EARTHQUAKE / THE LONG ROAD BACK : Valley Plant Is Drumming Up Business as Usual

If President Clinton, who is scheduled to visit today, wants to know the heart and soul of Los Angeles, let him visit small businesses in the earthquake-hit San Fernando Valley.

There he will find companies cleaning up, testing machinery and starting work again. If Clinton takes his saxophone and visits Remo Belli, president and owner of Remo Inc. in North Hollywood--the world’s largest maker of drumheads (the drum’s polyester skin)--he will see a company that even got back into production Tuesday, because this is an important week in its business.

The earthquake couldn’t have come at a worse time for Remo. The annual show of the National Assn. of Music Merchants opens Friday in Anaheim, with up to 40,000 musical instrument customers and dealers expected to attend.

This is also the week that Remo, which gets half its $20 million in annual sales from abroad, welcomes its 35 worldwide distributors and shows off its latest innovations in drums and drumheads.

On Tuesday, musical instruments dealers from Europe, Japan and the Middle East were calling Belli, asking if it was OK to come to Los Angeles. “Sure, come ahead,” he told them from his small office in the main plant on Raymer Street--the one that got electricity back on Monday.

A second plant nearby on Saticoy Street was still without power, but even there, many of Remo’s 250 employees were restacking drum cylinders and getting ready to resume production when the power came back.

In many ways--in its informality and energy, its spirit of innovation and even in the squabbles it has had with regulators--Remo exemplifies small business in Southern California.

It is not alone. Most companies in the Valley remained closed Tuesday but had people in the darkened factories preparing to open Wednesday. In Woodland Hills, Gershon Weltman, president of Perceptions Inc., and a crew of employees were sweeping up broken glass and restacking files. Perceptions, which makes simulators for training soldiers to drive tanks, is now adapting its know-how to teaching truckers how to handle 18-wheelers.

Nearby at Erwin and De Soto streets, Data Products, a maker of computer printers, was also closed. But company President Irvin Moloney and his workers were in the plant cleaning up water from busted sprinkler pipes and testing computer machinery.

Remo Belli, like most small business owners, doesn’t carry costly earthquake insurance. Remo Inc.’s sprinkler damage will be a write-off, and the few days of lost production--roughly 30,000 of the 3 million drumheads his company makes each year--will have to be made up on overtime.

Yet the earthquake hasn’t changed Belli’s plan to invest $1 million this year in equipment and efficiencies so he can keep the lead over competition from Taiwan, South Korea and Brazil. They offer low prices; Belli offers great variety at low cost--drumheads in eight or nine sizes and more than 400 kinds.

“We can give you a sound for rock ‘n’ roll or for the L.A. Philharmonic or the Marine Band,” says Belli, 66, who founded the company 36 years ago in Hollywood.

Belli was a drummer from Mishawaka, Ind., (near Elkhart) who stayed in Los Angeles after serving in the Navy during World War II. His idea was that a synthetic drumhead would be an improvement on the calfskin ones that were standard at that time. So, in 1956, with the aid of a chemist and an accountant, he started to make drumheads of DuPont Mylar, then a new polyester material.

Today Belli, who ties his gray hair back with a rubber band, credits synthetic drumheads with making possible the surge of youth music that accompanied rock ‘n’ roll, the Beatles and other groups in the 1960s.

“There would have been no way to supply 300,000 garage bands if drums were made with calfskin,” he says. “They couldn’t have killed all those animals.”

Belli’s company, and the music business of Los Angeles, took off in the ‘60s. “But traditional U.S. musical instrument makers in Chicago and Elkhart didn’t get it,” says Belli. They refused to invest to expand their businesses “and they ignored the Japanese,” he says. But Belli didn’t.

Yamaha and other Japanese companies were distributors and good customers of Remo products, even if they were sometimes competitors as well.

The qualities of California business--openness to new products and new markets--stood Remo in good stead.

But that’s not the end of the story. California too grew stodgy, and Remo almost left for San Antonio, Tex., last year. Belli’s complaints about the bureaucratic attitudes of environmental regulators and the cost of workers’ compensation insurance are common ones--but in his case, there’s a twist.

What Belli really didn’t like was that Remo was classified as a plastics manufacturer instead of a musical instrument maker (because its drumheads are of polyester). So it paid higher insurance premiums than Rico Reeds, a nearby maker of reeds for clarinets and saxophones, “that was classed a musical instrument maker because it works with cane.”

The problem was simple and, for once, so was the solution. A motion in Sacramento, made with the help of Los Angeles County’s Economic Development Corp., and Remo was reclassified as a musical instrument business.

That made a $1.5-million-a-year difference in insurance premiums, says Belli. And so Remo, its 250 jobs --and its new ideas--stayed in California.

New ideas are needed in music today, because the instrument business is becoming an unexpected victim of the Information Age: youngsters spend their money on video games, computer software and CD-ROMs. So musical instruments are a no-growth business, except for the great promise Belli sees in the emerging field of music and health.

Remo’s plant contains gigantic, six-sided drums that have provided effective therapy for Alzheimer’s patients. The vibrations reach them where speech and other stimuli do not. Remo is working with medical researchers, who are finding that playing music can do for the mind what brisk walking does for the body.

“It’s potentially an enormous market,” says Belli, and he’s going for it. And despite earthquake damage, he’s also turning out special items for this summer’s World Cup.

Remo is focusing not on what happened yesterday, but on what needs to be done tomorrow--like the best of Los Angeles business.