Marlen Mfg. | Application Preview
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General Information
Business Registration Number: 34-0858233
Location: Bedford Heights, OH, United States
Length of Operation: 11plus
Number of Employees: 51-100 Employees
Annual Gross Income: $1M to $10M
Annual Gross Expense: $1M to $10M
Open to Loans: YES
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Funding Usage
Marlen is looking to purchase an automated machine that will allow our manufacturing facility, and many jobs, to stay in Ohio. Marlen has great potential for growth, but that growth has been curtailed by our outdated method of current production. Marlen's manufacturing plant is located in Bedford Heights, OH. Currently, Marlen uses over 40 different machines and processes to create the individual pieces and parts that make up an ostomy bag before creating a final product. This process typically employs anywhere from 50-70 individuals. Using this method, sales cannot reach their significantly higher potential as we can only sell the amount we can produce. With an automated machine, Marlen will be able to increase sales anywhere from 500% to 900%. Marlen is currently in contact with several reputable machine makers that have made similar ostomy machines in the past. The machine will start with raw material rolls at one end, and with a finished product at the other end. To keep up with the drastic increase in sales caused by an automated machine, the current machines at our plant will need to be converted to make a part that will be fed into the machine and become part of the finished product. This means that no employee lay-offs would occur. In fact, it is likely that more jobs would be required to keep up with the significant increase in production. Without an automated machine, Marlen will not be able to achieve growth due to limited production capacity, coupled with high payroll costs. This will force Marlen to relocate its manufacturing facility, causing many Ohio jobs to be lost. This is our absolute last resort. As a family run company that has been operating in Ohio for over 70 years, it is our sincere goal to continue to prosper in Ohio for years to come.
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Business Plan
Using forecasting models that compare current production to production capabilities on an automated machine, Marlen would be able to raise production from 500,000 pieces a year to over 3,000,000 pieces. This significant increase in production would directly lead to significant increases in sales. Our plan to raise sales to meet the increased production capability includes selling more products annually to current customers, finding new customers and suppliers by adding a sales team, and expanding into new markets and countries. Due to the nature of the ostomy industry and the quality of Marlen's products, this is easily achievable. First, customers are now asking for more products than can currently be produced. This means that an automated machine would immediately raise sales with higher production. After the immediate increase in sales, Marlen plans on hiring more sales reps to focus exclusively on the US market. The US ostomy market is the most lucrative in the world and it is the market we know the best already. Over the past 10 years Marlen has steadily grown in size, allowing for us to open our own office and distribution facility in the Netherlands. An automated machine would allow the Netherlands branch to hire more sales reps and cover far more territory and sales throughout Europe. In addition to covering Europe, Marlen currently sells to Canada and Japan. With an automated Machine, Marlen would be able to expand into those foreign markets far greater than currently possible. Next, many individuals in all countries around the world are continuously in need of ostomy products. Unfortunately, many of those individuals are unable to obtain proper ostomy products due to cost or other means. With an automated machine, Marlen's products would be able to go down in cost, giving more companies and individuals the ability to purchase our products. This means Marlen would be able sell products in many new foreign markets that we currently cannot enter because we do not have the production capability and cannot produce at a cheap enough price to compete in. In fact, Marlen already has potential distributors in the Middle East, South America, and Asia that want large volumes of products in order to service individuals in countries where ostomy products are largely unavailable. With an automated machine, Marlen could provide significant quantities of products to many new markets and customers. Individuals that use ostomies cannot live without them. Couple that with the quality of Marlen's products and our expertise in the market coming from over 70 years of experience, we are certain that Marlen will grow exponentially with an automated machine. First, Marlen has successfully operated as a family business in Ohio for over 70 years. We know what it takes to both be successful in Ohio and the ostomy market. Our roots are in Ohio, and we would love nothing more than to grow and prosper in Ohio. Marlen manufactures ostomy products and supplies, and this is essentially a recession-proof industry. The sad truth is that individuals will always need Marlen's products, and sales have never been curtailed by economic ebbs and flows. In addition, Marlen has no debt on its books. Marlen already has a strong and loyal customer base that will continue to use our products for many years to come. In fact, many customers are asking for more products than can be produced at this time. The potential for growth with an automated machine is enormous. This stems from the need for ostomy products all around the world, the superior quality of our products, and our reputation as a great company in the ostomy community. Most importantly, a grant will both save and create many jobs for Ohioans.
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Self Identified Competition
1. Hollister 2. Coloplast 3. Convatec What differentiates Marlen from our competitors is simply the quality of our products. The above companies are large corporations that mass produce few products. When compared with Marlen's products, the mass-produced products of competitors are very stiff and rigid. This means they are not nearly as comfortable for users to wear, and they also do not stay on the body as long or as well as Marlen products. In addition, Marlen offers many more product variations than the competitors do. This allows Marlen to better service the needs of many ostomy users, gaining a competitive advantage over the competition. Finally, being a smaller, family-run business allows Marlen to treat both its customers and employees like part of the family. This is a unique feature of our business that our competitors cannot offer.
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