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How Sun Burst onto Scene
September 27, 2008 By: Mark Arzoumanian Official Board MarketsLou Sardella, chairman and founder, Sun Automation Group, Sparks, Md., openly admits that when he started the company 23 years ago, he made some major mistakes. First, he had insufficient capital ($30,000 in savings went into a computer). Second, he didn’t have a business plan. But what he did have in his head were plenty of ideas on how to better feed warped board into corrugated converting machinery. Today he owns 17 patents for his inventions.
Last week he told 475 attendees at the Association of Independent Corrugated Converters (AICC) Annual Meeting in Atlanta how he started Sun as a one-man consulting firm in 1985. This year the company will bring in about $62 million in revenues, generated from the sale of edge feeders, upgrades, parts, and a wide variety of add-on units.
Guiding Principles—
Sardella’s career in the industry has been guided by four principles: passion, problem solving, people, and “keeping your head on a swivel.”
He says his passion for the industry only builds as the years go by. While attending John Hopkins in the late 1960s, he worked for The Ward Machinery Co. as a draftsman. One day he asked founder Bill Ward Sr. why he continued to work for so many years in this industry.
“When you get the paper dust on your hands, it’s hard to get it off,” Ward told him. Sardella still remembers these words today and now knows why Ward responded the way he did.
Sardella also believes that it’s important to solve customer problems in creative ways. He has supported this feeling by (starting in 1979) developing the Roto Feed®, the Lead Feed®, the Sure Feed®, and Sun’s Extend-O-Feed®. Today the company has sold over 7,000 Extend-O-Feeds. He also would assume the challenge of “breathing life into old machines,” by establishing a machine refurbishing program called Renew.
But Sardella is not one to sit still and let people pat him on the back. Today he is working on developing a full speed, high quality digital printing machine that he hopes to introduce to the industry soon. It will employ water-based inks and have four-color printing capabilities powered by Kodak heads. Ink waste will be eliminated and set-ups will be instant with this machine, he says. Order sizes will range from 2,000 to 5,000 boxes and custom printing (say, different names on individual boxes) will be possible.
His third principal is people.
“You need to hire good people and let them do their job,” he states. “Then, when the company is successful, let them share in the profits.”
That’s exactly what he did. In October 2003 Sun became a 100 percent employee-owned company. Now it has been divided into 159 “slices of the pie,” representing the number of employees working at the company today.
Finally, he employed a football analogy and recommended that entrepreneurs keep their heads on a swivel.
“You never know what’s coming at you,” he says, noting that it could be the competition or new government regulations. He then shared a very tough period in his life. In 1991 Sun (and Sardella personally) was sued for millions of dollars for alleged lead edge feeder patent infringement. It was a five-week trial that had Sardella going through a five-day deposition and included operating an edge feeder in the courtroom. The court decided in Sun’s favor.
“We survived [the trial] and we were stronger for it when it was all over,” he says.
Ten years later his head swiveled in a different direction, this time for the company’s better: He gathered all the funds he could at the time and made a successful bid to purchase Langston Corp., which in 1997 was generating about $140 million in annual revenue.
Now it was out of business and putting up for auction all of its trademarks, patents, designs, and inventory. The auction was on a Thursday. He had already booked an AICC Region 1 ski trip on the West Coast for the next day. So as he headed to the auction his ski equipment was packed in his car. He ended up making the winning bid and then enjoyed the trip with good reason: His company had just grown from $27 to $44 million in annual revenue.OBM
