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Urschel Labs: cutting up the world's food.

Urschel Labs: Cutting Up The World's Food

What did you have for lunch today? A hamburger from McDonald's? Potato chips? Have you used an automatic teller machine at Indiana National Bank or a bank in Northwestern Indiana? If you have, you may already have indirect experience with Valparaiso-based Urschel Laboratories, Inc., and its affiliated companies.

That shredded lettuce on your hamburger might have gone through an Urschel food slicer. If you've eaten potato chips the odds are much higher-- 99 percent of the world's potato-chip production is processed by Urschel machines. Urschel Labs occupies a unique place in the world of food processing, boasts Chairman of the Board Joe Urschel, son of the company's founder, William Urschel. "The food industry is most of what we do," he says. "Last year, we (Urschel Labs) had $45 million in total sales. About 60 percent of that was on machine shipments to over 100 companies."

Other markets for Urschel Labs machines are the pharmaceutical and chemical industries. "Eli Lilly uses our machines to make uniform particles for their eye ointment," says Urschel. Indianapolis-based Eli Lilly and Company is a major Hoosier firm that uses Urschel equipment, as are Red Gold, Inc., in Elwood and Pilgrim Farms. Inc., in Plymouth.

Urschel says, however, that only about 1 percent of his company's business is in Indiana. "We deal with people in Japan 10 times more often than we do locals," he says. The company won a President's 'E' Award for excellence in exporting in the late 1970s.

Urschel Labs specializes in the design and manufacture of food-processing equipment that reduces the size of foods. "Grinding is a dirty word here," says Urschel. The company has pioneered the use of blade-dicing and chopping in preparing food. "We measure the output of our machines in tons per hour, not pounds. One of our customers produces chopped lettuce for hundreds of McDonald's."

The company was founded in 1910 as an operation to produce gooseberry clippers. Now it markets its products to the world. "Our exports for the last 10 years have never dropped below 50 percent. We are really in a unique position. There is very little worldwide competition," Urschel says.

In the hallway outside the company's offices is a world map spotted with flags marking where salesmen or branch offices are located. "There are something like 178 countries in existence now. We deal with over 100 of them," says Urschel. Urschel employs 30 people in a direct-selling role in four offices located in the United Kingdom, Japan, the Netherlands and France.

Joe Urschel's son, Robert R. Urschel, notes that the salesman's job is a bit different when it comes to finding companies. "They (food companies) seek us out. We have 14 domestic salesmen who deal with commercial food processing. I'd say that, when it comes to commercial food applications, we cut up most of the world's food."

Robert, now president of Urschel Labs, explains the major companies, such as Campbell Soup Co., search for better ways of processing foods for commercial applications. "We have a machine that can produce hamburger at 50,000 pounds per hour. We can produce potato chips at 1,000 pounds per minute," says Robert Urschel.

The demand for precut produce has been growing as well. The equipment Urschel manufactures uses extremely sharp knives and cutting edges. Cutting assemblies can be changed to allow for different products and sizes.

Urschel Labs' experimental laboratories have banks of refrigerators that hold different food at varying temperatures. The staff is constantly cutting meats and vegetables at various speeds, temperatures and sizes in order to determine the ideal processing, environment for foods. Strips of frozen chicken fed into one desk-sized machine, for example, almost instantly become cubes. At higher temperatures, the whirling blades may shred the chicken.

"By chopping instead of grinding, you can be assured of a uniform size," says Joe Urschel. And if there is anything that the Urschels work for, it's uniformity. "We're very conscious of quality. To ensure we get the right parts at the right sizes for our machines, we make almost everything ourselves.

"In a lot of places, it is considered suitable to measure in terms of a thousandth of an inch and then expects parts to be correct to the hundredth of an inch," he continues. "We measure to within eight millionths of an inch. A customer can buy a part for one of our machines that was made 25 years ago, and it will fit. We even make our own nuts and bolts. Other manufacturers can't make them to our specifications."

The company bought its first mainframe computer more than 20 years ago and has updated it three times. The company's inventory is listed and updated four times a week to ensure that customers anywhere in the world who need parts can have them in 24 hours.

The production area of Urschel's 121,000-square-foot facility is crowded with precision machine tools. "These are fully automated. Some are from Japan and France," Joe Urschel says. Before buying the expensive automated equipment, he and his son created computerized, automated machines themselves.

The term "in-house" takes on a whole new meaning at the Valparaiso plant. Two foundries produce the metal used for cutting assemblies--a patented alloy developed by Urschel Labs. "Every step, all of the parts are made here. The only thing we don't make are belts and motors," says Joe Urschel.

Carrying a new machine from design to prototype to production takes time because of the Urschel Labs' testing process. Interested parties are offered the use of the testing labs in order to ensure the food products are cut or chopped or diced just right by Urschel creations.

Because Urschel Labs never found a foundry that could produce stainless-steel castings of the required quality, its patented alloy is cast in in-house foundries using the lost wax process. Molds are made by an automated robot arm that dips the form in special clay that is fired on the premises.

Such attention to quality may keep prices high at times, but the machines last. The Model 30 bean cutter was first manufactured by Urschel in the 1930s. They can still be found working in food-processing plants, says Bob Urschel. "We spotted one in Michigan," he says. It's estimated that there are currently some 20,000 Urschel machines chopping away throughout the world.

Not content with carving its niche in the world food market, Urschel began looking for other avenues of investment in the 1960s. One venture that has proved to be another quality effort is Indiana Information Controls. Founded in 1967 as a banking and financial services data-processing facility, IIC has grown into a regional processor for more than 100 banks in Indiana, Illinois and Michigan. IIC serves more than 20 banks with automatic teller service.

Company officials are quick to point out the variety of functions IIC now performs. "In 1980 we constructed a facility in Beech Grove, near Indianapolis, to serve what has become a large area for us," says Richard Strain. IIC also operates out of a third office in Bloomington, Ill.

Urschel Labs has also expanded into property management with the construction of Vale Park Village apartments in Valparaiso, less than a mile from the lab site. Urschel Development Corporation runs the 207-unit Vale Park and a similar complex in San Diego.

Urschel Labs and its affiliated companies are run principally by the Urschel family. The children and grandchildren of William Urschel have continued in the tradition of inventiveness that has spawned patents and products of quality. And they've carried it well beyond the borders of Indiana.

PHOTO : Urschel food-processing machines measure output in tons per hour, not pounds. The

PHOTO : Valparaiso-based company sells to more than 100 countries. Its slicers cut 99percent of

PHOTO : the world's potato chips.
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Title Annotation:food processing lab
Author:Wignall, Eric
Publication:Indiana Business Magazine
Article Type:company profile
Date:Jan 1, 1989
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