DN Plastics is the newest manufacturing plant in Warren County, located at 8070 Manchester Highway in Morrison.
Most residents of our area have watched this plant being built over the last year. It contains a modern, spacious office and 120,000 square feet of manufacturing space. Local commercial building contractor Tri-State Development (Keith Bouldin) built the facility.
Raj and wife Sunita Agrawal are the owners/ partners of the firm. DN Plastics was established in 1998 in Grand Rapids, Mich., where it still operates. The original plant has 20 remaining employees and is planned for closure later this year. DN Plastics is named after a deceased uncle of the family. Raj is the CEO and Sunita is the CFO. The plant was built here to allow for lower product shipping cost to key customers in the Tennessee area. Warren County was selected over Coffee and Bedford counties due to the desired access to a rail spur, which is largely used to ship in raw materials.
DN Plastics is a custom compounder of thermoplastic elastomers in the form of plastic beads. The product is thermoplastic in lieu of thermoset in that it can be re-melted or recycled/re-used. Its particular niche is softer material beads. These beads would or could be used for injection molding, thermoforming, and other types of plastic molding. The beads are made in one basic size as most users melt the product as part of a molding process.
The key to DN Plastics is the ability to custom engineer the beads for particular performance specs and/ or customer applications. It is common for DN Plastics to provide prospect samples to try multiple times, each time resulting in a revised formulation to “tweak” to desired results.
DN Plastics usually works with customers or prospects which use high volume of these beads – 10,000 pounds or more at a time. A railroad car, for example, can ship 200,000 pounds of beads at one time. The residual expertise and working closely with OEM clients is the key to DN Plastics enjoying business success. To assist with this effort, Raj has a PhD in chemical engineering. Sunita holds a MBA degree in finance and is a CPA.
Most shipments, including to VIAM MFG of Manchester, are being made by truck. The immediate benefit of DN Plastics being located in Morrison is it can more directly cater to the continuing expansion of automotive manufacturing in the Southeast, which is centered in our area of Tennessee. Their business prospects are tier one and tier two automotive suppliers as opposed to primary auto firms such as Nissan and VW.
There are currently 16 employees at the Morrison plant. Over the next 6-12 months, that number is expected to grow to 30. The expectation is 100 employees will be needed within five years. Potential employees seeking employment at DN Plastics should go to www.dnplasticscorp.com and file an online employee application. The company will contact candidates of their interest once applications are filed. Current potential hires include a maintenance/ electrician person and a production supervisor. I asked about current employees in Michigan moving to Tennessee. Two employees there have been offered relocation and are considering at this time.
I asked Raj and Sunita about comparing manufacturing costs in Tennessee versus Michigan. They noted TVA electrical power is not an area of savings as they had originally expected. Property taxes are much lower. They do not have enough experience to comment on labor costs, although I would expect an advantage there, as well as in the services area. A key cost component advantage here is DN Plastics able to automate manufacturing processes more at the new plant than as it exists in Michigan.
DN Plastics does qualify as a minority owned supplier that would receive favorable consideration for government or prime contractor business. They have invested approximately $10 million so far with the new plant and equipment.
A significant new product is under consideration in the form of thermoplastic plastic sheets that would be more directly applicable to thermoforming. If this new product is undertaken, an additional $3 million in capital investment is expected. Thermoplastic plastics can be re-melted and re-used while thermosets cannot be. Raj said the Morrison plant is expected to have ample capacity to sustain future business growth.
The Agrawals have three children. Their oldest child, a daughter, just graduated from high school in Michigan and will be attending the University of Michigan this fall. A second daughter will be a senior in high school this fall. They also have a son who is 10 years old.
The Agrawals recently celebrated their 25th wedding anniversary. I asked them about their hobbies – “family and work.” They intend to permanently move to Middle Tennessee in about one year after their second child graduates from high school. They have only casually looked at housing options to date. Raj does like to sail on Lake Michigan.
DN Plastics is planning to hold a customer Open House sometime over the next 45 days. They are working with our Industrial Development Board (Don Alexander) to best present their new capability.
Raj and Sunita Agrawal have made a sizable investment in Warren County. So far they like the warmth of the Tennessee weather and people. BRAC welcomes their entrée in our county and wishes them the highest level of success going forward.