Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, February 26, 1995 TAG: 9502240022
SECTION: BUSINESS PAGE: F-4 EDITION: METRO
SOURCE: BOB WILLIAMS
DATELINE: DURHAM (AP) LENGTH: Medium
The 107-year-old company, which is owned by American Tobacco Co., is one of the country's largest manufacturers of cigarette packs. It made more than 1.4 billion of them last year at its red-brick plant in a rundown section of East Durham.
Inside the nondescript surroundings, huge rolls of cigarette labels and foil wrappings - 8 feet wide and thousands of feet long - literally fly out the end of the clattering, floor-to-ceiling printing presses and laminating machines. Most of the paper is sliced into smaller rolls by giant cutting machines and hauled by forklifts to a cavernous warehouse.
From those machines, Golden Belt makes the paper that is used to wrap cigarette filters, the foil liners that go inside the packs and the tabs that seal them. In between those jobs, Golden Belt makes the familiar green and yellow foil wrappers for Wrigley's Doublemint and Juicy Fruit gums.
Even though it recently installed computers and video cameras to monitor every phase of the manufacturing process, it is not a quiet process.
``We've been in Durham for a long time, but most people don't even know we are here,'' says Golden Belt President James Galioto. ``That's OK, though. Our customers know who we are.''
Those customers include five of the six major American cigarette makers. The only one that doesn't do business with Golden Belt is R.J. Reynolds Tobacco Co., which produces its packaging in-house.
``We have been a major customer of Gold Belt for man years,'' said Carol Jova, a spokesman for Durham cigarette maker Liggett Group Inc. ``We've stayed with them because they are very competitive in both price and quality. It's an added bonus that they are located near our factory in Durham. The money we spend with them says in the local economy.''
Golden Belt had revenues of $36 million last year, and Galioto says those numbers should top $40 million this year. The company employs about 170 workers, running three shifts a day.
``Our growth has been pretty steady, even though things have been tightening up in the U.S. cigarette business overall,'' he says. ``Right now we are starting to look at overseas markets. We think that is where most of the future growth will be.''
That growth has come in spite of keen competition from much larger companies like Kimberly-Clark Corp., International Paper and Reynolds Metal Co.
Along with Liggett, Golden Belt is one of the last remaining vestiges of Durham's once-thriving tobacco industry.
Founded in 1887 as a partnership between Durham entrepreneur William H. Kerr and local businessman Julian S. Carr, Golden Belt merged Carr's money with Kerr's expertise.
Kerr had been issued a patent on a bag-making machine, but he lacked the capital to start a company. Carr agreed to put up the money in exchange for a royalty of 10 cents for each 1,000 bags the company sold.
The fledgling company's first customer was a big one - Blackwell Durham Tobacco Co., which needed high-quality cloth bags for its trademark Bull Durham products. Golden Belt was soon producing more than 13,000 Bull Durham tobacco bags a day.
Durham tycoon James ``Buck'' Duke bought the company in 1899, adding to it his American Tobacco Co. empire. A year later, he built a cotton mill at Golden Belt's current site on Main Street to supply cloth for the bags.
In 1923, Golden Belt started printing labels for Bull Durham bags and book covers for roll-your-own cigarette papers. Three years later it produced its first Lucky Strike cigarette label using letterpress printing. In 1949, the company became the first company to use the gravure printing process for cigarette labels.
In 1975, Golden Belt became the first U.S. company to use lasers to punch tiny ventilation holes in cigarette filter paper, which allows manufacturers to carefully control the amounts of tar and nicotine delivered to the smoker. Almost all filter paper is now manufactured this way.
Golden Belt has also dabbled in businesses outside the tobacco industry over the years. It made hosiery from 1922 until 1946 and produced injection-molded plastic parts for a short time in the 1970s.
The company also made larger cloth bags for all manner of products including salt, ammunition, flour and coins. It sold all of its bag-making operations in 1970.
``Our roots have always been in the tobacco business,'' says Galioto. ``That is more true today than ever before.''
Golden Belt was the only subsidiary that American Tobacco was able to hold onto when government trustbusters broke up Duke's tobacco empire in 1911.
by CNB