By Jim Sterne
News Editor
Marilyn Labkon, owner of General Iron Industries, Inc., 1909 N. Clifton Ave., addressed more than 80 members of the Economic Development Council n at the Tower Club, 20 N. Wacker Dr., on April 30. She told her family story, which is a business story as well as a success story.
Labkon, a petite woman, was accompanied by one of her partners, her son Adam Labkon, who stood well over 6'6". Her other partner, Howard Labkon, also her son, "was busy minding the store," she said, adding that he was equally as tall as Adam.
Labkon's grandfather started General Iron about 100 years ago, shouting, "Iron and rags" in the alleys of Chicago's West Side. The company grew to four junk yards. Nathan Rosenmutter, Labkon's father, took over in the early 20s but by the 80s, the growth had stopped and business shrunk.
Large steel companies were being faced competition from non-union mini mills that sprouted up across the nation in places such as Iowa and Arkansas. The big steel companies were going out of business.
When her father's health began to fail, Labkon left her life as a housewife and mother, just to help her father. She never thought she would be the third generation to run the family business and that her sons would become the fourth.
Only one yard is left, 4.5 acres in the throbbing gentrified heart of Lincoln Park. "We survived and prospered because of family and a strong work ethic. We were flexible to meet new challenges of technology and community relations. And we had a Mayor who stood up for us, recognizing the need to keep industry in Chicago," Labkon said to the diverse audience of bankers, real estate agents, and technology specialists.
"It was never our intention to cut our costs by cutting labor," she said. Then General Iron lost a big steel contract because the company went out of business. With four yards and 450 people, General Iron had to sell off three of them and reduce the workforce to about 80.
"Our business is capital intensive. My sons traveled all over the world looking for ways to improve the business through technology," Labkon said. "We invested in a metal shredding machine and now people come from all over the world to see us."
The three-and-a-half story shredding machine munches up to 2,000 tons of metal each day. Concern for the neighbors gave Adam the idea to enclose the whole process, which would keep down dust and muffle the groans of cars and rebar as it is ground up like so much ground beef.
Marilyn Labkon said, "My father would say to neighbors, 'Tough, we were here first,' but I knew this was not a strategy that would win in the long run. I decided to educate our detractors. We have $400,000 condos 400 feet from our yard, and homes worth millions close by. I invited the Cub Scouts, students and teachers, and anyone to come by and learn what we do.... The Scouts had the best questions. They were also more fun."
"With the new shredder we can save money by turning around our scrap in two days. It cost a lot of money but it works so fast that we don't have to use it all day so it is another way of keeping our neighbors happy. The bulk of our scrap moves silently on barges down the river to Arkansas. Some goes by rail to Iowa, and some goes out by truck to the nearby expressways to other locations."
"Our neighbors began to realize we actually promoting better environment by limiting landfill by recycling scrap iron. All this would not have been possible without political support. In 1988 Mayor (Richard M.) Daley recognized the importance of maintaining a strong industrial base and new zoning designation called Planned Manufacturing District (PMD) was created. PMDs prevent industry from being pushed out by residential developers and rising taxes... this did not stop complaints but it did give us time to educate the community — and believe me there were time that I felt I was meeting a lynch mob at some of those meetings in the early days."
"Being a good neighbor also meant buying more land so we could create a buffer between us and residents. It means cleaning up after the hundreds of trucks that come to our facility each day, from semi-trailers loaded with cars, to the hard working collectors, who – like my grandfather — go through the alleys with their pickup trucks loaded with refrigerators, stoves, bicycles, and everything else. And like my grandfather they are hardworking and honest and some of the nicest people you will ever meet. General Iron has expanded to meet the needs of these small entrepreneurs."
General Iron cleans more than its share, which helps the community. They sweep a few blocks farther and in the winter they clear the snow. The yard is also used by the city as a dumping ground for city snow.
"Having a scrap iron facility in the city allows city contractors to bid lower because their transportation costs are less," Lobkon said. Being centrally located means companies can save time and finish early. General Iron is the last destination for the old Wacker Dr., the Chicago Stadium, and the Cabrini Green demolition.
Marilyn Labkon will receive the Lincoln Park Chamber of Commerce's "Business of the Year Award" tomorrow, May 8. It is an award that is well deserved. It is recognition of the General Iron business story, a family business story, and a Chicago story.
Before the luncheon began, Adam, an avid canoer, looked out from the 39th floor of the Tower Club on S. Wacker Dr. down to the Chicago River. "See that... where the river forks. That is my favorite view at dusk with the buildings and lights reflecting off the water." It was clear that the fourth generation of General Iron had all the values of the preceding generations and that the business — and Chicago's business and natural environment — were in good hands.
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