At a time when many economic experts are lamenting the decline of heavy manufacturing in the Charlotte region, one small family owned company in Statesville is doing just fine. J.C. Steele & Sons has been producing the clay working machinery used to make bricks since 1889. Today the plant on Mulberry Street is working expanded hours to fill its largest order ever – for a customer in Saudi Arabia.
“Heavy manufacturing is supposed to be dead,” says John Steele, one of two cousins now at the helm of J.C. Steele & Sons. “But we’ve been able to expand by developing new global markets.”
J.C. Steele & Sons is the largest producer of heavy clay products machinery in the United States. Approximately 90 percent of all the bricks made in the U.S. are made on Steele machines. However, about 50 percent of the company’s sales of new machinery are now going abroad. Over the past twenty years, J.C. Steele’s sales have grown by about 250 percent, primarily because the company is reaching new markets in Australia, Asia, the Middle East, and South America.
Although the company’s direction is in the hands of its fourth generation of family owners, J.C Steele remains focused on what it was founded to do: it is engaged exclusively in the manufacture of clay processing equipment. It has expanded into new markets, not new products.
“We’re a niche business,” says John Steele. “We’re sticking to our knitting and doing what we’re good at.”
John Shelton Steele, 55, and David Sherrill Steele, 50, head up J.C. Steele & Sons today. The titles they carry are unimportant since they rotate them every two years but the division of responsibility is essential. One is “Mr. Inside”, while the other acts as “Mr. Outside.” David is in charge of the manufacturing and engineering aspects of the company. He sees that the product gets made. John is the guy on the airplane – developing new markets all over the world. Working together, they get the job done.
“David is an extremely bright guy,” says John. “He’s the classic clean-up hitter. He pays attention to the details you have to get right for a business like this to be successful.”
David is just as enthusiastic about his cousin’s skills: “John is great with customers. He has a rolodex you would kill for. He has good business sense and is a great judge of character.”
In the beginning
James Columbus Steele was born in Iredell County in 1839, a descendent of the Scotch Irish who migrated from northern Ireland to Pennsylvania and then to North Carolina during the eighteenth century. Although his family were farmers, James was trained as a carpenter. When the Civil War began, he enlisted in the North Carolina infantry. Unharmed in battle, James walked home from Appomattox, Virginia, after Lee’s surrender in 1865.
With many of the farms, factories, roads, railroads and houses around him in shambles, James saw an opportunity to help rebuild the South. He acquired, or operated for others, several basic sawmills and small brick factories in or near Statesville.
At his brick factories, he began using a new auger machine, first introduced from Germany in 1857, to produce a continuous clay column which was then cut into brick. The new machine replaced the traditional hand-molded or pressed-brick method used almost universally since prehistoric times. Finding it difficult to get replacement parts for the new machine, James set up a small machine shop and foundry to make the parts. Before long he was supplying parts for similar equipment to others in the brick manufacturing business.
J.C. Steele’s oldest son, Clarence Montgomery joined the business in 1889. That same year, Steele received a patent for a two-wheeled “Hand Operated Brick Truck,” an early form of the forklift and a great laborsaving device for brick manufacturers. Two years later, when his second son Henry Oscar entered the business, the name of the company was changed from “New South Brick Machinery Company” to “J.C. Steele & Sons.” Soon the younger two sons, Flake Futhy and Alexis Preston, also joined the family firm. By 1912, J.C. Steele had turned the day-to-day management of the business over to his four sons, although he maintained an active interest in its affairs until his death in 1921.
In 1922, Flake Steele moved to Winston-Salem to manage the Pine Hall Brick and Pipe Company, while the three other brothers continued to guide the Steele organization. During the period between 1926 and 1932, J.C. Steele & Sons became recognized as one of the four or five most important United States manufacturers of clay working machinery. For the most part, Steele equipment was considered simpler, cheaper and less sophisticated than that which was being manufactured by its competitors. The company also began to do business with brick manufacturers in Canada and Mexico.
With the depression lifting and the country preparing for war in the years 1932 through 1946, the company was doing well but its leadership was aging. The three brothers were joined by J.C. Steele Jr. (son of Henry Oscar Steele) in 1935 and by Preston Steele Jr. in 1936.
However, the war years brought many changes to the Steele organization. Both J.C. Steele Jr. and Preston were called to active duty and, with the deaths of Clarence and Henry Steele, only Alexis Steele remained. He headed the business throughout the war years and remained at its head, at least nominally, until his death in 1959.
After the war, both J.C. Steele Jr. and Preston returned to the company and were soon joined by cousins Clarence N. Steele and Montgomery Steele. The business was incorporated in 1946 and all five Steeles were made officers of the corporation and comprised the management group.
It was at this time that J.C. Steele & Sons began the tradition, which continues today, of rotating the titles of president and chairman of the board. The five members of the management group act as an informal committee making decisions by majority agreement rather than by the individual who might be designated to a certain position at a certain time.
Dot Presser, whose advertising company has worked with the Steele company since 1947, says this policy exemplifies the great work ethic that everyone in the company has.
“Nobody takes the company or their place in it for granted,” she says. “The relative unimportance of ‘titles’ is significant. There is no pettiness. It’s a great company.”
The immediate postwar years were characterized by a sustained effort to catch up with the backlog of orders for machinery required by the rebuilding and expanding brick industry. The management group at Steele recognized the importance of keeping the machines continually running in brick factories.
Throughout a century of manufacturing clay working machinery and parts, everyone at Steele has understood that orders for repair and replacement parts must always take precedence over those for new units. A prime factor in the business’ success has been its ability to provide high quality parts at reasonable prices quickly.
“Our fathers had a pretty good game plan,” says John. “They understood what it means to have the parts in stock when someone needs them. We’re extremely vigilant about that. We try to make ourselves indispensable to our customers.”
“It’s very expensive to a brick plant if anything shuts down,” adds David. “We are there to keep the machinery going.”
Continuing the tradition
During the 1970s the fourth transition in leadership occurred at J.C. Steele & Sons. John Shelton Steele, son of J.C. Steele Jr., came to the company in 1971 after receiving a bachelor’s degree from the University of North Carolina. Foreseeing the advantages of a graduate degree, he also obtained an M.B.A. from Wake Forest University in 1975. David Sherrill Steele, son of Clarence N. Steele, graduated from North Carolina State University with a bachelor’s degree in Industrial Engineering and came to work for the company in 1975.
Under David and John’s leadership, J.C. Steele & Sons has continued to thrive. David has seen that the business has become more productive and more efficient, incorporating the changes brought about by automation and technology into the manufacturing process, while John has developed new customers in global markets. Today the company has agents in South Africa, Australia, South America, South Korea and Malaysia.
In 2000, Steele bought a German company, Handle GambH, one of its chief competitors, to give the company a larger foothold in Eastern Europe and Russia. Steele is also getting ready to start manufacturing in China.
“Nobody knows how big the Chinese market can be,” says John. “We’re just starting to explore it.”
Steele & Sons is one big extended family. All of the shareholders are descended from the founder, J.C. Steele. Many of its 160 employees have been around long enough to be considered family as well. About 35 of them have been with the company for 25 years or longer. The company has an excellent bonus plan that everyone participates in. In one hundred and fifteen years, J.C. Steele & Sons has never had to lay off employees.
“When times are slow, we work shorter hours,” says John. “When times are good, we expand hours. When the company does well, we all benefit.”
“We have great employees from bottom to top,” adds David. “We all have the same benefits. There are no special executive perks.”
The Steele cousins are betting that the same attention to detail and commitment to quality that their grandfathers brought to the business in the nineteenth century will keep the business growing and prospering into the twenty-first.
As to its future leadership, there are a number of good prospects in the fifth generation, although none is currently working in the business.
“I’ve told my own three sons to go distinguish themselves somewhere else and then see if they want to join us,” says John. “I want them to understand that nobody lives out of this business. People work here and draw a salary. It’s a company, not a private fiefdom.”