2019 is a year that will stand out in the nearly 45-year history of Falcon Plastics, a family-owned company bringing its custom products to clients worldwide.
Founded in 1975 by Don and Carol Bender, Brookings-based Falcon Plastics has been molding customer ideas into a wide variety of products in use every day – with a business built on strong, long-term relationships.
It started with just three employees and five used molding machines and now has grown to more than 320 employees, four manufacturing locations, a manufacturing partnership in China and more than 120 molding machines.
We learned more about recent developments and how the family has succeeded for multiple generations from president Jay Bender.
2019 has been a big year for Falcon Plastics. What are your latest developments?
2019 has been a very exciting year for Falcon Plastics. We completed a 27,000-square-foot warehouse expansion and significant upgrades and modifications to the manufacturing area in our Madison, S.D., facility. We broke several sales records. We also acquired another custom injection molding company in the Portland, Ore., area. This was the first acquisition in our 44-plus year history. We are very excited about the opportunities this new acquisition brings and continue to work hard on growing and expanding our business.
The Falcon Plastics location in Madison
What are some things you think people might be surprised to learn about your business?
Raven Industries in Sioux Falls was an investor and founder of Falcon Plastics in 1975. They were our first customer and are still a customer today. They owned a significant part of Falcon Plastics until 1997 when we bought them out. In addition, Dale Larson of Larson Manufacturing subleased us 5,000 square feet of manufacturing space in Brookings in 1975 to get the business started and became a customer within a year. Larson remains an important customer today. We have many customers, employees and suppliers that have been with us for more than 20, 30 and even more than 40 years. Solid, long-term relationships are one of the keys to our success.
Our business also is very capital intensive, and due to that and the time it takes to start up the equipment and have a stable process, we have always run 24 hours a day. All of our facilities are clean, safe, automated and climate-controlled. We are a true custom molder and sell into almost every industry, such as medical, electronics, industrial, automotive, agriculture, office products, recreation and many more. Almost all our customers are other manufacturers.
You’ve gone through or are going through multiple transitions as a family business, from the first generation exiting to the third generation coming into it. What are some of the strategies you’ve found successful?
Before we made the transition as a family-owned business from first generation to second generation, we were one of the founding families of the now Prairie Family Business Association. This association really helped open up communication for our family with regards to the business, both with leadership and ownership. Through the association, we developed a long-term plan to transition ownership, and they helped us find the resources to develop our business-leadership strategies. We worked that plan for 10 years, and then in 2003, we were able to fully make the transition from first generation to second generation with a 15-year buyout financing plan.
We now have two active third-generation leaders in the business. We are using our past experience and continued assistance from the Prairie Family Business Association to develop and execute a plan to make it to third-generation leadership and ownership in the business. It is very exciting to have the opportunity to continue the family business. It takes hard work and a lot of communication, but we are confident that we can continue to grow the business while making the transition to the third generation.
Guy, Jenn, Kyle and Jay Bender are the owners of Falcon Plastics.
You also have multiple siblings working in the business. How have you navigated your relationship as co-workers and family?
Early on, there were three second-generation siblings working in the business. By 1990, there were two second-generation siblings in the business: Guy Bender and Jay Bender. When we joined the Prairie Family Business Association in 1993, the first generation was starting to look at what it would take to make a leadership and ownership transition.
We used an outside consultant to help determine future leadership. Ultimately, my brother Guy and I discussed it and came up with a solution that was satisfactory to us and the first generation. By then, it was the late ’90s, and we had essentially found a way to work together as true partners. We assigned ourselves titles such as president and chairman of the board, but we really worked hard at being a team. It has worked really well, and I think our relationship is as strong today as it has ever been. We work hard at the business, and we try really hard to not bring the business into our family gatherings. If we have to talk business, we find a way to do that without interrupting what we are doing as a family.
Your business recently started an advisory board. Why did you start one?
When the company first started in 1975, Raven Industries was an investor and a customer. Because Raven is a public company, we have always had formal board of director meetings. In 1997, we bought Raven out of the business, and it has been family-owned ever since. After that, our board has been made up of just family members. The board is currently made up of Guy Bender, Don Bender (founder) and Jay Bender. Earlier in 2019, we started an advisory board with outside members. It is a seven-person board made up of four active family members and three outside members. It is our intention to convert the advisory board to a true board of directors sometime in late 2020 or 2021. I believe this new board will really help professionalize our company even more and be a great help in our transition to the third generation.
Falcon Plastics is a longtime member of the Prairie Family Business Association. What are some of the most valuable resources you’ve found through it?
Falcon Plastics has been a part of the Prairie Family Business Association since its inception in 1993. I was a board member the first 10 years of its existence, and I am back on the board again right now. I serve because I really believe in the organization and what it can do for families who are in business together. There are so many resources available to the members to help them be successful. Not many family businesses make it to the second generation, and few make it beyond that. I have found that networking with the other members has been invaluable. Their insight and experiences really help me in making good decisions for our business. The annual conference is fantastic, and I try to make it every year if I can. The conference is what really got my family talking and opening up about our business. I credit the association and the annual conference for helping our family make it from the first generation to the second generation. There are also peer groups, webinars, resource materials, consultants and access to many experts through the association and its members. If you are a privately held business, you should take a serious look at what this group has to offer.
What’s next for your business? What do you think it could look like five or even 10 years from now?
We are all excited about the future of Falcon Plastics. It has been a fantastic business. We have great employees, fantastic customers and suppliers, understanding and patient shareholders, and the communities we are a part of are an important part of our success. We are grateful for our founders who took a significant risk to start this business from scratch. The components and products we now produce end up all over the world and make life safer, more comfortable, more efficient and more satisfying for everyone they touch.
Our intention is to continue to grow our business in a positive way with customers, employees and suppliers that are looking for successful, long-term and sustainable relationships. Honesty and integrity are important to us, and we are looking for stakeholders that have those same values as we build our business and be a positive force in the communities we are a part of.