Sonnax speaks the language of business

Vermont Business Magazine, May 01, 2005 by Kelley, Kevin

Sonnax, the Bellow Falls manufacturer to be honored at Expo as Vermont's Exporter of the Year, owes its success in global markets partly to its recruitment of sales staff fluent in a variety of languages, says company president Neil Joseph.

Sales representatives based at Sonnax's instate facilities and at its offices in other countries speak 10 languages in aggregate, according to the company's promotional material. Internet support for Sonnax products is available in more than half a dozen languages. The automotive parts maker also operates technical centers in a few countries and sponsors seminars around the world in order to keep technicians up to date on developments in the automotive aftermarket.

In all, Sonnax does business in more than 60 countries, with its sales abroad and in the United States expected to top $34 million this year.

"Being able to speak to customers in their own languages helps us greatly in the markets where we want to be," Joseph says.

But it isn't easy to find bilingual sales staff in Vermont. In fact, the company has to recruit far and wide in order to fill openings for a variety of administrative positions at its headquarters, Joseph notes.

"It's a small gene pool. We do try to hire locally, but it's not always possible because of the size of the population," the Sonnax chief says.

Proximity to Vermont's Precision Valley does give the firm access to a sizable number of skilled machinists.

"There is talent available from the machine shops that used to operate in the area," Joseph notes. "And generally there's a tremendous scarcity of these kinds of skills in the US today."

Sonnax has found buyers for its automatic transmission components largely through its own initiatives. Joseph says the state's exportpromotion program has not been of much assistance to his company. "They're as helpful as they can be, but state government is small and limited in what it can achieve," he says.

The Vermont Economic Progress Council did provide considerable help, Joseph adds, in Sonnax's recent expansion into the former Ben & Jerry's 34,000-square-foot distribution center in Rockingham. The company was awarded $725,000 in tax incentives over five years. This subsidy persuaded the company to expand in Vermont rather than in Tennessee, as it had considered doing. in return, Sonnax is expected to add 75 jobs in the next few years to its 165-member Vermont workforce.

The company bases its machine shop and a research-and-development unit in the former Ben & Jerry's facility, which is less than half a mile from its main office.

The State of Vermont does offer technical assistance to companies trying to initiate or expand their export operations.

"We stand ready to assist any Vermont business that seeks to sell abroad," says Dana Eidsness, director of the state's international trade office. Her unit can provide market research data and explain documentary requirements and other regulations in a host of countries, Eidsness notes. Her office also organizes trade missions to countries viewed as potential customers for Vermont goods and services.

The Douglas administration takes this promotional effort seriously, Eidsness says, noting that the state moved the functions of Vermont's World Trade Office into the Department of Economic Development after that federal-state partnership ran out of funding.

"Governor Douglas was concerned that exporting companies would not be receiving the technical assistance they need," notes Eidsness, who came to the job recently from a similar post in Maine's LewistonAuburn area.

"The ability of Vermont businesses to compete globally is vital," she says, "if Vermonters are to have quality jobs."

Companies based in the state recorded more than $2.5 billion in export sales last year, according to the Agency of Commerce and Community Development. IBM accounted for about three-quarters of that total.

In addition to celebrating its Exporter of the Year award, Sonnax will soon be marking its 30th anniversary. Joseph founded the company in 1975 with assistance from his father, a Cleveland, OH, businessman. The younger Joseph, then 2 1, designed the first part sold by Sonnax a governor for the 350 transmission that was used at the time in about half the cars made in the United States. Sonnax still sells the same part today, Joseph notes.

He says he decided to base his firm in Vermont not because the state seemed to offer any particular business advantages but because it seemed like a nice place to live. Joseph had initially come to Vermont from Cleveland because he had friends in the Bellows Falls area.

Sonnax recorded $100,000 in sales in its first year of operation, Joseph recalls, noting, "We do that much on a slow day now." The company has enjoyed export-powered doubledigit growth in each of the past few years. For 2005, Joseph expects the rate to "slow" to the 10 percent range.

Joseph attributes the more moderate rate of growth to the maturing of some of Sonnax's market segments. Higher production costs are a factor as well, he says, noting that the company designs man many of its products.