Al-jon Cuts Ribbon on Larger Factory

Jon Kneen, co-founder of equipment maker Al-jon Inc., Ottumwa, Iowa, jokes that he started his company in 1963 with no products, no customers and almost no money.

Just how far the company has come was evident at an open house event held May 18 to show off the company’s new manufacturing capacity, which carries a $3.5 million price tag and which will be used to make popular balers and compactors for the company’s growing customer base.

The company Jon Kneen and Alan Sharp started has developed into a leading national provider of portable metal balers and landfill compactors that is also increasing its profile as an exporter.

Jon, his son Kendig Kneen, who is now president of the company, and other long-time Al-jon employees had a chance to reminisce for a documentary that was shown at the Open House event.

Jon’s long-time pilot recalled a number of occasions when he and Jon would fly to see a customer, receive a down payment on a piece of equipment, and then fly back to Ottumwa before the bank closed in order to make a deposit to make payroll.

Steven Bacon, son of original Al-jon employee Charlie Bacon, displayed the receipt from Charlie’s first weekly paycheck, which came in at nearly $65 thanks to some Saturday overtime hours.

An ongoing request from scrap dealer Frank Alter in Davenport, Iowa, led to Al-jon’s car crushing and portable baling line of equipment, which helped the company establish a product line that has grown ever since.

The Ottumwa factory has subsequently “built enough crushers to crush Detroit’s daily production,” says Jon Kneen. Adds Kendig, “We’ve been recycling long before recycling was cool.”

The scrap recycling equipment, combined with landfill compactors that have earned considerable market share, has helped Al-jon grow beyond its existing plant space and also attract the attention of private equity investors Republic Financial Corp., Aurora, Colo.

Bill Haan, Republic’s President of Private Equity, says Al-jon was one of “200 opportunities” the company considered in 2006. “We hooked up with three of them,” says Haan.

In addition to seeing opportunity specifically in Al-jon’s product line, Haan says that when Republic Financial finds partners, it looks for the right chemistry. “We work well together,” he says of Republic Financial and Al-jon.

Both Al-jon and Republic see opportunities in the export market, but both are also committed to allowing the business to grow right where it started in Ottumwa. “Growth for Al-jon is going to occur in Ottumwa, Iowa,” says Kendig Kneen. While the company sees advantages in a Midwest location that is equidistant to many markets, Kendig also says, “The fact is, we live here.”

Al-jon’s family atmosphere came through at its open house event, where the company dog mingled with invited guests and Al-jon’s in-house band The Crushers—consisting entirely of Al-jon employees—played a classic rock set for guests after the speeches and tours were concluded.