A devoted global following for its advanced lab-ware products has helped Eden Prairie-based manufacturer Savillex Corp. earn an award for sustained export sales growth from the U.S. Department of Commerce.
Savillex exports its high-end fluoropolymer lab-ware and custom-molded products to university researchers and other customers in more than 50 countries, which, along with its continuing international sales growth, contributed to its recognition as a 2013 Presidential "E" Award recipient.
Building export sales was a key strategy when owners Mike Osgar and Terry Nagel acquired Savillex in 2003. The export push, fueled in part by new products developed with input from customers around the world, proved especially valuable when the recession hit. Savillex continued to grow thanks to its expanding lab-ware exports, despite a drop in its custom-molded product sales during the downturn.
The owners attributed the recognition largely to the 50 employees at Savillex, which they say is one of few companies in the world with the molding and machining expertise to make advanced fluoropolymer lab-ware and custom-molded products. Researchers analyzing everything from environmental contaminants to DNA samples seek out lab-ware made from fluoropolymer, a thermoplastic resin developed by DuPont and sold under its Teflon brand. The material, Osgar said, imparts virtually no impurities, ensuring the purity and safety of the chemical or sample that goes into the lab-ware.
"Even a small company and the employees within that company can make a difference," said Nagel, who with Osgar also recognized the company's global distributor network for its success. "We're not a multibillion-dollar company, but we can make a difference."
Export sales account for 35 percent of the company's revenue, which last year exceeded $10 million, according to the company. Revenue has grown close to 400 percent since Osgar and Nagel purchased the company with a silent partner from founder Russ Saville, who passed away as the sale was under negotiation. Sales of custom-molded products, another post-acquisition push, have grown substantially in the past five years, Nagel said.
Savillex sells products to researchers at 700 to 800 universities worldwide, primarily in geochemistry labs, Nagel said. Environmental and semiconductor scientists also widely use the company's products, as well as market-leading manufacturers. The company makes 1,100 parts for Boeing's 787 Dreamliner, including components for linear bearings that support cables in the plane's wings, while sitting immersed in jet fuel.
Most domestic sales are direct, through the company's website or its catalog, which is a fixture in university labs and has been translated into Chinese, Japanese and Korean among other languages. Savillex hosts an international sales conference every two years at a resort in northern Minnesota, offering technical training to customers and learning about their research needs.
Savillex's long-term strategy anticipates strong new business producing bottles for pharmaceutical and chemical packaging applications. Osgar has worked with employees to develop proprietary blow-molding technology that produces the bottles, Nagel said. In a possible scenario, the company could begin production of the bottles here and complete the process at a new Savillex location in Europe or Asia to serve local markets.
The approach would save on transportation costs and duties and customs charges in other countries, Osgar said, and would not be a move to save on labor costs. It also would enable Savillex to maintain control of its technology in other countries.
Hai Cheng, lab manager for the University of Minnesota's trace metals isotope geochemistry group and professor at a university in China, said he has been buying Savillex lab-ware for more than 10 years for use in both countries. The U of M lab uses Savillex beakers for trace element analysis of seawater and coral from the Pacific Ocean as part of climate change research.
"I'm very satisfied with their products and their service," Cheng said. "Sometimes they come here and talk to me about what kind of things we would like for them to make or improvements to existing products."
The expert says: Dileep Rao, president of InterFinance Corp. in Golden Valley and clinical professor of entrepreneurship at Florida International University, said Savillex Corp. is a great example of a midsize company going where the markets are and flourishing in the midst of giant companies.
"By focusing on a niche market for high-end products, Osgar and Nagel have built a successful business to export products to the rest of the world … and done their share to balance our trade deficit," said Rao.
Todd Nelson is a freelance writer in Woodbury. His e-mail address is todd_nelson@mac.com
