Woodard Acquires Mallin
By Richard Wright
Hearth & Home: How has the year gone for you? Was it good, bad or ugly? Or was it just hilarious as the picture above would imply?
Bill Herren: “It was good. We are up a little bit, not as much as we had hoped but that was mostly due to natural disasters. That’s in Florida and all the bigger territories, but even then we were still up.”
Talk to me about the Mallin acquisition and what you see there in terms of what is symbiotic, what will work well as you try to mix the two together.
Herren: “Our original thoughts on acquiring Mallin was for their direct container business. We do a nice direct container business, but according to what we had been told, they did an even nicer one. So we thought we would just take that business. We had originally been told that it was a larger part of their business, but we found that to be not quite the case.
“Because that was our original thinking, we were just going to do direct and get rid of the rest of it. But they have some styles (one that I love) that we don’t have. Personally, I just wanted to offload the rest; I didn’t care about anything else. But once we started looking into it we decided, No. We’re going to do the direct business as it is and then do special orders out of Owosso (Michigan) because special orders are really Owosso’s forte.
“Because of the time of the year that this happened, they had already started making a lot of changes as to what they were dropping and what they were adding. There was really no time to change any of that. So we pretty much went with what they were going to do already, and as we went through different collections and talked to different customers there were some that were worth keeping, so we decided not to discontinue them like they were planning to do this year.
“As it stands right now, even though everything is going to ship from the same place, we are still keeping it separate as to This is Woodard and This is Mallin. We were given a day to call their top customers. We just wanted a feeling on what they were thinking if we took over Mallin. The first thing out of everybody’s mouth was, ‘Don’t change this and don’t change this and don’t change this and don’t change this.’ There was not any, ‘Change this.’ It was all a matter of, ‘We like these things the way they are so don’t change them.’
“Some of it we understand. Some of it we don’t, but we are going by what they said and we’re not changing it. When we sent the first pieces up to Owosso to start learning how to make them, (the Owosso people said) ‘Oh we can do this, or we can do this, and we can do this.’ I said, ‘No, no, no. We don’t change a thing.’ It started with the cushions because that was where we got the most comments. They wanted the cushions to remain the same and I said, ‘If it doesn’t have a zipper, add a zipper if it makes it easier for you. If you want to sew it with this dimension as opposed to this dimension, I don’t care. Don’t change the look. Don’t change the set. Keep it all the same because that’s what everybody wants.’
“So that’s what Owosso has been working on. Hardly anything had a zipper on it. But it does make it a lot faster for production and a lot easier for production if it has a zipper. So I told them, ‘If you want to put a zipper on, put a zipper on. I just don’t want to see the zipper.’”
|Mallin's Oslo Cushion.|
It also makes it easier for the customer if they want to clean that cushion.
Herren: “Oh, exactly. So that is really the only kind of little things that are going to be changed. We’re not changing factories. We’re not doing anything. We are basically just taking it from California and moving it to Michigan. They had a couple of programs that obviously we can’t do. They had something called ‘LA Express.’ But we basically already have the same thing, which is our Custom Express.
“LA Express was limited. You could have this finish or this fabric and it would ship in two weeks. Well, our Custom Express is any finish, any fabric, and it will ship in two weeks. It provides the opportunity for a lot more special orders than what they used to have, and east of the Mississippi they had very little distribution. So this will be a whole new exposure for the Mallin brand.”
That should be a big plus for you as you go forward.
Herren: “Yes, it should be. It better be. Otherwise we just wasted money.”
You saw one collection that you wanted badly?
Herren: “I wanted Oslo. I love that collection. From the day I first saw it in their showroom window, I just fell in love with that collection. I thought it was beautiful with a lot of style.”
Now that you have been able to get an inside look, was that their best-selling collection?
Herren: “Oh, not by a long shot. In fact, they were going to drop it because they said it wasn’t selling. Personally, I think it was because they didn’t present it correctly, but that is a whole other issue. No, it was not a good seller for them. Their best-selling collection is Volare. That collection is like our Cortland, which is our best-selling collection. Everybody wants it. Everybody buys it.”
I’m sure that Woodard is substantially larger than Mallin. Does Mallin represent about half again as much business, 50% of what Woodard does?
Herren: “No. They are closer to about a fifth, which surprised us also. I knew who they were. I didn’t know much about their products. I didn’t know much about them. I was basing it on their showroom in Chicago, which was almost as big as ours. And it’s not cheap to have a showroom in Chicago. Well, that was a foolish waste of money. They really didn’t need that kind of 25,000 sq. ft. showroom, or whatever size it was.”
Was Mallin manufacturing right there in California?
Herren: “Sort of. Originally, yes, they were, and then they moved a bunch of stuff to China. Then they were doing a combination of both. They were bringing product in for their programs that were out of their California warehouse; they were bringing in some unfinished frames and some parts because when we went out there we went with one of the guys from our factory in Owosso because they were also looking at whether we were thinking about buying any of their equipment. But they had about 100 welding machines of which the guy told us 70 of them hadn’t been used in years because they stopped doing that type of work there, which I can well understand because, my God, it’s California, and it’s the most expensive place around!”
So you’re going to be doing a lot up in Owosso, right?
Herren: “Yes. Some collections are available direct, some are available out of Owosso, and some are available both ways.”
Have Mallin dealers been accepting of the change?
Herren: “Oh, yes. They have been very nice. Some long-time Mallin customers walked us through the Mallin showroom because they know more about the furniture than we will know in a year. Some of them have been extremely helpful, telling us, ‘Well, this is the way this should be and this is the way this should be, or this is the way it comes.’”
The acquisition is certainly another workload for you. It’s a good thing you function as a team.
Herren: “Oh, yeah.”
A year from now you’ll look back and say, Yes, this was worth having.”
It seems a good way to boost revenues, by taking a primarily West Coast company nationwide. Now, Mallin has quite a number of oversized groups, which won’t play too well throughout many parts of the country.
Herren: “Yes, in fact we have been getting a lot more calls for smaller scale products. In fact, probably half of the woven stuff that we came out with this year was on the smaller scale. Even our aluminum collection we came out with was on a smaller scale.”