The money came at the right time for Synehi Castings.
The iron foundry located near the Greenwood County Farmer’s Market would likely be struggling today without a small business loan, according to Synehi Castings President Rodgers Gaines.
The $200,000 obtained two years ago from the Upper Savannah Sudden and Severe Economic Dislocation (SSED) Loan Fund helped Synehi Castings pay for equipment that has saved jobs and helped the company reach the highest profit margins in its 22-year history. Also, a local bank made a commitment to restructure Synehi’s long-term business financing and line of credit. The total project cost was $1.6 million.
“The money came in at an ideal time,” said Gaines, who after years as a salesman in the foundry industry opened the company in 1984.
While the original line of credit from a local bank was expiring, Synehi needed funds to complete construction, and machinery and equipment setup that began in 1997 when the company moved from the south end of Greenwood to its present location behind Legion Field on Ginn Street.
“We started building this foundry ourselves (in 1997) working these guys as foundry people for eight hours a day and four hours a day in construction,” Gaines said.
Synehi specializes in the manufacture of gray and ductile iron castings, abrasion resistant alloys, job shop machining and fabrication. Synehi has contracts with Michelin, Square D, Cutler Hammer, the Tennessee Valley Authority, and the Athens Plow Company. The company also molds replacement parts for power plants in Texas and Oklahoma.
Synehi also makes “steak weights” for Outback Steakhouse at its site that includes approximately 5.56 acres and consists of five industrial buildings totaling 44,524 square feet.
Past business has included the molding of thousands of tie down anchors for A-10 Warthogs and Apache helicopters at Southeastern military bases that are susceptible to hurricane damage. The shepherd hooks used in the 1980s failed to prevent damage to aircraft during Hurricane Hugo, Gaines said.
Synehi also made moldings for the guardrail at the Cape Lookout Lighthouse on the Outer Banks of North Carolina. Synehi’s work replaced castings from the year 1856, and Gaines has some of those samples.
Synehi has survived declines in the foundry industry by developing niche markets and low volume run products that are too costly for importers to exploit. Most small foundry operations have closed because they could not compete on this basis. Gaines said that when he started the business in 1984, he was one of 32 iron foundries in South Carolina. Now, there are only two. The other is Grede Foundry, also in Greenwood.
Synehi, with approximately 50 employees, has also held its own by adding other metal working services like machining, finishing and painting.
But the company’s growth likely would not have been possible without funds from the SSED program. The purpose of the program is to provide financing to help manufacturing, service and hospitality businesses create or retain permanent employment in the Upper Savannah Council of Governments (USCOG) region of Abbeville, Edgefield, Greenwood, Laurens, McCormick and Saluda counties.
Businesses that are expanding operations resulting in job creation or facing imminent threat of job losses because of economic downturns in their industry are eligible, according to USCOG Assistant Director Sam Leaman. Proceeds can be used for real property acquisition or improvement, machinery and equipment purchases or working capital needs.
The money from Synehi’s loan was used to put in machinery and add accessories, Gaines said.
“You go buy a piece of foundry equipment, you have nothing,” the former Clemson University and local textile league baseball player said. “You’ve got a piece of equipment that you can’t do anything with until you get everything else (accessories). So we’ve got about an $80,000 piece of equipment sitting in the warehouse that we can’t afford to start up because we can’t put the accessories around it.”
Now, thanks to the money, Synehi has the matching equipment. And the results are good.
“We knew we had to get to a magic figure of about $3 million in sales per year to make any kind of profit,” said Gaines, whose son Stan now helps run the operation. “This year, we are going to break close to $4 million because that machinery is still pumping out those molds.”
“This is a well-established company with a solid financial history,” Leaman said. “I met Mr. Gaines back in the late 1980s and knew that he was a man of character that built his business through hard work.”
Gaines said he knew Leaman from Greenwood Chamber of Commerce meetings. Leaman told Gaines about the loan program.
“I mulled it over for a while,” Gaines said, with a smile.
“We would have still been here (without the loan),” Gaines said. “We would have been struggling along like we had been struggling on. We would have made payroll and the bills.”
For more information about small business loans, call Sam Leaman at 864-941-8056 or 1-800-922-7729.