hen you take an endless hot shower at a hotel or wash your hands with warm water in a public restroom, you probably don’t give much thought to who’s behind your comfort.
But then again, Santa Ana’s Ajax Boiler Inc. never has been in it for the image.
The family company makes boilers,industrial-strength water heaters,for hotels, casinos, hospitals, launderettes, schools, condominium buildings and others.
The boilers, which weigh as much as 10 tons, end up in far-flung places, including factories in Africa, U.S. embassies in Moscow and Tokyo and military bases in Alaska.
Ajax boilers heat the team showers at Staples Center in Los Angeles and send water through pipes under Cleveland Browns Stadium to warm the field.
With about 100 sales representatives across the country, Ajax owner Ed Cancilla said he’s not always sure where his products end up.
“I got a call from someone who said they were the White House and I thought it was a joke,” Cancilla said. “It turns out the White House needed servicing for one of our boilers they had in their basement photo lab.”
Old School
Ajax Boiler is decidedly old school in modern Orange County.
Its 120,000-square-foot facility in Santa Ana would be right at home in the industrial Midwest with its sprawling factory floor, brick exterior and “Ajax Boiler Inc.” in red block letters outside.
Cancilla, 85, has owned Ajax for 40 years. He works full time with his daughter, Jane Terry, the company’s president whom he’s grooming to take over.
She runs daily operations. Cancilla oversees things as chairman.
Ajax actually has been around for 90 years,Cancilla bought the business for $350,000 in 1967 after responding to a three line add in the Sunday Los Angeles Times about a business opportunity.
“I knew nothing about boilers, but I always wanted to be in business for myself,” he said.
These days, Ajax does about $20 million a year in sales. A team of more than 80 people designs and builds boilers in Santa Ana, which is the company’s only facility.
As with most manufacturing here, Hispanics dominate Ajax’s workforce.
California is the biggest market for Ajax and accounts for about 10% of sales. Global markets make up another 10% to 15%.
The company makes boilers under the Ajax, Ace and Atlas brands.
Even the names are a throwback: The prior owner picked them to gain an edge in the phonebook.
Ajax got its start in Santa Fe Springs in a house with a shop in the back.
Back then, the operation was no more than 20,000 square feet.
In the past 40 years, the company has grown tenfold, Cancilla said.
Originally from Portland, Ore., Cancilla first became a mechanical engineer and then worked for Massachusetts consulting firm Arthur D. Little. He later was a salesman for Westinghouse Electric Co.
Cancilla said his career as a manufacturer brings daily gratification.
“I feel like a farmer who plants a seed watches his product grow,” he said. “So many jobs don’t allow you to actually see the work you do.”
Early Challenge
Early on, Cancilla said he faced a challenge from company defectors who started making similar products down the street.
Two months after Cancilla bought Ajax, the president and general manager left with two sales reps to set out on their own.
“It forced me to redesign and become more efficient,” Cancilla said. “I learned how to make them much cheaper.”
The rivals went out of business five years or so later, according to Cancilla.
“They weren’t good businesspeople,” he said.
Bringing his daughter into the business took some coercing, according to Cancilla.
“It was my plan from day one to pass the business on,” he said. “I wanted her to take engineering. But she chose history.”
Terry, personable and stylish, is the next generation at Ajax. She joined in 1995 after working in graphic arts and software.
She seems to have acclimated to the venerable business: “We’re not a glitz shop, not a dot-com,” Terry said.
She said she wonders if her son might take an interest in the family business.
Changing Business
Boiler making has turned many corners in the past four decades, according to Cancilla.
“In the old days the business was made up of smaller entrepreneurs,” he said. “I had a finger on everything, I knew everyone.”
Ajax has about 10 to 15 rivals now. California boilermakers include Parker Boiler Co. in Los Angeles and Oxnard-based Raypak Inc., part of Japan’s Paloma Co., owner of Rheem Manufacturing Co.
The business still is heavy on manufacturing, though design plays a bigger part.
In the past three years, Ajax has gone from one computer-aided designer to five. Cancilla said he plans to add three more engineers to the two he already has.
“People used to work without shop designs, now everything is automated with computers,” he said.
Cancilla said he sees the boiler industry going digital.
The company is testing a program with the Santa Ana School District to remotely monitor its boilers in schools via computers.
New Products
In coming weeks, Ajax plans to unveil five new products.
“Our products have had to become bigger to compete,” Cancilla said.
The company has three to four people working on new models. About 5% of operating costs go to research and development, Cancilla said.
Materials account for half of operational costs,mostly copper and steel, which have risen dramatically in recent years.
Ajax was one of the first companies to offer a packaged boiler that didn’t require any field assembly, according to Cancilla.
“This cuts down on field labor costs which are very expensive for buyers,” he said.
Business Climate
The company faces the usual litany of issues here,environmental regulations, high workers’ compensation and healthcare insurance costs and a tight market for manufacturing workers.
The company is within Santa Ana’s enterprise zone, a state designation where businesses get a tax break for hiring.
Surviving as a manufacturer takes hard work and common sense, according to Terry.
When California passed stricter clean air regulations in the 1980s that required clean firing combustion, it took a decade for Ajax to adjust, according to Cancilla.
“About 10 to 12 companies on the East Coast got out of the California market because they didn’t want to change for it,” he said.
The majority of Ajax’s workers have been with the company for at least 10 years, according to Cancilla.
A few years ago, Ajax’s workers voted down a move to form a union.
Modernization has come gradually, Cancilla said.
“It took us three years to use a plasma cutter tool into full operation,” he said. “Some are not so comfortable with computers.”
Finding new workers is a challenge, according to Terry.
“It’s hard to find people who can spell, write and have a good work ethic,” she said.
