Hoosier Magnetics proves profit comes with perseverance
By Joleene DesRosier
When the New York State Lottery came up with the phrase, “A dollar and a dream,” B. Thomas Shirk, CEO and president of Hoosier Magnetics, Ogdensburg, had no idea the phrase would relate directly to him.
It all began in Washington, Ind., in 1970. A manufacturing plant that specialized in the manufacture of ferrite powder, a raw material used to make magnets, was struggling to stay in business. When the recession hit in the early ’70s, several businesses were forced to shut down, including the Indiana plant. Despite the economic downturn, Mr. Shirk, then-plant manager, saw an opportunity to bank on the economic upswing, and approached the owners of the plant with a plan.
“I wanted to keep things moving,” Mr. Shirk said. “After some discussion, the former owners allowed me to continue the operation. I had a good relationship with them, but very little capital to actually buy the business. So they created a plan for me to pay a dollar a month for a period of time. “
One dollar — that was it. Well, for the manufacturing portion of the business, anyway. Mr. Shirk still needed to buy raw materials and pay the utility bill.
“We had to go out and borrow money to do that. But the actual capital to acquire the plant was only a dollar a month. I took a risk and it was a brave move, but it just seemed like a good opportunity.”
Ferrite is just a very basic ingredient in life.
There’s nothing glamorous about it. It’s not pretty; it’s just a brown powder. Really, we’re kind of boring.
— B. Thomas Shirk, president & CEO
Hoosier Magnetics, Ogdensburg
By 1975, the plant was up and running again under the name Hoosier Magnetics. For the first six months, the business sold nothing. And then, in April 1976, the phone rang.
“We got a call from a customer who needed ferrite powder to make magnets. He asked us if we wanted to sell him something,” Mr. Shirk recalled. “You can imagine what the answer was.”
Shortly thereafter, a second call kicked production into high gear. Before long, the plant was running around the clock. Mr. Shirks’ dollar had paid off. More and more customers were coming out of the woodwork, seeking the crucial raw material known as ferrite powder required in magnet manufacturing. Ferrite is mostly an iron oxide-based material: 85 percent iron oxide, 15 percent carbonate. The two powders are then mixed together and introduced to a high-temperature process that has workers playing with chemicals at 2,300 degrees Fahrenheit.
“During this heating process, the chemicals go through a reaction and turn into strontium ferrite,” Mr. Shirk said. “What goes into the calciner is not magnetic; what comes out of it is. It’s basically a little miracle of chemistry.”
This little miracle grew to be a big, profitable miracle, and by the ’80s, Hoosier Magnetics expanded to four plants: The one in Washington, Ind., another in Toledo, Ohio, a third in Ogdensburg, and the last on the other side of the world in Italy.