Stanley still committed to domestic production
By Thomas Russell -- Furniture Today, February 1, 2010
STANLEYTOWN, Va. —
A layoff announced last month at the Stanley case goods factory here doesn't mean the company is shifting jobs overseas or abandoning its domestic strategy, the company's president said.
Unlike other plant closures and layoffs that have occurred in the past 10 years, this has to do strictly with current economic conditions, said Glenn Prillaman, president and chief operating officer.
“This is merely a reaction to the economy and is not in any way a change in strategy,” he said. “It's all about us getting flexible and efficient given the level of revenues caused by the depressed housing market, low consumer confidence and consumer credit being tough to get. It causes us to react.”
The layoffs, which will occur over the next two months here, will affect 190 workers, including 150 permanent hourly employees and 40 temporary workers, Prillaman said. It does not affect the estimated 550 workers at its Robbinsville, N.C. plant, which produces the Young America line.
In the third quarter, Stanley reported sales of $38.5 million, a 29.4% drop from $54.5 in the same period of 2008. For the first nine months of 2009, sales were down 31.6% to $120.5 million.
The new round of job cuts follows the company's decision in December to lay off as many as one third of its management, supervisory and other salaried corporate office positions. Prillaman did not reveal the specific number of individuals affected, or the cost savings to be realized by either of the layoffs.
He did say that following the latest layoffs, the company will have 750 workers left in Virginia, for a total of about 1,300.
The Robbinsville plant will continue to produce the bulk of Young America, although Stanleytown does make dining, bedroom, home office, home entertainment and cribs for the youth line.
Between both facilities, the company produces about 75% of its product in the United States, Prillaman said. As a domestic producer and not solely an importer, he said, Stanley has the flexibility to provide options, higher quality and higher levels of service such as faster shipping.
But he also said that the industry is in the midst of an economic period that makes it difficult to know what business model will be right moving forward.
“It is fair to say that no one knows for sure whether our strategy is right and whether domestic manufacturing works, but I will be the first to tell you that now is not the time to judge that,” he said. “No one has sales and revenue that will be indicative of where they will be going forward.”
The company expects to release its 2009 results on Feb. 3.
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