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Cindy Hodnett

N.C. upholstery manufacturer Key City shuts down

WILKESBORO, N.C. — Upholstery manufacturer Key City Furniture Co. permanently closed on Friday, according to a story in the Wilkes Journal-Patriot.

The Journal-Patriot reported that 97 employees were losing their jobs as a result of the closing. Company officials have not yet responded to Furniture/Today's requests for information.

Employees were told about the closing on Friday. A Key City spokesman told the newspaper that the closure resulted from long-term difficult economic conditions which reflected a lack of orders for the company's upholstered furniture.

The spokesman said that more than 240 people were employed by Key City in 2003, the year the company moved its offices and most of its manufacturing from downtown North Wilkesboro to the former Ithaca Inds. textile manufacturing facility.

An economic downturn started within six months after Key City moved to the 240,000-square-foot facility, said the spokesman. He added that retailers started buying less furniture around the same time period, affected by decreased demand from upper-income buyers.

Key City was founded in 1927 and specialized in custom and special-order upholstered furniture at medium to high-end price points for retailers, design showrooms and designers. In a deal completed last November, Key City acquired Greene Bros. Furniture, another Wilkes County upholstery manufacturer founded in 1946, to add a mid-range product category to the company's line. Greene Bros. also produced the Johnston Benchworks brand, an upscale line of classic American country upholstered furniture.

At the fall High Point Market, Key City showed product from both companies. The product line included sofas, chairs, ottomans, loveseats and other upholstered furniture.

Key City will sell the company's remaining inventory and equipment, according to the spokesman. The Wilkesboro facility is leased from a local owner.

"Since 2008, we have ratcheted down six times with layoffs and age reductions and we've reduced our footprint (occupancy) in this building to try to make it out of this recession," he said. The spokesman added that the most recent cutbacks occurred two months ago.

Company officials said they plan to apply for Trade Adjustment Assistance, which will provide workforce training, education and additional services to displaced employees.

Key City is owned by grandchildren of the company's founder, James E. Caudill, and was one of two remaining furniture manufacturers in Wilkes County. The remaining furniture manufacturer is Johnston Casuals, a contemporary metal furniture supplier.

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