Future looking better for U.S. producers

The first quarter has borne a mixture of good and bad news for domestic producers.

Just two weeks ago, promotional bedroom producer Harden Mfg. closed its doors after 42 years in business, putting more than 300 out of work. And in February, bedroom producers Higdon and Mobel revealed they were closing after operating for more than 60 and 43 years, respectively.

Sources have also told Furniture/Today that high-end upholstery manufacturer Southwood Furniture closed its North Carolina factory in late January and that Pearson, another high end upholstery producer, will shift its upholstery manufacturing from High Point to Hickory, N.C., in the coming months.

Such announcements should come as no surprise as domestic producers continue to face a host of regulatory challenges and ongoing competition from low-cost producers outside the U.S. And while the economy has begun to rebound, it just hasn’t been enough to turn these companies around or get them the capital they need to keep running their businesses.

Still, there have been bright spots for U.S. producers. One of these was the news that Sauder Woodworking has signed a five-year contract with Ikea to produce residential furniture for the Swedish retailer’s growing network of U.S. stores. This will result in a capital investment of $13 million at Sauder’s Archbold, Ohio, plant and add at least 150 workers starting later this year.

Another positive development is Kith Furniture’s purchase of Harden Mfg.’s assets. Over the past few years, the two companies have been neighbors — not to mention competitors. Ironically, Harden Mfg. closed just as it was starting to focus exclusively on its domestic manufacturing. Those dreams won’t be realized as Harden Mfg. But the owners of Kith have some plans to utilize the former Harden’s manufacturing facilities and equipment to grow their own business.

And in a recent update relating to its domestic operations, Ashley said it expects its 1.1 million-square-foot distribution center in Advance, N.C., to be operational by October. It already is producing upholstery there and expects to add case goods production by September

These and other developments are positive news for domestic manufacturers and the U.S. economy. Big retailers like Ikea and Wal-Mart are making it a point to publicize their sourcing of domestic goods and why it’s important for their customers. Wal-Mart, for example, has announced its plans to buy an additional $250 billion in U.S. made products in the next decade as part of its commitment to help support U.S. jobs.

Other retailers too have begun to tell a domestic story, including Pottery Barn brand PB Teen, which promotes the fact that some of its products are made in America.

“Made in America means pride, it means opportunity and it means people are working in America,” touts a video promoting a U.S.-made upholstered youth bed on the PB Teen website.

Given the fact these and other retailers sell so much imported product in their stores, the message may come as a surprise. But it also speaks volumes about the opportunity that exists for domestic furniture manufacturers. For those who have managed to stay afloat this long, the best may yet to come.

Source: Furniture Today