- THE MAGAZINE
- NEW PRODUCTS
How can U.S. manufacturers compete against low-priced imports? It's a question that has plagued virtually every industry. But perhaps one of the hardest hit sectors has been dinnerware and pottery, as retailers have been forced to cater to increasingly cost-conscious consumers.
In May, Robinson Ransbottom Pottery Co. closed its doors after 105 years of producing lawn and garden stoneware products. The company, which had manufacturing facilities in Zanesville and Roseville, Ohio, saw significant declines in its core business-sales by independent lawn and garden centers-from 2000 to 2001. Although Robinson Ransbottom had found new ways for distributing its product over the past several years that promised to boost sales, it could not complete the turnaround in time to convince its parent company, Cleveland, Ohio-based Brittany Corp., to keep the plant open.1
In June, Lifetime Brands Inc., based in Westbury, N.Y., acquired all of The Pfaltzgraff Co.'s (York, Pa.) brands, intellectual property and retail stores. However, the deal did not include a Pfaltzgraff factory in Thomasville. In August, Susquehanna Pfaltzgraff Co. told its workers that it would close its Thomasville, Pa., plant by October 28 if a buyer could not be found. The company chose the October date because that's when the plant was scheduled to complete an order for Lifetime Brands. "There really was no more product needed after that date," said John L. Finlayson, Susquehanna Pfaltzgraff finance and administration vice president and chief financial officer. "When Lifetime bought a portion of the Pfaltzgraff business, they placed an order that would tide them over until they could fully source their product, and that order was completed around mid-October."
Lifetime Brands officials said they will have the dinnerware manufactured overseas because it is too expensive to have it made in Thomasville.
"There's no question that the people in the factory in York made a terrific product, but there are literally thousands of dinnerware factories in the world capable of making a terrific product," said Lifetime Brands Chief Executive Officer Jeffrey Siegel.2
In September, Brown-Forman Corp. sold substantially all of its Lenox, Inc. subsidiary to Department 56 for $196 million. "The environment for this business has been challenging for several years as evidenced by the weakness throughout the U.S. tabletop and giftware industry," explained Brown-Forman Chairman and Chief Executive Officer Owsley Brown II.
It was unclear at press time what changes, if any, Department 56 would make in the Lenox manufacturing operations. Paul Leichtnam, plant manager of Lenox's Kinston, N.C., facility, which manufactures 100 china patterns, said he believed business at the china manufacturing plant would continue to flourish. "I don't think there will be any effect on this facility," Leichtnam said. "I don't know that much about (Department 56), but I think they will let Lenox implement its business plan at least until they get their feet wet and find out what this business is all about." Still, he admitted that many of the plant's 480 employees were worried about the security of their jobs and benefits.3
Despite these challenges, there have been some bright spots. Hartstone Pottery in Zanesville, Ohio, which was slated to close this summer after production came to a halt in November 2004, was reopened in June after being purchased by six partners, including Clayfish LLC and The Original Hartstone Pottery Inc., both out of Virginia. The company anticipates that new products and new distribution channels (including Internet sales) will enable it to once again become a leader in the pottery business.4
Other companies are looking to diversification to ensure their continued success. Niagara Ceramics, which was reincarnated from Buffalo China in 2004, is seeing solid growth in its business as a contract manufacturer while it also continues to supply Oneida with high-quality dinnerware. In a similar vein, Frankoma Pottery in Sapulpa, Okla., hopes to find a new life by adding contract manufacturing to its existing production of kitchen and dining products, home accents, giftware, souvenirs and Merrymac product designs. The facility was closed in December 2004, but was reopened in July 2005 when new owners, Det and Crystal Merryman, believed they could salvage the business.5
Only time will tell whether these strategies prove successful. In the meantime, it appears that a flexible operation and a unique, continuously updated product line offer the best chances for success in this field.
References1. "Pottery to Close after 105 Years," Zanesville Times Recorder, Zanesville, Ohio, April 20, 2005.
2. "Pfaltzgraff Plant to Close," York Daily Record, York, Pa., August 13, 2005.
3. "Lenox Sold to Department 56," The Free Press, Kinston, N.C., August 6, 2005.
4. "Hartstone Pottery Comes Back to Life," Zanesville Times Recorder, Zanesville, Ohio, June 24, 2005.
5. "A Merry New Beginning for Frankoma Pottery," Ceramic Industry/Pottery Production Practices, October 2005, pp. 37-40.