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Survival Guide: Clark students’
assistance helped spark
TriStar turned to MBA students at Clark University’s Massachusetts Small Business Development Center and received help that eventually led to the company’s geographic expansion in 2004 and the near-doubling of its sales. “We took a hard look at ourselves and took the business from the kitchen table to the boardroom,” said Richard T. Cedrone (right), chief executive officer and co-owner of TriStar along with President David P. Mello. “There was a lack of structure, no formal meetings, no business plan. Now I feel we have a solid foundation.” Founded by Mr. Cedrone in 1982, privately owned TriStar specializes in industrial plastic stock shapes such as rods, tubes and slabs used as components in factory machinery and other equipment. From auto plant robots to ski lifts, TriStar’s plastic products can be found in a diverse group of businesses. Its top 50 customers are in 49 different industries. The company’s focus today is on bearings and related custom components, some of them self-lubricated, for customers as varied as the military, railroads, analytical instrument makers, the National Aeronautics and Space Administration and Disney, Mr. Cedrone said. TriStar also has custom machining, milling and fabricating operations, and has become a resource of engineering services and industrial plastics products. The company’s engineers specialize in crafting products to fit customers’ specific needs. They provide assistance in material selection, component geometry and prototyping all the way into production. TriStar employs 65 nationwide, including 35 in Shrewsbury, and at three other distribution centers.
The company also faced expiration of its lease for the 40,000-square-foot Shrewsbury facility to which Tri-Star moved from Worcester after its downtown location was acquired by the city to make way for the Medical City project. Mr. Cedrone wanted to purchase the Shrewsbury building, but to do so needed a bank loan. The Worcester Regional Chamber of Commerce recommended he consult with the SBDC at Clark, a partnership program with the U.S. Small Business Administration and the Massachusetts Department of Business and Technology that provides free and confidential assistance to area businesses. Clark’s SBDC project teams are made up of MBA students who are trained to assist in developing business and marketing plans, and financial forecasting and accounting systems. They will also work with banks and the SBA to help small businesses obtain loans. “What we really needed to do was get Rich better financial control of the business, help him get a feel for the numbers,” said John Rainey, a senior management counselor who headed the MBA team and met regularly with Mr. Cedrone. “The problem a lot of small businesses face is that they are only able to do accounting and finance on a part-time basis because they are too busy running the business,” said Mr. Rainey. “They don’t really understand the economics of it right away, and we help them do that.” Under Mr. Rainey’s guidance, the MBA students helped Mr. Cedrone develop TriStar’s first formal business plan, incorporating his long-term goals and operations into a multiyear time scale and factoring in different financial scenarios. “We developed a package to give them a better understanding of the numbers and a forecasting system,” Mr. Rainey said. “We put together a big financial review for them.” Mr. Rainey and his team also helped Mr. Cedrone prepare the company’s presentation to Bank of America. As a result, Mr. Cedrone secured $5 million in loans to recapitalize his business and buy the Shrewsbury building at 906 Boston Turnpike. After Mr. Cedrone bought the building, he decided — based on a marketing analysis by another team of Clark MBA students — that he wanted to further expand TriStar, which already had two distribution centers in Charlotte, N.C., and Yorba Linda, Calif. “It happened because once we were able to get the financial information under control, Rich was able to be much more aggressive,” Mr. Rainey said. “So we brought in another team of MBA students that next semester to help with a marketing study.” The team pored over the company’s existing customer base and suggested to Mr. Cedrone that TriStar capitalize on a Midwest market that was expanding its manufacturing industry and was hungry for the company’s services. TriStar already had existing sales in the Chicago area, but, based on the analysis, decided to open a third distribution center in Elk Grove, Ill., in 2004. It is doing “extremely well,” said Mr. Cedrone. Sales in that market this year are forecast to double over 2004, he said. “So we took their advice, launched a new facility and it has been quite successful,” he said. In the next five years, the company plans to open three more distribution centers in the United States, he said, with the next two positioned based on the Clark team’s recommendations. “We really have a structure we can continue to build on. There were many people who helped us and who were there with us through difficult times, but they believed in the vision,” he said. Mr. Cedrone said he consults with Mr. Rainey each quarter. “I’ve learned a lot from him,” he said. In 2006, Mr. Cedrone said, he will likely seek Clark’s help in building an Internet division for e-commerce and engineering assistance. “I try to speak with TriStar about once a month, just to see how they have been,” said Mr. Rainey. “They were one of the biggest and most successful projects we’ve worked on.” From Worcester Telegram &
Gazette (August 30, 2005)
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When the plastics industry experienced a
downturn in 2001 and ’02, TriStar’s revenues fell by 40 percent. (Mr.
Cedrone declined to disclose financial figures.) In addition to the
revenue loss and lack of formal business and marketing plans, TriStar also
had issues with family ownership, which were resolved in 2003 when Mr.
Cedrone bought out other family members.