CPFilms Adjusts and Remains Focused on Long-Term Success

The words: layoffs and inevitable are somewhat synonymous. No employer wants to face the decision of who or what to cut; yet, in recent times, it seems the majority have had to do this.

Since joining Solutia as executive vice president and president of its CPFilms division, Kent Davies has faced this decision three times. Two years ago, the company had to cut 39 employees at its Martinsville, Va.-based manufacturing plant. In January of this year, it cut an additional 45 and, most recently, yet again the same number. However, the company continues to employ more than 400 in the Martinsville area. And Davies says he feels the adjustment period, called for by market fluctuations, should be over.

"You know, it's painful to make changes, and particularly changes like that, but when you know it's necessary, you know it's in the best interest of the business, you know it's in the best long term interests of those hundreds of employees that remain there, and other hundreds that exist around the world, then you do it. And you don't do it with relish, but you do it with conviction, knowing it's the right thing to do," Davies says. "We do very much believe that we've made the changes that are necessary in Martinsville. We believe we have re-established the right baselines consistent with the economy and we're driving forward from there."

Davies says the market is showing positive signs recently.

"As the year goes on, the results from the business, the demands from the industry and certainly what we read from the market is giving us somewhat more positive signs," he says. "And I think that should be encouraging to everybody."

CPFilms certainly has not been alone in these difficult decisions. And Davies doesn't stand alone in his belief that the market has shown slight signs of relief. In March, The Conference Board, a nonprofit company that assembles and publishes knowledge about management and the marketplace, reported that while its Employment Trends Index™ (ETI) had slipped further in March, the decline wasn't as sharp as witnessed in previous months.

"While we see a continued sharp fall in the ETI, the decline was not as strong as in the previous four months, suggesting that the most intense stage of job losses may be behind us," says Gad Levanon, senior economist at The Conference Board. The company publishes its index on the Monday that follows each release of the Bureau of Labor Statistics employment situation report.

CPFilms attributes its recent cutbacks to lower demands across various market segments. But Davies says there is one area in which the company is experiencing extremely high demand.

"We have a multi-level energy analysis program where we qualify and screen projects on a more detailed basis," Davies says. "And the number of projects that are currently going through that stage of analysis is amazing. And, in fact, on some level it may even be overwhelming. It's up dramatically over what we've seen in recent years."

He attributes this spike to consumer awareness.

"I think that's all a great sign that interest and awareness is up and that potential customers are searching hard for these types of solutions," he explains. But Davies also says that, before going in for the sale, dealers need to have their facts straight in this day and age. Consumers are looking for specific numbers pertaining to product performance and return on investment. "They're balancing their investment potential against the proof and the documented evidence that they'll get from a company like ours that demonstrates what the product really will do," Davies says. And presenting the facts upfront and accurately could have payback, he explains. "I think once some of the bigger property management firms, construction firms and energy management firms really begin to get positive experience with products, then the momentum will build and the business will flow," he says.

But the product's inroads at the consumer level don't come from consumer-based marketing campaigns. Davies says that has never been part of CPFilm's strategy.

"I don't think that we're at the Proctor and Gamble level or the level of major multi-national consumer products companies, nor are we necessarily trying to do that right now," he explains. Rather, he says the company relies on a more localized approach, brought about by its dealers. "What we're trying to do is everything possible to allow our dealers to put out into the marketplace, on a local level, the highest quality image, the greatest product and technical expertise, and better market development skills than they've had before," he says. "It is our thought that we have to create the most professional dealer network in the world, as a first step; and when that dealer network is in place, then I think we'll have the ability to effectively advertise and drive people into that channel."

In order to facilitate this effort, CPFilms began removing its independent distributors in recent years, replacing them with company-owned centers. It began by cutting ties with SAGR Industries in the Northeast. "We've had very good results," Davies reports. "In the Northeast, for instance, we have significantly improved rep coverage beyond what we ever had before." But several recent changes included acquiring third-party distributors and converting them into company-owned centers. In the other regions, in each case there has been an acquisition and those are all proceeding very positively."

Davies reported previously that the company's plan included creating greater intimacy with its dealers, something he says has proven successful.

"We get good feedback all the time from our dealers saying, 'Wow, it's great. I'm not several steps removed from the factory anymore. I'm getting direct information, direct contact and support,'" he says.

With its staffing adjustments in Martinsville and changing distribution strategy, Davies assures that CPFilms is focused on long-term success.

"The one thing I always want to make clear to everybody in the industry is that CPFilms is absolutely committed to this industry, our role in this industry and adding value in this industry for a long, long, long time-in fact, forever as far as I can see," he says. "That's for sure. And so, that's not going to change. We have to adjust our game plan as the economy ebbs and flows, but our commitment to the industry is not going to change."