seaming lines and three automatic dual acting high-speed drill presses complete the lines. Computer software drives the lines and maintains schedules throughout the plant.

Employees also operate Berkowitz’s trucks to deliver finished goods throughout the region. The decisions to maintain his own fleet, to embrace quality control and buy state-of-the-art equipment all contribute to the company’s ability to occupy the high-end niche Berkowitz strives to fill. He wants to set his company apart from large and growing competitors. He also identifies a need for independents and large corporate fabricators in the United States. “There’s a fair amount of us left, absolutely,” he says. “We’re an independent, and as long as the market grows, we will continue to grow. There are opportunities for both kinds of companies.”

J.E. Berkowitz L.P.

Fabricator of architectural glass and storefronts

Owner: Arthur M. Berkowitz, president and majority partner

Top managers: Edwin Berkowitz, chairman; David Byruch, vice president of finance and chief financial officer; Robert E. Price, director of outside sales; James Carroll, director of operations

Location: One, with five buildings, about 185,000 square feet under roof

Employees: 200; among hourly employees about 130 are members of the International Painters and Allied Trades union

Annual sales: 2005 gross sales forecast to approach $40 million

Connections: Delsea Drive and Harvard Ave., Westville, N.J. 08093, 856/456-7800, 800/257-7827, info@jeberkowitz.com, www.jeberkowitz.com