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JGB Enterprises facilitates growth with military contracts

The Central New York Business Journal

Hose company provides water systems for troops overseas

SALINA — Hoses serve an important function in everyday life. They funnel the gas we pump, the beer we drink, the snow we ski on, and the water a soldier needs on a daily basis.

JGB Enterprises, Inc. has made a business of providing a variety of hoses both for industry and for the military. Military operations account for $40 million of JGB's annual $60 million in revenue. Commercial operations account for the remaining $20 million.

Robert Zywicki, president, anticipates annual revenue of $100 million in 2007, JGB's 30th year in business.

The increase in revenue is due to a $40-million military contract in which the company will provide the U.S. Department of Defense with several hundred Basic Expeditionary Airfield Resources (BEAR) water systems. The BEAR system is designed to allow troops in the field to deploy rapidly and support a combat force.

JGB's water systems purify and pump water, producing 30 gallons per soldier each day. Each system is considered a sub assembly composed of inflatable-pillow tanks, hoses, pumps, fittings, valves, and connections that are attached to showers and latrines.

Wastewater is pumped out of the system, usually into a leech field where it dissipates.

JGB assembles and tests the water systems at its five-acre Syracuse headquarters. Once in the field, however, the system is spread out and there is usually at least one mile between each tank.

JGB Enterprises received its first military contract in 1981. Over the years, the company has acquired the business expertise necessary for working with the military.

"Without the right experience and talent, you are not going to be successful in working with the military," Zywicki says.

In addition to hoses, JGB Enterprises has produced during the past decade a unique hood latch that is used on military Humvees. In 2005, the company supplied military laundry systems to Katrina efforts.

JGB's military success can be demonstrated by the fact that over 60,000 National Stock Numbers (NSN) pass through the company on a yearly basis. An NSN is a numeric code that identifies material items used by the Department of Defense.

Most of the military-hose products are stored in two 30,000-square-foot warehouses located in back of JGB Enterprises' 80,000-square-foot headquarters at 115 Metropolitan Drive in the town of Salina.

The warehouses, built in 2001 and 2006, bring the number of JGB's buildings to five. Sister companies Generation Power, LLC and Precision Systems Manufacturing, Inc. are also located on JGB's property.

The company's humble beginnings illustrate how far JGB Enterprises has come since being founded in 1977 by Jay Bernhardt, current CEO and sole owner.

Bernhardt, a hose salesman, decided to start his own company — initially employing two and using 2,000 square feet of space on Moore Road in the town of DeWitt. In 1979, the company moved to 106 Metropolitan Drive and expanded again in 1981.

In 1985, the company built the first 20,000 square feet of its current headquarters. JGB added 30,000 square feet in 1990, 15,000 square feet in 1996, and another 15,000 square feet in December of 2005. It funded each expansion internally.

Revenue increased as the square footage grew: JGB Enterprises generated $6 million in revenue in 1985 and $8 million to $9 million in 1990.

Today, the company employs 225 people and sells over a million feet of pressure-washer hose annually.

"We have varied products in both the commercial and military lines," says Stephon Starrantino, executive vice president in charge of operations. "Basically any type of hose you see, we sell."

A few examples of the types of hose produced by JGB Enterprises include: automotive-hydraulic hose assemblies; snowmaking hose; and metal hose for welders.

Zywicki says the niche-based company expanded into other products to grow the business. JGB Enterprises sells all its products nationally and offers limited products internationally. Most of the company's competition is located in Washington, D.C. and the Midwest.

"We have high product innovation, and we are never afraid to enter new fields," Zywicki says. "Commercially, we are going to continue to look at new products to launch."

Starrantino says that JGB Enterprises is also looking for more sub-assembly contracts and plans to increase internal capacity for manufacturing.

During the assembly of hose, however, the equipment is not as important as the people, because it is a very knowledge-based industry, Starrantino explains.

The 18-to-20-year average tenure of JGB's executives is indicative of Bernhardt's commitment to Central New York, Zywicki says. The hose salesman-turned-CEO has had plenty of opportunities to move elsewhere.

JGB Enterprises has branches nationwide: in Buffalo; Charlotte, N.C.; St. Louis, Mo.; and Kansas City, Kan. The company is currently considering a joint venture in Las Vegas, Nev.

Zywicki and Starrantino plan to continue JGB's aggressive expansion.

"We have a few more places in mind," Zywicki says.