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Control Resource Industries Inc.

Control Resource Industries Inc.

John M. Wojcik is not a miracle worker. In fact, he is a quiet, soft-spoken man who eschews flash.

But stockholders of Control Resource Industries Inc. believe Wojcik has worked miracles. Wojcik is chairman, president and CEO of the Michigan City-based concern. When he took over 21 months ago, the company had nine straight quarters of red ink. In 1988, it lost $16.9 million. Since then, he has turned the company into a business that posted a $466,000 profit in the first nine months of 1990, a 285 percent gain over 1989.

But Wojcik, who previously worked as a lawyer and an accountant, says that turnaround wasn't easy.

"It is never easy to make decisions to reduce staff and terminate programs," explains Wojcik. "I guess the fortunate thing about it was we had a lot of young people. I knew we weren't letting people go who were 50 or 55 and would have a hard time finding a new job."

Wojcik put himself in each employee's shoes before making the difficult decision to lay off. "Your try to be fair in severance, try to be fair in insurance benefits and work like hell to get them another job," he says.

The company closed offices in Alabama and Georgia and reduced the number of employees from 250 in 1988 to 135. As painful as the cuts were, Wojcik never lost sight of the fact that his ultimate job was to maximize the return on the stockholders' investment. At the company's annual meeting in June, he told shareholders: "If you are going to err, then err on the side of cutting costs. With competition the way it is today, you can't afford to wait."

R. Steven Lutterbach founded Control Resource Industries in 1977 in response to the nagging problem of asbestos removal. Lutterbach, who still lives in Michigan City, became involved with asbestos removal when he was working on a demolition project for the U.S. Navy in Chelsea, Mass. Before he collected a paycheck, the government halted work on the project because of an asbestos-removal problem.

To get his money, Lutterbach began doing research on asbestos. Out of it came a series of filters that make asbestos removal safe. Out of that came Control Resource Industries. The company steadily grew through the mid-1980s, and in 1985, it went public.

Even though Control Resource became a media darling--it was profiled in The Wall Street Journal and touted by major securities firms as a hot-buy prospect--fundamental changes were taking place. Control Resource sold its asbestos-removal operation to the San Francisco-headquartered construction giant Bechtel Group Inc. in 1987. That also was the year the company posted its first loss of $1.36 million.

Lutterbach was an entrepreneur who was more at home creating new ventures than administering them. In 1988, he hired Wojcik as corporate counsel. A year later, Lutterbach stepped away from the company, turning the day-to-day details over to Wojcik. Lutterbach still owns more than 1 million shares--some 18 percent of the company. He also is involved in real-estate development projects in Berrien County, Mich., about 10 miles north of Michigan City.

The Control Resource Industries that Wojcik runs is now out of the asbestos-removal business in which it had its roots. Instead, its $30.7 million in sales in 1989 involved asbestos-removal equipment and the sale of industrial safety supplies, ranging from hard hats to steel-toed shoes.

That change in direction was reinforced on Oct. 2 when Control Resource completed the acquisition of an asbestos and safety supply company, Continental Industrial Supply of Garden Grove, Calif. Wojcik predicts that the acquisition will increase 1991 sales by 25 percent. "That provides the best return on assets for us," says Wojcik.

Wojcik has been able to guide the company through that change, he says, because of the stability and discipline he has brought to the firm. "I have been able to convince people to stick it out through tough times, "says Wojcik.

And while Wojcik is confident of his ability, he admits there are a few things that have surprised him. Number one on that list is the current weakness in the economy. "I expected it to be much stronger," he admits.

Even so, that hasn't stopped him from crystal-ball gazing. "What I want to be able to do with the company is chalk up 15 percent return on equity each year and a return on assets of between 8 percent and 10 percent a year. I want this comapny to become a recognized leader in supplying industrial safety equipment."

Even though the company is primarily a distributor of that equipment now, Wojcik wants to begin developing and manufacturing it himself. He wans Control Resource to have a reputation for quality in industrial safety equipment as it now has for its specialty filters. Not only are the filters used in asbestos removal but also to control indoor air pollution in high-rise office buildings. In 1989, the company introduced seven new filter products, which accounted for 3 percent of total sales.

Wojcik, a Chicago Cubs fan whose main relaxation is spending time with his wife and two sons, says the company is well-positioned financially and geographically for the future. "This is a great area for us," he says. "Here, and to the east and south, there is great potential. It is tougher for us over near Hammond because there is more competition, but I think we can do all right. The labor market is good and the quality of applicants we get is good.

"The competitive environment has changed over the years," Wojcik concludes, "but I'm able to learn something new from it every day."
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Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Author:Richards, Rick A.
Publication:Indiana Business Magazine
Article Type:company profile
Date:Jan 1, 1991
Words:947
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