Oscar DiVeroli:           I’d like to welcome today to the studio Felipe Sixto, of Sixto Packaging. Welcome.

Felipe Sixto:                 Thank you Oscar.

Oscar DiVeroli:           On behalf of EO South Florida I would like to congratulate you for earning a prestigious ranking on the 2014 Inc. fastest growing privately held companies in the United States. Congratulations.

Felipe Sixto:                 Thank you again.

Oscar DiVeroli:           Tell us a little bit about Sixto Packaging.

Felipe Sixto:                 Sixto Packaging is a family owned and operated flexible packaging manufacturer. We’re based out of Opa-locka, Florida, which for those who don’t know, it’s near Miami.

We’ve been in business for over 45 years. We print, laminate we make flexible packing of all sorts. For sectors as diverse as coffee, to produce, to pet foods, to medical packaging so it’s pretty diverse stuff.

Oscar DiVeroli:           Interesting. What’s unique about your business?

Felipe Sixto:                 What’s unique is the very fact that we are a family-owned company. We’re relatively a small company in an industry that’s dominated by large corporations that [inaudible 00:01:10] mergers, acquisitions and so on. They become these giants that try to take over, and they push their customers around.

We’re a little different. We’re very service oriented. We try and treat every customer like a family. Like a member of the family. We have quick lead times, attractive pricing, and quality products.

Oscar DiVeroli:           Having a family dynamic does that offer … Sometimes there’s challenges with that in business. How does that work in your company?

Felipe Sixto:                 There’s always challenges. When executive decisions need to be made there’s always good debate. You get that in every … As long as you have respect for one another you really can make your decisions … We all have the same goals.

What’s unique about a family business of this nature is you really worry when something messes up. It’s food off your table every time you make a mistake in the manufacturing process , so we take our job very seriously. It’s not a 9-5 job, it’s a lifetime.

Oscar DiVeroli:           That’s very interesting. Do you have key partnerships in your business?

Felipe Sixto:                 We do. We have strategic partnerships with suppliers even with customers believe it or not. It’s a way to help grow a business. Very often … and for years, for probably 35 years the way we got our business was through our customers. Word of mouth was very important. Referrals. Just creating those long-lasting bonds.

Oscar DiVeroli:           How has technology changed your business?

Felipe Sixto:                 Technology is key to our industry. When we first started this company, we were making paper bags on all-mechanical machines. Now-a-days several motors dominate the whole conversion process, and on the print … Right now we’re still doing flexographic printing, but 10 years from now we might be having a different conversation with the emergence of digital printing. It’s key . It’s key to our business.

Oscar DiVeroli:           So other than the introduction of digital printing, is there anything else that you think might change dramatically for you in your industry in the next 5 or 10 years?

Felipe Sixto:                 There’s always innovations. Right now we’re working very closely with a strategic partner. We’re trying to develop specific innovations using lasers. Lasers to create microwave packaging for fresh produce, or special score marks to help tear pouches, to even tailoring oxygen transmission rates in plastics so that you could have longer shelf life of meats, cheeses, fresh produce.

So absolutely. There’s definitely more technology. In 1999 we invested in new technology which was solventless lamination. We are one of the smallest companies in the nation that are able to laminate aluminum foil. We did that, because we were driven being an Hispanic based company in Miami where the Hispanic coffee market emerged in the 60’s. We grew along side our customers, and we were almost forced to learn to laminate aluminum foil. That’s been key. As technology has improved throughout the years we’ve had to modify our production and continuously invest in equipment and in that technology.

Oscar DiVeroli:           Interesting. Being one of the fastest growing privately held companies in the country. What’ problems does that bring along with all of the good stuff that happens?

Felipe Sixto:                 Absolutely.  Again I think it happens to any company that’s growing. The number one problem is cash flow. Growing pains. You really have to be careful not to over-extend your staff, over-extend your bank account, over-extend your credit lines.

The majority of our financing is self-financing. SBA has been key to helping us out. Our local banks … Shout out to Total Bank whose been excelling in helping us grow our business. Those are two main concerns. Right now we’re struggling as a company to decide … Being a family-owned company … How do we implement longer shifts? For a long time we were a one shift company. Now we’re a shift and three quarters. How do we start implementing a 2nd shift and eventually a 24 hour operation?

There comes personal decisions that we have to make. Who of the member of the family is going to stay behind or do you start trusting outside employees. So there is a dynamic as you grow … As you change the way you run your company. The larger you get you almost have to lose a little bit of that. The way we run things without losing our family values and our family way of running the business.

Oscar DiVeroli:           Do you think that … Especially because this is a family business … That the growth of the company could perhaps outpace the abilities of family members.

Felipe Sixto:                 That is a struggle. I think that we probably have for several years … We were stagnant for several years.  I think it was the fact that my father, my uncle, and my other uncle had the business. Everything was paid for. They were content with … My cousin and I coming into management and really pushing. We’ve had to invest quite a deal of capital into the business and create a sales campaign to go out and get additional business.

I think at the moment we have that energy. We have that desire to grow the company. We have not thought of 10, 20, 30 years from now, but in the short-medium term we have plenty of energy to really go out there and grow this business.

Oscar DiVeroli:           That’s great. What is the most unusual sales tactic that you’ve ever deployed?

Felipe Sixto:                 Okay. I don’t know.  The majority of my sales tactics is old-fashioned. Cold calling. Going … Walking to the shows. Getting on the internet and finding companies, and visiting them sometimes without appointments and breaking down that barrier. There is a couple of organizations that do networking that we’re a part of. It takes several years to develop those customers, but sometimes they end up being your best customers because you become friends before before you become business partners.

Oscar DiVeroli:           Sure.

Felipe Sixto:                 That’s really important.

Oscar DiVeroli:           You ever turn down a client?

Felipe Sixto:                 All the time. There’s 2 reasons for turning down a customer in our business. The first is … Obviously when they don’t pay on time. When there’s financial issues that just don’t make them a viable customer or if they’re haggling price. The way we feel … The way we run our business is we’re in the business to make a living to make profit. Not to work. We have printing presses, but our philosophy is not to keep the presses running no matter what. It’s better to shut them down and not have that overhead and the electricity, and all the other expenses that go with running a printing press.

Number 1: It has to be a customer that is going to be profitable, and it’s going to be a good strategic partnership between them and ourselves. We don’t look to make sales. We really look to become partners, and help them out. Help them out in their product development and their sales. When they’re successful, we’re successful. That’s been the way we’ve run business up to now and absolutely we’ve had to fire customers in the past. It’s happened quite often.

Oscar DiVeroli:           Sure. What’s the toughest decision you’ve ever made in business?

Felipe Sixto:                 In business okay. In personal there’s plenty. Sometimes the toughest decision are those gambles. Do you invest half a million dollars in this equipment when you really don’t have the business for it yet. Those are hard decisions, but you have those gut feelings where you have to take those risks. Up to now we’ve been lucky that they’ve all panned out.

There’s always the tough decisions. There’s always the human resources decisions that have to be made. Which are difficult. Whenever you have to fire somebody that you know has a family … We take it personal.. We know … We end up knowing these people working with them for a long time.  So those are always hard decisions as well.

Oscar DiVeroli:           Great. You mentioned a half million dollars a moment ago so let’s up the stakes a little bit. Let’s say that I would like to invest 1 million dollars in your company. How would you deploy those funds?

Felipe Sixto:                 We’ve invested 3 1/2 million over the last 2 years so it would really help to pay back some of those loans <laughter>. If I had to invest right now a fresh 1 million dollars, forgetting all the other investments we’ve made, and whatever debt or cash flow or none of that.  It would be exactly what you said. It would be in technology. It would be looking at … Seriously looking into digital presses, into laser converting apparatuses because I believe they are the future.

If you take a digital press versus a flexographic or even a rotar grove veer press, you don’t have printing plates, you don’t have solvents.  You have no volatile compounds in your inks. It’s better for the environment. There’s downsides at the moment. I don’t think the technology is quite there in my industry, in flexible packaging, but it’s slowly, slowly creeping up.

There could be a couple things. Would I say all of that 1 million dollars would go into equipment? Probably not. We could probably toss some into the cash flow, into payroll accounts, into paying off some debt, but it would definitely go back into our business because that’s crucial. That 1 million dollars would go a long way in bringing a lot more business per year into our business

Oscar DiVeroli:           Great. Let’s say for a moment you had some magical powers. You had the ability of rolling back the clock, you could reverse a critical decision that was made in terms of the company. What would you change?

Felipe Sixto:                 I would have to say a little antidote which one of my employees told me, and it was actually about my Grandfather several years ago. Several decades ago actually.  When they moved into a new building in 1984, my Grandfather told this employee,  my son’s will have us jam-packed in this building.   We’ll have to get a new building within 10 years. That decision, which was not mine at the time, obviously didn’t occur. We stayed in that building probably a little longer than we should of. That probably restricted our growth for several years.

Recently in 2012 we moved into a larger 60,000 square foot facility which allows us to move and grow, and really service out customers. My goal is not to be restricted by the walls of our building. If we need to keep investing. If we need to keep moving into larger spaces or acquire other spaces we will do that. That’s really the only business decision, which again wasn’t mine, but it’s the organizations decision that probably we could have made the move a little quicker.

Oscar DiVeroli:           Sure. What one word describes you as an entrepreneur?

Felipe Sixto:                 Workaholic. It’s kind of two words. Passionate now.

Oscar DiVeroli:           In your opinion, are entrepreneurs born or are they made?

Felipe Sixto:                 I think entrepreneurs are made, but they have to have specific characteristics as human beings.  I think those same characteristics are evident in many of leaders whether it’s in religion, politics or sports organizations or whatever. I think you need to be a leader to be an entrepreneur. You have to take risk. You have to have values and ethics, and that drive to never give up.

How many people do we know have failed on the first business or second business or third business and never give up? It’s like that in our personal lives. Things go up. Things go down. I’ve had my own ups and downs that brought me back into this business … or into this business not back to this business. I think you need to have those core values and that desire never give up and keep going. I think that’s what makes a real entrepreneur. That drive.

Oscar DiVeroli:           Success to you is what?

Felipe Sixto:                 Success is … Success has many definitions I guess. First and foremost I would say at a personal level success is being content. Being happy with who you are, and what you have. For me personally it’s having a nice long, healthy, good family. It’s not about the flashy cars or any of that for someone like me.  It’s just having enough. Having a solid family, a solid organization to keep building on to provide for my kids.

We all have our dreams that maybe perhaps our kids will end up taking it and end up going to a 4th generation. How many businesses fail after the 2nd or 3rd generation. I think our company has already been successful, it’s just can we make it more successful, and that’s what we’re trying to do.

Oscar DiVeroli:           Who do you go to if you’re looking to problem solve or have a brainstorming session, or looking for some guidance. Who’s your go-to person or persons?

Felipe Sixto:                 We have a team, and it’s actually comprised of members of our organization and some key suppliers which have been in the business for a long time. These are all guys in their 60’s and 70’s … A couple of guys in their 30’s. We get them all together, you know conference call, and really understand what’s going on. What we’re trying to accomplish. What’s best for whatever particular decision we’re trying to make.

It’s definitely a group of people with a lot of experience. For me personally, the first person I always go to is my father.  Because he’s been in the business 45 years, because he’s been in the military. He’s had a lot of life experience. Not necessarily college or professional degrees, but that life experience is very important.

Oscar DiVeroli:           Share with me one of your coolest experiences you’ve ever done, either personally or professionally.

Felipe Sixto:                 I think one of the coolest things I ever did was in a previous life when I worked with the government I got to brief President George W. Bush on some issues. In that room we had the National Security Advisor, the Secretary of State, and several others … that was a pretty exciting moment at a professional level.

In a personal level it’s what every guy says. When my kids were born type of thing, but that’s the truth.

Oscar DiVeroli:           Sure. What’s better than that?

Felipe Sixto:                 Absolutely.

Oscar DiVeroli:           So going back to making a mark. We have X amount of time on this earth. What do you want to be known for or remembered by?

Felipe Sixto:                 I want to remembered … I guess at a personal level, for a family man, someone that created a strong, solid basis so that my kids could be successful. Whether it’s in this business or other or some other business or whatever they want to do.

As a member of this management of this organization, I want to be known for a company that really goes out and services their customers, and that customer say “man, we want to work with Sixto Packaging because they really treat us well”.

We’re their big fish in their pond.

Oscar DiVeroli:           Sure.

Felipe Sixto:                 Which is something they don’t always get from big corporations.

Oscar DiVeroli:           If I say the words trust and respect. What does that mean to you?

Felipe Sixto:                 It means a lot. Those are some of the values we live … I personally live my life with. Trust is important. Trusting your management team, trusting your employees. Trusting your gut feeling. Like I said, when you have to invest money you really have to trust yourself. You’re going to second guess yourself every time when you’re going to make a big investment. You fear failure, but you still have to attack. You still have to trust.

Oscar DiVeroli:           Sure. Final question. It’s going to be a very difficult one for you because of the longevity of this family business, but let’s assume tomorrow morning you wake up, and your business is no longer there. What business would you then go in to?

Felipe Sixto:                 I actually have a side business that I started up about a year ago. It’s somewhat related, but it’s actually a snack food business. I started a trail mix brand, and I sell it in Burlington Coat Factory and Marshall’s and all these retailers. With the experience I’ve learned and with the knowledge I’ve learned about this market, especially in the food and beverage, it’s always going to be needed. So I would gain those experiences and try and grow that business or some other business in that industry because people always have to eat …

Oscar DiVeroli:           Sure.

Felipe Sixto:                 People always have to drink. Whether it’s packaging or the final product or something thereof, I think it will always be manufacturing something, packaging something, sending something out. Something that someone has to use and buy another one.

Oscar DiVeroli:           It has been an absolute pleasure having you in the studio today. Again, on behalf of EO, congratulations for being one of the fastest growing companies in the United States, and for helping to fuel the entrepreneurial spirit in South Florida. Thank you so much.

Felipe Sixto:                 Thank you Oscar.

Oscar DiVeroli:           Pleasure.

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