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Posted December 21, 2012 | Leave a comment
Trex CEO chosen as one of the best
By Sally Voth
Ronald Kaplan's vision of turning around a struggling Trex Co. five years ago has come to fruition and led to his being ranked one of the best small-cap CEOs in the country.
In addition to being the CEO of Trex, Kaplan also serves as chairman and president.
Kaplan was ranked 14th out of a field of more than 18,000, according to ExecRank. A ranking algorithm worked with 23 categories, and consulted with evaluation committees, according to its website, www.execrank.com.
"We were extremely impressed with Mr. Kaplan and his ability to drive profitability despite a tenuous market for building products during the last three years," Ian MacDonald, analyst for ExecRank, states in a Trex news release. "He is highly regarded amongst his peers as a CEO who truly understands the nuances of the industry."
The release calls Kaplan "a seasoned turnaround expert," who took the helm at Trex as it "was struggling to improve profitability, increase growth and maintain its pre-eminent brand."
"Kaplan executed a strategic turnaround formula that included implementing supply chain best practices, developing a best-in-class product portfolio (exemplified by the game-changing Trex Transcend® decking and railing collection), creating compelling marketing and advertising initiatives and expanding internationally," the release states. "Under Kaplan's leadership, Trex is now a $300 million manufacturer with industry-leading brand recognition and unsurpassed channel placement in more than 6,000 retail outlets worldwide."
A Buffalo, N.Y. native, Kaplan said he spent two years as CEO of Continental Global Group, an international manufacturer of mining equipment, and 26 years with Harsco Corp.'s Gas Technologies Group where he was senior vice president of operations.
"Trex called me in the autumn of 2007 to effect a turnaround," Kaplan said in a Friday afternoon phone interview. "The challenge and the opportunity was very enticing to me, and I thought I could do it, make an impression here and a contribution. And, it turned out exactly as I had hoped."
"A wonderful period of growth" at Trex was followed by a series of difficulties, which resulted in a poor financial performance, he said.
"The team that I brought together was able to turn that around and make this into a profitable company, and shareholders quintupled their investment," Kaplan said.
He said this was accomplished through developing a sense of unit cohesion among employees, redesigning organizational structure and downsizing the corporation so expenses fit the revenues. Some of this was through terminations, Kaplan said.
But, he also has committed to keeping Trex jobs in America. When Kaplan arrived at Trex, its wood-alternative products were only sold in the U.S., Canada and Mexico. The company now exports to 27 countries.
"We're doing it the old-fashioned way," Kaplan said. "We're exporting from Winchester, so we're not shipping jobs overseas. I've got lots of experience building factories overseas. When I came to Trex, I decided we will put the put the work right here. It's a great workforce and a great factory."
About 60 percent of Trex's 600 employees are in Winchester, he said, with the rest at its factory in Nevada.
A research and development program was launched in 2008 to transform industry technology, and led to market penetration and sales increases, according to Kaplan. This resulted in a product that the company could guarantee wouldn't fade or stain for 25 years, he said.
Engineering and marketing groups are conceiving and developing new products, Kaplan said.
He plans to stay in Winchester as long as employees and the board of directors want him, he said. In fact, the board has offered him a retention agreement through August 2015 at the earliest, Kaplan said.
"I live Winchester because it's the right mix of a very pastoral, small-town atmosphere with a lot of great resources right here in town," he said. "Over the course of my almost 40-year career, this has been the most exciting and productive assignment I ever had. I just couldn't be more pleased with the successes we've all had here as a team."
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