A Family Business Survived One Pandemic. It’s Determined to Do It Again.
A small Buffalo manufacturer has had to trim its staff and spending. But its fourth-generation owner says: “We will take care of everybody.”
By the time Robert L. Stevenson gathered his work force at Eastman Machine in Buffalo in mid-March, businesses nationwide were shutting down. But Eastman, which makes fabric-cutting machines, has been in family hands for four generations, and Mr. Stevenson wasn’t about to turn off the lights.
Standing atop a table in the lunchroom just off the factory floor, he recounted other crises in the 132-year-old company’s history — World War I, the Spanish flu pandemic of 1918, the Great Depression and World War II. “We survived those episodes, and we’ll survive this one,” he told his employees. “We’re a family business, and we will take care of everybody.”
A little more than a month later, Eastman has successfully battled to stay alive but has the scars to show for it. Forty of the company’s 57 production workers were laid off, a move that Mr. Stevenson said was unavoidable.
“It’s painful, and we never like to lay people off,” he said. “But otherwise there would be no company to come back to.” He has continued to pay for those workers’ health benefits, so he feels he has kept his word that everybody would be taken care of. On Monday, he brought back five assembly-line workers.
Demand for the cutting machines that Eastman makes at its downtown factory is down 50 percent, but there have been enough orders to keep production employees on the job. Eastman’s equipment is used by the aerospace and transportation industries, as well as by makers of medical masks and shields, qualifying it as an essential employer permitted to operate under New York State guidelines.
The 76 office workers at Eastman are operating remotely, even though functions like marketing and sales have been hobbled. “People who were close to making decisions before the pandemic have postponed out of fear,” said Elizabeth McGruder, vice president for European sales and marketing.
Small businesses like Eastman make up the bedrock of U.S. employment, accounting for half of all private-sector jobs, according to the Small Business Administration. Eastman’s durability shows how some small to medium-size companies are prepared to ride out the crisis.
Buffalo lost thousands of jobs in the postwar era as large industrial companies like Bethlehem Steel, Curtiss-Wright and Bell Aircraft shut operations there, said Ben Rand, president of Insyte Consulting, which advises small manufacturers in the area. Eastman is typical of the factories that remain, he said, noting that of 1,500 manufacturers in the Buffalo region, only 2 percent have more than 500 employees.
Since he took over from his father in 1988, Mr. Stevenson has avoided high levels of debt or risk-taking. That has served him well in the current crisis. Eastman was able to obtain a $2 million loan under the government’s Paycheck Protection Program, part of the larger federal stimulus effort enacted in the wake of the pandemic. “It was trickier than we thought it would be,” he said. “But it’s very helpful.” He hopes to bring enough workers back on the payroll by June 30 to qualify for loan forgiveness under the program.
Mr. Stevenson, 68, has taken other steps to help Eastman survive. The company has cut back on both research and development as well as capital expenditures.
With about 140,000 square feet of production space, Eastman planned to add 10,000. Everything was ready for the contractors in April, but the project has been put on hold, another one of the multitude of small, individual decisions that will cause the national economy to contract sharply in the second quarter.
Nevertheless, Mr. Stevenson’s son, Trevor, who is poised to one day run the business, shares his father’s upbeat attitude. “I know we can weather the storm,” he said. “We’re ready for when the spigot gets turned back on.”
Trevor represents the fifth generation in his family to help run the company and is currently a vice president. At 44, he oversees the manufacturing operations as well as customer service and sales — but keeps in mind the lessons he learned when he started as an installation technician in 2004.
Trevor Stevenson is in Buffalo full time, while Robert Stevenson is managing things from his winter place in Florida, on the phone to company executives up to 10 times a day.
“One of my dad’s friends told me, ‘You’re never going to be able to do anything unless you earn respect,’” Trevor Stevenson said. “I was humble. I did what I was told and learned how to do the job.” He hopes to be running Eastman day to day in about five years.
The company has evolved during his time there, as production shifted from manual cutting machines to automated, computer-programmed devices. The automated machines not only carry higher prices and profit margins, they also shielded Eastman from competition from China in the form of cheaper manual devices that were easy to copy.
“We continually reinvent ourselves,” Robert Stevenson said, noting that 80 percent of what the company sells now it didn’t produce when he took over in 1988.
The move into automated machines also opened up a new world of clients who work with a wide variety of materials, from Kevlar and fiberglass to carbon fiber composites. Eastman cutting tools are used to trim everything from SpaceX rocket parts to hulls on boats and the surfaces of skis. The wind energy industry has been a source of growth, with Eastman machines used to cut the material for giant blades.
Dozens of clients have shifted production recently to medical masks and face shields, working with Eastman to reprogram machines that can churn out products to help combat the coronavirus.
“It’s pretty incredible,” Robert Stevenson said. “That’s why we’re bringing people back. There’s work to be done.” Indeed, demand for machines to cut fabric and make medical supplies is a big part of the reason that 17 workers stayed on the job, with five more joining them Monday.
DPS Skis is a Utah company that is one of a handful of domestic manufacturers of skis and is an Eastman customer. Eastman donated blades and cutting surfaces to DPS to help it make the transition to making face shields.
“It’s our small drop-in-the-bucket effort to meet the world’s needs and contribute to the fight,” said Alex Adema, DPS’s chief executive. “More selfishly, it helps DPS. It’s been a great morale booster and helps keep our team employed.” Without the effort to make the face shields, layoffs would have been inevitable, Mr. Adema said.
The drive by clients to make medical equipment encourages the blue-collar production employees who are still on the job at Eastman, too, said David Gee, a 37-year veteran.
“Somehow, we are helping,” said Mr. Gee, whose father spent 42 years on the production floor before retiring in 1999. “It’s nice to see my work make a difference.”
The workers who remain on the job are those with the most seniority, with their average age about 60, said Rick Deschamps, president of the United Auto Workers local at Eastman. “We call it the Eastman nursing home,” he jokes.
Eastman’s work force, like that at many American manufacturers, skews older even during normal times. Right now, the shop floor has been rearranged to leave six feet between workers, and employees eat at their work spaces rather than in the lunchroom.
Like other longtime employees, Mr. Gee and Mr. Deschamps have a faith in the Stevenson family that recalls a more paternalistic time in American business, when employers were trusted to do the right thing and employees in turn were protected.
After following in his father’s footsteps by attending Yale, Robert Stevenson decided to enter the family business when other members of his social class were leaving Buffalo for careers on Wall Street.
“My family has always felt that supporting the community was one of the most important factors in owning a business,” he said. “I was brought up with that philosophy.”
And he kept Eastman, with its union work force, in Buffalo even as other manufacturers were relocating to nonunion locales in Southern states or moving production to Mexico. Robert and Trevor Stevenson have both chosen to live in Buffalo, instead of moving to upscale suburbs like Amherst.
“We’re on an affluent street, but a block from us is not so affluent — it’s a mix,” Robert Stevenson said. “When I came back from college in 1973 and Buffalo was deteriorating, I just thought, I’m going to stay and wait for better times. That optimism has been justified, and Buffalo has been revitalized with new investment.”
Mr. Stevenson notes that Buffalo was hard hit by the Spanish flu pandemic, suffering more deaths than in the current coronavirus situation. But just as his grandfather Wade successfully steered Eastman Machine through that ordeal, he’s confident in his ability to see it through this one.
“We will learn to deal with this as we did with crises in the past,” he said. He survived two bouts with melanoma and was told in 2014 that he had six months to live. But he recovered after taking part in a clinical trial at the Mayo Clinic.
That experience has informed his outlook. “I’m an optimist, always,” Mr. Stevenson said. “Having faced death, I’m not afraid of living. Things are going to get better.”