Century pushing customization
Imports account for just 20% of sales
Thomas Russell -- Furniture Today, January 22, 2006
HICKORY, N.C. -- On a sunny afternoon in mid-November, Century Chair Plant Manager Kevin Boyle gathered his employees outside for a picnic and post-furniture market update.
 Kevin Boyle, manager of Century’s chair plant in Hickory, N.C., shows the detail on a newly made piece. Multiple fabrics, finishes and nailhead trims are among the chair options available to Century customers. |
| Kevin Boyle, manager of Century’s chair plant in Hickory, N.C., shows the detail on a newly made piece. Multiple fabrics, finishes and nailhead trims are among the chair options available to Century customers. |
He congratulated them on a job well done, saying Century received positive reaction on more of its October introductions than usual.
He also applauded them for helping the company achieve improvements in its production process. These have occurred thanks largely to employees’ suggestions and their willingness to change.
But Boyle warned that neither they nor the company can rest easy in the face of ongoing competition that will keep demanding innovation.
What makes Century stand out among its peers is that while it hasn’t been immune to short time or layoffs, it hasn’t closed any of its seven plants. It has kept them running — and plans to keep doing so — with a business model that emphasizes customization rather than mass production.
According the Bureau of Labor Statistics, some 49,000 production workers at U.S. residential wood furniture plants and 19,800 more at upholstery plants have lost their jobs in the past five years.
Most of the losses stem from the steep rise in furniture imports from China and elsewhere. Industry analyst Jerry Epperson of Mann, Armistead & Epperson estimated that imports accounted for 38% of indoor furniture and bedding sold in the United States in 2005, up from 29% in 2000. Some 56% of all wood furniture was imported last year, compared with 40% five years earlier, he estimates.
At Century, however, imports accounted for just 20% of the company’s estimated $160 million in sales last year. (In case goods, imports were 30% of sales.)
In the past five years, only seven of Century’s 21 case goods groups were made abroad. Some of the imports, including the Kelly Hoppen collection, are made in Colombia, where company officials say the workmanship is superior to what they have seen in China.
In the next couple years, Century plans to limit imports to between 17% and 20% of its business. Officials believe they will achieve that through a customer-focused approach that relies on product customization and quick turnaround, drawing mainly on the strengths of the U.S. factories. Century says it invests several million dollars a year in its plants, in new equipment and other improvements.
“We always have reinvented the wheel,” said Chief Operating Officer Eric Schenk. “Our case plant looks more and more like an upholstery plant. A significant portion of production is made to order, like in our upholstery plant.”
The changes on the wood side have largely occurred in the past year. Custom orders now represent about 35% of Century’s case goods business, a figure company officials expect will rise.
Century is tailoring its case goods assembly toward smaller cuttings, and offering a selection of about 100 finishes.
As part of the move toward customization, the company has shifted its inventory focus from finished goods to white, or unfinished, wood products. Between February and November, it reduced its finished goods inventory by $7 million, said Ed Tashjian, vice president of marketing.
Another sign of change is in the finishing operation at its case goods plant here. Several years ago, the finishing room was set up to run a single wood finish for three weeks at a stretch. Today, finishes can be changed 10 or 15 times a day, said Plant Manager Wade Yount.
Cuttings also have been reduced. Thirty years ago, there were 500 pieces in a typical cutting. A few years ago that dropped to 70. Today, a cutting can have as few as 10 items.
The process works particularly well in home office. Drawing from hundreds of parts in a bin stock
management program that keeps parts adjacent to the manufacturing floor, the products can be assembled in many configurations. In addition to various pedestal and hutch shapes, the consumer or designer can choose from a range of finishes, leather inlays and lighting styles.
“Our approach has been, ‘Can we have a process in place to satisfy the wide range of needs?’” said Cale Knopf, product manager for Century’s configurable home office and entertainment line. “We saw a huge variety of requirements from the customer that needed to be addressed. We do not do the assembly until we get the customer order.”
Tashjian said the company’s 1,200 employees have the skills to handle the increasing shift toward customization, meeting the demands of the marketplace.
“They have to be artisans, they have to be craftsmen to build the whole case,” he said.
“At the end of the day, you get a lot more quality and craftsmanship than you do in mass production.”
Through an employee stock ownership plan, the employees own 30% of Century, giving them a big stake in its long-term health. The Shuford family remains the majority owner.
The customization approach isn’t unique to Century. About four years ago, Hickory Chair also changed its production cycle more toward customization and quick delivery. Domestic metal beds manufacturers also tout customization as a key to their future success.
Century says the changes are getting positive feedback from key customers. That includes Fort Myers, Fla.-based Robb & Stucky, where special orders represent about 60% of business.
“Designers love to have that type of flexibility,” said the retailer’s president, Fred Berk, noting that his stores have interior design studios with many fabric and finish samples. “It will play well for our business with them. We have noted in the past 12 to 18 months that the ability (to customize) has been there.”
Berk said how well domestic manufacturers such as Century do in the long run will depend largely on their expense structure. But the ability to handle special orders is a plus, he said.
“I would say if you have the ability to customize and hit specific lead times customers are looking for, that will certainly give you an edge,” he said.
That’s exactly what Century must do to survive long-term, said Alex Shuford II, president of CVI Holding, the parent of Century and Valdese Weavers.
“If we have a future in this business,” he said, “it has to be in mass customization.”
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Century pushing customization
Jan 29, 2006
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