TAMKO & Vertical Integration

Products packing

 

From its inception to present day, TAMKO Building Products, Inc. has employed a strategy of vertical integration. This strategy has contributed TAMKO’s success in the building products industry.

The practice of vertical integration started for TAMKO when founder E.L. Craig built a paper mill in Dallas, Texas for a competitor with the agreement that the mill would supply TAMKO’s Joplin, Missouri asphalt shingle plant with felt. When the Dallas plant was sold and the new owner refused to honor the agreement, E.L. built his own felt mill on Rangeline Road in Joplin, Missouri.

Vertical integration continued under E.L.’s successor, Jay Humphreys. Jay put a limestone grinding mill at the High Street plant in Joplin, Missouri—an oddity in the industry at the time. This allowed TAMKO to produce its own powered limestone for its shingles, instead of having to purchase the material from another company.

When David Humphreys, TAMKO’s current President and CEO and grandson of its founder, assumed leadership of the company in 1994, the push for vertical integration increased. TAMKO continued to take steps to maintain its own supply line, such as running its own asphalt refineries near or at its plants and by buying or converting existing paper mills to supply felt. Through investing in the ability to make its own materials, TAMKO has decreased its raw material costs.

“In our case, vertical integration means making more of our own raw materials and insourcing more activities rather than paying someone else to make or do things for us,” said David Humphreys. “All of these efforts have helped to reduce our costs and grow our profits.”

Some of TAMKO’s vertical integration projects include:

  • The construction of fiberglass mat lines at its Rangeline Road plant in Joplin, Missouri and its Tuscaloosa, Alabama plant.
  • The purchase of the Ennis, Texas fiberglass mat plant.
  • The development of the Columbus, Kansas polyester mat plant so TAMKO could produce its own polyester mat.
  • The establishment of the Frederick, Maryland limestone mill so TAMKO could produce all of the limestone filler for the Frederick plant.
  • The additions of the Tuscaloosa, Alabama and Joplin, Missouri limestone mills so TAMKO could grind all of its own limestone at these locations.
  • The MW/MB joint venture in Clarksville, Tennessee to produce chopped glass fiber for TAMKO’s fiberglass mat production.
  • The establishment of a new asphalt processing plant in Inwood, West Virginia in 2011 to supply all of the Frederick plant’s coating needs.