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CCLB 10-06-08 A 27 CCLB10/2/20084:13 PMPage 1OCTOBER 6-12, 2008CRAIN’S CLEVELAND BUSINESSWWW.CRAINSCLEVELAND.COMManufacturing target of Cleveland’sCrawford Group files for Chapter 11Pennsylvania injection molder suffers fromearly ’08 loss of Procter & Gamble workBy MICHAEL LAUZONPlastics NewsErie Plastics Corp. of Pennsylvania, which the Crawford Group ofCleveland wants to buy, plans toreorganize under U.S. BankruptcyCourt protection while creditorswork to finalize a sale.The Corry, Pa., company lastMonday, Sept. 29, filed for Chapter11 bankruptcy protection fromcreditors. The action should allowErie Plastics to eliminate a significant portion of its debt, the companysaid.“After reviewing all of our alternatives, the company’s management and ownership, workingalongside outside legal and financial advisers, has determined thatthis action will provide the bestresults for our creditors, suppliers,employees and customers,” thecompany said in a Sept. 30 statement.Chapter 11 “will pave the way fora bidder or bidders to submit proposals to acquire the assets of EriePlastics and continue the ongoingoperations,” according to the statement. Erie Plastics performs custominjection molding of rigid, thin-wallpackaging for a variety of industries.Its production plants are in Corryand in Hungary. It specializes inhigh-cavitation molding and highspeed molding.Erie Plastics chairman HoopRoche said the bankruptcy protection is unrelated to the biddingprocess for the company’s assets.He said he could not comment onpotential bidders that may be intalks with Erie’s creditors. However,Mr. Roche confirmed Sept. 22 thatCrawford Group of Cleveland wasnegotiating to buy Erie Plastics.Ed Crawford, chairman and CEO ofCleveland-based Park-Ohio HoldingsCorp., is negotiating on behalf ofCrawford Group. The Crawford“Creditors will know theywill be paid goingforward. Unsecuredcreditors should getsome settlement, andsecured creditors shouldget a good settlement.”– Hoop Roche, chairman,Erie Plastics Corp.family has an investment in ParkOhio and owns Crawford Group.Park-Ohio is a diversified manufacturing and logistic company.A cut for creditorsCrawford Group, which providesmanagement consulting services toa group of manufacturing companies, is negotiating to buy the assetsby meeting Erie Plastics’ creditorobligations rather than by buyingstock.Mr. Roche said Erie Plastics creditors stand to gain from the Chapter11 process.“Creditors will know they will bepaid going forward,” Mr. Roche saidin a telephone interview. “Unsecured creditors should get somesettlement, and secured creditorsshould get a good settlement.”Mr. Roche declined to reveal EriePlastics’ debt load. Its major securedcreditor is J.P. Morgan Chase.Erie Plastics is operating normally,according to Mr. Roche. Its workerson Sept. 22 approved a new laborcontract that will pave the way fora new owner and will make thecompany more competitive andable to pursue growth opportunities, he said.The contract will run to September 2011, Mr. Roche said. Workersagreed to substantial but undisclosed cutbacks in wages andbenefits. The contract was ratifiedby members of the InternationalUnion of Electronic, Electrical,STUFFDespite turmoil, Parker still on trackBorrowing, acquisitions remain options, but dangers lurkThe banking system is goingthrough convulsions that are makingloans hard to come by, but it’s mostlybusiness as usual at Parker HannifinCorp., according to an Oct. 2 storyfrom The Wall Street Journal.Tim Pistell, chief financial officer ofthe hydraulic-equipment manufacturer,brings to the job “the sort of conservative attitude toward debt and balance sheets that translates into solidcredit ratings,” The Journal reported.The result is that Parker hasn’t hadproblems borrowing money, thoughit has become more costly. And thenewspaper says Parker is “wellpositioned to pounce on acquisitions(Mr. Pistell) expects to becomeavailable because of the crisis.”“I can get all the capital I need, ascan most of my big customers —the Boeings, the Cats, the Deeres,”Mr. Pistell told The Journal.Part of Parker’s good fortune, thenewspaper said, is that the company“ended up with a solid group ofbankers. Its lead banks are CitigroupInc., Morgan Stanley, GoldmanSachs Group Inc. and Bank ofAmerica Corp., all of which havesurvived the current shakeout.”Even so, potential troubles still lurk.Parker and other manufacturers“rely on a vast network of smallersuppliers and distributors that arebeing whacked hard by the creditcrunch,” The Journal said. “As lending — the oil that keeps the cogs ofU.S. commerce rolling — dries up,the situation will quickly snowball intolost sales for everyone.”He noted that an Oct. 1 reportfrom the Institute for Supply Management showed that the manufacturingpurchasing managers’ index plungedto a recessionary 43.5 in September,a level not seen since October 2001.“We’re in good shape, but this isnot good, really not good,” Mr.Pistell told The Journal. “We reallyneed (Washington) to come up withsomething.”Salaried, Machine and FurnitureWorkers-Communications Workersof America.“We will go after business with alower cost structure,” Mr. Roche said.The company’s new name will beWellington Products.Workers make concessionsEarly this year, Erie Plastics lostconsumer product contracts withProcter & Gamble Co. that amountedto about half its business. Erie Plastics subsequently cut its work forcenearly in half to its current level ofabout 200. Mr. Roche said the workwas lost to other domestic molders.Mr. Roche said he expects most ofErie Plastics’ workers will retain theirjobs under the new ownership. Healso will continue working with thebusiness, but does not know yet inwhat capacity.Union members voted 131-31 toaccept Mr. Crawford’s concessions,said Suzanne Chase, president ofLocal 88681. Concessions includedwage cuts of up to 2 an hour, cutbacks of holidays and vacations,and higher insurance premiums.Members earn 8 to 16 per hour,Ms. Chase estimated.Ms. Chase said Mr. Crawford “didaccept the union and will keep theseniority” of members.Mr. Roche is Erie Plastics’ majorityshareholder. His father, Paul C. RocheSr., established Erie Plastics in 1960.Erie Plastics had estimated sales of 83 million last year, when it ran anestimated 67 injection presses. (Michael Lauzon is a correspondentfor Plastics News, a sister publication of Crain’s Cleveland Business.)Experience our ExperienceW E A T H E R H E A DE X E C U T I V EE D U C A T I O Nwhat you learn in a single daycan change everythingUpcoming programs include:Managing for MotivationIgniting Positive Change through Appreciative Inquiry (AI)October 21, 2008November 10, 2008Fuel your team’s commitment and energyFind out how revolutionary the AI positive approach to changecan be for you and your organizationGetting the Best Results:A Practical Framework for Solving Business ProblemsAnalyzing Financial Statements for Non-Financial ManagersOctober 22-23, 2008 (2-day program)November 12, 2008Seize and tackle business opportunities and challenges“better, faster, cheaper”Acquire a fast grasp of accounting, the language of businessFinancial Decision-Making for Non-Financial ManagersManaging Teams across Departments,Locations & Time ZonesNovember 13, 2008Learn the financial tools essential to all managersOctober 29, 2008Overcome geographic barriers for better teamperformanceBusiness and Market Strategy: Creating Actionable PlansNovember 14, 2008Translate the lofty concepts of your strategy to a realistic planPowerful Presentation Skills: Design and DeliveryOctober 30, 2008Become more confident, polished and persuasiveseats fill quickly, so register now!Weatherhead offers over 70 programs throughout the yearto increase management and leadership tionor call 216.368.6413 for answers.27
CCLB 10-06-08 A 28 CCLB2810/2/20089:47 AMPage 1CRAIN’S CLEVELAND BUSINESSWWW.CRAINSCLEVELAND.COMJANUARY 7-13, 2008LARGEST ACCOUNTING FIRMSRANKED BY NUMBER OF LOCAL CPASRankNameAddressPhone/Web siteNumber ofCPAsNumber ofdegreed professionals8/31/20088/31/2007Practice personnel engaged countingTaxConsultingOtherTop local executiveTitle1Ernst & Young LLP925 Euclid Ave., Suite 1300, Cleveland 44115(216) ald T. MisheffNortheast Ohiomanaging partner2PricewaterhouseCoopers LLP200 Public Square, 18th floor, Cleveland 44114(216) 875-3000/www.pwc.com1622892870.730517288NA45Rich Stovskyoffice managing partner3Deloitte LLP127 Public Square, Cleveland 44114(216) 9Patrick S. Mullinmanaging partner4SS&G Financial Services Inc.32125 Solon Road, Cleveland 44139(440) ry S. Shamismanaging director5KPMG LLP1375 E. Ninth St., Suite 2600, Cleveland 44114(216) John S. MacIntoshmanaging partner6Cohen & Co.1350 Euclid Ave., Suite 800, Cleveland 44115(216) andall S. Myeroffpresident, CEO7Meaden & Moore LLP1100 Superior Ave., Suite 1100, Cleveland 44114(216) James P. CarulasCEO8Grant Thornton LLP1228 Euclid Ave., Suite 800, Cleveland 44115(216) 18Daniel S. Zittnanmanaging partner9CBiz Inc.6050 Oak Tree Blvd. S., Suite 500, Cleveland 44131(216) en L. Gerardchairman, CEO9Skoda Minotti6685 Beta Drive, Mayfield Village 44143(440) 0Gregory J. Skodachairman11Maloney Novotny LLC1111 Superior Ave., seventh floor, Cleveland 44114(216) 21Matthew J. Maloneymanaging shareholder12Bruner-Cox LLP388 S. Main St., Suite 403, Akron 44311(330) ld J. Mansemanaging partner13RSM McGladrey/McGladrey & Pullen LLP1001 Lakeside Ave., Suite 1400, Cleveland 44114(216) 00Ron DeGrandisexecutive managingdirectorSee LIST Page 30YOUR BUSINESSIS OUR BUSINESS.What surprises many clients is how well we know their business fromthe very get-go. Probably because so many of our team membershave worked for years in various industries. Which means getting upto speed in your industry and company can happen quickly, and oursolutions and recommendations will be based in real-world experience.We wouldn’t have it any other way.Craig Thornton 216.274.6535plantemoran.comCPAs / Business AdvisorsTHRIVE.
CCLB 10-06-08 A 29 CCLB10/3/20084:08 PMPage 1OCTOBER 6-12, 2008Hospital: Patient reach a prioritycontinued from PAGE 3“The brand of MetroHealth hasbeen that we’re the county hospital,we’ll take care of you when nobodyelse can,” Mr. Moran said. “That’snot reassuring to commercial (i.e.,insured) patients.”The hurdle that perception ofMetroHealth creates to attractinginsured patients shows up in thenumbers. Of the patients coming toMetroHealth this year, 28.3% arecommercial, or insured, patients,down from 31.4% in 2003. Over thatsame period, the hospital has seenits percentage of self-pay, or uninsured, patients rise to 18.6% from15.8%.That patient mix helped lead to an 8 million budget shortfall in the firstquarter of this year. As a result,MetroHealth had to cut this year’sbudget by 17 million, which wasachieved through layoffs, eliminatingopen positions and cutting the hoursof 33 of its 6,600 employees. Thebleeding must stop, Mr. Moran said.“We have to find a way to continueto pursue the mission and reversethe shift in economics,” he said.The first step is to increase MetroHealth’s market share, Mr. Moransaid. MetroHealth is talking withvarious entities in Cuyahoga County,such as local governments, askingthem to include MetroHealth amongtheir health care options.Mr. Moran said he believes that,once people come to MetroHealthand are well cared for, they will comeback. But getting people to MetroHealth in the first place will beanother hurdle, he said.More people with insurance —and even the uninsured — steadilyhave moved to the fringes of Cuyahoga County or out of the countyentirely. But, unlike its hospitalrivals, the Cleveland Clinic andUniversity Hospitals, MetroHealthhas not followed them.“We have not made efforts toexpand our referral network the waythey have,” Mr. Moran said, but thecounty hospital will need to makeitself more accessible if it’s going toincrease its market share of thecounty’s insured residents.The plan for greater accessibility hasnot yet been created, but it won’tinclude new buildings at this timebecause the money isn’t there, Mr.Moran said. Expansion plans will beon hold until MetroHealth createscenters of excellence, better managesservices to the uninsured and attractsmore paying customers — all of whichwould improve the health system’sfinancial health, according to Mr.Moran.CRAIN’S CLEVELAND BUSINESSWWW.CRAINSCLEVELAND.COMMAKING THE CASEA look at the patient mix atMetroHealth: Insured: This year, 28.3% ofpatients are commercial, or insured,down from 31.4% in 2003. Uninsured: During the likeperiod, MetroHealth has seen itspercentage of self-pay patients riseto 18.6% from 15.8%.In return, the county expects to save15% to 30% on health care expenseson each employee who choosesMetroHealth as their provider becauseMetroHealth is a lower-cost healthcare option, Mr. Nanni said.MetroHealth already has made adent in the number of uninsuredpatients it sees. The hospital on Aug.4 implemented a program underwhich it charges uninsured patientsfrom outside the county 150 beforethey can be seen by a doctor. Manyof MetroHealth’s 990 uninsuredpatients from other counties decidedto stop coming to MetroHealth afterthe hospital alerted them of the fee,he said.For the estimated 129,000 uninsured residents of Cuyahoga County,a group of MetroHealth physicians isat work on a plan to provide primarycare for them, Mr. Moran said. Apilot project will be launched by thestart of next year, he said.If MetroHealth can convince theuninsured to visit a primary caredoctor regularly in order to get undercontrol chronic diseases such asdiabetes and hypertension, it couldgreatly reduce the amount of charitycare the hospital provides, Mr.Moran said. It’s far cheaper for thesepatients to see a doctor early than tolet their chronic conditions reach thepoint where they must be treated inthe emergency department, he said.Mr. Moran cited as an example ofthis strategy MetroHealth’s successwith its Senior Health & WellnessCenter. Elderly patients in the Concordia Care senior day care programused to spend an average of 17 daysin a hospital bed each year. That figure has been reduced to 1.8 daysnow that those seniors regularly seea primary care doctor, he said.Such programs to provide peoplewith a “medical home” are crucial,especially as the economy headstoward a recession and the rates ofunemployment and the uninsuredcontinue to climb, Mr. Moran said.What’s Behind the Power ofRSM McGladrey?The Accounting, Tax and BusinessConsulting Practice for Northeast OhioNo time to wasteMetroHealth seems to be on theright track as it follows other publichospitals around the country thatsuccessfully are competing againstother health systems and are makingnames for themselves through centersof excellence, said Larry Gage, president of the National Association ofPublic Hospitals in Washington, D.C.“Restructuring the delivery systemis often the best thing for everybody,”Mr. Gage said. “If you can depress theER, you can provide primary care inmore appropriate settings.”The key, Mr. Gage said, is to havea team of top-notch doctors andprograms with an academic link,which MetroHealth already has.Whatever programs MetroHealthdevelops will need to be donequickly. Mr. Moran said he has nointention of sitting around bellyaching about the problems in healthcare and waiting for the federalgovernment to fix them. He said theentire health system has beencharged with finding ways to reducecosts and increase the level andamount of care provided.“We’re sitting at an interestingtime,” he said. “The whole idea thatwe’re going to have some nationalhealth care system after we pay forthe 700 billion bailout is kind offanciful.” We’re focused on small-to-medium sizedcompanies on the move We’ve successfully grown our careers inNortheast and Central Ohio Our firm is regionally based with officesin Cleveland, Akron, Canton and Columbus We have a depth of resources with national and global -670-6515Canton330-455-1120Columbus614-224-7722RSM McGladrey, Inc. and McGladrey & Pullen LLP are two separate and independent legal entities. They operatein an alternative practice structure that enables them to work together to service clients’ business needs.For daily on-line updates, sign up @CrainsCleveland.com/DailytrustMORE THAN A WORDOne hand washes the otherMetroHealth and the countygovernment hope to make up for thehospital system’s smaller presencein Northeast Ohio by offering incentives for the county’s 9,000 employees to choose MetroHealth as theirhealth care provider, said JosephNanni, director of human resourcesfor Cuyahoga County.In 2009, county employees will beable to obtain health care coverageat MetroHealth without paying adeductible, he said. They also willhave lower co-pays and will receive 500 from the county, which likelywill be paid in two installments nextyear, he said. The 500 incentive willcome out of the reserve fund that thecounty, as a self-insured entity, mustset aside to pay for employees’health expenses, he said.Earning trust is something we don’t take lightly at Maloney Novotny.It’s something that’s built over time. And with 75 years of experience,we’ve earned the trust of clients for the auditing, tax and businessconsulting work we provide in 14 practice areas. The trust of our clients ismost important – because trust isn’t easily gained. At Maloney Novotny,it’s valued above everything else. Business Advisors and Certified Public Accountants Cleveland 216.363.0100 Canton 330.966.9400 Elyria 440.323.3200 maloneynovotny.com29
CCLB 10-06-08 A 30 CCLB3010/2/20089:47 AMPage 1CRAIN’S CLEVELAND BUSINESSWWW.CRAINSCLEVELAND.COMOCTOBER 6-12, 2008LARGEST ACCOUNTING FIRMSRANKED BY NUMBER OF LOCAL CPASRankNameAddressPhone/Web siteNumber ofCPAsNumber ofdegreed imepermanentemployeesPractice personnel engaged inAudit/Top local executiveaccounting Tax Consulting Other Title14Apple Growth Partners (1)1540 W. Market St., Akron 44313(330) avid J. Gainochairman15Barnes Wendling CPAs Inc.1215 Superior Ave., Suite 400, Cleveland 44114(216) effrey D. Neumanpresident16Hill Barth & King7680 Market St., Boardman 44512(330) 758-8613/www.hbkcpa.com37625219.270NANANANAPhillip L. WilsonCOO17Walthall Drake & Wallace LLP6300 Rockside Road, Suite 100, Cleveland 44131(216) 573-2330/www.walthall.com354850(4.0)5037640Richard P. Nagychairman18Howard, Wershbale & Co.23240 Chagrin Blvd., Cleveland 44122(216) 831-1200/www.hwco.com3476760.0813213256Stephen E. Stanisapresident, CEO19Bober, Markey, Fedorovich & Co.3421 Ridgewood Road, Akron 44333(330) uni & Panichi Inc.25201 Chagrin Blvd., Suite 200, Cleveland 44122(216) es M. Ciunimanaging partner21Brockman, Coats, Gedelian & Co.1735 Merriman Road, Akron 44313(330) 864-6661/www.bcgcompany.com2787861.2931932339James J. Coatsmanaging director22Zinner & Co. LLP29125 Chagrin Blvd., Pepper Pike 44122(216) 831-0733/www.zinnerco.com254041(2.4)43251541Robin L. Baummanaging partner23Hobe & Lucas CPAs Inc.4807 Rockside Road, Suite 510, Independence 44131(216) 524-8900/www.hobe.com213135
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