APA moves Encore factory from California to Nevada
By Jeff Linville -- Furniture Today, January 23, 2005
Henderson, Nevada — APA Marketing has moved assembly and distribution of its Encore home entertainment furniture line from Commerce, Calif., to a factory here.
Vice President of Sales and Marketing Rich Serlin said the new furniture market launching in July in nearby Las Vegas was a consideration in the move, but the biggest reason was an unfriendly business environment in California, with high workers' compensation costs and tight regulations.
He also cited such factors as this month's big Consumer Electronics Show in Las Vegas, and incentives offered by local economic development officials.
APA was leasing a facility in Commerce and wanted to buy a building when its lease ran out at the end of 2004. But real estate prices proved "insulting," he said.
Serlin, who lives here and had been commuting, suggested Henderson because of the upcoming furniture market and the Consumer Electronics Show, billed as the biggest trade show in North America. The Jan. 6–9 event drew 130,000 people, and in addition to electronics offered such categories as home theater seating and home entertainment furniture.
Until two years ago, APA sold only imported casual dining. Then it launched a line of home entertainment centers that were so well received the company created the Encore division, with its own light assembly/distribution center facility. Now entertainment centers and walls produce slightly more revenue than dining, Serlin said.
Encore showed at CES for the third time this month.
Serlin said Henderson had real estate for half the cost of similar properties in Commerce. Nevada also has no corporate income tax. Plus, the local development commission offered $1,000 to train each employee hired locally.
Encore bought a 181,000-square-foot facility on seven acres for $5.9 million.
The building is somewhat larger than the California one and has a higher ceiling, which Serlin said will allow a tall stacking system.
The facility, employing about 75 people, won't have a finishing department but will do light assembly.
The distribution center serves the West Coast, while a similar facility in Richfield, N.C., handles the East Coast. Similar in size to the Henderson plant, the North Carolina facility is slated for expansion in 2005.
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