Royce Associates is a fourth generation company that has successfully evolved and thrived for over eighty-seven years. But, how is it possible that some companies achieve such longevity and success while others do not? In most cases, there is not a single factor, but rather a combination that together makes those companies unstoppable. For Royce, it is strong family values, adaptability, quality, and a customer-centric focus.
The grandfather of one of the current owners, Wylie H. Royce founded the company in 1929 and focused on textiles in the chemical industry. Wylie’s grandfather spent the next fifty years working hard to expand the company. With attention to service, quality, relationships, and the right people he achieved this.
However, in 1979, a shift occurred. “We made our first real departure from the textile chemical industry when we bought a company called Passaic Color,” explains Wylie. “That’s put us in the color business.”
The company sold the chemical business in the early eighties, as it became tougher and the colorant business became more lucrative. There was also a shift in family ownership. “My father and uncle retired, and my cousin and I took over. It was small at that point, and we had a couple of small ventures.” The new owners started by concentrating on colorants of all sorts and expansion into other industries.
The company’s vat dye business grew, and it diversified into paper dyes too. With diversification proving successful, it continued that strategy in the late eighties by entering the plastics business. It focused on producing plastics color concentrate and continued a successful progression to the company it has become.
Today, Royce Associates is located in the same building as when Wylie’s grandfather started the company. The company produces colorants for the plastic, textile, and paper industries and specializes in vat dyes used in factory work clothes, basic dyes used in paper and colorants and additives for plastics, specializing in colorants and additives for the food packaging industry. “The other big items are liquid dyes and powdered dyes,” remarks Wylie.
The process of coloring the plastic involves taking the blend of dyes and pigments, processing it, and compounding it into a plastic pellet, at a high concentration of dyes and pigments. “The concentration of solids in our product is anywhere from twenty to eighty percent,” says Wylie. “The product is then blended with uncolored plastic resin. When it’s heated and mixed, it goes through extrusion lines and injection or blow molding machines where they are mixed. The color then disperses. They only put like one to five pounds of our product into about one hundred pounds of natural resin. Then it disperses in and comes out the right color.”
While this part of the business is selling what is known as a color concentrate, the company does sell dyes to other concentrate manufacturers. “So, we have our competitors, but we coexist, as they are our customers as well.”
The companies wrote co-manufacturing agreements with compounding companies around the world. “We not only manufacture ourselves but have the product manufactured for us. We match the strength of those suppliers to us with the type of customer we’re selling to. We have five people we work with in the U.S., as well as two people in Asia, and one outfit in Europe.” Its markets are North, Central, and South America, as well as Western Europe.
Having a global market is a change from the early days. “We’ve always embraced evolutionary change, and we’ve grown conservatively. We’ve invested in the future, but made sure those investments are balanced against our needs today. We’ve never overextended ourselves. Another thing: we’ve been managed by the family all these years. When you do that, then you have real ownership of it [the company]. You feel a responsibility toward your family as well as everyone that works with you. Every Royce in Management feels a personal responsibility towards every one of our employees. We manage things on that basis, making sure they’re able to pay their bills, put food on their table every night.”
However, it is not only about an ability to adapt and a strong family ethos. Indeed the focus on the customer and quality are two of the company’s guiding principles for success. “The most important job they [our employees] have is to know that our customers are going to receive what they want when they want it and to the quality they want. That’s what we do. We are driven by what our customers tell us they need.”
“Even with our co-manufacturing partners, we’ll perform our own quality control.” It has up to five checkpoints before releasing any product, with the shipping department being the last line of defense.
The fact that the company has won several vendor awards for quality service is a testament to its focus on quality.
It is no surprise that quality is Royce’s unique advantage. “I tell this story often,” says Wylie. “I read a book years ago that talked about the structure of the market leaders. The theory in this book – that I still prescribe to today – is that there are only three business platforms that successful companies are built on. One is going to be a technology leader. One is going to be the low-price provider. And the third is going to be the quality and service provider. You can’t be all of them. You can’t be two of them. You can only be one of them. We’ve always chosen to take the service and quality approach.”
While the quality approach has contributed toward success, there have been challenges. Only six years ago, when faced with rapid growth, it became afraid it was losing the ability to serve clients. Employees were unhappy and stressed.
“You were afraid to ask them to do anything out of the norm because people would explode on you. We said that this is not an acceptable work environment. We got to change this now. We actually told our sales people, ‘Just stop. Service, and don’t look for any new business for a while.”
To help the company built a cloud-based computing platform to run the business. It has allowed Royce to double in size in the last eight years, without adding any new administrative people. Besides a streamlined business process, employees are happier.
Other challenges are regulatory. “One of the interesting challenges we’re facing now is in the food packaging business,” states Wylie. “Customers are starting to dictate regulatory specifications. That’s creating a consistent need to reformulate the color and keep up with regulatory requirements, globally.”
While every country Royce sells to has unique requirements, the company is the world leader in keeping up with and dealing with these challenges. Being involved in the Plastic Industry Association (PIA) and the Food Drug Cosmetics Packaging Materials Committee (FDCPMC) helps. In fact, Wiley is the Vice Chairman of the Plastic Industry Association and Treasurer of the FDCPMC.
Regardless of the challenges it is experiencing, the current industries in which it operates – textile, paper, and food packaging – are healthy and present opportunities for continued growth. The textile industry is showing promise with manufacturing growing. The recycled paper dye industry is also well poised as more people buy online through channels like Amazon. It means higher demand for cartons used to ship these items and, in turn, the liners that Royce manufactures. Finally, the food packaging industry is also projected to grow by three to four percent a year.
As it looks to the future, new products are also set to drive growth. “We’re looking at additives for the plastic industry.” There seems to be potential for growth I this area. Indeed, only recently, it developed a new product. “When you buy meat on a foamed plastic tray in the marketplace, sometimes they have a pad to absorb the juices. We’ve developed a product that allows the plastic to absorb the moisture, eliminating the need for a pad. We’re seeing if that product will get any traction in the marketplace.”
Wylie and the team are also focusing on sustainability by working with paper recyclers and biodegradable resins.
Company growth is also supported by its marketing efforts and regular attendance at exhibits. “We exhibit at the Pack Expo and the National Plastics Exhibition,” says Wylie. While these techniques work, building relationships and word-of-mouth remain key to success.
Business from referrals is the company’s biggest source of income. These referrals are thanks to the reputation and goodwill it has garnered since 1929. Royce certainly has traveled the distance since then. As a fourth generation company, with Wylie’s Nephew AJ Royce running the day to day operations of the company, success is thanks to strong family values, adaptability, quality, and customer focus. It could be that another eighty-seven years are on the horizon.