Business Journal 20170201

THE NORTHEAST MISSISSIPPI

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Kellex on schedule with Tupelo operations pg. 8 FEBRUARY 2017

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henever the titans of furniture industry are mentioned, Hugh McLarty’s name inevitably pops up.

McLarty, like many in the industry, found a mentor in none other than Morris Futorian, who in 1948 opened a furniture plant in New Albany, laying the foundation for what would be an economic force in Northeast Mississippi.

McLarty, 81, passed away in December, leaving a rich legacy behind.

He earned a bachelor’s degree in business at what is now the University of Memphis, and began his career with Humble Oil in Charlotte, North Carolina before later accepting a job with Futorian.

McLarty decided to strike out on his own in 1976 and founded his own furniture company,

BUSINESS JOURNAL

FEBRUARY 2017

Furniture industry loses another icon Benchcraft, in Blue Mountain.

At its peak, Benchcraft employed 2,000 people. After merging with Berkline in 2002, the company – having shifted its headquarters to Morristown, Tennessee, filed Chapter 11 in 2011 and was liquidated.

But by that time, McLarty was faring far better with another company he founded in 1995, Albany Industries, with his wife and three sons. The company started with 15 employees in a 10,000-square foot building. Today, the company continues to excel, now employing some 600 employees who work in some 1 million square feet of manufacturing space.

McLarty, who retired in 2000 at 65, was married to Shelby Long McLarty for 61 years. She died on Nov. 19, 37 days before he died on Dec. 26.

M c L a r t y ’s isn’t the first of the industry’s icon’s to have died in recent years.

In February DENNIS SEID 2013, Alvin E. “Bo” Bland died at the age of 88.

Bland founded reclining furniture company Action Industries in 1970 with Mickey Holliman.

They were the “sons” of Morris Futorian, and many of today’s furniture company executives could be called Futorian’s grandsons.

“He’s the reason why I moved to Mississippi,” said Guy Lipscomb, CEO of Pontotoc-based furniture manufacturer Southern Motion after Bland’s death.

“He was a wonderful man. I would put him and Hugh Mc-

Larty among the top legends of the industry.”

Lipscomb worked for Bland 14 years.

“He was very professional, a first-class guy,” Lipscomb said.

In 1972, Action merged with Lane Furniture Industries. In 1987, Furniture Brands International acquired the company.

Bland was inducted into the American Furniture Hall of Fame in 2001. He was credited with developing the mechanism used in Action’s motion furniture, helping pave the way for the company’s success.

“Bo Bland, Hugh McLarty, they were pioneers in the industry,” said Joey Tarrant, vice president of operations for H.M. Richards, which was founded in 1997. “We all learned something from them.”

Jerry Epperson, a longtime

analyst, researcher and investment firm director long respected by the furniture industry, said this about Mississippi’s contributions to the industry a few years ago.

“Our industry doesn’t have many leaders the stature of Hassell Franklin, Hugh McLarty, Mickey Holliman, Tom Foy and others. Gerald Washington’s story of success make you proud to be in our industry, and I am glad to know him.”

I’ve had the honor and privilege to meet all of them at one time. The backbone of Northeast Mississippi’s economy still is manufacturing, with furniture at the forefront. And we should be thankful that these giants of the industry all had their roots here.

Contact Dennis Seid at (662) 678-1578 or dennis.seid@journalinc.com

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H.M. Richards celebrating 20 years

BY DENNIS SEID BUSINESS JOURNAL

BALDWYN – Since it’s founding 20 years ago, upholstered furniture maker H.M. Richards has expanded every two years.

Following that pattern, the company should be making and announcement sometime this year.

“I think we took care of that with our last announcement,” said Joey Tarrant, with a laugh. Tarrant is the company’s vice president of operations.

Indeed, the announcement in 2015 was significant, the biggest in the company’s history: a 280,000-square-foot addition and 500 jobs over a five-year span.

Rooms To Go, the Florida-based retailer that has a majority stake in H.M. Richards, pledged $8 million to the project.

State and local authorities offered cash and tax breaks valued at more than $5.4 million, while the Mississippi Development Authority pledged $2.95 million in state help, including $2.45 million for site preparation, infrastructure, electrical and parking lot improvements.

The remaining $500,000 was earmarked for TURN TO RICHARDS, P. 14

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FEBRUARY 2017 ADAM ROBISON | BUY AT PHOTOS.DJOURNAL.COM

Dustin Jones, an employee at Southern Motion, rolls a new sofa into line during assembly at the Baldwyn location Wednesday afternoon.

Southern Motion looks to third decade

BY DENNIS SEID BUSINESS JOURNAL

BALDWYN – Southern Motion celebrated its 20th anniversary last year in style, punctuated with an announcement last fall that it planned to add 600 jobs over five years.

Five months into that plan, it has added 60 employees – 10 percent of that target – bringing total em-

ployment in Baldwin to 315.

“Things are going great at our new location,” said Southern Motion President Roger Bland. “We completed the move from our other Baldwyn plant in December, and that building is now under lease from Custom Engineered Wheels.”

Southern Motion is investing $20 million after

purchasing and renovating the former distribution center, warehouse and headquarters for Hancock Fabrics. The Pontotoc-based furniture company already occupied another Baldwyn facility it bought in 2012, but environmental issues and other factors didn’t allow for expansion, which Southern Motion desperately sought.

The company employs another 1,200 people at its two facilities in Pontotoc, where it was founded in 1996.

Double-digit growth in recent years led Southern Motion to expand its capacity, and the Hancock facility suited its needs.

The furniture manufacturer offered $9.3 million for the property, which includes about 64.5 acres of

land; a 650,000 square-foot warehouse and distribution facility; a 28,000 square-foot manufacturing facility and an 80,000-square-foot headquarters building. Southern Motion is looking to sale or lease the headquarters building.

The company has room to have 12 production lines, and as of last month is nearly halfway there.

“We moved the four existing lines in December and added a new line in mid-January,” Bland said.

Southern Motion still is looking for additional workers, and the opportunities are plenty, he added.

“As you know, we are a domestic manufacturer and perform all functions from foam cutting, frame TURN TO MOTION, P. 11

BUSINESS JOURNAL

FEBRUARY 2017

“M

ade in China 2025” is a five-year strategy to comprehensibly upgrade the Chinese manufacturing sector by transforming China into a leading innovative manufacturing power.

Adopted in March 2016, the plan focuses on enhancing advanced Chinese manufacturing by making it more efficient and integrated over the next five years.

Some manufacturing experts liken the strategy to Germany’s implementation of Industry 4.0, which was discussed at the Franklin Furniture Institute’s 2016 Manufacturing Summit. Industry

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Warning: Made in China 2025 is coming 4.0, also known as intelligent manufacturing, applies the tools of information technology to production processes.

The advantages of Industry 4.0 include bringing products to market quicker, reducing costs and building new revenue streams.

The use of advanced robotics, big data, cloud computing, industrial internet, horizontal and vertical integration, simulation, augmented reali t y, additive manufacturing and cybersecurity are at the heart of Industry 4.0.

Some experts describe Industry 4.0 as the fourth industrial revolution since the first one that

occurred in the 18th century. Germany adopted Industry 4.0 in 2013, and in July 2015 Germany and China signed a memorandum of understanding to speed up development of the smart manufacturing technology and to expand strategic cooperation in newly emerging opportunities.

“Made in China 2025” targets 10 specific priority industries. While furniture is not a specific focus, the strategy does focus on traditional industry sectors which include furniture and component parts. The innovation-driven strategy focuses on quality over quantity, structure

optimization and enhancing human talent.

By upgrading technologies to enhance efficiency and integration, China hopes to control the highest parts of global production and raise the domestic content of core components to 70 percent by 2025. This in itself will drastically reduce the opportunities for American manufacturers to export products and gain market share in China’s growing domestic market.

Some of the largest challenges for multinational companies will be to mitigate China’s goal of making its companies more competitive in the global supply chain, de-

termine how to sell products in China’s domestic market with a focus on domestic component production and how to combat China’s value-added innovations.

Additionally, the “Made in China 2025” calls for increased direct foreign investment. This additional investment in target industries provides opportunities for better collaboration among multinational companies. Furthermore, as manufacturing is upgraded, China’s overall economic conditions will improve and lead to the strengthening of their educational and financial systems.

U.S. manufacturers

need to stay abreast of global strategies and initiatives, such as Industry 4.0, robotics, and the Internet of Thing, in order to continue to lead the world in productivity and job growth. The time to act is now.

This article is based on information from the Center for Strategic and International Studies, HKTDC Research, and Boston Consulting Group Perspectives.

BILL MARTIN is director of the Franklin Furniture Institute at Mississippi State University.

Contact him at (662) 3253348 or w.martin@msstate. edu. Find out more about the Institute at www.ffi.msstate. edu

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FEBRUARY 2017

Kellex on schedule with Tupelo operations

BY DENNIS SEID BUSINESS JOURNAL

TUPELO – Nearly two years ago, KLN Manufacturing decided to close what had been Tupelo Manufacturing, leaving more than 30 employe e s wondering about their future.

Charlie Williamson

Enter new owner Kellex Seating, who paid employees to stay on board while the transition in ownership was made. Kellex also has

made good on its promises to the city and state ahead of schedule.

Mississippi offered $200,000 to help with infrastructure improvements, while the city chipped in a 10 percent match. Kellex said it would invest a minimum of $600,000.

That got a new roof and much-needed exterior and interior renovations that plant manager Charlie Williamson said is some 90 percent complete.

But there was one catch to the state's financial commitment – Kellex had to employ 75 people within two years.

The company has already met that goal, now

Ron Scales builds a frame for a chair at Kellex Seating in Tupelo.

employing nearly 80 people.

Williamson, who came out of retirement to run the plant, was impressed by the people who stayed with the company. He also brought in a long-time friend and fellow furniture

industry veteran, Dennis Lesley.

It was Kellex that initially approached Williamson about finding them a plant in Tupelo that might complement its operations.. The North Carolina-based company has made commercial upholstered furniture since 1994.

"Kellex asked me to help find people to help build furniture for them," Williamson said. "They have a plant in North Carolina and several plants that build furniture for them.

But I couldn't think of anybody who really did what Kellex does until I thought about Tupelo Manufacturing."

Williamson visited with KLN shortly before they decided to close the plant

THOMAS WELLS | BUY AT PHOTOS.DJOURNAL.COM

and wasn't sure if Kellex would still be interested, given the condition of the building. As it turned out, Kellex was.

"They had a lot of work and needed to get it out," he said. "Then we got to talking to some of the people that were here who had a lot of history with the plant. Kellex did offer each one of them here a job. Some had gone on and others stayed. I was retired and didn't really didn't want to get in it. But when I started talking to Dennis, Jan Scott, Cheryl Hendrix and Shawn Cardwell, I knew we had a good nucleus of people. That's what got me to come here, and we've been really successful ... without these four people, I wouldn't be here."

Lesley's expertise in cutting, sewing and frame-building, along with Cardwell's knowledge of woodworking, has been has been key to Kellex's success in the Tupelo facility, Williamson said.

Scott, who started with Tupelo Manufacturing since 1992, brought purchasing and upholstery experience, while Hendrix, who joined the company in 2003 and had years of Human Resources experience.

"We had a good core to start with and just needed to rebuild and find an experienced work force," Williamson said.

And what was supposed to be a three-month, partTURN TO KELLEX, P. 14

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BUILDING FURNITURE Academy to help train, develop industry workforce

BY DENNIS SEID DAILY JOURNAL

TUPELO – With a $12 billion economic impact on the state, the furniture industry includes hundreds of manufacturers and suppliers that employ some 60,000 people directly and indirectly.

But there’s also a growing need for skilled and trained workers, as the industry continues to recover from the recession.

“The furniture industry is making a comeback,” said Bill Renick, of Three Rivers Planning and Development District. “Just look at the companies that are

adding workers today.”

To help foster that growth and meet labor needs, several Northeast Mississippi manufacturers, colleges and economic development groups have created a Furniture Academy that will put more qualified workers in the pipeline.

The 28-hour program, which is an introduction to furniture manufacturing, also includes training in teamwork and problem solving, developing work ethic and gaining financial awareness and life skills.

Classes will be taught at Itawamba Community College and Northeast Mississippi Community Col-

TOP 20 MANUFACTURERS 2000

1. La-Z-Boy $2.232 billion 2. Furniture Brands International $2.116 billion 3. Lifestyle Furnishings International $1.78 billion 4. Ashley Furniture Industries $952 million 5. Klaussnere $931 million 6. Ethan Allen $760.2 million 7. Sauder Woodworking $552 million 8. Bush Furniture $419.7 million 9. O’Sullivan Furniture $397.5 million 10. Bassett $344.6 million 11. Bernhardt $338 million 12. L&P Consumer Products Unit $294 million 13. Stanley Furniture $283.1 million 14. Chromcraft Revington $259.4 millioin

lege, which will set up the schedule based on the needs of those signing up in the program.

Funded through a $250,000 grant from the state, the Furniture Academy begins Feb. 13, with a goal of signing up 300 people.

The program is free, and takes two to three weeks to complete, depending on the schedule that will be tailored toward participants.

It is open to both new hires and current employees at participating furniture manufacturers. As of now, the list includes H.M. Richards of Baldwyn,

15. The Rowe Companies $253.1 million 16. Hooker Furniture $250.8 milion 17. Heath Home Furnisings $250 million 18. Pulaski $242 million 19. Standard Furniture $209 million 20. Flexsteel $205 million TOTAL: 13.259 billion

TOP 20 MANUFACTURERS 2014

1. Ashley Furniture Industries $3.875 billion 2. La-Z-Boy $1.071 billion 3. Klaussner Furniture Industries $524.3 million 4. Sauder Woodworking $517.8 million 5. Dorel Industries $504 million 6. Man Wah Holdings $421.4 million

Homestretch in Nettleton, Kevin Charles Furniture in New Albany, Max Home of Fulton and Iuka and Southern Motion of Pontotoc and Baldwyn. The five companies alone employ some 3,000 workers combined.

“It’s open to everyone in the industry, and we want more to participate,” said Rusty Berryhill, president of Kevin Charles. “We may be competitors and rivals, but we’re all in this together to help the industry.”

Roger Bland, president and CEO of Southern Motion, said the Academy is much needed.

“It has been difficult to

recruit and retain workers, part of this is not exclusive to our industry but the workplace in general,” he said. “The Academy ... will provide an opportunity for prospective employees to learn work habits, basic skills along with an introduction to the furniture industry.”

An incentive for Academy graduates is that their job applications will move to the front of the line for consideration. And if hired, they’ll receive extra pay.

“That was something we let the companies decide on,” Renick said. “It’s up to each company to determine how much more

7. Flexsteel Industries $411.2 million 8. Lacquer Craft $373.1 million 9. Ethan Allen Interiors $348.4 million 10. Bernhardt Furniture $314.9 million 11. Home Meridian International $302.2 million 12. L&P Fashion Bed Grouop $278.8 million 13. Standard Furniture Manufacturing $261.9 million 14. Hooker Furniture $234.6 millioin 15. Best Home Furnishings $233.2 million 16. Sherrill Furniture $223.1 milion 17. Bassett Furniture Industries $219.2 million 18. Natuzzi $202.3 million 19. Franklin $173.3 million 20. American Furniture Manufacturing $121.9 million

they’ll pay.”

Other partners in the Furniture Academy include the Franklin Furniture Institute at Mississippi State University and the Community Development Foundation in Tupelo.

“The Furniture Academy will ensure Northeast Mississippi has a skilled, robust workforce to see the demand of the region’s manufacturers, “ said Gov. Phil Bryant. “I am grateful to the local industries, educational systems and community organizations whose partnership made it a reality.” dennis.seid@journalinc.com

TOTAL: $10.612 billion Source: Furniture Today

FURNITURE FYI

• The U.S. furniture market was estimated to be worth $96.4 billion in 2014. Furniture Today forecast the market will grow at a compound annual growth rate of 2.9 percent between 2015 and 2019, reaching $111 billion in 2019.

• The industry has become less fragmented over time as the largest 100 retailers have taken market share away from the remaining industry players. The top 100 represent 79 percent of the industry’s revenues, according to Furniture Today, while in 2007, before the recession, they accounted for 59 percent.

BUSINESS JOURNAL

FEBRUARY 2017

It’s time in the market, not timing the market

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s we continue to digest the course change our new administration has taken, it is important for investors to remember that with few exceptions, it’s not a wise idea to try and time market swings.

Historically, equities have outperformed bonds, cash and inflation, though past performance is no guarantee of future results and those returns have involved greater volatility. This can be particularly tough in market periods like 2000–2002,or 2008.

During both of these periods, investors became frazzled and nervous as events both inside and outside normal market functions caused large downturns. Eventually, investors saw their accounts recover value over a period of time as markets stabilized, but the huge swings caused many sleepless nights.

Trying to second-guess the market can be at times be akin to the old adage of shutting the gate after the cows have gotten out. A University of Michigan study in 2005 found that investors who were out of the market on the 90 best trading days between 1926-2004 saw their returns cut dramatically. In 2010, the Library of Congress prepared a study on the behavioral patterns of U.S. investors. What

they determined was that excessive trading often caused investors to greatly underperform

CHRIS COLE the market.

This was amplified by their results looking at the chance of a positive return over one, five, and 10-year holding periods. Their findings were that looking over market history, investors had a 73 percent chance of a positive return over a one-year holding period, an 86 percent chance of a positive return over fiveyear holding periods, and a 95 percent chance over a 10-year holding periods.

Having an understanding that there will always be good and bad days in the market prepares investors for difficult times. Also having guidelines on when to take profits can help. Many investors use a core-and-satellite approach for their portfolio, which has certain assets that have a buyand-hold strategy, while assigning the others assets to sell when they rise a certain percentage, and buy back after they drops a certain percentage.

It also is important for investors to understand that current performance may not reflect past results. While it’s

easy to get caught up in the day-to-day movements of markets, try and focus on how you stand relative to last year, three years ago, five years ago and 10 years ago. Reminding yourself of how far you have already come since you started can help to calm nerves when markets go negative. Also, just as down times don’t always last, they are inevitable and necessary for long-term market functions as are periods of positive times.

Finally, remembering basic financial investing principles can help alleviate the stress of market swings. Make sure you have an emergency fund of three to six months’ living expenses. Set up a systematic investment plan where you have funds automatically put into your investment vehicle of choice on a monthly basis.

Know what you own and why you invested in such to begin with. Know why you are investing and the financial goals you hope to attain with such.

All these are fundamental actions that can get you through times of great volatility.

Probably the best way to describe this is to liken it to rainy days. They are inevitable but eventually the sun comes out.

CHRIS COLE is a Chartered Wealth Advisor and vice president of Hilliard Lyons in Tupelo.

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Motion FROM P. 6

cutting, fabric cutting and sewing to upholstery. We have needs for all levels,” he said.

BUILDING THE FUTURE

Southern Motion recently joined four other furniture companies throwing its support behind a new Furniture Academy that begins classes later this month at Itawamba Community College and Northeast Mississippi Community College.

“A small group of us saw the need to develop this coalition for the industry as we were all struggling to find qualified employees,” Bland said. “The Academy is for the entire industry, but we felt the need for a small core group to help get organized. The goal was to deliver the message that the furniture industry was thriving in north Mississippi and was great career opportunity. The Furniture Academy was the vehicle to make this happen.”

Bland said the industry has made a comeback after the recession, but its struggles aren’t over.

“The biggest difference from 15 to 20 years ago is on the raw material supply side – today much of our raw materials are not available in this country,” he said. “We managed our grow by staying focused on our core business and developing a business model based on “Made in America.” We developed a strategy to grow our business by taking advantage of

what we could provide that imports couldn’t ... we are all in with ‘Buy American’ and ‘Made in America.’”

Among the most sought-after workers are those with cut-andsew experience. They are the ones who cut, stitch and sew the fabric that cover the sofas, recliners and chairs. Cut-and-sew kits imported from overseas is less expensive, but Southern Motion has been one of the leaders in the industry that have kept most of that type of work inside its walls.

“We do about 95 percent of our business with fabrics cut and sewn in the U.S.,” Bland said. “It is a big challenge for those companies who cut and sew here to find sewing labor; it is somewhat of a lost trade since so many garment companies and furniture manufactures have gone offshore.

“Not unlike case goods ,a lot of the fabric industry has moved offshore. It would take a huge investment along with some governmental support in environmental regulations for this industry to come back to the U.S.” Southern Motion’s is committed to building in the U.S., and Bland has high hopes the Furniture Academy will help fill the gap in finding qualified workers.

“The biggest obstacle we have faced in making product here has been finding people, which was the basis for the Academy,” Bland said. “Our industry had developed a very bad reputation based on bankruptcies that affected our industry several years ago, and we have to deliver a message that furniture is only back but thriving in our area.”

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BUSINESS JOURNAL

FEBRUARY 2017

No secret that success comes from partnerships

ill Gates, the founder of Microsoft, once said, “Our success has really been based on partnerships from the very beginning.”

I look at how successful Northeast Mississippi has been in recruiting businesses and what makes us stand out against other areas in the state and around the country, and the answer is “partnership.”

Synergism is where the activities of a group working together exceeds the sum of the efforts of the individual members. This is hardly a secret in the favorable outcomes in business recruitment and retention in Northeast Mississippi,

Comfort Suites to build near Hampton Suites TUPELO – A Comfort Suites hotel will open later this year, but not at its former site near the North Gloster and North Green street intersection, where it was heavily damaged by the April 2014 tornado and later demolished.

The new location for Comfort Suites will be on Carter Cove,

but it takes willing partners to make the accomplishments happen.

My company has been fortunate to be a part of some great campaigns that have come from partnerships.

We were given the opportunity to work with the Community Development Foundation, the PUL Alliance and Three Rivers Planning & Development District to brand the land that came to be known as Wellspring in Blue Springs.

The result was the Toyota plant. We played a very small part in this, but we are proud to be a part of the team.

We have been honored to work with executive di-

rector R a n d y Kelley and his team members at Three Rivers.

TY ROBINSON From concept to completion, we’ve worked on many campaigns for dropout prevention, adult basic education, youth summer job experience, assistance with promoting the Mississippi Department of Human Service’s campaigns through the Area Agency on Aging and the Furniture Academy.

So do you remember “Bling, No Bling;" “Talk to Someone Who Cares;" “Know More, Go Further;"

"Hot Jobs;" “Summer Coin Crew;" “Mississippi State Health Insurance Assistance Program (SHIP);";or “Mississippi Access to Care (MAC)”? The names might not be as familiar as the visuals. Getting the word out is important, and we enjoyed the work we did to bring it to the attention of the public.

Regarding the Furniture Academy, the key players in putting together the academy are H.M. Richards of Baldwyn; HomeStretch of Nettleton; Kevin Charles Furniture of New Albany; Max Homes of Fulton and Iuka; Southern Motion of Pontotoc and Baldwyn; the Franklin Furniture Institute of Missis-

BUSINESS REWIND behind Lowe’s in the Tupelo Commons Development.

The 75-room all-suites hotel will be built adjacent to the Hampton Inn & Suites, which was built in 2011.

The Comfort Suites is being built by Vee Patel, who has owned the Baymont Inn and Suites in Tupelo for 11 years.

Construction should be finished in the next 12 months, but Patel said he would like to open

the hotel before the end of the year.

The hotel will be four stories tall and include an indoor pool, a fitness room and a two-story lobby. An 1,800-square-foot conference room also will be included.

When completed, the Comfort Suites will be the newest addition to the city’s inventory of some 1,500 hotel rooms. The last hotels to open in the

All-America City were the Candlewood Suites (79 rooms) and the Holiday Inn and Suites (121 rooms) in 2013.

The former Comfort Suites, a four-story, 80-room property, was built in 2008. That property has remained vacant since its demolition. Fusion Hospitality, which owns the site, announced in 2015 that it would build a 108-room Home2 Suites. It’s unclear if those plans remain.

sippi State University; Itawamba Community College; Northeast Mississippi Community College; CDF; and Three Rivers. My company was invited by Three Rivers to participate by aiding with the branding of the program by working with the partners to develop a name, a logo, advertising materials and putting together a news conference.

Again, we played a very small part in the Furniture Academy, but we are pleased to be a part of a program that has such great importance for our community. We learned that within the first few days after the news conference and the advertising

started that over 100 people had applied to be part of the Furniture Academy.

This speaks volumes to the collaborative effort of all the parties that are working together to raise the level of the workforce in our area.

We are all more successful working with each other. The proof is seen in the good news that we read in the news. Not every story has a happy ending, but it’s small steps that move us forward and make Northeast Mississippi a great place to work and live.

Golden Chair bought

by Chapter 3 Inc.

Chapter 3, said Chapter 3 also will have a small sales and marketing office in Minneapolis.

The new owners said all current Golden Chair personnel will remain with the new company and continue to work for Chapter 3. Washington will be staying aboard as vice president of manufacturing Essentially, the company will operate very similar as it did in the past, focusing on accent furniture.

Chapter 3 will be expanding the company to include online retail customers as well as other midsize brick-and-mortar accounts.

HOULKA – Furniture maker Golden Chair was purchased by Minneapolis-based Chapter 3 Inc. in December, but the company's headquarters and manufacturing plant will remain in Houlka.

Greg Washington, the owner and president of Golden Chair for the past 30 years, made the announcement recently. Chapter 3 Inc. is owned by Jennifer and David Schock, who live in Minneapolis, Minnesota.

Jennifer Schock, CEO for

TY ROBINSON is president and COO of Robinson and Associates, a Tupelo-based marketing, advertising and public relations agency.

BUSINESS JOURNAL

FEBRUARY 2017

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CALENDAR FEBRUARY

7:

Starting a Business – First Steps.

Tupelo, 1 p.m. to 2:30 p.m. Topic: Start-up Assistance. Are you interested in starting your own business, but don’t know where to begin? This seminar outlines the basic steps to start a business.

Topics include: regulations such as licenses and permits; legal forms of business ownership; basic marketing concepts to help analyze the revenue potential; lending terminology; outline for a business plan and other resources to assist in starting a business. To register call 1-800-725-7232 Location: UMSBDC Business Assistance Center, Renasant Center for IDEAs. How to Develop a Business Plan, Oxford, 1 p.m. to 2:30 p.m. Topic: Business Basics. This seminar is designed to assist in preparing a business plan. The parts of the business plan are explained, i.e., industry research, description of company products and services, identifying target customer groups and a marketing

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plan. Financial components discussed are start-up costs and preparation of a projected cash flow statement. To register, call 1-800725-7232. Location: UMSBDC, Lafayette County Starting a Business – First Steps, Starkville, 1 p.m. to 2:30 p.m.

Topic: Start-up Assistance. To register, call 1-800-725-7232. Location: MSU MSBDC – MSU Business Incubator Building, Thad Cochran Research, Technology & Economic Development Park.

Starting a Business – First Steps, Ripley, Noon to 1:30 p.m. Topic: Start-up Assistance. To register, call 1-800-725-7232. Location: UMSBDC-Tupelo, Tippah County Administration Building, Tippah County Starting a Business – First Steps, Holly Springs, 1 p.m. to 2:30 p.m. Topic: Start-up Assistance. To register, call 1-800-725-7232.

Location: UMSBDC, Marshall County Library

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How to Develop a Business Plan, Tupelo, 1 p.m. to 2:30 p.m. Topic: Business Basics.

To register, call 1-800-725-7232. Location: UMSBDC Business Assistance Center-Tupelo, Renasant Center for IDEAs, Lee County How to Develop a Business Plan, Starkville, 1 p.m. to 3 p.m. Topic: Business Basics. To register, call 1-800-725-7232. Location: MSU MSBDC – MSU Business Incubator Building, Thad Cochran Research, Technology & Economic Development Park Starting a Business – First Steps, Tupelo, 1 p.m. to 2:30 p.m. Topic: Start-up Assistance. To register, call 1-800-725-7232. Location: UMSBDC Business Assistance Center-Tupelo, Renasant Center for IDEAs, Lee County Starting a Business - First Steps, Caterpillar Inc. in Oxford, 3 p.m. to 4:30 p.m.; 4:45 p.m. to :15 p.m. and Topic: Start-up As-

sistance. To register, call 1-800-725-7232.

Location: UMSBDC, Caterpillar Inc., Oxford How to Develop a Business Plan, Oxford, 1 p.m. to 2:30 p.m. Topic: Business Basics.

To register, call 1-800-725-7232. Location: UMSBDC, Lafayette County How to Develop a Business Plan, Ripley, 1 p.m. to 2:30 p.m. Topic: Business Basics.

To register, call 1-800-725-7232. Location: UMSBDC, Ripley Public Library, Ripley How to Develop a Business Plan, Holly Springs, 1 p.m. to 2:30 p.m. Topic: Business Basics. To register, call 1-800-725-7232 Location: UMSBDC, Marshall County Library, Marshall County

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MARCH

Starting a Business – First Steps, Oxford, 1 p.m. to 2:30 p.m. Topic: Start-up Assistance. To register, call 1-800-725-7232. Location: UMSBDC,

Lafayette County Starting a Business – First Steps, Corinth, 1 p.m. to 2:30 p.m. Topic: Start-up Assistance. To register, call 1-800-725-7232. Location: UMSBDC, Corinth Public Library, Corinth Starting a Business – First Steps, Starkville, 1 p.m. to 3 p.m. Topic: Start-up Assistance. To register, call 1-800-725-7232. Location: MSU MSBDC – MSU Business Incubator Building, Thad Cochran Research, Technology & Economic Development Park.

Starting a Business – First Steps, Tu pelo, 1 p.m. to 2:30 p.m.Topic: Start-up Assistance. To register, call 1-800-725-7232. Location: UMSBDC Business Assistance Center-Tupelo, Renasant Center for IDEAs. How to Develop a Business Plan, Oxford, 1 p.m. to 2:30 p.m. Topic: Business Basics. To register, call 1-800-725-7232. Location: UMSBDC, Lafayette County

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Richards FROM P. 3

workforce training.

The expansion gave the company the capacity to add six additional production lines.

“We’ve added more than 200 people since then, and our total employment is now over 1,100,” Tarrant said. “We’ve been very fortunate. Business has certainly improved, coming out of the recession. Since 2010, we’ve more than doubled our business.”

Thomas Wells, the company’s vice president of manufacturing, said H.M. Richards takes pride in calling itself a homegrown company.

He and Tarant helped form the company in 1997, with 25 employees. Unlike many of its peers in the industry in Northeast Mississippi, H.M. Richards wasn’t geared to be a promotional furniture company. Instead, its products were intended to hit a higher price-point.

The business model worked, and within a few years, H.M. Richards hit $100 million in sales.

Neither Tarrant or Wells were willing to reveal what the company’s sales volume is today, but they did say it has returned to at least pre-recession levels.

That’s quite obvious,

given the 2015 expansion announcement.

“We’re fortunate to have been one of the companies to have ridden out the recession,” Wells said. “We’re fortunate to have Rooms to Go to get a majority of our sales from them. We were afforded the opportunity to put in systems for growth when we started, and as we had to cut back and build back, that system has worked, whether we had 50 lines or one line.”

The company has 14 production lines, including two at its expanded facility.

“We felt like the best way to use the next plant was to put existing lines in there and put the new hires in the existing plant from a training standpoint,” Tarrant said.

The unveiling of three new furniture groups was a success at the October market in High Point, and the new employees and production lines are dedicated to those new lines.

“We built that addition to be a stand-alone facility,” Tarrant said. “You can cut, sew and upholster in that one plant. We built it to have six lines and bought enough land to flip it and add another six lines if necessary.

“We’re sitting in a great position, capacity wise.”

Rooms to Go may be H.M. Richard’s largest cus-

tomer, but the company also has several other large regional customers to keep it busy with plenty of work.

Like other furniture manufacturers, the company has had to deal with global competition. Unlike the case goods industry, however, upholstered furniture has been able to stay competitive. Some components are imported, but most are domestically sourced.

“Sure, we have a some imported cut-and-sew kits, along with some show wood, but 80 percent of the cut-and-sew work we do in house,” Tarrant said. “So when a lot of it went offshore, we kept it here. The inverted tax relief on suede due to the Foreign Trade Zone status kept us competitive.

“We’re sitting in a very good position.”

Said Wells, “We’ve contributed well over $1 billion to the local economy since we started 20 years ago with a 30,000-square-foot building. Now were at just under 1.3 million square feet, and we’ve had great employees and a great management team. ...

We’ve probably gone outside of the company twice over the years to find people for our leadership team. That speaks well of our people. And it says that they have opportunities here.”

FEBRUARY 2017

Kellex FROM P. 8

time gig for Williamson has morphed into a nearly two-year stint with the company.

"It's been enjoyable to see where it was and where it is today," he said.

"We've had some challenges, but we've gotten through them."

UP, DOWN AND UP AGAIN

The past few years have been a roller coaster for one of Tupelo's most storied companies.

Tupelo Manufacturing made a name for itself starting in the 1990s, building furniture for dormitories, hospitals and restaurants. Mary Werner and her husband, Charles, bought the unprofitable company from her father-in-law in 1992.

They rebuilt the company and helped grow it into the 21st century. It was a turnaround effort that hadn't done unnoticed.

But cheaper imports, along with the Great Recession, took its toll on the industry, leaving many untouched, including Tupelo Manufacturing. The company changed hands in 2012 and was then bought by San Antonio, Texas-based KLN around 2014.

KLN was one of the largest supplier of metal dorm and quarters furniture to the U.S. military and also built wood and laminate casegoods for the residence hall markets. But it decided in March 2015 to close two of its three plants, including Tupelo, That's when Kellex stepped in.

At the time, Kellex said demand from hotels and timeshares for its furniture necessitated the need to expand. Officials also said the experienced furniture workforce in the area and Tupelo’s “logistical advantages,” to West Coast markets also were attractive.

The company also has a manufacturing plant in Valdese, North Carolina.

Kellex's Tupelo plant continues to build customs-built furniture for the hospitality industry and medical industry.

"It's a good business," Williamson said. "Not a lot of people want to do it."

Apparently, Kellex's investment has paid off so far, as business grows.

Williamson said the plant is nearly at full capacity, but still has room to grow if needed.

"The space in the plant, if we get to about 100 people, it will become an issue," he said,

adding that it's a good problem to have. "Kellex at this time has plenty of business to meet its goals and maintain the work.

Right now it's real steady."

Expanding capacity has been brought up by Kellex officials, as the company has concentrated on getting the building in Tupelo in better shape.

"There's been a lot of effort, a lot of sweat and tears," he said.

That effort was put in by the nearly 30 people who were put on Kellex's payroll even before the company officially moved into the building.

"That says a lot about the company," said Scott.

Said Williamson,"We didn't want to let them get away, because it's hard to find experienced people like that. So they were painting, helping clean out the building, whatever work we could find for them to keep them on board."

Kellex – formerly Tupelo Manufacturing – is alive and well, Williamson said.

"At this point, we just want people know we're still here and we're getting the best employees we can get as we go to our next step," he said. dennis.seid@journalinc.com

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In & Out Smart Repair

Compassionate Care Clinic

In & Out Smart Repair held a ribbon cutting in celebration of its grand opening at 2434 W. Main St., Suite D in Tupelo. In & Out Smart Repair offers device repair services for iPhone, Samsung, LG, Sony, Motorola and more including screen and water damage repair. Contact In & Out Smart Repair at (662) 346-4538 or visit phonerepairstore.com.

Compassionate Care Clinic celebrated its grand opening with a ribbon cutting. Located at 218 S. Thomas St., Suite 120 in Tupelo, Compassionate Care Clinic is a family care and therapy clinic specializing in the management and treatment of general health care issues. For more information or to schedule an appointment, call (662) 269-3870 or visit Compassionate Care Clinic on Facebook.

Paul Dunklee Allstate Agency

COMMUNITY DEVELOPMENT FOUNDATION

AMBASSADOR

OF THE YEAR

Paul Dunklee Allstate Agency celebrated its grand opening with a ribbon cutting at 129B Town Creek Drive in Saltillo. Committed to helping area residents assess their immediate and long-term needs, Paul Dunklee Allstate Agency offers a variety of options for protecting your home, personal property or financial future. For more information contact (662) 584-2928.

Find out about all the buzz in the business world at djournal.com/bizbuzz/

KAYLA BAXTER Kayla Baxter, BankPlus Lending Assistant, was awarded CDF December Ambassador of the Month. Serving her first term as Ambassador, Kayla attended three of the four ribbon cuttings and events and contacted 18 CDF members through the member-to-mentor program.

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