BELOIT, Wisconsin—STE president Chris Sipe just wanted to compete. He’s convinced his company creates highly desired stainless steel tank trailers, but capacity constraints were keeping him from meeting greater demand, growing market share, and evolving beyond STE’s reputation as a manufacturer of “one-off,” highly customized products, so something needed to change.
The Hendricks organization agreed—and decided to do something about it.
“Our owners want to provide the best products and services,” Sipe said. “They like to lead, and they’re willing to do what it takes to make that happen.”
Sipe gave them three options: Shutter the struggling operation, shift to a smaller structure, and embrace the boutique-brand identity, or “invest significantly” in expanding the enterprise with a first-rate new facility. “I guess I’m fortunate that the day I made my pitch, they picked Option 3,” he reflected. The overwhelming result is a highly automated, 400,000-sq.-ft. greenfield site directors deliberately designed for tank trailer production. “It’s massive—with an amazing amount of thought and innovation under one roof,” said Calvin Ewell, president of long-time STE customer H.R. Ewell, who recently toured the facility.
Most significantly, STE’s new plant is right here, in Beloit, Wisconsin, U.S.A.
“That’s who we are,” said Brent Fox, president and CEO of Hendricks Holding Co., STE’s parent. “We’re very proud, very patriotic, and we love our country, and the people who worked hard and sacrificed themselves to help preserve this great nation we live in. So we’re highly motivated to take a company with a right to exist and do everything we can to make it viable, in America, with quality products built by Americans.”
An American story
Alex Falch and Don Rostad founded Stainless Tank and Equipment Company (STE) in 1966 in Sun Prairie, Wisconsin, after previously working for Dairy Equipment Company in nearby Madison. Paul Krueger, who perfected the design of STE’s chemical, dairy, and sanitary tank trailers as chief engineer, joined STE as part owner in 1973. He and Falch met at Krueger Fabricating, which was founded by Krueger’s grandfather as Paul Krueger and Company and later acquired by Dairy Equipment, before Falch left the company.
STE, then owned by Jim Hammis, relocated to Beloit Corporation’s northernmost campus, a foundry erected in 1912 to build papermaking machines, after it closed down in 2000. But the trailer manufacturer soon fell on hard times, so Hendricks’ co-founders rescued it from receivership in 2006. “It employed a lot of hard-working people, and they didn’t want those jobs to go away,” explained Fox, the Hendricks chairman’s eldest son.
“So they chose to find a way to make STE work, and it’s been difficult.”
Sipe, who previously worked at Stoughton Trailers, joined STE in July 2019 with the goal of revitalizing the operation. He’s grown average order size from 1.4 to 10-plus trailers, but he realized early on STE would never flourish in an ancient facility filled with low, leaky roofs and tight turns that wasn’t intended for 53-ft. products. “Today, we’ve got the best 94,000 sq. ft. of ‘spaghetti-bowl’ manufacturing around,” he joked.
“All we do is move left, right, and recross our steps—and that’s one of the most inefficient ways to build a trailer.”
That’s why current production is limited to 400 units per year.
“We tried making it work without putting a lot of money into it, so we’d pick up a new piece of equipment here and there, but we finally came to the conclusion that the only way we were going to make STE successful and sustainable long term—for ourselves and our customers—was with a significant investment,” Fox said.
Planning and preparation
Sipe started dreaming of a modern trailer manufacturing facility—and how to convince ownership to buy in—during the Covid-19 pandemic, which he called “a blessing and a curse” for STE. “Covid gave us the opportunity to really think about it, meet people, and dive into the market—and the tank trailer business is one of the best businesses to be in,” he said. “It’s still filled with mom-and-pops, and a lot of great people in an industry that moves critical commodities across the country.”
When Sipe was certain he could defend his position, he finally made his pivotal pitch in late 2022. After piquing owners’ interest, Sipe hired an industrial engineering firm to help him refine the building’s basic design and cost, and Fox officially endorsed the project in early 2023. Then they enlisted Pravda Quinones to develop and implement a transformative business strategy.
Sipe and Quinones, STE executive vice president of supply chain and operations, continuous improvement, and manufacturing, worked together at Stoughton, but she began her 30-year career in Mexico, giving her a unique understanding of Mexican and U.S. operations, and how to win in both. “Maquiladoras” leverage cheaper labor and process discipline, but they’re not as technologically advanced and face other challenges, like higher taxation, and logistics and distribution expenses, Quinones said. So she seized the opportunity to optimize a U.S.-based operation with the right mix of skilled craftsmen and innovative robotics to produce equipment both exceptional, and economical.
“There’s a balance point where you can bring value to the customer and the company by understanding the right level of automation, overhead, and install capacity to create a good value proposition,” she said. “Customers are willing to acknowledge the power of ‘Made in America’—up to a certain point. So we have to be competitive on our pricing.”
Quinones’ work included securing a “front-to-back,” customer-centric supply chain, solidifying STE’s pipeline of materials and components, spacing equipment so it flows efficiently from sourcing to shipping, and protecting STE’s budget while operating two facilities in the transition. The final piece was site selection, and leaders picked the 46-acre tract just outside Beloit’s current city limit to plant the company’s 132-ft.-tall, 50-ft.-by-80-ft. American flag—well within sight of Interstate 90 traffic.
“Once we had a number we thought would deliver a sustainable business with an acceptable return, we moved forward,” Fox said.
Purpose-built tanker plant
STE broke ground at its ground-breaking location Aug. 6, 2023.
Built by Corporate Contractors, Inc. (CCI), a Hendricks-owned construction company, the advanced facility features over 1,000 feet—or more than three football fields—of straight-line manufacturing with 38-ft.-high ceilings, 13 service bays, 56 total bay doors, and two covered pavilions for equipment storage and trailer presentation. It also boasts modern offices filled with natural light—three of which are dedicated to long-time dealers—a fitness center, and large common area where employees can gather to eat and socialize.
“We’re trying to create a total employee and customer experience,” Sipe said.
One of Sipe’s favorite aspects is an enclosed tank trailer showroom that provides a perfect backdrop for an upstairs meeting room. “I wanted a place where we could show off our products in February, in Wisconsin—without shivering,” he said.
Designers mapped the factory’s layout with input collected at several vendor and customer “summits,” where STE secured fleet support and discussed incremental volume increases, and ship-through and consignment programs, with suppliers. STE leaders also continue to tweak designs and processes, including finetuning lean manufacturing “takt times” and enhancing safety features through “5S” methodology and SQDC (safety, quality, delivery, and cost) principles. The building’s cavernous shop floor eliminates cramped spaces and fall hazards, like steps, cords, and component clutter, and includes an isolated area for carbon fixturing, a self-contained interior building for processing insulation, and a 100,000-gallon underground water tank for fire suppression.
“From a safety standpoint, this facility steps up the game significantly,” Sipe said.
The purpose-built plant also incorporates new equipment and technology leaders insist will enhance safety, efficiency, and output while simultaneously boosting STE trailer quality, durability, and value. The vertically integrated operation will feed four “tank-agnostic” production lines through a “coil-based” program, which enables STE to receive, flatten, cut, and form cold-rolled steel for barrel construction; and finish trailers with end caps shaped in house using a hydroforming machine. Sipe didn’t want to reveal all the automation in between, but it’s concentrated in the “high-labor-input” stages of the manufacturing process, and includes a high-tech laser cutting machine that cuts, sorts, and stores parts.
“This is definitely a state-of-the-art facility,” said Cindy Fittery, president of STE dealer Hy-Tec. “After 36 years in the industry, I was pleasantly surprised to see this level of technology in tank trailer production.”
People-centric employer
STE does not plan to replace people with robots, Sipe said.
On the contrary, the Hendricks family is determined to defend local jobs and buoy Beloit’s economy. That’s why they bought the Beloit Country Club, kept a minor-league baseball team in town by helping fund and build ABC Supply Stadium—and made a nine-figure investment in STE’s awe-inspiring expansion. “When Beloit Corp. closed, thousands of jobs went away overnight, so they made it their mission to replace those jobs,” Sipe said. “And I’m proud to say that, by reinvesting in Beloit over the years, they have brought many of those great blue-collar jobs back to this community.”
All 167 employees eventually will move to the new facility, increasing machine-assisted production capacity to 2,400 trailers on two shifts. Sipe’s goal is to employ 300 people within the first four years—and eventually make over 3,000 trailers per year—and with jobs for new- and old-school welders, including computer programmers, cobot operators, specialty builders, and repair technicians, he isn’t worried about finding help. “These aren’t just jobs we’re creating,” Sipe said. “They’re careers.” Hendricks’ backing also unlocks Fortune 500 benefits, making STE a “destination employer” with low turnover.
“People truly want to work here because they’re treated so well,” Sipe said.
STE customers receive the same first-class care.
In addition to running Hendricks Holdings, Fox sits on the board of ABC Supply, which boasts more than 900 locations, 10,000 trucks, and 22,000 associates. But he’s still happy to accompany Sipe on fleet visits—and give his cell number to anyone who asks. “The people we’re talking to are excited about our ownership,” Fox said. “That’s what makes this so attractive. We’re patriotic, we’re accessible, we’re invested, and we have the financial horsepower to deliver for our customers and associates.”
Ramping up operations
Construction workers were pouring concrete for heavy equipment slabs, installing a net in the pavilion rafters to prevent birds from roosting, and adding a door to the wall that divides the service and manufacturing areas when Bulk Transporter toured the facility in October. Sipe expected substantial completion in November.
The company is planning to move into the facility in January, and targeting April 2025 for a celebratory grand-opening. “Big customers in the tank trailer industry, including fleets and distributors, are very engaged with us right now, and they’re telling us this plant can’t turn on soon enough,” Fox said.
STE will test equipment, validate processes, and manufacture tank trailers at its future and former facilities for the first several months. Sipe expects Lines 1 and 2 to be fully operational in April, and all four lines by July. He also plans to continue growing the company’s capabilities and services, including developing new polyisocyanurate insulation processing and installation technology, and expanding parts sales.
“Through the research that we’ve done, and the meetings we’ve had with carriers and fleets, we know a lot of people are as excited about our new facility as we are,” Sipe said. And that’s saying a lot because STE employees new and old are “incredibly excited” about this monumental opportunity, Quinones added. They now have the chance to help advance a more than 100-year-old industry—and make next-generation tankers with 95% U.S.-sourced parts—here in the heart of small-town U.S.A.
“There is a lot of pride in the people who got us here; and the talent coming in, the new people we’ve added, including myself, have a very good understanding of why we signed on, and what we’re trying to build,” she said.
“We’re putting our stamp on a project that we strongly believe will make history—and evolve the way we manufacture tanks.”
