To seal the deal

 In 2014-12

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George Halages and Alyssa White, his wife’s younger sister, have clashing personalities. He’s a stolid, meticulous engineer. She’s mercurial and passionate. “He’s black-and-white, does his work in pencil and drawing within the lines. I’m drawing in all different colors, and I draw outside the lines,” she says. “Oh, we’ve had some knock-down drag-outs.” But they’ve managed to resolve their differences and turn them into an advantage. Archer Advanced Rubber Components, the business they started 15 years ago in Halages’ garage, has tripled its staff and more than doubled its gross sales in the past five years through acquisitions and pricing that allows the company to undercut overseas rivals. The company makes and sells all sorts of rubber gaskets, seals, O-rings, washers — crucial components in nearly all manufacturing systems. Major customers include manufacturers of lawn-and-garden equipment, home appliances and fuel and water systems that need to keep fluid from leaking. Archer is a rarity in the rubber components business because it makes and sells all four types of standard rubber seals and gaskets: lathe-cut, die-cut, molded and extruded.
Halages, 51, spent much of his early career working for Cleveland-based motion-and-control technologies giant Parker Hannifin Corp. but decided in 1999 that he “was just tired of making a lot of money for other people.” White, 48, dropped out of N.C. State University and founded successful post-disaster restoration and property-management companies in Winston-Salem. But she wanted to try something new. Twenty-hour-plus workdays were frequent during the startup phase, and White went without a paycheck the first five years, relying on income from her other businesses, which her husband, Mike, and their sons took over.
“It was really, really hard at first,” says Halages, the company’s president. “I had $60,000 in credit-card debt. We’d check the mailbox every day, hoping and praying there’d be a check in there so we could make payroll. But we ended up figuring it out together, and it works out.” Just as Archer achieved $9 million in annual sales and began to make what Halages calls a “substantial profit” in 2009, the Great Recession clobbered many manufacturers. But Halages and White saw a golden opportunity for Archer in the downturn: They could scoop up assets of companies that made other kinds of seals and gaskets to supplement Archer’s specialty lathe-cut components. Through buyers and other industry connections, White, the company’s vice president, learned about Midwest and Canadian manufacturers that were struggling. An extruded-parts company near Akron, Ohio, had lost 30% of its business. Two others, in Ontario and Illinois, were about to fail when a customer suggested Archer buy the businesses and become his single supplier. Halages spent $3 million to take over companies and move equipment and employees to Winston-Salem. By the end of 2010, he says, “we had everything in place.”
The investments have paid off as the economy rebounded. Archer’s gross sales are projected to reach $16 million this year and $22 million in 2015, more than doubling its pre-recession total. Its workforce has tripled to 90 full-time employees in the last five years. The company sells products mainly to domestic manufacturers eager to do business with another American-owned company and wary of increasing shipping costs in foreign markets, especially China. Halages and White share that vision. Until a couple of years ago, the company imported most of its molded components from China. It was a necessity, given the paucity of U.S. makers of the parts, which are made by pouring liquid rubber into a mold, then letting it harden. With the necessary equipment on site, the company has expanded its domestic molded-goods line, which now makes up about 10% of total sales. Overall, about a quarter of Archer’s products are imported, compared with 50% three years ago. “We’re trying to bring it all back,” White says. The textiles and furniture industries that made North Carolina a manufacturing hub have suffered because of overseas competition and relaxed trade regulations. Halages hopes Archer helps reverse that trend and points the way for other North Carolinians to make things. “It’s an absolutely awesome state to live in,” he says.
— Greg Lacour
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