October 2013 | ManufacturingEngineeringMedia.com 55

Milacron LLC—still often referred to by

its legacy name “Cincinnati Milacron”

and still based in Cincy—got out of

the metalworking tools and grinding

business in 2004. Ever since, it has

focused its efforts on being a world

leader in plastics machinery, mold technologies and industrial

fluids. The company, now owned by the private equity firm

CCMP Capital Advisors LLC, has been rapidly expanding,

acquiring Mold-Masters (Toronto, Ontario) earlier this year and

giving credence to its tagline: “Now More than Ever, Your Most

Complete Partner in Plastics.”

Milacron executives Mark Vanzant and Jim Kinzie say that contract manufacturing has become an important tool

to diversify the overall business.

Milacron Optimizes Capacity with Contract BusinessContract manufacturing, once just a tool to use excess capacity at Milacron, becomes a vital diversification strategy

Sarah A. WebsterEditor in Chief

Contract Manufacturing Profile

Today, Milacron consists of Milacron Plastics Machinery

(injection, extrusion and blow-molding); Mold-Masters (hot

runners); DME Co. (mold technologies); Milacron Aftermarket

(parts and service) and CIMCOOL Fluid Technology (metal-

working fluids and services).

But a little-known part of the Milacron business has also

been growing, too. About a decade ago, Milacron planted the

seeds of a contract manufacturing business to offset the cycli-

cal nature of the machinery business, which is highly sensitive

to the ups-and-downs in the economy.

The strategy is now regarded as vital to the company.

Milacron’s contract manufacturing business, known as Mila-

cron Contract Manufacturing, has provided a relatively stable

source of revenue, especially during tough times, and it’s also

been a steadily growing source of revenue.

“We have a pretty cyclical business,” said Mark Vanzant,

director of Manufacturing and Engineering, Milacron. “This

was a strategy we arrived at 10–15 years ago to help us kind

of balance our manufacturing loads. …

“Using [the] machining facilities we already have, we look

for business that requires similar capabilities.”

Most often, that has been customers with big, high-tech

parts, including those in the oil and gas, wind, agriculture,

mining and locomotive sectors, among others. Milacron also

provides parts to other noncompeting machine builders who

sometimes do not have enough capacity to meet orders.

56 ManufacturingEngineeringMedia.com | October 2013

Contract Manufacturing Profile

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“Our niche is low volume, high technology,” said Jim

Kinzie, plant manager, Milacron, Mount Orab Operations.

Kinzie, who has worked in various positions at Milacron

during his 42 years with the company, explained that the

large vises, injection screws and fabricated or cast-iron

bases that Milacron manufactures for its plastic extru-

sion, blow-molding and injection-molding machines makes

Milacron especially capable to make smaller lots of large

items. “The machinery to make the parts is pretty much the

same,” he said.

Vanzant added: “We have capability up to about 60-ton

parts.”

Milacron’s contract business has grown to more than $8

million in sales annually, which Vanzant called “a small part of

total sales, but an important diversification tool.”

The company learned how important that diversification

was during the Great Recession, when the machinery side of

the business took a severe hit. During that period, the contract

manufacturing business made up nearly 40% of the ship-

ment’s out of the Mr. Orab plant. “It was a boon to us during

that period,” Vanzant said. And while Milacron still had to lay

off workers, he noted that without the contract business: “It

would have been worse.”

Today, Milacron has come to consider this contract manu-

facturing business, once meant only as a offset to use excess

manufacturing capacity, as highly important to the overall busi-

ness strategy.

“We will subcontract Milacron work to maintain our

contract business,” Kinzie said, explaining: “Once you lose it,

you won’t get it back. The problem with turning it on and off is

losing customers. We try and keep the contract work growing

no matter how business at Milacron is doing. We need to be

able to fall back on that.”

The contract manufacturing business does have some

boundaries to its growth, however. Milacron will not compete

with its machinery customers. Because those customers are

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58 ManufacturingEngineeringMedia.com | October 2013

Contract Manufacturing Profile

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typically in plastics, however, and Milacron is typically selling

metalworking services, this has not been an issue.

“We do not compete with our customers,” Vanzant said.

For example, he noted, “We do not do molds.”

Optimizing Manufacturing Capacity

Milacron has two large factories that

make a variety of small and large parts

required to make plastics machinery.

There’s a 500,000-ft ² (46,500-m²) facil-

ity in Batavia, OH, as well as a 190,730-

ft² (17,738-m²) facility about 15 miles

away in Mount Orab, where the majority

of contract manufacturing work is per-

formed. “The equipment we have in

our facility is a wide range, from small

parts to large parts, geared to make the

parts required for extrusion, blow mold-

ing and injection molding machinery,”

Kinzie said.

Milacron offers precision CNC mill-

ing, grinding, turning and hard-facing

operations, as well as a number of sec-

ondary and finishing operations, such

as whirling, heat treating, deburring,

coating, freezing, testing and more.

At Mount Orab, the facility consists

of five connecting buildings. Each build-

ing has a different type of operation.

One makes small parts you can pick up

with your hand. Two plants make large

parts that are moved by crane or with a

forklift. A fourth building does heat-

treating and other specialty processes.

The fifth does long and skinny, shaft-

type work, which is where the com-

pany makes its screws for the injection

business. Among its many machining

capabilities, which are listed in detail

on the company Web site, Milacron

also does whirling, a specialty opera-

tion. The whirling machines (made by

Weingärtner in Austria) have a ring with

a series of different types of cutters. As

the ring spins, it travels down the shaft.

The process is somewhat similar to turning, except instead of

one cutter working at a time, there are maybe six–eight cut-

ters working at a time. “It removes a considerable amount of

stock,” Kinzie said.

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Among Milacron’s greatest assets in securing contract

business, however, is the company’s sizeable, highly-skilled

and flexible manufacturing workforce of about 230 workers,

175 of whom are machinists. “We have a higher skill set. All

of our machinists must be able to read their own blueprints,

do their own setups,” Kinze said. “The rest of the people are

support people, manufacturing engineers, production control.

… We do our NC programming in house.”

With their large, highly-skilled workforce and varied techni-

cal capabilities, Milacron also does some machine refurbish-

ing in its contract manufacturing operations.

Planning Ahead

Managing the contract manufacturing business has not

been much of a change or difficulty for Milacron, Kinzie said.

That’s because the plants already operated on a contract-

or customer-focused basis internally, with different parts of the

business placing orders to the manufacturing operations.

“It’s not easy, but we try and treat every order as if it’s from

an external customer,” Kinzie said. “We have five different

internal customers because the businesses for the injection, ex-

trusion and other business units, they all submit orders to us.”

That makes the contract customers “just another customer,”

he explained.

Because most Milacron jobs are smaller and custom, ver-

sus large automated operations, Kinzie said, “We do an awful

lot of capacity planning. We move around the machinery. …

We have the ability to move people around. We have to be

very flexible.” And fast. “We’re able to provide that customiza-

tion as rapidly as possible.”

Milacron uses J.D. Edwards EntepriseOne ERP software to

manage its capacity and other operations.

Typically, the machinery side of Milacron forecasts its sales

about six months in advance, leaving the machining operation

to book its excess capacity. Virtually all machines are built to

order, with very few stock machines. ME

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60 ManufacturingEngineeringMedia.com | October 2013

Contract Manufacturing Profile

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