Harriston-Mayo, LLC: Some Business Moves are Meant to be Undone
by Susanne Retka Schill Posted on 2/5/2007
Mike Delisle, President
Back in the mid-90s, Minto's Harriston Industries and East Grand Forks' Mayo Manufacturing were part of a major buyout. The two companies, plus three other equipment manufacturers, were merged into TerraMarc Industries. The advantages of being part of a larger firm were offset by frustrations with working through layers of management.
When KRG Capital Investments, the Colorado-based investment group, announced their intention to sell TerraMarc, Dexter Sitzer and Mike Delisle jumped at the chance. "We asked if they would consider breaking up the company and selling Mayo and Harriston separately," Delisle said.
They had three months to figure out what it would take to put together a deal. "First we asked can we do it?" Delisle said. "Second, is it a good idea?"
"We went to Dawn Keeley and said this is what we want to do," he said. "She knew the team to put together to do it."
The team included Dawn's organizations: the Red River Regional Council and the SBDC; local development people: Choice Financial Bank; state agencies: Bank of North Dakota, N.D. Development Fund, N.D. Department of Commerce Division of Community Services; the Small Business Administration; Walsh County Job Development Authority; the City of Grafton; City of Grand Forks; City of Minto and private investors.
With the time constraint, it was no small feat to line up presentations to all the groups. The City of Grand Forks involvement, for example, required meetings with three committee levels.
"Meanwhile, Dexter and I were going door to door to line up investors," Delisle said. They are pleased that both employees and customers were willing to invest in the deal to bring local ownership and control back to the companies.
Mayo Manufacturing was started in 1952 by Delisle's grandfather, Mayo Delisle, as a small farm welding shop. His dad worked with his grandfather and built the business until the third generation bought it. Delisle sold it to the investment group hoping the improved capitalization would help the company grow.
Mayo Manufacturing's 30 employees build potato handling equipment used in warehouses.
Sitzer has worked at Harriston Industries on the northern edge of Minto for 21 years. Founded in 1973 by Tom and Tony Osowski, Sizter became general manager in the mid-90s. Currently at 36 employees, the Minto plant builds potato planters, cultivators and clod hoppers as well as a line of edible bean equipment.
The clodhopper was a machine that gave Harriston Industries a big boost when first introduced in 1989. They peaked at 55 employees building the unit which separates clumps of dirt and rocks from potatoes.
Sitzer is pleased with the businesses' return to local control. "We can do the R&D to keep up with product changes in a much more timely fashion," he said. In the last three years, Harriston has developed a new potato planter with design innovations that result in reduced maintenance. New this year is a steering hitch for potato planters that utilizes the tractor's global positioning unit.
The two companies function as one. "Even in our short experience we've enjoyed synergies," Delisle said. With complimentary busy seasons when the Minto plant's field equipment orders begin to slow down, they help the East Grand Forks plant meet their warehouse equipment orders.
"It allows some economies of scale," he added. The company saves on insurance bought jointly and vendors combine orders for volume discounts, even though they often order individually. They share sales people and dealers.
Harriston-Mayo Industries is expanding its territory from being a regional manufacturer to supplying growers in all the U.S. potato growing states including Michigan, Maine, Texas, Colorado, Idaho and Washington. Next, it's the global market. At the end of 2006, they had their first order of field and warehouse equipment going to the Ukraine. New Zealand, Australia and Japan are other countries in their growing global market.
