Vaughan-Bassett to invest $8 million to expand U.S. capacity
Thomas Russell -- Furniture Today, January 26, 2012
GALAX, Va. — Master and youth bedroom manufacturer Vaughan-Bassett is embarking on an $8 million expansion that will boost its manufacturing capacity by about 50% and add about 115 furniture production jobs here.
In response to a wave of renewed interest in U.S.-made furniture among dealers and consumers, the company said it is purchasing a mothballed 350,000-square-foot plant next to its main bedroom plant here for about $1.5 million from Webb Furniture Enterprises, which still makes mirrors and particleboard. Vaughan-Bassett will use the plant, which closed in 2006, to make youth and master bedroom furniture.
Doug Bassett talks with Ray Allegrezza about planned expansion. Click on the video player above to see the interview.
It also is spending about $1.75 million to expand its rough end system in its main bedroom plant, another $1.2 million in other machinery upgrades and about $2 million in inventory, officials said.
New routers will cost an additional $800,000, and the remaining $750,000 will be spent on dust removal and electrical system upgrades and on machinery relocations and additions.
The project's first phase will involve moving machinery to the Webb facility from Vaughan-Bassett's adjacent bedroom plant. The newly purchased plant will reopen in March with about 50 workers.
The week of July 4, during its typical summer shutdown, the company will expand the rough end system in its main plant. This equipment removes defects from wood and cuts it into the appropriate sizes.
The Webb Plant was built around 1960 and has a finishing line that was installed about 10 years ago, making it one of the newest of its kind in the U.S.
Production, assembly and finishing work will take place on the plant's first floor, with some second and third story space used to warehouse finished goods.
The company said the expansion is related to its recent sales growth, which was up 19% in the fourth quarter. The company said its full year sales were $84 million.
For the first six weeks of the company's 2012 fiscal year, which started Dec. 4, sales and orders are up more than 20%.
"Today, we are the largest wooden bedroom manufacturer in the United States, with almost 700 employees," said Wyatt Bassett, president and CEO of Vaughan-Bassett. "We need this expansion because we are growing quickly and we have reached full capacity in our Galax factory."
Click on player to see Part II of Doug Bassett's interview with Ray Allegrezza.
The company also has an assembly and warehouse operation in Elkin, N.C., which houses some equipment that that will be moved to the Webb facility.
The company has long promoted its domestic production to dealers and the media. It also has encouraged dealers to promote domestic goods in their showrooms.
"Furniture dealers are reporting to us that their customers are asking for American-made products," said Doug Bassett, chief operating officer. "We are benefiting from the fact that 98% of our furniture is made in the USA and the fact that we're the only large player offering domestically produced bedroom in the middle price points."
The company said the expansion will help the company avoid any future delays in shipments that could occur as sales rise.
"This is allowing us in real time to stay ahead of that growth," Wyatt Bassett, adding that due to the expansion, "They (dealers) will continue to grow with us without any reduction in service."
Doug Bassett added that adding $2 million in finished goods to its inventory will let the company "continue to deliver faster than anybody in the U.S. or the world."
Vaughan-Bassett is receiving about $56,250 in incentives from the City of Galax for the project and about $200,000 from the Virginia Tobacco Region Opportunity Fund. It also is receiving about $75,000 from the Virginia Jobs Investment Program. To qualify for those funds it has to meet certain capital expenditures and employ 115 workers in the next 38 months.
In a statement, company Chairman John Bassett said he was impressed with how quickly government officials, including State Sen. Bill Stanley, were able to get things done necessary to put the incentives deal together.
He added that the expansion, along with the company's quality work force, will help it continue to win the battle against its Asian competitors.
"We have the finest work force in the world and we have the best equipped factories in the world," Bassett said. "The Webb factory already has the newest and most sophisticated finishing line in the United States, and we will also equip the factory with state of the art machinery that we will relocate from our Galax and Elkin factories, plus some brand new machines that we will purchase this year."
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