Trial by Fire

The worst-case fire scenario for a business owner is not much different than that for a typical homeowner. A fire sweeping through a property can destroy keepsakes, vital records and the furniture and equipment that is necessary to function from one day to the next.

Universal Metal Corp., Worcester, Mass., experienced a dose of that worst-case scenario in the fall of 2001, when a fire swept through a portion of the company’s three-acre specialty metals recycling facility. The blaze destroyed 25,000 square feet of the company’s 60,000 square feet of space.

SPECIALTY ORDERS

Many scrap dealers pride themselves in the wide range of commodities in which they deal, and in their ability to find a home for any number of metallic and nonmetallic secondary commodities.

The approach taken by specialty metals dealers like Universal Metal Corp., however, is very different. According to president and CEO Stuart Freilich, the company deals exclusively in titanium and high-temperature alloy scrap. “We’re basically a wholesaler to the trade,” says Freilich. “80 percent of our scrap comes from other scrap dealers around the world, and the balance from large generators.”

The company was started in 1953 by Freilich’s father Joseph. From the beginning the company concentrated on high-temperature alloys, initially including more common forms of stainless steel scrap.

The company purchased the property where it is currently located in 1970, converting a former stamping plant into its home. Steady business growth has allowed Universal to add a second building in the mid 1980s and a third in 1989, and key personnel along the way.

The Universal Metal Corp. facility consists of one processing area devoted to titanium and titanium alloyed scrap and another where specialty high-temperature alloys are sorted, analyzed and often reduced in size before shipment.

While there is no high-volume processing machinery such as an auto shredder to be found at Universal, there is a collection of smaller cutting and turning equipment, as well as equipment for testing, shearing, shot blasting and briquetting. Many larger pieces of scrap—items such as aircraft engine parts or helicopter blades—are cut by plasma torches or sheared. Smaller material is chopped in an automatic chopping line.

Chemical analysis of incoming scrap is a key part of the operation. For the past several years, Universal Metal has relied on large analyzing units made by Kevex that are highly regarded for their ability to analyze larger samples and to accurately analyze a wide spectrum of materials. The company owned 12 of the large analyzers before the fire.

These larger units preferred by Universal have been discontinued by Kevex, so the company has operated its own in-house electrical testing lab to monitor and maintain the analyzing equipment. The lab has the ability to burn replacement chips as needed by the analyzers.

More recently, Niton Corp., Billerica, Mass., has designed a comparable large analyzing machine, and Universal has purchased six of the units in order to update and upgrade its analyzing department afte the September fire.

 RISING FROM THE ASHES

There were no injuries. Stuart Freilich says that is far and away the most important piece of information connected to the fire that swept through a portion of the Universal Metal Corp. facility on Monday, Sept. 17, 2001.

“Everything went by the book during the fire,” says Freilich. “Our safety official Albert Gagnon assembled everyone out by the truck scale and conducted a head count. When the fire department arrived, they were assured that everyone was accounted for and the building was empty.”

Gagnon also presented fire fighters with an emergency response book with the plant’s layout and other vital information. The fire department was so impressed with the book that it has been recommended as a model for other companies in central Massachusetts to use to make one for themselves.

State and federal environmental officials were also on hand to test run-off water leaving the site during the fire-fighting effort. “We received a clean bill of health,” states Freilich.

Despite this initial good news, the process of putting the business back on track has not been easy, and the management challenges of steering a company through a rebuilding process have taken a lot of effort.

Freilich arrived at the scene as the fire was winding down after being subdued by fire fighters. Almost from the start, his mind was made up to rebuild the company. “Looking at the fire-gutted building, I won’t tell you that for just a moment or two I wondered whether we could come back. But there was never any serious contemplation to shut things down,” says Freilich. “I’m too young to retire—I’m only 54—and I like the business too much. We have friends we haggle and argue with, but you have a lot of fun. I would miss my friends from the industry too much.”

The fire ripped through the front building on Universal’s property, where the titanium processing operations were.

Several factors have helped Freilich and Universal cope with the impact of losing much of its processing space and its equipment, including its shot-blasting equipment, shears, the chopping line and seven of the Kevex analyzing units its employees have long favored.

“We’ve received support from customers and friends throughout the world,” he comments. Much of the initial, and most important, support has come from city officials and from Universal’s insurance provider.

According to Frielich, state and city economic development officials have “helped open a lot of doors in the city as far as getting people on track to be receptive instead of negative,” in terms of securing building permits and clearing other potential bureaucratic hurdles.

Freilich says that the day after the fire, the local CNA insurance adjuster came in, and the next day an adjuster from Chicago was on the scene. “I was suspicious, but the adjuster’s parting words were, ‘Listen, don’t have a heart attack over this. This is why people have insurance. Call me if you can’t reach your local adjuster, and I will give you the same answers that he would give you.’”

He says of the insurance company, “CNA Insurance has been magnificent. They’ve been helpful and have come forth with money as it’s needed. No one expects a catastrophe, but if I didn’t have a good company like CNA, I could be out of business.”

An additional piece of good fortune for Universal is that the company was already in the process of designing and constructing an additional building when the fire occurred. “Another of the things that saved us is that we had contracted for that new building before the fire,” says Freilich. “So that building will be in place by late February.”

The brick and mortar plans are underway or in place. But a challenge since the fire has been to keep employees motivated and active during a time when the company has been handling only a small percentage of the material it normally does.

“We didn’t lay anyone off and we continued to pay people, but there were many people walking around doing next to nothing, because we could only serve select customers for several months,” says Freilich. “We’ve directed a lot of material elsewhere to be processed.”

The interruptions are far from over, however. Essentially, says Freilich, the entire office will have to be replaced due to smoke damage, including the walls, ceiling tiles and floor coverings

Freilich knows that the fast pace of recovering from the fire will soon be replaced by the fast pace of running the business at full strength. “By the end of January, we’ll be aggressively back in the market. Our Nitons will be up and running, and we’ll start packing the building with scrap.”

The author is editor of Recycling Today and can be reached at btaylor@RecyclingToday.com.