First in a weekly series

LAKE WACCAMAW The 6-inch billet of steel begins to glow as it’s fed through an induction heater, where the temperature reaches more than 2,100 degrees.

As it exits the heater, an employee grabs the billet with tongs and places it in a giant drop hammer, which pounds the billet repeatedly, forging the now-pliable steel into the shape of an ax head. After a trimming die slices off excess metal, an upsetter machine punches the eye for the ax handle before the still-glowing head is tossed in a bin.

Council Tool has been making axes and other tools this way in Lake Waccamaw, a town of 1,500 about 30 miles west of Wilmington, for more than 100 years. Today, the company touts itself as the only manufacturer in the country that still forges its own axes.

“It’s still old-fashioned forging. It’s hot, dirty, and it’s wonderful in its own way,” says Margo Council, director of fire and exports for the company and the great-granddaughter of its founder. “We have equipment here that, not only is it no longer manufactured in the United States, but maintenance is not available in the United States.”

Council’s method of tool-making may be old-fashioned, but look closer at the company’s shop floor, and you’ll see the changing face of manufacturing in North Carolina. In recent years, Council has been overhauling the way its employees work, rearranging equipment and tools, reducing inventory levels and identifying new markets as it seeks what Vice President of Operations Tom Reece calls the “relentless pursuit of perfection.”

“It’s the only way we can continue,” Reece says. “We can’t continue doing the same things we used to.”

North Carolina has shed nearly half its manufacturing base over the past two decades, as hundreds of thousands of jobs moved overseas or were eliminated when machines began performing tasks that had employed people for generations in the state’s mills and factories.

But while the sector no longer employs North Carolinians at levels it once did, the state continues to be a place where people make a vast array of goods, from jet engines to elevator cables to beekeeping supplies. The Triangle, in particular, has seen an explosion in recent years in small manufacturers that are taking advantage of growing consumer demand for high-quality products made locally. Manufacturing still accounts for 20 percent of the state’s gross domestic product, the most of any one sector, and the goods made in North Carolina make up nearly 85 percent of the state’s exports.

“In terms of GDP output, this is still the fifth-largest manufacturing state in the country and the biggest in the Southeast,” said Lew Ebert, CEO of the N.C. Chamber. “The manufacturing component is still a big deal.”

But, as a result of globalization, the terms under which manufacturers in North Carolina can succeed have changed. Since there will always be a lower-cost manufacturer somewhere in the world, manufacturers here have had to distinguish themselves through the quality of their products or through technical innovations that can’t be easily replicated.

“You see so many companies that are successful in a business over decades, and then all of a sudden, there’s a shift in technology or something that disrupts the market,” said Hal Hunnicutt, vice president of marketing for Glen Raven, the Burlington-based textile maker that employs 750 people in the state. “You watch them, and they just ride it into the ground. … Most of us don’t like to change and won’t do it until we’re in crisis mode.”

Founded in 1880, Glen Raven was among the first mills in the South to dye fabrics. It later went on to make parachutes for the military and, in 1959, introduced Panti-Legs the first line of commercial pantyhose.

Today, Glen Raven makes neither parachutes nor pantyhose, and the only apparel it manufacturers is flame-resistant material worn by firefighters and other workers in hazardous industries. The company’s biggest seller: products made from Sunbrella, the brand of fade-resistant fabric it introduced in the early 1960s, which is used to make awnings, convertible tops, boat covers and indoor and outdoor upholstery.

“Most of the things we’re in to today are not things that are commodities. They’re products based around our expertise in fabric production,” Hunnicutt said. “They’re specialized; they’ve got some technical attribute that’s hard to duplicate or hard to manufacture. That’s where we end up finding our success.”

Finding a new way

Like Glen Raven, Council Tool dates to the 1880s, when founder John Pickett Council came up with a tool that offered a superior way to extract resin from pine trees to make tar and turpentine. The company thrived in its early years by selling sledgehammers, bars and other tools used to build ships in the Navy yards along the East Coast.

The company later worked with the U.S. Forestry Service to develop a line of tools for firefighters. One piece of equipment still used by firefighters today is known simply as the Council Rake.

But the arrival of cheaper imports from overseas eventually led Council products to largely disappear from the shelves of major retailers.

“There have been fantastically lean years,” Margo Council says. “The business had to keep morphing into what could we make tool-wise, what could we forge that would have a market demand.”

What the company didn’t do is abandon its principal method of manufacturing – forging – and its insistence that all the materials in its tools come from the U.S. But Margo Council says it’s inaccurate to call the company antiquated.

A few years ago, it purchased an Italian robotic machine that has automated the sharpening of many of the company’s tools. And the hiring of Reece as vice president of operations last year has continued the company’s efforts to make its manufacturing operation as efficient as possible.

‘Inventory is evil’

Reece, an ex-Marine who carries around a Toyota production handbook at all times, speaks about manufacturing processes with an evangelical zeal usually reserved for obscure hobbies. When he arrived at Council, he had the employees watch a video of the ballet “Swan Lake” because, he says, they should seek to emulate the repetition of movement and synchronization among the dancers.

Many of the changes he has helped introduce have been small – creating permanent places for tools, rearranging equipment to reduce unnecessary walking on the shop floor, and posting skills and safety matrixes to better anticipate the company’s staffing needs. Others have been more significant, such as no longer piling up much more inventory than the company needs to fill orders.

“I hate inventory,” Reece says, arguing that it can only get damaged or become obsolete. “Inventory is evil.”

Edward Williamson, a senior manager who is now in his second stint working for Council, admits the “Swan Lake” connection seemed “totally out of the ballpark” at first. Many of Council’s roughly 50 employees have worked for the company for decades and have become experts in their jobs in the process.

“I feel like a lot of them have bought in, or they’re buying in,” says Williamson, 49. “It’s a lot of change. But I can see a big difference.”

As it becomes a more efficient company, Council will need to identify new markets for its tools. While it still sells a fair amount to fire departments, those sales are threatened as government budgets get slashed. In recent years, the economic downturn has led to an increase in customers wanting to replace a handle or blade instead of purchasing a new tool.

The bulk of Council’s business today is making tools for other companies, which are then sold under the customer’s brand name. Over the past three years, Council has come out with its own line of premium axes. The Velvicut axes, which sell for between $130 and $170, have become popular with the survivalist crowd and “even zombie enthusiasts,” Margo Council says.

The company shipped tools to 17 countries last year. Russians imported Council’s forged ax heads for their firefighters, a sign that an ax forged on the shores of Lake Waccamaw still has few rivals.

“We make this thing, and just because it is forged in the United States, it’s wanted all over the world,” Margo Council says. “And that’s very validating.”

News researcher David Raynor contributed.

Bracken: 919-829-4548