Flexsteel Named Furniture ‘Supplier of the Year’
Flexsteel Industries Inc. has been recognized as the best of the nation’s furniture suppliers by an industry publication — an award that comes on the heels of company layoffs and sales declines in the midst of a struggling furniture market, according to the Dubuque (Iowa) Telegraph Herald.
The Dubuque-based furniture maker was named Supplier of the Year by Furniture Today magazine. The award, Flexsteel spokesman Justin Mills said, is significant since the publication is highly regarded among manufacturers and retailers in the industry.
Flexsteel received word about the recognition late last week, and the award will be presented in December at a conference in Naples, Fla.
“This is kind of a landmark for Flexsteel, it really puts us on the map,” said Mills, who said the publication also ranked Flexsteel as ninth among manufacturers worldwide in recent years as residential sales have grown.
Flexsteel was recognized in large part for company longevity, as it has been in existence for more than a century. Flexsteel was founded in Minnesota before moving to Dubuque in the early 1900s.
“We’ve been around 116 years and have one of the strongest balance sheets in the industry. So retailers are recognizing we’re a credible supplier,” Mills said.
The award was cast in the context of the current economic downturn, as the publication looked to recognize companies staying competitive. Mills said this served as a reaffirmation of the company’s efforts.
In the article, Furniture Today Editor-in-Chief Ray Allegrezza called Flexsteel an “American success story.”
“The company, which makes seating products for virtually every application, has more than a 100-year history as a credible, reliable and innovative supplier,” he said.
But the past year has unquestionably been a challenging one for Flexsteel.
Last quarter, Flexsteel reported net sales of $73.6 million for the quarter — 25% lower than the year before.
Ron Klosterman, Flexsteel chairman and CEO, said the work force was slashed by more than 30% over the year.
Many of those reductions came from the closure of Flexsteel’s New Paris, Ind., recreational vehicle seating production plant and ending manufacturing operations at a Lancaster, Pa., facility last fall.
But there have been job cuts locally as well, a series of reductions at the Dubuque flagship factory trimmed the staff to less than 150 and completely eliminated the second shift.
Mills said Flexsteel now employs 1,450 employees companywide.
“We hope that’s all behind us. It’s not been an easy journey to get where we are today,” he said. “Until this economy turns around that’s all we can do is be ready, be prepared and be well equipped.”
Mills said he didn’t want to speculate on the role the troubled recreational vehicle business will play in the future.
“It’s tough to say,” he said, adding that a turnaround on recreational vehicles won’t happen until the original equipment manufacturers rebound.
The furniture industry in general has been facing a perfect storm of rising material costs, the credit crunch and a generally poor housing market.
“Some of these manufacturers can’t balance source production versus domestic production and they get in big trouble. They’re taking out millions in loans just to stay in business,” said Mills, who said Flexsteel officials are hoping for a retail bounce back this fall.
“The bottom line is we’re well-positioned and well-equipped to handle the demand when it does turn around.”