Baltimore steel company is growing — again

The north wall at Marlin Steel Wire Products in South Baltimore stands in the way of progress, and it has to go.

On Monday, Mayor Stephanie Rawlings-Blake and Rep. Steny Hoyer are expected to strike the first ceremonial blows to the white cinder block with sledgehammers, then contractors will finish taking down the wall — about 22 feet high and 100 feet across — making way for the factory to expand by half.


The construction and new equipment will probably cost about $2.5 million, but the company's president said it's necessary to continue growing. It also marks Marlin Steel's continuing effort to resurrect American manufacturing, especially in Baltimore, where the city lost nearly all of its once-large industrial base in recent decades.

"It's a lot of investment," said Drew Greenblatt, whose company recorded $5.5 million in 2014 sales of steel baskets, brackets, wire forms and other custom pieces used by such manufacturing giants as Toyota, Honda, General Motors, Caterpillar, Pfizer and Merck. "It shows our optimism. We're very bullish about the future. There's an American manufacturing renaissance going on, and we're leading the charge."


Sitting in a modestly furnished conference room, Greenblatt gazed through the glass window at the factory floor; on the north wall hung an American flag about the size of a small movie screen. He expounded on a favorite subject: tackling foreign competition.

"I reject that you have to make things abroad," Greenblatt said. "That's the conventional wisdom, and I reject it — and we're proving it."

Just the day before he was on Capitol Hill testifying about manufacturing, as he has several times before. The 48-year-old Montgomery County resident has become a semi-official spokesman for small American manufacturers, and now is about to back the words with action again by launching his second expansion in four years.

In 2011, Marlin broke through the south wall to add 12,000 square feet. Busting through the north wall this time will increase the space from 28,000 to 43,000 square feet.

The decision to expand followed the need for more electrical power, as there was no longer enough juice to run more machines. Last summer, Marlin Steel needed to install a generator outside the building.

By early spring, Baltimore Gas and Electric Co. will install a new line to boost the power supply by seven or eight times, Greenblatt said. As long as he was spending that money — about $27,000 — he figured he'd open up new space that would allow him to add more machines and increase production capacity.

Increasing power and completing the renovation will probably cost about $500,000, the added equipment another $2 million, he estimated. He expects to hire 15 more people, bringing his workforce to about 45, and increase from 20 the 30 the number of robots that perform routine tasks.

Most of Marlin Steel's workers earn more than $20 an hour, he said, although they usually start at about $15. The mechanical engineers — about a quarter of the employees — make more.


He said the project is possible in part because the company received a 10-year, low-interest loan of $250,000 from the Baltimore Development Corp.

Rawlings-Blake said the loan program is part of a continuing city effort to develop small business, including manufacturing.

"I think it's a strong sign that Baltimore is growing," she said of Marlin's expansion. "We're hopeful that more production, more manufacturing jobs will come to Baltimore."

Maryland manufacturing has been declining steadily since upheavals in the steel industry slammed the Bethlehem Steel plant at Sparrow's Point in the 1970s and 1980s. Since 1990, the number of Maryland manufacturing jobs has dropped by nearly half, from 198,600, or 9 percent of nonfarm employment, to 103,800, or 4 percent last year.

As a portion of Maryland's economic activity, manufacturing is nearly 6 percent, relatively unchanged since the recession hit in 2009, said James Palma, senior research manager with the Maryland Department of Business and Economic Development.

Since 2009, while the country as a whole saw a modest 1.5 percent gain in manufacturing jobs, Maryland finished last among the 50 states, losing 10 percent of those jobs, he said. The economic output remained steady though, suggesting that manufacturers here are doing the work with fewer people.


Marlin's complement of some 20 robots work in cages, some alone, some with human helpers. Greenblatt said automating the simplest tasks — bending steel wire into particular shapes, for instance — makes it possible for him to compete on price and still pay decent wages.

His success gives some people hope that manufacturers in Maryland and across the country can thrive in the face of foreign competitors that pay much lower wages.

Economist Anirban Basu, who acted as an adviser on Gov. Larry Hogan's transition team, said Marlin is an example of a small manufacturer prospering by carving out a niche where there is little or no foreign competition.

"Labor costs matter less when one is talking about a specialized product where there is not that much competition," said Basu, chairman and CEO of the Sage Policy Group, a consulting firm. "If it can happen on a small scale, it can happen on a larger scale."

Mike Galiazzo, president of the Regional Manufacturing Institute of Maryland — of which Greenblatt is board chairman — said Marlin shows that American manufacturers can compete worldwide.

"Drew has demonstrated the kind of leadership of a company that otherwise might have been put out of business by China," Galiazzo said.


Galiazzo was referring to a point only a few years after Greenblatt bought the company in 1998 and moved it from Brooklyn, N.Y., to Baltimore. He continued specializing in the one product that the company made since it was founded in 1968: wire bagel baskets.

That became a lucrative business as bagels caught on across the country with chains such as Einstein Bros., Bruegger's and Manhattan Bagel. But, as Greenblatt tells the story, he soon faced a double-barreled crisis: A low-carbohydrate diet fad hurt the bagel business as Chinese manufacturers started making bagel baskets and selling them here for less money than it cost him to just buy the steel.

Greenblatt said he was trying to keep up, but the company was in trouble.

"In the early 2000s, we were spending out of control, hemorrhaging cash," he said. "It was terrible."

Then fate took a hand. Someone from Boeing saw a Marlin advertisement in the old Thomas Register of American Manufacturers — for years an industry bible. The ad was meant to cultivate more business in custom-designed bagel baskets, but the aircraft manufacturer wanted a small order for about 20 baskets for washing precision parts.

"At that moment, that's when the light bulb went off: I'm in the wrong business," Greenblatt said.


He decided to "pivot to high-quality engineered" baskets and other steel products. After a "wrenching transformation" that took four to six years, including buying new equipment and retraining employees, Greenblatt said Marlin was established on its new course.

The company now works on 80 to 100 projects a month for 400 to 500 active accounts, doing 15 percent to 20 percent of its business in exports.

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Greenblatt hasn't dropped his beef with China, however, and complains about that nation's currency manipulation and the shortcuts its manufacturers take that jeopardize employee safety.

On a tour of his factory, Greenblatt relished pointing out a machine stamping out slender four-hole brackets dropping from a conveyor belt into a box — all eventually shipping to a Chicago company that once bought brackets from China.

"This is all jobs I stole from China," he said. "Every time one of those comes down, it's one point for America, zero points for China."

Elsewhere on the factory floor, a shipping box containing parts used in telecommunications is stamped not only with the Marlin name, but with an American flag and the slogan: "Proudly Manufactured in the U.S.A."


The parts will be shipped to Ireland, Mexico, Singapore — and China.

"There's a Chinese shipping clerk that opens this box," said Greenblatt, smiling and pointing to the American flag. "How cool is that?"