I described the ground-breaking ceremony of Allastics Inc. What I left out was the fact that when construction started on our 25,000 sq. ft. building, we discovered that our ceremony was on a totally different property. Despite minor things like that it got built in time for the arrival of the machinery and the polymer handling equipment. Our solitary machine looked lonely in this big building but we got it set up to run with a pair of molds loaned to us by Union Carbide.
We first made a really good little rigid bucket which was designed as the tub for a home-made ice cream machine. It was a perfect office waste paper basket. We made them in several molded colors from polyethylene, high impact polystyrene and even in ABS. When we changed polymers and color additive we got mixtures of the melt which gave rise to some very attractive and very ugly versions of our bucket. We gave samples to our share-holders and I know, to this day we all have a few of them around the house
. The other mold we borrowed was of the American eagle, in the form of a wall plaque. In single color, it was not too attractive but when painted up it was quite good. I still have one over the garage door of our Houston house which had previously hung on our Atlanta and Jacksonville garages as long as 45 years ago.
When it got time to find a product we could mold and sell for profit, we ran into the serious problem of having a new capability which was unknown by potential customers and product designers. The newly available properties of structural foam would allow designers the greater freedom of being able to mold multiple or very large items from a tough new material but not until they were educated enough to design such new items. The two alternates available to us were to design new applications ourselves or go on an educational tour to explain the new features of structural foam and the capability of the equipment.
We all believed we could demonstrate and prove the advantages to a customer but to do so, meant having a product of that nature in hand. Thus, we had a chicken and egg dilemma which we decided could only be resolved by factually producing a large molded item which clearly would open the eyes of designers and engineers. The product we first chose was eight foot lengths of builders’ crown molding and we contracted with a mold maker to build us an in-expensive demonstration mold using an intricately carved attractive wooden molding. When molded, the product appeared to be perfect but when used for room enhancement or decoration, temperature changes caused movement and undesirable cracks opened up. What appeared price-wise to be an attractive product ended up having no market.
We had occasionally compared notes with Union Carbide’s first licensee, First Rigid Foam Inc. in Massachusetts that already had orders to make some small products on their three 100 ton machines. They were under-financed and already had serious money problems and we wound up acquiring their assets and moving their machines and molds to our Atlanta plant. This helped our revenue in a small way but also gave us actual paying customers and a very flexible molding capability.
Our second choice for a marketable product was to make a rigid plastic pallet to compete with the wooden pallets in almost every industry. I set out to find about the existing wooden pallets available universally. The standard American industry pallet is 40 in. x 48 in. with the deck-board being 40 in. and the stringer being 48 in. These are all relatively cheap, especially if the supplier offers reconditioned ones. It would be hard to compete on a price basis, so we looked further to see if some industries had special needs for which they might pay a premium. For example, the meat and chicken wholesalers had considerable problems with the Government pallet cleaning specifications and procedures, particularly with used wooden pallets. This was encouraging.
We found that the canning and bottling industry used a 44 in. x 56 in. pallet and also had high rates of damaged pallets and sometimes damaged cans or bottles. When we checked with the American Can Company we found that they had tried several versions of blow-molded or injection molded plastic pallets with no success. We were well received when we presented the features of structural foam products and the capability of the machinery to mold large pallets, possibly two at a time. Our enthusiasm was matched by American Can’s engineers and they agreed to jointly work on the pallet and mold design. Ernest Holdredge, our sole engineer spent a lot of time with our chosen mold maker in Birmingham, AL. In order to provide strength over the whole pallet we would have to design a strut system that required using cores which would automatically withdraw after polymer cooling began and this caused many frustrating interim tests and delays. While this was going on we were already into 1971 and were spending money without having any off-setting revenue and a crisis was looming.
By that time, we were so sure that our future was with some form of pallet or similar large industrial item, especially if these could be molded two or more at a time with each molding cycle in order to keep the cost economical for the customer. The answer was to install larger machinery and more automation. We started estimating and found that we could do it with dual 400 ton molding machines with a proportional polymer silo and an automatic injector-feeding system.
We took the machinery requirement and the cash situation to our board members and were surprised to receive great enthusiasm to return to our investors, raise more money and make our first expansion. (I later found that Harland Allen had pro-actively included an early plant expansion and a secondary stock sale in his original fund raising presentations.) He went to work again with his investors and, in addition to his original shareholders, he attracted several Coca-Cola family and management personnel, the major one being Dr. Asa Candler IV. When Dr. Candler visited the plant to see our progress, we gave him one of our buckets. After he left his chauffeur came to me and wondered if Asa could have another bucket. Since he was investing a second $50,000 I thought maybe we should give him another. The stock offering went well and we placed orders for the new equipment.
In the meantime, the pallet mold was installed on our 150 ton press and we began to slowly produce plastic pallets in sufficient numbers for testing on the moving belts of American Can’s facility in North Carolina. On testing day, Ernie and I went with a truck-load of freshly minted pallets and they were loaded with empty cans on one belt and full cans on another belt. They operated quite well until they reached a transfer point and a sudden direction change when some pallets with the full cans sagged enough to cause jamming. After helping pick up a few thousand cans we realized we had a flawed product. American Can paid us for the mold and cancelled the project. Ernie came to the conclusion that strengthening more would be counter-productive and we put the pallet project aside. (Later, we sold many pallets for less stringent operations and to other industries.)
We had now reached the stage at which new companies typically failed. We had operated way too long with no in-coming revenue and we had started an expensive expansion with no new prospects of getting projected revenue early enough to solve the problem. Payments were due and time was against us.
Another problem had arisen with our spend-thrift chairman and his liberal use of the company credit for his personal benefit. He had acquired a very fancy houseboat for entertaining investors and possible customers. This was on Lake Lanier and was busy every week end. Gas alone at 45 gallons per fill-up was the least of the charged expenses. Personal relations were already strained by our product disappointments and things came to a head when an attractive young lady presented herself one morning and announced that she had been hired by Mr. Allen to be our receptionist. Our VP Finance, Frank Pidgin and I paid her two week’s pay and sent her away, waiting for Allen’s usual 10:00 am arrival.
To cut a long story short, we asked for his credit card and told him he was not welcome in the office unless invited. This of course called for an emergency board meeting and the agenda for that is another memory for another day.