Cruising for business
McAllister Mills manufactures fire protection system used by European cruise ships
- May 29, 2012
The small town of Independence in Southwest Virginia is known more for mountain music than for cruise ships. Yet McAllister Mills, a company with 46 employees, manufactures a passive fire protection system here that’s used by cruise ships around the globe.
Princess Cruises has ordered the product, ALVEX-PF. In the event of a fire, it helps protect critical equipment, such as water mist pipes, and communication and electrical cables aboard passenger and military vessels. McAllister Mills began working on the system after the International Maritime Organization mandated in July 2011 that all crucial systems on a ship be fire protected for 60 minutes.
That mandate opened a door for new international business, particularly in Europe, where many cruise ships are built. In fact, the order from Princess came after Alec McAllister, president of McAllister Mills, made five sales trips to Trieste, Italy, a small shipbuilding seaport. “Trieste is different than any other city in Italy because years ago it was part of Austria,” he notes.
McAllister decided to focus on Europe “because it is the biggest builder of cruise ships,” he notes. Most ships are built in Germany, Finland, France and Italy.
The ALVEX-PF system uses high-temperature fibers — from 500 degrees to 2,500 degrees — that McAllister Mills develops and manufactures. “We have a very specialized, high-heat application for the aerospace, automotive and pollution control industries,” McAllister explains.
He started the company in 1980 with his father, William McAllister, who previously owned Darco Southern in Independence, as an investor. At the time, McAllister Mills was producing high-temperature glass fabrics for the replacement of asbestos in a variety of industrial applications. Today, the company works with a variety of industries through three divisions: high-temperature fabrics, high-temperature yarns and nonwoven products such as McAllister’s insulation-blanket patented technology.
One of the company’s newest high-temperature products relates to diesel particulate filters used in the trucking industry. “There is a push in the trucking industry to have less pollution in the use of diesel trucks,” McAllister says. “We are developing new materials and products to insulate these systems for companies such as Caterpillar and Cummins.”
In the past 10 years, McAllister says the company has doubled its sales thanks to the development and distribution of new products in the U.S. market. “We are strategically located near industrial centers on the East Coast. A big swath of our customers is within a 500-mile radius of Independence. ”
While most of its sales are domestic — only 10 percent are international — the company has a growing focus on international exports. These days McAllister is focusing on New Zealand and Australia because of the concentration of heavy industry and mining in those areas.
In Trieste, the company works with Fincantieri, a Trieste-based shipbuilding company. While doing business in Italy, McAllister has faced challenges in understanding the Italian business culture and in getting products to market. He first networked through international marine trade shows. “I found out I should be selling through agents,” he says. “I researched and found the best agents and within six months found the right people to sell to the shipyards.”
He also took advantage of the company’s advanced technology by having ALVEX PF registered and certified with Lloyds Register for use on cruise ships. Communicating with the Italian business community is easy, he adds. “They speak English very well.”
However, when it comes to getting paid, he has discovered that Italians have long payment terms — the shipyard has 120 days. “We ended up giving them a bigger discount so we could get paid on a letter of credit immediately,” says McAllister.
Another lesson: Italians like to be wined and dined. “Sometimes when they are invited to dinner they bring a group of 10 to 15 people,” he says. “Dinner can take three to four hours, so you get to know people more intimately, and it’s very important to do that in Italy. Lunch and dinner are not just about eating. They are about socializing, connecting and relaxing.”
THE ECONOMY OF TRIESTE
A seaport in northeastern Italy on the Adriatic Sea, Trieste is known for shipping containers and oil and steel through the Port of Trieste in addition to shipbuilding. The city produces more than 40 percent of Italy’s coffee. Trieste is part of the Pan European Corridor 5 plan to boost transport between Western Europe and Eastern European nations. Companies headquartered in the city include shipbuilder Fincantieri; global insurance and financial products giant Assicurazioni Generali; coffee producer Illy; and shipping company Italia Marittima.
TRAVEL TO TRIESTE
One of the gathering places is the Piazza dell’Unità d’Italia with neighboring Castle Miramare, built in 1860 by the archduke of Austria, Maximilian of Habsburg. The modern art gallery, the Museo Revoltella, the former palace of Baron Pasquale Revoltella, holds the baron’s art collection as well as the artwork of Trieste artist Giuseppe Tominz. The city is a fisherman’s paradise. “That’s one of the biggest pastimes,” says Alec McAllister, noting that the fish served for lunch and dinner are caught in the morning of that same day. “You can’t get any fresher than that.”
THE ECONOMY OF INDEPENDENCE
In the past, the economy of Independence was fueled by the textile and furniture industries. Today, the town has a number of small industrial companies such as McAllister Mills;Tritex LLC, providing high-temperature alternatives to ceramic fiber, and Med-Fit Systems, which makes Nautilus exercise equipment. The town’s largest employer is Grayson County Public Schools. Independence is part of the Wildwood Commerce Park economic development project in Carroll County that also involves Grayson County and Galax.
TRAVEL TO INDEPENDENCE
Part of The Crooked Mile, Virginia’s Heritage Trail, Independence is a center for bluegrass music. The late “Uncle Wade” Ward is listed in the Smithsonian archives for his claw hammer banjo style. The area also is home to many luthiers (people who make stringed instruments), including noted guitar maker Wayne Henderson. Outdoor activities such as hiking and camping are plentiful, thanks to the town’s Blue Ridge Mountain location. Other activities include canoeing and tubing in New River Trail State Park and fishing in the New River.