Nearly 50 years ago, two young organizations were both getting their start.
In 1978, Sammy Hammons and his mentor, Tommy Brown, founded B&H Toolworks in Richmond with a vision of building a world-class manufacturing company in Kentucky. At nearly the same time, Mountain Association, founded in 1976, was beginning its work to expand economic opportunity across Appalachia by investing in local businesses and local leaders.
Tommy was a respected metal worker and machinist educator at Eastern Kentucky University, and had first met Sammy as a student. With Sammy’s interest in tooling and machining, the two men began to partner, taking on repair work and small jobs that came their way.
“It was a hobby shop. Something we loved to do,” Sammy said of the early days.
The business grew quickly. In its first year, B&H generated about $30,000 in revenue. By year two, sales had climbed to $100,000, and the company had opportunities that suggested it could reach $750,000 the following year. The challenge was financing that growth.
At the time, Mountain Association, then known as MACED, was also just getting started in community economic development. We were founded with a primary purpose to work alongside entrepreneurs to help strengthen businesses from the inside out. However, after a few years, staff realized entrepreneurs like Sammy and Tommy weren’t able to access financing from traditional lenders.
Launching our loan fund in 1981, B&H became one of the organization’s earliest loan clients and one of our longest lasting success stories, but the growth was not without challenges.
More than a Loan
As MACED and B&H began to work together on the business’s projections, MACED staff found that while demand was strong, management systems needed improvement. B&H’s accounting indicated a small profit, but a deeper analysis revealed it was actually operating at a loss. Instead of shying away from the risk, MACED worked with B&H’s leadership to develop a plan for growth, improve management practices, and invest in needed equipment.
Based on that plan, MACED provided $100,000 in financing, as well as hands-on business support. Within just three months, B&H grew from 12 employees to 21 and became profitable.
Sammy and Tommy were then able to purchase land and build a 1,200-square-foot facility. Demand continued to grow, helped in part by opportunities connected to Toyota’s arrival in Kentucky. Then came a major setback. A lawsuit involving the original property owner dragged on for three years, making traditional lenders hesitant to provide financing just as the company needed working capital most.
“We were growing with no cash flow,” Sammy recalled.
Looking for help, he again contacted MACED.
“They sent Ed McCormick out here. He audited us, and we hit it off great.”
Over the years, McCormick became a trusted advisor. MACED helped B&H modernize its accounting and management systems, purchase equipment, and eventually expand into Rockcastle County.
“We got all the creditors all lined up, but we didn’t have enough to put down,” Sammy said of the expansion.
They worked with our Lending Team on a creative arrangement of a preferred stock investment that provided the capital needed to open that second facility. Later, B&H was able to buy out that investment, creating what Sammy describes as “a win for everybody.”
The People Behind the Numbers
For Sammy, yes, the equipment, square footage, and sales figures over the last five decades matter, but his greatest success is 110+ employees.
“What I’m most proud of is providing good quality jobs. We probably spend over $5 million a year in payroll. And we have workers who’ve been here three to four decades, and many who have happily retired.”
During a recent tour of B&H, Sammy walked us through the now 120,000-square foot Richmond facility, stopping every few minutes to introduce his staff. At nearly every workstation, there was a story worth telling—some employees had spent more than 30 or 40 years with the company and were approaching retirement. A newer hire was only on his third day of work. Then there was a young employee whose father and grandfather had both had careers at B&H. Now he is building a career there himself after graduating from technical college.
As Sammy introduced each person, he knew their histories and their families. He spoke to the role each has played in building the company that generates millions in sales each year, feeding automotive and other industrial clients like Toyota in Georgetown and Link-Belt with essential metal parts.
For those of us who work in community economic development, getting to see Sammy with his employees and, to think of how we helped get this started all those years ago, was a great reminder of why this work matters.
“The field of economic development often equates success with how many jobs are created and saved. Those numbers are important, but they aren’t the whole picture of how meaningful investments can be,” said Leslie Ferguson-Oles, Mountain Association’s Chief Advancement Officer. “Every person Sammy introduced us to as we walked represented a story, a family, and a career.”
As Mountain Association celebrates its 50th anniversary, B&H Tool Works’ growth from a small startup into a sophisticated manufacturer, now serving industries ranging from automotive and aerospace to defense and transportation, stands as a powerful example of what can happen when we invest in Kentuckians.
To learn more about our 50 years of history, please visit here.
