Bestar seeks to reopen labor talks to prevent layoffs
RTA furniture maker says sales have continued to decline
Michael Knell -- Furniture Today, July 6, 2010
LAC-MEGANTIC, Quebec — Ready-to-assemble home office furniture specialist Bestar says it is seeking to open its collective bargaining agreement with its production workers early, in a move to stave off job cuts, and said it expects to report lower second-quarter sales.
In a statement, the company said it has asked to reopen the agreement early "to negotiate changes in the working conditions which would contribute to improving in the short-term profitability of the company."
The company also said it has notified its employees that without a renewed agreement, there is a possibility of layoffs by fall.
In the first quarter ended March 31, publicly held Bestar said its sales fell 12% from the same period a year earlier to C$10.1 million, and declared a net loss of C$113,000 or one cent per share.
Although it hasn't released results for the second quarter, it said sales continued to deteriorate. It said management isn't foreseeing any significant upturn in sales over the new few months and "immediate measures must be taken."
Two weeks ago, Bestar named a new president, Daniel Mercier, an executive with experience in operations, supply chain management and just-in-time manufacturing, to lead the company back to profitability.
Bestar supplies a number of retail category specialists in Canada and the United States, including Staples. It also began producing components for other furniture manufacturers in 2008, but that market has soured since the onset of the world-wide recession.
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