The Last Band Standing: America’s Oldest Rubber Band Maker

Unless you found yourself in dire need of one, it’s likely you haven’t given much thought to rubber bands of late. More often than not, rather than being sought out, these flexible circles of magic make their way to us, snapped around our mail or produce from the grocery store.

If that rubber band is from Alliance Rubber Co., located in Hot Springs, Arkansas, it is part of a rich history that involves a woman-owned family business with a 100-plus year history of manufacturing in the US. It also represents the quest to carry a legacy forward while innovating the simplest of tools.

A Solution in Need of a Problem

When Bonnie Swayze’s father, William H. Spencer, founded Alliance in 1923, timing, kismet, and a little bit of going out on a limb served him well. Back then, the business was in Alliance, Ohio, and he worked moonlight shifts on the Pennsylvania Railroad. During one of his treks, he encountered a spare pickup truck filled with bicycle inner tubes made with Goodyear rubber that was for sale. He bought the truckload of inner tubes and brought them back to Alliance.

It was there that he got to work cutting the tubes up into rubber bands he then set out to sell. To some extent, after cutting up the tubes into bands, he found himself selling a solution in search of a problem, but it wouldn’t be long before a lasting, meaningful match was made. One of his first cold calls was to the local paper, the Akron Beacon Journal. He had observed newspapers blowing apart and flying across many a yard on windy days. He suggested using his rubber bands to secure the papers better.

At first, the paper declined his offer, but Spencer offered them free samples to see if the bands solved the problem. “They liked them,” says Swayze, “and they, and the Tulsa World were the first two newspapers in the world to use rubber bands for home delivery.”

Spencer then approached local supermarkets, which often used string or twine to keep vegetables together. As with the newspaper, the rubber bands were initially a hard sell, so again he offered them samples. And again, sales resulted and with that came increased enthusiasm and demand for his products.

Swayze can still remember the days when Alliance faced competition from other US-based rubber companies, but those days are long gone. In 1965 for instance, she says, there were 12 different domestic rubber products manufacturers. The US-based rubber production industry has cooled significantly since then, though. Two years ago, Swayze watched as her final domestic competitor shuttered up its shop, making Alliance Rubber quite literally “the last band standing,” she says.

The loss of the domestic production and manufacturing industries is a subject that matters to Swayze, whose thinking goes beyond the impact of a lost job to the impact on the community. “In the last 20 years, 66,000 US manufacturing plants have either been closed or offshored, and we’ve gone from 18 million to 12 million manufacturing jobs,” she says. “Every US manufacturing job supports three to four additional jobs in the community so it’s a very sizable impact on a community when a factory closes or goes offshore.”

With its manufacturing plant located in Hot Springs, Arkansas, and an additional warehouse for the products they provide for the produce industry located in Salinas, California, Alliance’s dedication to keeping production in the US is undeniable. “We’re big believers in US ingenuity and technology in order to be able to stay competitive,” she says.

Demand for rubber products continues to increase, according to analytics firm Statista. In 2000, global production of both natural and synthetic rubber reached 17.68 million metric tons. By 2020, it had increased to 29.6 million metric tons. During COVID-19, Alliance, which sources its crude rubber out of Vietnam and then manufactures its end products in the US, watched as the freight cost of raw materials spiked from $3,500 to $24,000 per container. The cost has leveled out now and hovers anywhere between $3,500 to $4,000 per container.

Swayze, who gained deeper insight into supply chain because of the pandemic, reiterates the value that comes from manufacturing their products domestically. Although the materials are sourced from foreign suppliers, they are produced into the items that get sold in the US. “American-made gives you the great advantage that you don’t have to wait for the [finished] product to come over,” she says.

Taking Care of Your People

Despite being the only domestic rubber band name left in the game, Alliance still faces uphill struggles. It has 15 different competitors that import into the US. When compared using just dollars and cents, offshore competitors have some inherent advantages, such as fewer rules and regulations. Wages, too, are a major source of disparity. “Most of our competitors in China and Thailand pay $1.50 per hour with no additional sizable benefits,” she says. “Wages in our factory are $19.72 per hour plus 30% additional in fringe benefits.”

Swayze remains committed to the company, its 155 employees, and her customer base, working to keep costs competitive. “We do this with increased technology, higher quality, better service, and attention to detail,” she says.

Attention to detail also means caring for the workers. Alliance has won the Hot Springs Sentinel Record’s Best[1]  Large Business to Work For category for two years in a row, and on average, it has retained 66% of its workforce for five years or more. “Happy associates make long-time associates and long-time associates give you happy customers,” she says. “They’re good at satisfying customers and come to know customers as friends. They know their wants and needs, and they know a lot about their business.”

At 101 years young, Alliance holds legacy status to boot. In 1969, when astronaut Neil Armstrong walked on the Moon, he had Alliance rubber bands in his luggage. Alliance products have been featured in movies including The Fugitive, Memphis Belle, and Wall Street: Money Never Sleeps. Retailers, including Walmart and Office Depot, carry Alliance items, and they still keep bundles of mail together and bind vegetables tight.

Compassion and Creativity

Alliance has had women holding positions of power since the 1970s. In 1981, Swayze’s sister Wanda took over from the older guard and ran the company, a job she kept until 2005 when Bonnie took the helm. Swayze cites compassionate leadership – a trait commonly attributed to women-led businesses – as a key strength, and one that serves both leaders and workers. Compassion leads to “understanding your associates and doing what’s necessary to give groundbreaking, pioneering new products a level chance to help,” she says.

Compassion, when combined with creativity, then helps the business to stand out. “When someone says ‘I need this to look this way, can you make this part look this way for me?’ the answer is ‘oh, yes, we can,’” she says. “And by the way, we can have it in 10 different colors and different composite consistencies and we can give it to you in 50 different iterations.”

Innovating a rubber band can only stretch so far, which is where other Alliance products step up. The US Military uses Alliance STR Packs to assist with soldiers’ gear during combat missions. “They help silence and secure your gear whereas Velcro or hooks-and-loops makes noise when removed,” says Swayze. “STR Packs are totally silent and secure.” She also notes that STR packs are more reliable, as moisture and dirt compromise the utility of hooks and loops.

In addition to combat gear, Alliance also manufactures wristbands, silicon products, and resistor strips, which are used for at-home fitness routines, gyms, and physical therapy exercises. The ability to bring new products and solutions to market has been critical to the business’s survival from the start. “When you have a business in the US, you have an incredibly rich market,” she says. “You have the ability to provide value-added products that people are interested in.”