WestPoint Home Cuts 1,000 Closes Most U.S. Bedding Plants
June 4, 2007,
Hacking away at costs, shutting down more plants and thinning out its white-collar ranks as it tries to stabilize sales and push more production to low-cost off-shore operations it can own or control, WestPoint Home is winding down what's left of its U.S. bedding operations, closing several plants by the end of August with the loss of about 1,000 manufacturing jobs.
And the most recent wave of cost cuts is scything through the formerly sacrosanct white collar ranks as the major mill eliminates about 40 jobs in its New York City headquarters and at regional sales offices. Among those being cut loose are:
Steve Magee, vp of sales with responsibility for Wal-Mart and the dollar stores;
Judi Alexander, with Charisma brand responsibilities;
Gary Droser, vp of West Coast sales;
Cynthia Lerner, bath design and product development;
Bruce Cook, head of institutional;
Pat Hayes, sales manager with responsibility for Kohl's.
Other headquarters jobs being eliminated as West Point makes long overdue moves to reduce its overhead are in sales and marketing, design, human resources, and finance.
As WestPoint plays catch-up and builds a global manufacturing platform under new owner Carl Icahn after years of turmoil, bankruptcy and a painful restructuring, it is now shutting down its last remaining U.S. bedding plants and shifting production to low-cost off-shore producers. Plants to be closed by the end of August are the Opelika finishing plant, the Marianna plant, Grifftex and Graphics, all located in Alabama, Florida, and Georgia.
WestPoint Home said the plant closings and downsizing will enable it "to continue its strategy of global supply chain expansion to better compete in the world market."
Coming out of bankruptcy with no debt, $150 million in cash and substantial borrowing capability, the company has launched a program of buying outright, or joint-venturing offshore suppliers in bed and bath. The company has quietly, if not explicitly, made it plain that it wants to own or venture up off-shore manufacturing, controlling its own production, rather than functioning as a marketing company and adding a layer of cost that could turn off retail customers.
Two deals recently in the works fell apart at the last moment as the sellers changed their minds. But more change could soon be in the offing, with a third deal said to be still in the works, possibly completed by the end of this month, and even more changes on the way as the company tries to stanch eroding sales and rebuild its bottom line.