Astec celebrates half a century of success
It is often said that great ideas start with a couple of people sitting around the kitchen table having a chat. This was exactly how Astec Industries was formed.
On Aug. 9, 1972, Dr. Don Brock came up with the concept for Astec with Norm Smith, Al Guth, Gail Mize and Mike Uchytil, after the five friends sat around Mize’s kitchen table and developed a five-year plan for this exciting new business venture.
“You can only imagine the kind of the excitement, the adrenaline, the risk, that goes with these types of things,” says Astec CEO and president Barry Ruffalo.
Fast-forward to present day and the Chattanooga, Tenn.-based company is celebrating its 50th anniversary as a global, billion-dollar manufacturer of equipment for road building and construction-related projects with more than 4,100 employees worldwide.
“What a great story. The fact that they went from humble beginnings to a $1 billion-plus global revenue business is impressive,” Ruffalo says.
He adds the key to Astec’s success all these years has been its focus on customers and customer-based solutions.
“We’ve done that by being devoted to our customers, listening to them, innovating groundbreaking products to meet their needs, and providing best-in-class customer service,” he says. “I think this really is a testament that if you take care of your customers better than anybody else, good things will come.”
Not only surviving, but thriving over 50 years, comes with its ups and downs for every business, and Astec is no exception.
“The 50 years we’ve gone through weren’t always easy. We had to rely on customers, and customers had to rely on us, to get us to this point,” Ruffalo says.
The company underwent significant expansion over the next few decades, through a combination of strategic acquisitions and the development of proprietary products and solutions.
Dr. Don Brock
“Astec is known for manufacturing market-leading equipment for ‘rock to road’ customers,” Ruffalo says. “Customers with rock crushing and screening plants, hot mix asphalt facilities, concrete plants, and those that used road construction products for paving and milling and horizontal grinding.
“But there were a couple of acquisitions that didn’t fit that rock to road value proposition from a customer perspective, so we divested those. We bring value through engineering knowledge, technical expertise and listening to customers to deliver rock to road solutions. This focused approach is an important element of our growth strategy,” he adds.
There have been many major milestones over the past 50 years that could be highlighted. A few of them include taking the company public in 1986, and more recently, acquiring RexCon in 2017.
“That was our first opportunity to take Astec from being focused on aggregate processing and asphalt to also providing concrete solutions. It was a big move,” Ruffalo says. “Over time, our customers have grown into offering both asphalt and concrete as the market has consolidated and our customers have diversified what they offer their customers. Since then, we have also added the Con-E-Co and BMH talent and product solutions to our port- folio, making us a leader in the concrete space as well.”
Another big move recently made was the rebranding of its 16 subsidiaries under the ASTEC brand.
“That was also a big milestone. Both the branding and, separately, the cange of going from 16 independent companies to one, where we’re really leveraging more around product types and product ranges versus individual companies,” Ruffalo says. “We took the best of each one and put them together into a product portfolio, which is really a market leader.”
When the COVID-19 coronavirus pandemic was declared in 2020, many companies struggled to adapt and some were forced to close permanently, but Astec has charged through it.
“When the pandemic hit, no one was really ready for it. We were deemed an essential business, so we implemented pandemic health protocols, and I’m proud we found a way to serve our customers, grow our revenue, and increase our profitability under difficult circumstances. Not too many companies could claim that, especially with capital equipment manufacturers. And so again, I think that was a testament of us being focused on our customers and building that customer relationship and trust and respect in delivering products,” Ruffalo says.
He adds that customer-focused mindset and culture comes from the top of the company and flows all the way through the organization to the shop floor.
The toughest aspect of navigating the pandemic has been dealing with the reoccurring supply chain issues around the globe.
“Like many heavy equipment manufacturers, the supply chain has been difficult for us, too. But what’s interesting about that is in Q2 of 2022, we delivered a record number of shipments for the second quarter over the history of our company. And so, even with our supply chain issues, we’re finding ways to get products to our customers,” Ruffalo says.
Photos courtesy of Astec
One aspect of Astec’s business that has certainly helped keep operations running smoothly is that most of their customer base is close to home.
“About 80 per cent of our revenue is in the United States and 20 per cent is international. And I would say that when you think about our supply chain, it reflects that, generally,” Ruffalo says.
So, what are the company’s goals moving forward? Well, no matter what the plans are, they always include their customers.
“We want to always keep customer at the centre of every- thing we do, that’s important to us,” Ruffalo says. “Operating as OneASTEC with a common purpose makes us a stronger, more efficient company and sets us up for long-term profitable growth. We’re focused on filling gaps in our products lines that add value to our customers. Ultimately, we want to find ways to grow globally, either organically or through acquisitions.”
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