W. H. Brady Co. History

Company Perspectives:

Find a niche and work to own it. Risk trying the untried. View every customer as your ultimate employer. Above all, stick to it.

Company History:

W. H. Brady Co. is an international manufacturer of coated films and identification labels, signs, and related products for the global industrial, commercial, governmental, public utility, medical, semiconductor, and computer markets. In 1995 Brady was the ninth-largest adhesives and sealants manufacturer in the United States, and its Industrial Products Division was the fortieth-largest miscellaneous manufacturing industry.

Brady's expertise lies in three interrelated operations: creating and applying coatings, such as adhesives, to cloth, paper, metals, and plastic films; converting these coated materials into products such as industrial labels and tape products through lamination, printing, die cutting, perforating, and other processes; and designing lettering machines, computer software, portable printers, and other equipment. In the mid-1990s, Brady manufactured and marketed roughly thirty thousand products, ranging from wire identification markers, medical and splicing tape, factory safety signs, adhesive letters, and bar code labels to data collection equipment, portable label printers, data storage tapes, and computer floppy disk supplies and components such as wipes, springs, and reinforcement rings.

Brady comprises three main global groups: the Identification Systems and Specialty Tapes Group, which consists of Brady Precision Tape Co., Coated Products Division, and Industrial Products Division; the Graphics Group, Brady's safety and facility identification division; and the Seton Group, Brady's direct marketing operation for selling products to 1.5 million end users. Brady's prominent customers have included NASA, Boeing, Hollywood's film industry, IBM, PepsiCo, General Electric, and the Alaskan oil pipeline. In addition to U.S. operations in Wisconsin and Connecticut, in 1996 Brady maintained manufacturing or customer service operations in fifteen foreign countries including England, South Korea, Germany, Canada, Australia, Italy, France, and Japan. In 1996 these international operations accounted for about 44 percent of Brady's annual sales.

Origins, 1914

W. H. Brady traces its origins to founder W. H. (Will) Brady's early career as a salesman for an Ohio remembrance advertising firm that manufactured calendars, yardsticks, and other promotional items on which advertising messages were printed. After turning down a promotion to the company's New York office, in 1914 Brady founded the W. H. Brady Company in Eau Claire, Wisconsin, Brady's hometown. His first product was promotional photographic calendars sold to offices and stores, but he soon followed with elaborate color displays for ice cream parlors, printed glass beer signs, point-of-purchase displays, and pre-billboard roadside advertising.

After a decade and a half of growth, the stock market crash of 1929 and the depression that followed drove many of Brady's customers out of business, forcing him to sell his home and, with his parents' support, enroll in college. In the midst of this crisis, an unusual promotional gimmick saved the firm. Candy-maker Webster's Famous Fudge included in its fudge packages a small, paperboard card that contained rows of perforated circles, each of which concealed a prize number. When customers exposed a winning number by pushing out one of the circles on the card, they won four free candy bars. The product fit neatly into Brady's printing, die-cutting, and laminating capabilities, and, aided by the cross-country marketing efforts of Will Brady's oldest son Fred, Brady-manufactured push (or punch) cards, as they were called, were soon being used to sell everything from cigars and cigarettes to beer and turkeys. Throughout the 1930s and 1940s, Brady manufactured millions of push cards and became their largest producer in the United States. In 1939 Brady was incorporated and declared that its new purpose was to carry on the business of printers, publishers, and painters of advertising matter and, in general, to engage in advertising businesses of all kinds.

Postwar New Product Lines

As World War II erupted, Will Brady yielded leadership to his two sons, Fred and Bill Jr., who from 1942 to 1955 shared direction of the company. The war brought shortages in the paperboard Brady used to make push cards, which was only partially offset by stopgap contracts such as printing morale booklets for the Red Cross. In 1944, however, while working at Milwaukee electrical control manufacturer Cutler-Hammer, Bill Jr. discovered the wire marker card--an adhesive card from which numbered cloth strips could be pulled and wrapped around electrical wires for identification purposes. The self-adhesive (or "pressure-sensitive") tape technology on which the wire marker card was based was still relatively new, but there was an urgent need for a clear and easy way to identify the ever-more dense masses of wiring being installed in ships, planes, and other military equipment. Moreover, the printing, die-cutting, and laminating processes for the paperboard backings on which the wire markers were placed were the same ones Brady used to make push cards. The new Brady markers were quickly embraced by the war industries; among their uses was the identification of wiring for the Manhattan Project construction work.

Sensing an untapped market, Brady began sending its four-page sales brochure to electrical manufacturers around the country and was quickly bombarded by inquiries. It began improving its markers' flexibility and applications by adapting them to customers needs: it made wire markers easier to remove from their backing, for example, and improved the type of material used for the backing itself. After the war's end, wire markers continued to eclipse push cards as Brady's main product, and Brady began performing the typesetting for the marker's label, offered new marker sizes and numbering systems, and introduced new marker types--from circular labels and Underwriters Laboratories seals of approval to small safety signs, pipe and conduit markers, and foil-, epoxy-, and vinyl-based markers that could resist oil, acid, and temperature extremes. Brady's first Caution and Danger safety signs appeared in 1949, and Brady's fallout shelter and radiation hazard signs enjoyed brisk sales during the 1950s and 1960s when the threat of nuclear weapons and radiation was at a peak.

At the same time, Brady was developing proprietary machines that could laminate, die cut, print, and cut to length in a single operation, boosting production volumes and cutting unit production costs. Because it was inexpensive for Brady simply to mail potential customers samples of its markers, it was not until after 1950 that it developed a national sales force. By the late 1940s Brady nevertheless claimed distributors in over 125 cities, most of which were local outlets of national electrical firms. By 1967 the two hundred distributors Brady claimed in the early 1950s had grown to more than one thousand.

National Presence, 1950s

By the early 1950s, Brady had become a national presence and chose "identification specialists" as the way to describe its specialized product niche to the increasingly interested industrial consumer. In desperate need of more production space, it moved permanently from Chippewa Falls, Wisconsin, to a new facility in Milwaukee in late 1952. The move hastened the pace of new product development, which averaged one new product every one to two months. The thirteen products listed on the company's letterhead in 1954, for example, had grown to twenty-one by 1956, and between 1944 and 1969 alone Brady introduced more than eighty new products in a variety of materials, sizes, and colors. By the late 1960s, Brady was offering ten thousand stock items in thirty-five distinct product groups.

Brady's 1953 introduction of Blue Streak Release--an adhesive so effective that labels and markers could be dramatically increased in size without loss of adhesion--was another major step forward in Brady's labeling capability. It also led Brady into a new product group--coatings--that would eventually form a crucial component of its product line and signaled Brady's desire to control as many stages of the label production process as it could. To manufacture its coatings, Brady engineers designed and built proprietary machinery that was used to produce a vinyl tape product suitable for making warning stripes for factory floors. Brady could now free itself of its traditional dependency on 3M, its major tape supplier, and by supplying its own tape could now determine the characteristics, price, and quality of the materials it used in production.

In 1955 profits surpassed the $1 million mark for the first time, and two years later Brady--with Bill Jr. now alone at the helm--expanded into another new product line: nameplates. Thousands of consumer products, from power tools to washing machines, required plates that identified the manufacturer or displayed ratings or instructions. The sale of its aluminum and polyester nameplates (Quik-Plates and Poly-Plates, respectively) gave Brady a new niche in another lucrative market.

The same year, yet another innovation, the Markermatic automatic wire marker application system, solidified Brady's position in the expanding identification products industry. When loaded with a wire marker card, Markermatic automatically peeled back the card's adhesive starter strip, picked off an individual marker, wrapped it around the wire, and returned for the next pass--at a rate of one thousand markers an hour. The machine proved to be a substantial source of lease income for Brady while simultaneously promoting the adoption of its wire marker brands. As Bill Jr. later remarked, "Markermatic made us king of the hill in our industry. Customers perceived us as the leader." Quickly capitalizing on the product's success, Brady followed with Printermatic (an automatic label printer), Wrapmatic (a device for wrapping tape around cylindrical objects), and Aisle Markermatic (a machine, resembling a floor polisher, for the precision-marking of factory lanes).

Overseas Expansion, 1960s

With the establishment of Brady Canada on the outskirts of Toronto in 1958, Brady moved into the international marketplace, which within forty years would generate nearly half its annual sales. In the following years Brady added a nameplate manufacturing operation in Mexico (Uquillas-Brady) and a marketing/distribution operation in England (Simpson-Brady), which by 1962 had evolved into Brady England, Brady's first overseas facility. Although Brady claimed to have no strategic plan for its foreign expansion, a pattern nevertheless emerged. It first established a sales presence in the new foreign market, followed it by building a warehouse to maintain stock for the market, graduated to a leased manufacturing plant managed by local staff, and finally moved on to a new factory owned by a full-fledged subsidiary.

In 1966 Brady opened Brady Europa, a warehouse/factory in Belgium, and in the early 1970s, it bought out its ailing Australian distributorship to form Brady Australia. A formal international division was established in 1972 when Brady Sweden and Brady Germany joined the fold. Discovering that its foreign operations tended to thrive only when it established a subsidiary, rather than merely a distributorship, Brady opened a combined sales/warehouse/factory as Brady France in 1980. By the end of the year, Brady's international subsidiaries were accounting for 20 percent of the company's annual sales--the level at which they stayed for years, despite the addition of Brady Japan in 1987.

The 1960s and 1970s were a time of both continued growth and difficult transitions. Brady's new microscopic, fireproof component markers were being launched into orbit on Gemini space missions, and Brady had presciently seen the potential of the computer market as early as 1962 when it began selling computer-printable wire markers.

Before the end of the decade Brady was manufacturing labels, markers, drafting aids, and keypunch-hole correction seals specifically for the still-infant computer industry. Annual sales broke the $10 million mark in 1968, driven by a robust annual growth rate of 18 percent between 1953 and 1969, and Brady's policy of plowing profits back into new product development continued to reap benefits. By the 1990s, Brady was investing roughly four percent of annual revenue into new product R & D, and its expectations for such innovations were high. In 1989, for example, Bill Brady Jr. announced that he expected new products to account for 25 percent of Brady sales every year.

Corporate Reorganization for the 1970s

Brady's hierarchic management structure was meanwhile showing signs of obsolescence, and its sales force, overwhelmed by the sheer number of products Brady now offered, could only show a limited part of the company's product line to each customer. Partly as a result of these problems, in 1971 Brady experienced a decline in sales for the first time since the wartime years of push cards and morale booklets.

Brady's answer to its troubled business structure was to scrap it in favor of a group of individual divisions, each focusing on a specific product line and market: the Nameplate Division, the Data Processing Division, and the Industrial Products Division, each with its own sales, marketing, and manufacturing units. Rather than conform to a top-down corporate plan, each division manager established his or her own pace for the division, which operated virtually as an independent company.

As the company adjusted to its new structure in the 1970s, product innovation forged ahead. Circuit tracers, hot stampers, nameplates made of specialized materials, and portable wire marker books were added to the Brady catalog in the 1970s. More importantly, typewriter lift-off correction tape and BOT/EOT markers for detecting the beginning and end of recorded data on computer tapes provided Brady with two lucrative new markets to pursue, and it was soon a major player in both. In 1977 Brady unveiled its LiteTouch membrane switches, in which electricity-conducting inks and adhesives enabled consumers to turn on microwave ovens, dishwashers, and sewing machines with a touch of the finger. Ironically, given Bill Brady Jr.'s disdain for government intervention, major federal legislation in the 1970s helped to further boost demand for Brady products. The Occupational Safety and Health Act of 1970 imposed a series of regulations regarding signage, safety warnings, and hazard identification in the workplace, and a related law in 1977 required all trucks carrying hazardous materials to sport high-visibility warning signs. By 1980, Brady had climbed past the $50 million sales plateau.

Not all of Brady's new product gambles bore fruit. In 1969 it introduced Phodar, a method for manufacturing printed circuit boards using dry resist techniques rather than the traditional liquid resist method. It had to abandon the product in 1972, however, when DuPont's competing brand won the battle for market share and Brady's engineers were unable to overcome Phodar's poor shelf life limitations. The same year Brady unveiled Kalograph, an instant, one-step label maker that promised to enable customers to create their own custom industrial labels. The product's high cost, however, combined with its inability to create black lettering and its labels' tendency to fade in sunlight, undermined Kalograph's early promise, and in 1979 Bill Jr. finally pulled it from the marketplace, making it the most expensive failure in Brady's history.

Growth in the 1980s

After the lull in acquisitions of the 1970s, Brady began shopping for potential targets again in the 1980s. Small- to mid-sized, privately owned businesses with stock product lines and technologies similar to Brady's were scrutinized, and between 1981 and 1987 Brady acquired the Weckesser Corporation, a manufacturer of plastic wiring accessories (later sold); the M. C. Davis Co., a maker of miniature and subminiature coils; the MPV Co., a manufacturer of hard protective coatings; Browncor International, a distributor of shipping and packaging supplies; Revere Products, a direct marketer of maintenance products; and, most importantly, the Seton Name Plate Corporation, a manufacturer of nameplates and a business-to-business direct marketer, established in 1956. The Seton acquisition allowed Brady to supplement its traditional niche-focused sales and distribution network with blanket mail order sales through Seton's industrial catalog, which in 1988 alone reached eight million potential customers. Brady soon was establishing Seton subsidiaries in England (1985), Canada (1986), and Germany (1988).

Now operating six domestic divisions and eight international subsidiaries, Brady's annual sales grew 350 percent through the 1980s to $175 million, and profits soared past the $10 million mark. In 1984 Brady became a private/public hybrid when it sold 500,000 shares of nonvoting stock to avoid the estate taxes due when Bill Brady Jr.'s heirs inherited his stake in the company. That moment came in 1988 when Bill Jr., the Brady Co.'s second founder, died, and a longtime Brady insider, Paul Gengler, took over direction of the company. Brady retired its family-run reputation permanently in 1994 by hiring Katherine M. Hudson, a vice-president at Eastman Kodak, to lead it into the 21st century. An aggressive, hands-on executive with a ready sense of humor, Hudson announced her intention to quadruple annual sales to $1 billion, improve earnings, and exploit new opportunities for joint ventures, acquisitions, and geographic expansion, particularly in such new markets as Italy, Brazil, and the Far East.

A year into her tenure, Hudson announced that Brady's far-flung operations would be reorganized into three international divisions: the Identification Systems and Specialty Tapes Group, the Signmark Group (renamed Graphics Group in 1996), and the Seton Group. A year later Brady acquired Varitronic Systems, a U.S. manufacturer of high-tech printing systems, and two British firms: TechPrint Systems Limited, a printer producer, and the Hirol Company, a manufacturer of printing systems and die-cut parts for electronics, telecommunications, and medical testing markets. Brady also sold off its nameplate and medical wound care operations to concentrate on its core businesses and entered into a joint venture with a South Korean marker equipment firm. It was also continuing to push the technological envelope of labeling and coating product design. Between 1980 and 1996 it introduced bar code software; a fully automated labeling machine for circuit boards and electrical components; and the Bradywriter printer, which allowed customers to print their own marker legends in house. It also began offering an express custom sign-making service; computer systems to exactly match customers color samples; installation, training, and contract services for Brady products; and integrated product groups that widened the number of labels and markers customers could choose from.

Principal Subsidiaries: Brady USA; Seton; Brady Precision Tape Co.; Varitronics Systems, Inc.; W. H. Brady, Inc. (Canada); Seton, Inc. (Canada); W. H. Brady Co. Ltd. (England); W. H. Brady (Germany); Seton Limited (England); W. H. Brady S.A.R.L. (France); Seton GmbH (Germany); Nippon Brady K.K. (Japan); Seton S.A. (France); W. H. Brady Pty. Ltd. (Australia); Seton Australia Pty., Ltd. (Australia); W. H. Brady, N. V. (Belgium); W. H. Brady Co. (Hong Kong); W. H. Brady, N.V. (Italy); Seton Italia Srl (Italy); W. H. Brady Pty. Ltd. (New Zealand); TechPrint Systems Limited (TechPress II Limited) (United Kingdom); W. H. Brady Pte Ltd. (Singapore); W. H. Brady Co. (South Korea); Brady AB (Sweden); Brady Financial Co.

Further Reading:

• "CEO Interview--Katherine M. Hudson, W. H. Brady Co.," Wall Street Transcript Digest, May 8, 1995.
• Grube, Lorri, "Katherine M. Hudson, Chief Executive," Chief Executive, January/February 1995, p. 29.
• Gurda, John, Sticking to It: A History of the W. H. Brady Co., 1914-1989, Milwaukee: W. H. Brady Co., 1989.
• Holley, Paul, "Global Spending Slows Earnings at W. H. Brady," Business Journal Serving Greater Milwaukee, May 18, 1996, p. 7.
• Joshi, Pradnya, "W. H. Brady Labels Its Fiscal Year Exceptional," Milwaukee Journal Sentinel, September 14, 1995, p. 1.
• ------, "W. H. Brady Wants Growth to Continue," Milwaukee Journal Sentinel, August 14, 1995, p. 3.
• Kirchen, Rich, "With New Owner, Former Brady Unit Sticks to Growth Track," Business Journal Serving Greater Milwaukee, April 8, 1995, p. 7.
• Shapiro, Joshua, "An Unusual Climb at Kodak Wins Her a Place at the Top," New York Times, January 30, 1991, p. 8.

Source: International Directory of Company Histories, Vol. 17. St. James Press, 1997.