HIGH POINT, N.C. - Stanley Furniture says it has established a strategic alliance with a Vietnam furniture manufacturer, Starwood Manufacturing VN Corporation, to develop a dedicated factory in Ho Chi Minh City, Vietnam.
Stanley says the purpose-built, 150,000 sq. ft. plant, which will employ 500, will rely on Stanley Furniture’s manufacturing know-how, its construction aimed at helping Stanley achieve better long-term control over its sourcing in Asia, says company CEO Glenn Prillaman. Currently Stanley produces at 10 factories in Indonesia and Vietnam; it closed its U.S. manufacturing last year after several years of try to revive its domestic manufacturing.
Starwood designed and built the new facility in the last six months of 2015, and production began at the end of the year, Stanley said in its February 23 SEC filings.
Those filings said its alliance with Starwood allows it to "engineer its designs specifically for the efficiency of the factory, schedule and supervise production to satisfy its specific customers’ demands and provide quality assurance." More simply, Stanley will have greater control over the quality its products.
Starwood will manufacture Stanley’s more recently introduced products in a stand-alone facility designed by Stanley for its products and constructed by Starwood over the last half of 2015 on its existing manufacturing campus outside of Ho Chi Minh City.
“Stanley is a company with a long heritage of manufacturing,” said Prillaman. “By partnering with a manufacturer overseas, we are developing a differentiating sourcing strategy that has already lowered costs, but should also allow us to lower lead times for improved customer service and provide customers with more consistent product quality, as we market and distribute a broader product line to increase revenues.”
Stanley says the plant will allow it to make its products 10 to 15 percent lower in cost than a traditional line, and without sacrificing quality or lowering specifications, the company says. Stanley will use its own engineers, quality control, and product design and development staff working in the facility, which it expects will give it better control over quality.
Stanley Furniture's sales fell 5.4 percent in the latest quarter, to $57.4 million.
In the past year, in addition to aligning with Starwood, Stanley closed domestic manufacturing facilities and moved to an overseas sourcing model, discontinued an un-profitable product line, implemented a new enterprise operating system, opened new trade showrooms and consolidated corporate offices.
Separately, Stanley Furniture said in an SEC filing that it had approved a 65 percent salary increase for Prillaman, and a 22.8 percent salary increase for Anita W. Wimmer, vice president of finance/corporate controller.
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