Posted: 3/28/06
Permac Industries (Burnsville) CEO Darlene Miller is SBAís Minnesota Small Business Person of the Year
by John Gessner
Thisweek Newspapers
Darlene Millerís first application for a U.S. Small Business Administration loan was denied.
Two SBA loans later ó and after quadrupling sales at Permac Industries in Burnsville ó Miller has been named the SBAís 2006 Minnesota Small Business Person of the Year.
Millerís turnaround of Permac, a once-floundering precision-machined parts manufacturer, is a story of risk, persistence and growing into a job.
With the help of a bank officer who took a chance on her, Miller has become a leader in a male-dominated industry and counts Fortune 500 companies among her clients.
From Permacís 16,600-square-foot building in Burnsvilleís Southcross Corporate Center, Miller and her 31 employees make parts for sectors including food and beverage, hydraulics and heavy equipment.
ìWe really would like to get more into the medical, and even more so, the avionics,î said Miller, 56, who is chair-elect of the Burnsville Chamber of Commerce.
After growing up in New Prague, Miller tried a year of college before taking a job with Honeywell (now a Permac customer) as a circuit-board inspector in 1969. A friendly supervisor pushed Miller to find an office job, something off the factory floor.
ìShe was wonderful,î Miller recalled. ìWe talked, and I donít know if she saw something or what. But she was so sweet and just adamant that I not stay there. It was a major turning point.î
Miller went to work for Blue Cross Blue Shield, taking a claims job and a pay cut. She went on to inside-sales and other jobs with manufacturing firms in the electronics and glass industries.
Permac Industries owner Phillip Douville wooed Miller to her first outside sales job in 1992. The Bloomington company, which was founded in 1966, made machined parts using automatic screw machines.
ìIt was a big step,î Miller said of her first commission-only gig. ìBut it was fun. On my first day, my first sales call was to a medical company. I got the order, and I was sitting in the parking lot going, ëYes! I can do this.í î
Soon she was made a full-fledged employee, working at whipping the antiquated office operation into shape.
ìWe didnít even have a computer,î Miller said. ìThere was no traceability for orders. We had no accounting software, no manufacturing software. There was nothing.î
In 1993 Miller purchased 45 percent of the company, whose lender was moving to foreclose. Her initial bid for an SBA loan to complete the purchase in 1994 was rejected.
ìItís a manís type of business, and I didnít have the skills to be an owner of a business,î Miller said, recalling the loan officerís rationale. ìI hadnít been in it too long. I was too high of a risk.î
But she had a buy-sell agreement with Douville and persisted in her efforts to purchase the remaining 54 percent. Miller appealed to Dave Cleveland, president and CEO of the former Riverside Bank in Minneapolis.
ìYou know how some of those days youíre just on? Dave asked me a million questions, and the answers just flowed,î Miller said.
He agreed to give Miller an SBA loan with the bank assuming a higher percentage of the risk. The $500,000, seven-year loan is all paid up.
ìHe didnít do it just for me,î Miller said. ìHe did it for small business ó anybody he believed in.î
Since taking ownership Miller has boosted Permacís annual sales from $800,000 to $4 million. A company that had churned out products on screw machines and simple lathes was soon buying the latest high-tech machines with which to produce more complex parts, and hiring people who knew how to operate them.
ìThe greatest part was I didnít have the technical knowledge, and I still say today that contributes a lot to my success, because I have to listen to my people,î Miller said. ìI donít have preconceived notions. ... I ask a million stupid questions, and they just laugh with me.î
Miller got another SBA loan, for $700,000, to buy the companyís building on 14401 Ewing Ave. in Burnsville. Thereís plenty of land for expansion, which Miller envisions in 2008.
ìBusiness is booming,î she said, noting that 2006 sales are up 6 to 7 percent over the same period last year. ìIt is for a lot of people in manufacturing.î
Her employees include her two sons, ó Tim, 36, and Michael, 31.
Miller is active in the community with the chamber and the Burnsville Medical Alliance. She worked with Mayor Elizabeth Kautz, City Council Member Teresa Daly and Maggie Linvill of Linvill properties to organize a mentoring program for freshman girls at Nicollet Junior High in Burnsville.
Miller is the only woman serving on the board of the Precision Machined Products Association, a national organization of industry leaders.
ìAm I a ground-breaker? Yeah, I think so,î Miller said.
ìBut I have never, ever felt intimidated in this industry,î she said. ìI have never felt I couldnít make a sales call because (of gender). If anything, itís been the opposite ó people were curious to see me.î
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