Florida Furniture closing
By Powell Slaughter -- Furniture Today, January 5, 2003
Palatka, Fla. — Midprice bedroom furniture manufacturer Florida Furniture has closed its doors and will liquidate after rejection of a proposed lending arrangement under its Chapter 11 reorganization.
The 72-year-old company stopped production in mid-December.
"We're winding down operations and will be liquidating," said President Howard Gardner III. "We're filing a plan with the court ... which is a liquidation plan under Chapter 11."
Gardner was not certain how long the process will take, but said he anticipates "an orderly liquidation, not a distress sale."
Import competition and a slow economy, especially in the wake of the September 2001 terrorist attacks, had combined to reduce sales and market share for Florida Furniture.
In May, the company suspended manufacturing and began servicing accounts out of existing inventory. Soon after, Florida filed for reorganization under Chapter 11 of the U.S. bankruptcy code.
Cost-cutting efforts included withdrawal from the High Point market and a decision to terminate the company's importing efforts to concentrate on its core mid-price domestic bedroom business.
Florida also looked to build distribution through the rent-to-own and rent-to-rent channels. To improve its financial stability, it explored the possibility of giving equity positions to potential new partners, but never added any partners.
Florida resumed manufacturing in its 400,000-square-foot main plant Oct. 30 and ran for six weeks before shutting down Dec. 13, two days after the bankruptcy court rejected its application for a debtor-in-possession lending arrangement. Including two other facilities that already were idle, the company has a total of 750,000 square feet of production space.
Gardner declined to disclose sales, but said Florida Furniture's market share fell 40% in the past five years and its employment declined from 650 in 1997 to about 200 at the time of the shutdown.
Florida Furniture dates back to 1930, when Howard Gardner Sr., Fount Rion Sr. and Charles Tanner Jr. founded the company as an outdoor furniture manufacturer. Florida expanded into kitchen furniture, then dining room and bedroom. After World War II, the company switched exclusively to bedroom.
Throughout its history, the company remained family-owned.
Florida Furniture unit open
03/23/2002
