L.J. Gascho grows with bedroom
Thomas Lester -- Furniture Today, June 3, 2013
PIGEON, Mich. - A new bedroom program launched in January is fueling sales growth and a plant expansion at wood furniture producer L.J. Gascho.
The company is adding about 10,000 square feet to its plant here, said Brandon Yowler, vice president of sales and marketing. When completed in late June, the project will bring the facility to about 70,000 square feet.
Company officials say the expansion represents a big growth opportunity for the manufacturer founded by Lyle J. Gascho in 1986.
Over the years, the company has used a number of Amish and Mennonite workshops in Ohio, Indiana, Pennsylvania and Michigan to produce a line of solid wood dining furniture. It also manufactures and finishes product in its own plant in Pigeon.
The company has produced dining room furniture at the factory. It began doing business with its first big retail account, Warren, Mich.- based Art Van Furniture, in 1989.
Last July, Yowler said, Art Van case goods buyer Melinda Lehman suggested that Gascho produce a line of bedroom. Over the next six months, the company designed and produced samples. In mid-January Art Van launched four groups on its floors.
Yowler said the bedroom line now includes 12 groups available in solid oak, maple and cherry. They are available in seven finishes and have multiple hardware options.
A five-piece set is targeted to retail around $4,999, comparable to pricing offered by other U.S. solid wood bedroom producers, he said. By comparison, the company's dining sets retail at $1,999 for a table and four chairs.
L.J. Gascho employs 90 at its Pigeon plant and headquarters, where it recently added a third shift. Over time, the expansion could fuel more jobs, but that will depend on future revenue growth, officials said.
Yowler said he's optimistic, and expects the bedroom business to double the company's volume this year. Sales are projected to reach $12 million to $14 million, with bedroom representing about half of that volume.
The company doesn't show in High Point or other markets. Instead it holds private showings for its accounts, which also include HOM Furniture, Wolf Furniture, Steinhafels, Levin Furniture and Darvin Furniture.
Due to the interest in U.S.- made furniture, Yowler said the company is optimistic about growth prospects beyond this year. Dining business alone has been up 200% from 2010, he said.
"I attribute this to retailers focusing more on domestic products," he said. "They are doing a phenomenal job with advertising and promoting."
He also attributed the success of the domestic business to the company's special order capability, which is kept simple since L.J. Gascho doesn't have an up charge on wood, finish and hardware options. In the past three years, that "one-price" system has helped grow special orders from 10% to 40% of business, he said.
Yowler also said the new bedroom program could get some help from improving economic conditions.
"I do think things are getting better in the economy," he said. "American shoppers are looking for better goods and are looking for domestic products if the prices are reasonable. We are targeting an audience that wants to buy a quality product that is a value and reflects today's designs and trends at a reasonable price."