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Challenges in ChinaIn Las Vegas, Nev., M.B. "Det" Merryman and his wife, Crystal, were experiencing their own challenges producing their
Merrymac Collection, a line of whimsical ceramic dogs ranging up to 3 ft tall. Early on, the couple had tried manufacturing in Mexico but experienced continual quality problems. In the late '90s, they approached Frankoma Pottery about taking on their product line but couldn't work out a mutually agreeable deal, so the Merrymans decided to move their production to China instead. It was the perfect solution-for a while. But in the spring of 2005, Det Merryman got a phone call that every businessperson working with China dreads: One of the plants that had been producing his products had been seized by the government and closed down.
"We lost all the work in process and containers of merchandise, as well as all of our molds. We don't know why they seized the plant. I was told that I could go and try to buy the stuff out, but I saw myself ending up in an argument and subsequently a Chinese jail someplace, and I didn't think that was particularly advisable," Det says.
The Merrymans quickly evaluated their options. Should they try to find another producer in China?
"Doing business in China in some ways is wonderful-the Chinese are great people and they work hard, they care. But we had been there for a long time and had learned a lot of the ins and outs of doing business there, and it is very difficult. China is a communist country, and the rules are different there," says Det. "Additionally, it's hard to be market-responsive. If you put something new in your line and oversell it at a show, you won't be able to get those orders filled for three to six months because you're always that far behind in changing your production schedule. There are also the unknown elements, like a longshoreman strike that has your product sitting offshore-you're unable to fill orders so a lot of them are canceled, but that doesn't mean you don't have to take the product in. Or, in some cases, the only shipping line that's allowed to move is a Chinese shipping line, and they double their rates. The stories go on and on."
The answer was clear-the Merrymans needed to find a domestic producer. Remembering that Frankoma Pottery had the space and the equipment to produce large ceramic pieces, Det gave the company a call.
"The owner said he was selling the plant and had an offer on the table. I jotted him a note telling him to give me a call if that offer didn't work out; lo and behold, I was here two weeks later looking around and making an offer," says Det.
The sale to the Merrymans was finalized on June 30, 2005, and included all of Frankoma Pottery's designs, trademarks, products and standing inventory, the entire 75,000-square-foot manufacturing facility located in Sapulpa, Okla., on more than seven acres of property, and the offsite Oklahoma property that supplies the natural terra cotta clay used in Frankoma's pottery. By July 1, the Merrymans had reopened the Frankoma Factory Outlet Store on site, and by mid-August, the Sapulpa plant was once again producing pottery-both from the Frankoma line and the Merrymac Collection.
"We're trying to grow the company as quickly as we can within the parameters of reason. When we closed on the sale, the plant still just employed three people. By the second week in August, we had 14 employees, and we expect that to grow to 25-30 employees by early September. Depending on how things go, we hope to employ 100 people by this time next year," says Det.
Expanding the BusinessDet says he is energized by the challenge of producing in the U.S. and is encouraged by the enthusiastic reception he and his wife have received in Oklahoma. Their initial plans include reintroducing many classic Frankoma patterns that have been popular for generations, and they will also update product designs to accommodate modern cooking and tabletop trends. The company has already attracted the attention of celebrity chef and bestselling cookbook author Paula Deen, who is using Frankoma pottery to dress the Thanksgiving table for her one-hour TV holiday special on the Food Network. And Frankoma's terra cotta three-piece starter bakeware set has been awarded the Cooking Club of America's seal of approval, because it cooks evenly, is microwavable, ovenproof and dishwasher-safe. Besides kitchen and dining products, Frankoma will actively resume production in home accents, giftware, souvenir and custom projects.
The Merrymans also intend to continue to produce their Merrymac product designs, and because of the flexibility offered by being able to produce in the U.S., they plan to introduce a new line of hand crafted and hand-painted whimsical pet canisters and cookie jars.
The company has five presses and five kilns, including a tunnel kiln, and is already capable of producing 32,000-35,000 pieces per month with its existing staff. According to Det, the capacity of the plant is 250,000 pieces per month, which leaves plenty of room for expansion. To further enhance their contract manufacturing capability, the Merrymans plan to implement a full shipping and fulfillment center from their Oklahoma facility. "This presents definite freight and transport advantages for companies that are struggling with expensive international freight costs, shipping delays and frustrating custom clearance procedures at overburdened ports of entry. Even our central Oklahoma location should cut costs and shipping time around the U.S.," notes Det.
While producing high-quality ceramic giftware and tableware will continue to be the company's mainstay, the Merrymans are driven by a much larger objective.
"We want to prove that a U.S. manufacturer can successfully compete and can be profitable," Det says.
For more information about Frankoma Pottery, contact the company at P.O. Box 789, 9549 Frankoma Rd., Sapulpa, OK 74067; (918) 224-5511; e-mail email@example.com; or visit www.frankoma.com.