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A business consultancy, based in London, England, John Sacks' JSA Consultancy Services provides expert, in-depth, information advice and guidance as to how to exploit successfully the office furniture and interiors markets in Europe, North America, Australasia and Japan.

HNI to close Virginia plant

Friday 5 October 2007

Muscatine-based furniture maker HNI Corp. will close a plant in Richmond, Va., next year and move the work to factories in Muscatine and Cedartown, Ga., the company said this morning.

The closing will eliminate 370 jobs and involve $9 million in capital costs to implement, but will eventually produce savings of $10 million a year starting in 2009, the company said.

HNI expects to take a pre-tax charge of $15 million to $17 million between 2007 and 2009 to cover the cost of the layoffs and restructuring.

“Rising freight costs and the opportunity to provide our customers with a better, more cost-effective fulfillment process necessitated this realignment,” the company said in a statement announcing the closing.

HNI has manufacturing operations at 15 cities in the United States including Muscatine and Mount Pleasant in Iowa.

The plant that is closing makes Hon brand office furniture. HNI also makes office furniture under the brands Allsteel, Maxon, Gunlocke, Omni, and Paoli. The company makes hearth products under the Hearth and Home brand.

At the end of 2006, HNI had 14,200 employees.

HNI made the announcement just before the New York Stock Exchange opened Friday. Shares of the company initially shot up as much as $1. By mid-morning shares were trading around $36.80, which was 55 cents above Thursday’s close.

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