John Worley, President and COO of Zeus Industrial Products, Inc.

MidlandsBiz:
Discuss the origins of Zeus.

John Worley:
The company was founded by Frank Tourville who was originally from Vermont.  After returning from a tour of duty in the Army, Frank looked around for business opportunities and his uncle introduced him to the Teflon extruding business, an industry that at the time was in its infancy.  He subsequently worked as a supervisor for Boston Insulated Wire and as Production Manager at Trimflex Corporation before deciding that he wanted to start his own company.  Frank Tourville founded Zeus in 1966. 

MidlandsBiz:
When and why did Zeus relocate to Orangeburg, SC?

John Worley:
The original decision was based on a need to expand our manufacturing capacity to support the rapid growth that we were experiencing.  As we looked for a location within the Sunbelt states, we were impressed with the welcome that we received from South Carolina and Orangeburg County.  The Governor sent up a plane to pick us up, and when we arrived, the town of Orangeburg pulled together an impressive group of local business leaders who all made a convincing pitch for this region.  They showed us an old mill building that had been sitting vacant for a few years and that came close to our specifications.  From start to finish, the Orangeburg County Development Commission did an excellent job.

We began manufacturing in the mill building in 1981 and in 1989 we relocated our sales and marketing as well as most of our administration from New Jersey to Orangeburg.  I moved to Orangeburg in 1989. 

MidlandsBiz:
Where were you born and raised?  What is your education?

John Worley:
I was born in Taylor, Texas, but raised mostly in Decatur, Texas.  I attended Dallas Baptist University for a couple of years before joining the Army.  Following military service, I attended Temple University in Philadelphia. 

Mine is more of an on-the-job education; I am not degreed.  My family was not well off so I learned at a young age the importance of hard work.  I knew that I was going to have to pay for college on my own so I chose courses carefully, picking only the ones that would benefit me for the rest of my career. 

MidlandsBiz:
Give a brief overview of your business experience prior to joining Zeus.  

John Worley:
Prior to joining Zeus, I was in sales with a company that sold expensive specialty metals.  As we looked to add to our lines of business, we discovered that plastic sheet, rod, and tubing were also being purchased by our specialty metals customers, so we started offering various lines of plastic materials.  As part of our plastic line, we began selling tubing of Teflon manufactured by Zeus.  Later on, I met the President of Zeus when he was in Texas and when he told me that they were looking to hire a national sales manager, I applied for and received the job. 

MidlandsBiz:
What is the core business of Zeus? 

John Worley:
Over the years, it has become increasingly more and more difficulty to answer that question.  Our initial core business was extruding tubular products from Teflon, the fluoropolymer resin that was originally produced by DuPont Company but that is now produced by suppliers all over the world.  Initially, customers would pick a product out of the catalogue and we offered a minimal amount of customization.

Today, we are out of the business of selling a standard, commodity product.  Our core business is the development and precision extrusion of advanced polymeric materials.  As industry became more sophisticated, we found that our customers and industry partners started demanding much higher levels of customization combined with much shorter lead times.  When companies are looking to build a new product, speed to market is critical so since the 1970’s, we have worked on a maximum two-week turnaround for new product.   We built a reputation for our ability to make difficult extrusions from Teflon with extremely tight tolerances, and to deliver those products on a very short production cycle. 

Over the years, as a result of working in close collaboration with our customers, we have also developed capabilities for custom inventory management. 

MidlandsBiz:
Who are your customers? 

John Worley:
Product engineers around the world look to Zeus for innovative tubing solutions to meet increasingly stringent performance requirements in this global economy. 

The majority of our business is in the medical device industry, but we also have customers in aviation, aerospace, automotive, fluid handling and electronics.  Our products are often embedded in the design of a product, so it may not be clearly evident looking at something like a catheter that a Zeus product is involved.  But our tubing is one of the key components in the delivery system of a stint delivery catheter that a company like Johnson & Johnson manufactures, for example.

MidlandsBiz:
What challenges are you facing in this economy?  What adjustments have you had to make in this economic environment? 

John Worley:
This is not the first recession that I have been through and it won’t be the last. We have been blessed through the years that the portion of our business that tends to be impacted the most during a recession – industrial OEM equipment such as home appliances etc – is our least profitable. Our main line of business, medical device components, remains fairly stable during a recession and is generally recession resistant.

As a privately held company, we have latitude about the timing of major capital expenditures and of acquisitions of other companies.  Prior to the economic collapse last year, we had spent time analyzing possible strategic acquisitions in the market, but backed away from those decisions given the state of the economy.  As a result, we came into the downturn in a very strong cash position. 

MidlandsBiz:
What is the key to your success? 

John Worley:
We place a premium on close collaboration with customers through our research and development department; we come up with solutions to help our customers become more profitable. Understanding our customers’ yields is a key component of product development.  In talking to some of our customers, we often discover ways that we can improve their operational efficiency.  For example, one customer loved our product but they had a 40% manufacturing yield rate due to limitations on their assembly line.  We worked with them to significantly improve their yield.

Another customer told us that they had run out of manufacturing capacity for a product that was critical to their success.  We discovered that it would be more efficient for them if we took over a large part of the manufacturing, so that they could focus better on their core business.  They came onto our plant floor and showed us how to make the product.  

The key to our success is getting to know our customers’ businesses, listening to their needs, and providing solutions.  Through that process, you build long-term relationships and trust.  Over the years, we have always invested heavily in developing technology for quality control.  When I first started out in 1975, we used to meticulously inspect each product by hand.  Now it is all done with the latest laser powered inspection equipment, but custom
ers need to have 100% confidence in our company and our ability to deliver quality.

MidlandsBiz:
What new strategic initiatives do you have planned for the next five and ten years?  Where do the opportunities lie?

John Worley:
We see that the medical devices of the future will involve bio absorbable materials.  We have already been using them for years, but plastic materials loaded with medicines that will be released over time will become an increasing trend over the next few years. 

I am excited about our new products and our growing opportunities overseas including collaborative efforts in Asia.  We have more product development initiatives underway right now in our company than we ever have had previously.

By locating a plant in Ireland, we were able to serve the European market without the associated tariffs and the expense of freight.  Ironically, one of the reasons that we located in Ireland was also because the strong US dollar that made it challenging for our products to remain competitive in Europe. Since we have located there, the dollar has declined, but we are well positioned to serve the European market and have recently expanded our sales efforts in Europe in this strategic opportunity for the company. 

MidlandsBiz:
Who are your competitors?

John Worley:
We have competitors all over the globe, many of whom are located in Europe.  But we consider Zeus as outside of the industry because of the high level of customization that we do. 

MidlandsBiz:
What are you most proud of?

John Worley:
I am most proud of how we have managed the incredible growth that we have experienced at the company over the years.  The steps you need to take to build a $1M company are vastly different from those that must be taken to get to a $100M company and beyond.  The challenges that you face as you go through each of these thresholds in order to perpetuate the company are substantial. 

Another thing that I am proud of is that in our entire history we have only ever had one series of layoffs.  We had to layoff 12 people in our Aiken plant when one of customers in the computer industry experienced difficulties, but we are proud that in these challenging economic times, we have not laid off a single person.

I am proud of our employees.  The employees have confidence that management of Zeus will act in their best interests.  Our turnover rate of employees is virtually non-existent, and I am proud that we are able to offer great benefits to our employees.  Our wage increases have outpaced CPI. 

MidlandsBiz:
What leaders have inspired you?

John Worley:
I have been influenced by many people, but Winston Churchill is probably the leader that has inspired me the most.  I am most impressed with his ability to overcome obstacles and maintain a vigilant attitude in the face of adversity.

MidlandsBiz:
What is your ownership structure and what is your current level of sales?

John Worley:
We are a privately owned company and as such, our sales numbers are not released to the public.  When I joined the company 1975, I was the 28th employee; today we employ over 1,100 people.  In 1975, we had one plant site; today we have 7 different campuses including one in Ireland. 

The ownership of this company has never had as its goal to build the company so that we can sell it or take it public. Frank Tourville has four sons and it has always been his intention to leave the company to his family.

MidlandsBiz:
What are the obstacles to success over the next five years?

John Worley:
The biggest challenge will be sorting out the implications for the health care industry should the government start to take on an increasing role.  Will government involvement in the industry act as a disincentive for product development?  In Europe, the government tries to provide incentives for investment in the healthcare industry, but my experience is that more government involvement will not benefit our industry.

MidlandsBiz:
Will South Carolina be able to compete in the future in manufacturing?

John Worley:
South Carolina’s move away from low-cost, low-technology manufacturing is clearly the right strategy for the state.  The state is actually filled with plenty of manufacturers such as Zeus that have been able to reinvent themselves and find a niche in advanced manufacturing.  Partnerships with the research universities are critical to success as is a commitment to high levels of R&D spending. 

MidlandsBiz:
How does Zeus give back to the community?

John Worley:
We are proud of the role that we have played in this community.  We have received Martin Luther King Community involvement award, the Edisto Award for service by the city of Orangeburg as well as the 2008 Volunteer Award as one of only 5 companies in South Carolina recognized for service directly in the elementary schools. 

Over the years, Mr. Tourville has made a substantial investment in this community and remains committed to ensuring that Orangeburg is able to continue to attract top businesses to this region.  One recent development is that we have purchased the Orangeburg Golf Country Club.  As financial problems hit the Country Club, it became apparent that it would not survive without new ownership. 

We are making substantial renovations to the golf course and investing in a new clubhouse that will make the Country Club a top attraction to this area.  We did not acquire Orangeburg Country Club as a business proposition, but as a way of giving back to the local community.  If we are going to attract other companies to locate in Orangeburg, we need to have amenities such as nice golf courses, and nice restaurants. 

Our final new development that we are excited about is that we have put in a four diamond restaurant in Orangeburg called Four Moons.  I encourage people from all around, from Columbia and Charleston to come to Orangeburg and try the food at Four Moons.