Industrial Belting & Supply closes up shop
By John Johnson; Ken Brack -- Industrial Distribution, 4/1/1999
Grand rapids, Mich.--Industrial Belting and Supply, Inc., once a powerful and formidable competitor in the power transmission industry, has closed its doors and laid off all but five of its 176 employees, including president Ron Yob, the son of majority stockholder Charles W. Yob.In last year's Top 100 published by Industrial Distribution, the firm reported 1997 sales of $37.2 million. ©
At press time, plans were underway to liquidate the company, with inventory and equipment scheduled to be auctioned off on March 24. While initial reports have been sketchy, sources say the firm has debts of at least $5 million, and that it faces several lawsuits from creditors, the largest being Goodyear Tire & Rubber Co. Goodyear is seeking approximately $1 million, and claims that Charles Yob signed a personal guarantee that he would cover Industrial Belting's bills in case of default.
Initial reports that the firm suffered from severe competition and pressure on margins are not accurate, according to sources close to the company. At least two sources told ID that too many family members remained on the payroll for too long. The 1996 National Industrial Belting Assn. membership directory lists five members of the Yob family as employees.
"I'd say it was a combination of things; it boiled down to leadership and management issues," says a source close to the company. "Unfortunately some pretty significant strategic mistakes were made along those lines. It's tragic because IBS was one of the last significant independent players in the Midwest market."
The situation has also reportedly strained the relationship of the Yob family. The Yobs tried to sell the business last summer and again in the fall, but there were no takers. Chuck Yob Jr., who served as assistant to the president until resigning in September of 1997, now operates Integrated Distribution Inc., a commodity management solutions provider of mechanical power transmission and MRO supplies. His younger brother, Ronald Yob, who most recently served as president of Industrial Belting, has formed a separate venture called Belting and Bearing Technologies.
Several employees, including Clay Greiffendorf -- ID's Distributor Salesperson of the Year in 1998 -- have found employment at Binkelman Bauer-Wenner Inc., which has hired five IBS employees and opened a new branch in Saginaw, Mich., effectively replacing the IBS branch at that location.
"It's a sad thing for all the employees of IBS," says Dan Kazmierczak, president of Binkelman Bauer-Wenner Inc. "I don't know any more details. Quite frankly, we've been very impressed with the caliber of employees they had."
Industrial Belting intended to raise up to $5 million to pay off creditors from the auction. However, sources say much of the inventory is more than three years old, and that a portion of it may be deemed slow-moving and useless.
"Everybody has their own opinion. I'm told there was competition in the industry, but frankly, management wasn't what it should be," says another source. "This business ran very profitably for 32 years. They didn't manage their inventory very well, and there's a lot of old inventory which has been the subject of much debate."
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