New Classic sets big China plant
By Thomas Russell -- Furniture Today, January 30, 2005
Rancho Cucamonga, Calif. — The sourcing partner of case goods importer New Classic Home Furnishings here is building a massive, 3.6-million-square-foot manufacturing complex in Guangdong, China, that could employ 20,000 people.
The $150 million facility will be dedicated to New Classic and is being built by Yihua Timber Inds., a separately held corporation that supplies timber and furniture to Yihua International Group, parent of New Classic.
Construction began late last year, and the first of about eight main buildings is set to be complete in July. The entire facility should be finished in late 2006 or early 2007.
The complex will be near a 1.2 million-square-foot Yihua Timber furniture and flooring factory that employs between 3,000 and 4,000. The furniture component will be moved to the new plant; flooring will remain at the existing complex.
About 2.17 million square feet in the Yihua Industrial City will be devoted to manufacturing, a figure that does not include onsite lumber prepping and milling areas. Another 387,500 square feet will be devoted to warehousing. Administrative offices, employee housing, entertainment and an onsite hotel will occupy another 1.02 million square feet.
A rail line surrounding the facility will transport workers to different locations.
The aim is to continue fueling New Classic's growth. Just over two years ago, the company didn't have a sales force outside its California home base. Today, it has 20 sales representatives, 15 handling accounts outside California. Out-of state business represents about 70% of total sales.
Changes in product mix helped New Classic increase sales 250% in 2003 and another 90% in 2004, said National Sales Manager Robert Jarrard, who joined the company in September 2002.
A key part of New Classic's strategy has been to achieve a better product focus, leaning more toward a collection concept with coordinated bedrooms and dining rooms. Bedrooms typically retail from $999 to $1,199. A dining table and four chairs would retail as high as $799.
The company plans to add more juvenile furniture for the April market, and also is starting to develop occasional and home entertainment product.
"We need to expand our bedroom selections as well," said Director of Marketing Michele McPherson, who joined the company about two years ago. "We have a lot of growing to do and we have a lot of room to do it in. That's our plan."
She said the new complex should increase container shipment capacity by more than 750%. And there's more room to grow in its current location.
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