“I supported Kamala Harris because she was more predictable and a better candidate from the point of view of geopolitics. But if you look at it purely from a business point of view, Trump is actually a better option” says Arkadiusz Muś, 10th on the “Forbes” Richest Poles List.
Forbes: You are the biggest Polish investor in the United States.
Arkadiusz Muś: In terms of greenfield investments, yes. We are just in the process of expanding our second plant in Virginia, which specializes in the production of insulated glass for commercial buildings, primarily offices. If we add our plant in North Carolina, the total cash invested in our U.S. production capacity will exceed $220 million. Last year we were even personally congratulated on this by Virginia Governor Glenn Youngkin. He told us that, being a Polish company, we had made the largest capital investment in Henry County’s history, making a valuable contribution to the revival of industry in the region. This year we will achieve $160 million in sales overseas.
You seem to be blazing a trail. In August, Sebastian Kulczyk‘s Qemetica (former Ciech) announced the acquisition of a US stoneware manufacturer for $310 million.
I think this is happening, but it will be an acquisition. We spent ten years building our business in the States almost from scratch, based on a small family business found for us by local consultants.
In the United States, everyone is living through the recently finished presidential election. What is your opinion on Donald Trump’s election?
I am a classical, pro-free market liberal and I have always been closer to the Republicans than the Democrats. But in this election I had fingers crossed for Kamala Harris because she was more predictable and a better candidate from a geopolitical point of view. But if you look at it purely from a business perspective, the better option seems to be Trump.
He based his campaign on restoring the splendor of the American economy, because, unfortunately, inflation, social stratification, and the flight of industry from the US have led to the impoverishment of society, which is strongly felt, as can be seen even on the streets. The good life here is only on the coasts. There is a lot of stagnation in the interior or the so-called deep south. And Trump has sensed this mood better than the Democrats.
I myself have talked to many American business people, and almost all of them supported Trump’s “Make America Great Again” slogan. By cutting taxes, Trump wants to leave an additional $8 trillion in the economy, financing this by slashing red tape and, above all, raising tariffs on Chinese products. Some of his supporters are eager to compare him with Reagan and his reforms, which unleashed the US economy in the 1980s. And this is, in my opinion, a viable scenario.
Why did you start investing in the U.S. in the first place?
In Poland, many entrepreneurs proudly talk about foreign expansion and then they enter the Czech Republic. But if you have ambitions to build a global company, you need to tap into the potential of the United States.
Twenty years ago Press Glass became the number one player in Poland, but we had zero exports. It took us another 15 years to fight to become number one in glass processing in Europe. And when we achieved that – or even five years before that – I decided that the natural next step needed for our growth was to enter another continent and there is no better place to do business than North America. With nearly 400 million consumers in the U.S. and Canada speaking the same language, it is a country with a deep-rooted liberal democracy, the largest water and energy resources, and borders Mexico to the south, with a population of more than 125 million.
But the States – as an investment destination – are not very popular among Polish companies.
I think this is due to fear of the unknown. The states are far away, so making such an investment seems more difficult to control. But once you get in there, you quickly learn that this is not the biggest difficulty. The biggest challenge is the fierce competition. It is far more difficult to identify any market niche to enter there than in Europe or Poland. America experienced its last big boom in the Reagan era, and before that, after the war under Eisenhower, with the construction of a huge highway system and all the infrastructure. There has been stable growth there in recent years, which is incredibly competitive because everyone is looking for a way to survive. Therefore, in order to invest in the United States, you need a strong organization and an awareness that it won’t be easy.
What do you need to be prepared for?
For the fact that in the first year, you add $10 million to the business, in the second year $17 million, and after 5 years you see minimal profits. You need the capital to survive it. In the US, we have set our sights on the state-of-the-art and theoretically most profitable glass façade market for office buildings in Manhattan. Two years ago we reached almost 12 percent EBITDA margin, but this year the market has slowed down a lot and we will earn 4-5 percent.
Entering that market, did you have a vision and a sense of market advantage for a Polish company unknown there to conquer America?
We have relied on what has previously worked for us in Europe. However, in the US, because of the competition, we have to do it even better and more efficiently.
Then what is your advantage?
In this business, seemingly everyone has access to similar machinery and technology, but we made our leap with an approach to development and organization of production. We have 15 factories and in building each plant we eliminate mistakes from previous investments, work with technology suppliers, automate, and introduce new management programs.
How does it work in practice?
This family-owned company, which we took over when we entered the US, employed 170 people, making mainly not glass for office building facades, but smaller interior glazing. Today we have 550 people working for us in both factories, with production increasing eight-fold.. Similarly, we have raised efficiency in our Welsh plants, converting three factories into one modern plant, with production capacity 50 percent higher and employing 1/3 fewer people. We have a major competitor in the US., They are two and a half times larger than us. But they produce these windows in 40 obsolete plants. You can imagine what costs they must have.
Aren’t you frustrated by the fact that conquering this market is taking so long and after ten years you are still worried about margins and profitability?
Absolutely not. We are consciously ahead of certain trends, which is initially costly, but thanks to that the future belongs to Press Glass. America is technologically obsolete in certain areas because they had very cheap energy and didn’t have to save money. And Manhattan is a concrete jungle. This is the result of the fact that commercial glass manufacturers fought an unequal battle for years in New York against the extremely strong concrete and cement lobby. They were blocked.
But this is changing, the comfort offered by buildings with large glazing and access to lots of natural light is taking over. There is a growing awareness of energy conservation and carbon efficiency. Americans are changing their approach, reaching for better quality products, like quasi-European products, in the construction of state-of-the-art office buildings. And that is where we come in with our insulated glass. We just won a joint bid with Aluprof to glaze the iconic Flatiron, a distinctive triangular office building from 1902 at the intersection of Broadway and Fifth Avenue, now an apartment building.
How much longer will it take Press Glass to conquer America?
We need another 10 years. But I follow the saying: “If you do not plant this tree today, you will not be sitting in its shade in 20 years.” I have invested, I have taken a risk, but I think America will help double or triple my business.
The biggest surprises?
Certainly in Europe, we live with certain myths about America. For example, I was strongly surprised to learn that getting people to work in our plants has proven more difficult than in Europe. We have our factories halfway between New York and Florida. It seemed to me that here people would be ready to come even from Chicago for work.
I understand that this was the case decades ago, at the time of the creation of the great American novels.
Exactly. We had to look for people locally. Virginia is an agricultural state famous for growing tobacco and corn. We recruited a crew of several hundred people among farmers and we had to teach them everything in our industry. On top of that, there was a very large ethno-cultural dispersion – our people speak more than a dozen languages. We have everyone from Lithuanians to Chinese and Puerto Ricans. I was also surprised by the bureaucracy and tax complications, given their commitment to economic liberalism. For example, a driver traveling with goods across four states must file four different returns.
And what would you have done better? What were the biggest mistakes made with this investment?
I sent an overly large team of 20 people from Poland there to fill key positions, and I should have focused on hiring local workers by then.
The Poles were supposed to give you security and a sense of better control over your investment overseas.
Yes, but that turned out to be illusory. What was more important than my sense of security was to do business there faster, and for that, you need local people who know the local market well.
Do you have to go there often?
Against all odds, I do not have to, but I also go there for sport…
…meaning golf?
Yes, in the USA they have great courses. And I only visit the company on occasion…(laughs). But in fact, I am such a rare visitor there that they do not even recognize me at the plant gate. I am not particularly needed there for anything, anyway. The technological changes that have taken place in the last 20 years are incredible. This is a completely different product than when I was managing Press Glass on a more operational level before we went outside Poland.
Then what is your job today?
Thinking about where we will be in ten years, planning investments, and looking for markets where we want to be present. And on finding the competitive advantages with which we want to do it. And on light coaching of my people so that they understand our strengths and where we are heading as a company.
Arkadiusz Mus, entrepreneur, Chairman of the Board of Press Glass Holding, and founder of the Economic Freedom Foundation.
The text was originally published in Polish in Forbes 12/2024 issue. Interview by Piotr Karnaszewski.
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