Brown & Sharpe Manufacturing Co. Business Information, Profile, and History
North Kingston, Rhode Island 02852-2937
We provide superior services, knowledge and products. We contribute to our customers' success by enabling them to dominate their design and manufacturing processes. We provide our customers: complete line of measurement products; global service and distribution; world class product support; long term partnerships; in-process solutions; optimized capital equipment use; common CAD integrated processes; reduced product development cycle time.
History of Brown & Sharpe Manufacturing Co.
Brown & Sharpe Manufacturing Co. is a manufacturer and marketer of metrology products, measuring everything from car bodies to electronic chips to accuracies of 20-millionth of an inch. Its products in the mid-1990s ranged from hand-held micrometers to $1.5 million car-inspection coordinate measuring machines for the accurate measurement, gauging, and inspection of parts to meet quality control objectives. About one-fifth of its revenue was coming from selling software used by its products and providing aftermarket services such as training, retrofits, and parts.
The First Century, 1833-1933
David Brown and his son Joseph formed a partnership in 1833, opening a shop in Providence under the name David Brown & Son for the making and repair of clocks and watches and to perform other light mechanical work of precision. They made many church clocks in New England. The partnership broke up in the 1840s, however, with the father settling in Illinois and the son remaining to run a retail and jobbing business. In 1850 Joseph R. Brown started out again on new lines. Intent on raising the standard of accuracy in machine shop operations, he built an automatic linear dividing engine that year so fundamentally correct in design and workmanship that it remained in continuous service. His pocket vernier caliper of 1851 has been called "the first practical tool for exact measurement which could be sold in any country at a price within the reach of the ordinary machinist."
Lucien Sharpe joined the business as an apprentice in 1848 and became a full partner in the newly created enterprise of J.R. Brown & Sharpe in 1853. While Brown concentrated on mechanical problems, Sharpe provided the business acumen. Brown & Sharpe made a regular line of watchmen's clocks and certain textile manufacturing appliances. Brown built a precision gear cutting and dividing engine in 1855 that led to an expanding business in gear cutting, circular graduating, and index drilling. Another of the firm's activities begun in that decade was the production of accurate gauges. Soon after the company also began building sewing machines for special purposes.
In 1861 Brown invented the modern universal milling machine for cutting spirals. This machine has been called an important step in advancing the modern lines of manufacture of which the automobile and airplane are examples. Also important were his micrometer caliper of 1868--the world's first to be mass-produced--and universal grinding machine, first exhibited in 1876, to fabricate accurate cylindrical work. After Brown's death in 1876, Oscar J. Beale became the company's genius in the field of mechanical design. As a tool for Brown & Sharpe's gauges, he developed a measuring machine enabling the company to make and sell its gauges within a guarantee of accuracy to within one ten-thousandth of an inch. He also invented an automatic screw machine in 1880.
In 1866 the company merged with a competitor, forming a partnership under the name Darling, Brown & Sharpe that lasted until Darling's interest was bought out in 1892. Brown & Sharpe proper was incorporated in 1868, with Brown's wife and daughter remaining as stockholders following his death. A new plant on Promenade Street in Providence was constructed in 1872. After Sharpe died in 1899, his son Henry Dexter Sharpe became chief executive officer.
Brown & Sharpe's plant grew from 6.5 acres of floor space in 1896 to holdings occupying nearly 32 acres in 1925. The property was something of a curiosity in that it was not located on a railroad siding or boat slip, making it necessary to transport all incoming raw materials and outgoing finished products first by horse and wagon, later by motor truck. Moreover, the property was intersected by three public streets, frequently leading to delays. The company was employing some 6,000 men in 1930.
Changing Times, 1933-1980
The Great Depression hit Brown & Sharpe hard, its sales reaching only $2.9 million in 1933, when the company recorded a loss of $933,427. It returned to profitability the following year, however, and began paying dividends again. With the outbreak of World War II the United States began to rearm, and in 1940 the company almost doubled its net sales to $29.1 million. Net income reached almost $5 million. Sales volume attained a peak of $60.6 million in 1943, although high costs and taxes reduced profits. In 1942 Brown & Sharpe's open-shop policy, perhaps the oldest in U.S. industry, was swept aside when the National War Labor Board awarded the International Association of Machinists a contract in the wake of an election in which a substantial majority of the firm's 10,000 employees chose this union to represent them.
Even before the war ended, Brown & Sharpe's revenues were falling. In 1949 they sank to $15.3 million, and the firm lost $315,562. Better times returned with the Korean War, and although the company lost $1.4 million in 1951, it more than doubled its sales the following year, earning $3.2 million on revenue of $59.4 million. With the end of the war in 1953, sales plummeted again, but the company remained in the black, in part because the work force was cut from nearly 9,000 during the war to 3,500 in 1955.
Under Henry D. Sharpe, Jr., who succeeded his father as president of the firm in 1951, Brown & Sharpe became a very different company. He got rid of machines of somewhat outmoded design and took the firm out of the business of making sewing machines, hair clippers, and low-volume plain-cylindrical grinding machines. Instead he invested in the mass production of automatic screw machines, capable of performing about a dozen different cutting operations on a long bar of metal. A three-year, $4 million refitting program for the Providence plant was completed in 1957. In addition, Brown & Sharpe was reorganized into divisions, with each one responsible for its own profit and loss.
Brown & Sharpe also began expanding by acquisition. A British subsidiary was established in 1955, with a plant in Plymouth, England. In 1957 the company purchased Double A Products Co. of Manchester, Michigan, and in 1958 it acquired the power-unit portion of Rosaen Co. of Hazel Park, Michigan. The following year it acquired Howe & Fant, Inc. of East Norwalk, Connecticut, and American Twist Drill Co. of Detroit. In 1964 the company, which had been Providence's second biggest taxpayer, moved its main operations to a modern plant and headquarters in the suburb of North Kingston. Only the foundry was left at the old Promenade Street site, which became an industrial park.
Machine-tool products, all of the cutting type and used by manufacturers to shape metal parts, were accounting for 55 to 60 percent of Brown & Sharpe's annual sales in 1965, with the greatest volume in single-spindle automatic screw machines and in grinding machines. The company also was making milling machines, turret drills, machinists' precision measuring instruments, and products allied to machine tools, such as cutting tools and hydraulic valves and pumps. In 1963 it introduced a computer-controlled coordinate measuring machine. Almost all of the company's components were being manufactured internally, starting with castings from its own foundry.
With the advent of the Vietnam War, Brown & Sharpe's sales rose rapidly again, reaching a high of $75.9 million in 1967, when it had net income of $5.3 million. In 1968 the company developed a unique new steel tool it named Sharpaloy and acquired certain assets of Cleveland Grinding Machine Co. and Cleve-Co Jig Boring Co., which were merged into a new subsidiary, Cleveland Precision Instruments, Inc. That year Brown & Sharpe also acquired Tesa, S.A., a Swiss manufacturer of precision measuring instruments. Such instruments, also called metrology products, were being used in the quality testing of manufacturing products.
Brown & Sharpe's acquisition spree continued in 1969, when the company purchased a controlling interest in Anocout Engineering Co. of Elk Grove Village, Illinois; acquired Olmstead Products Co. of Ann Arbor, Michigan, producer of high-flow-capacity hydraulic valves; and purchased 20 percent of Chamberlain Group, Ltd. of London, manufacturer of the Staffa hydraulic motor. In 1979 it purchased the remainder of Chamberlain Group. Brown & Sharpe established a German subsidiary in 1970 and a French subsidiary in 1971.
Brown & Sharpe's prosperity came to a sudden halt in 1970, when a recession cut its sales by $15 million and resulted in a $5.6 million loss for the year. The company lost money again in 1971 and, after three improved years, fell into the red again in 1975. One reason was the demise of the single-spindle automatic screw machine, whose prime markets had been auto, appliance, and office-equipment manufacturers. During this period the first two switched small parts to plastic and the latter became electronic rather than electromechanical. Beginning in 1977, Brown & Sharpe developed an electronically controlled version of the screw machine. During the decade's second half, sales and income improved each year, and in 1980 the company had net income of $14.5 million on net sales of $227.5 million.
Metrology Displaces Machine Tools, 1980-1996
Measuring instruments became Brown & Sharpe's chief source of business in the 1980s. The company's principal metrology product was Validator, a high-technology, computer-controlled coordinate-measurement robotic system first produced in 1968. A securities analyst described it in 1980 as far superior to anything competitors could offer in the automation field. Brown & Sharpe's specialized hydraulic devices included small gear-type pumps for metal-cutting coolants and lubricants, Double A and Olmstead valves, British-made motors, and components for high-water-base fluids. Besides automatic screw machines, the company's machine-tool output included a line of surface grinders, among them computer-controlled vertical machining centers. In 1981 Brown & Sharpe acquired Roch, S.A., a Swiss precision-tool manufacturer, and Melbourne Engineering Co., a British machinery firm.
Although Brown & Sharpe had adopted a no-layoffs policy in the mid-1970s, it demanded in return the right to shift machinists wherever needed, often cutting across traditional seniority lines. In response, 1,600 machinists walked off the job in October 1981. The company broke the strike by hiring non-union replacements. Cutting costs was vital, because the company was facing competition from Japanese machine tools during a severe national recession. In 1982 it sold its Greystone, Rhode Island cutting-tool plant, and in 1984 it phased out its line of vertical computer numerically controlled machine tools, a field now dominated by Japanese models. Brown & Sharpe lost $11.2 million in 1982 but made a profit the next three years.
Brown & Sharpe sold its hydraulic operations in 1985 to Vickers, Inc., a subsidiary of Libbey-Owens Ford Co. The sale included the company's Double A Products subsidiary and its fluid-power operations in Britain, France, and Germany. These businesses had sales of about $36 million in 1983. Metrology equipment accounted for 70 percent of Brown & Sharpe's net sales in 1988, the first profitable year since 1985. The firm acquired three gaugemaking companies between 1986 and 1988.
The year 1989 was another profitable year, but in 1990 Brown & Sharpe lost $14.6 million, an outcome the company blamed chiefly on investment writedowns and restructuring costs. The following year it omitted its dividend for the first time since 1933 and announced that it would discontinue making machine tools entirely. This phase of its business had accounted for 29 percent of its 1990 sales. The last piece of the machine-tool business was sold in 1993. By that year employment at the North Kingston plant had fallen to 700, compared with 2,000 in 1982.
Repositioned Brown & Sharpe now was focusing all its energy on its metrology business, especially coordinate measuring machines (CMMs). It acquired a number of companies in France, Germany, and Switzerland, the most important of which was, in 1990, the purchase of a division of the German firm Wild Leitz G.m.b.H., makers of the first digital computer-controlled coordinate measuring machine (1974) and CMM with full 3-D scanning probe (1978). With the acquisition of this business, Brown & Sharpe gained $40 million in annual sales and boosted its proportion of sales made abroad to 61 percent in 1991.
In 1994 Brown & Sharpe surrendered more than 40 percent of its Class A common stock to acquire Italy's Finmeccanica S.p.A, whose DEA Group was its closest competitor in the metrology business. DEA had manufactured the first CMM (1963) and shop-floor measuring robot (1981). Brown & Sharpe also had formed a manufacturing joint venture with a Lithuanian-based manufacturer. It had 12 overseas manufacturing locations in 1996, each managed by local nationals.
After five consecutive years of losing money, Brown & Sharpe earned $1.9 million on revenues of $328 million in 1995, of which automotive companies and suppliers accounted for 46 percent. The following year it had net income of $7.8 million on net sales of $344.9 million, with international sales accounting for 61 percent. Finmeccanica sold all but 2.6 percent of the 42 percent of the company's Class A common stock that it held in October 1996 for about $37 million. Its shares had been worth about $21 million when it acquired them in 1994. The sale took place as part of a public offering of nearly 7.3 million Brown & Sharpe shares, priced at $11.75 a share. Brown & Sharpe, which sold four million shares and received $48.9 million, said it planned to use the net proceeds mainly to pay off debt. The long-term debt was $33.7 million in June 1997.
The Firm in 1996
Brown & Sharpe's products in 1996 were dominated by CMMs and high-speed process-control systems, which accounted for about 69 percent of its sales that year. About 18,000 CMMs had been installed worldwide, mostly for installation in the automotive, aerospace, earth-moving, and industrial-manufacturing industries. This stock consisted of a wide range of manual and computer-controlled high-precision contact and optical CMMs and shop-floor measuring robots under the Brown & Sharpe, DEA, and Leitz names.
Precision measuring instruments accounted for about 28 percent of the company's 1996 net sales. They consisted of a wide range of mechanical and electronic measuring and inspection tools, including height gauges, calipers, dial indicators, micrometers, and gauge blocks. Brown & Sharpe also was manufacturing a wide variety of specialty products and systems under the Tesa brand name.
Largest of Brown & Sharpe's three units, the Measuring Systems Group had its headquarters in North Kingston, Rhode Island, where it was manufacturing CMMs under the Brown & Sharpe name. Group products sold under the DEA name were being made in Turin, Italy, and those under the Leitz name were being made in Wetzler, Germany. The Precision Measuring Instruments Division had its headquarters in Renens, Switzerland and had manufacturing plants there and in Rolls, Switzerland; Poughkeepsie, New York; Leicester, Plymouth, and St. Albans, England; and Luneville, France. Ranging in price from $100 to about $13,000, its products included micrometers, dial indicators, calipers, electronic height gauges, and gauge blocks. The Custom Metrology Division, with headquarters in Telford, England, was engaged in engineering and in manufacturing laser interferometers, measuring sensors, and contact and optical measuring machines and fixtures aimed at specific niche markets.
Principal Subsidiaries: Borel & Dunner, Inc.; Brown & Sharpe Group Ltd. and its subsidiaries (Great Britain); Brown & Sharpe International Capital Corp. and its subsidiaries; DEA-Brown & Sharpe S.p.A. and its subsidiaries (Italy); Mauser Prazisions Messmittel GmbH (Germany); Roch-Brown & Sharpe S.A. (France); Technicomp Inc.
Principal Divisions: Custom Metrology Division; Measuring Systems Group; Precision Measuring Instruments Division.
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