Masonite Algoma, Wisconsin plant
Masonite Algoma, Wisconsin plant
TAMPA - Door manufacturer Masonite saw net sales increase 3 percent third quarter to $489.6 million. Excluding foreign exchange, net sales would have increased 5 percent. Masonite sales so far this year are 68 percent from North America, totalling just over $1 billion.
 
CEO Fred Lynch discussed in an earnings call plans to close a manufacturing facility in Algoma, Wisconsin, with 140 employees affected. The decision was announced November 8. 
 

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"As part of our acquisition strategy, we acquired a collection of architectural door and component manufacturing companies," Lynch said, making Masonite the largest manufacturer of architectural interior wood doors and the only vertically integrated manufacturer of architectural wood doors in North America. This new architectural door platform expaded its reach across the commercial construction industry.

"But of course, the integration of these businesses came with a unique set of challenges," Lynch said. As its number of manufacturing centers grew to 64 in 9 countries, each new business came with its own computerized operations. Here's how Lynch put it (transcript courtesy of Seeking Alpha):

 
At the time of each acquisition, each company had its own manufacturing processes, product portfolios, specifications, brands, and ERP systems. To fully unlock the value of these combined assets, we set out on a multi-year strategy that includes the harmonization of the door chassis, which provides the core performance specifications; rationalization of duplicate product families; manufacturing footprint optimization; and migrating multiple ERP platforms onto a contemporary common system. We believe that this strategy improves our ability to flex production schedules, labor needs and order flow across multiple plants, while making it simpler for the customers to identify and order the doors that they need.
 
Lynch says the Algoma, Wisconsin, facility production of architectural doors will be transitioned to other similar facilities, which will take until the third quarter of 2017. The $4.8 million cost to close the plant will be rapidly recouped: it will save $5 million annually. 
 
"Closing a manufacturing facility is never something that we take lightly and we're grateful for the service provided by the employees that are impacted by this," Lynch said. The cost for personnel will be about $2.4 million.
 
Meanwhile Masonite is expanding a digital design operation in Ybor City, Florida (same site as Ashley's digital center). The Digital Innovation Center in Ybor City is led by Larry Repar, our Chief Customer Experience Officer, who is tasked with expanding Masonite's digital reach and online presence, creating new go-to-market strategies, and serving as the central location for similar developments culled from various Masonite locations.
 
The digital team uses Agile development methodologies for Lean software programming that helps drive faster solutions, develop, launch, learn, and then rapidly enhance and update.
 
"This is the way that the new customer facing applications are most effectively developed, as witnessed by the application ecosystem we are using on our mobile devices today," Lynch says. "We believe that digital tools make it easier for our customers to search for, configure, order, and pay for the doors that they need."
 

 

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