Firm’s decision to go Asian is one we’re all living with

Earlier this month, Whittier Wood Products, a Eugene company that produces wood furniture, announced plans to lay off 100 of its workers and move most of its manufacturing operation to Vietnam.

CEO Scott Whittier was quoted in media reports as stating that the competition from Asian-made furniture left his company, which was founded by his father in 1975, with no other choice.

Sales have fallen for three years, down from $50 million in 2005 to an expected $28 million this year, he said. In July, the company bought a 150,000-square-foot plant near Ho Chi Minh City, formerly Saigon, and hopes to start production in 2007.

The company plans to keep 85 employees in Eugene and produce birch bookcases and several other products. It will buy alder in the United States for its Vietnamese plant, and then ship the furniture back to the United States.

The declining sales is the reason why the decision was not a big surprise to employees, one of whom is a friend of mine – which is why I’m particularly interested in this company’s fortunes.

The average tenure of the departing employees is 10 years, according to news reports.

When you look at just the bottom line, Whittier’s move appears to be the only logical one. He said the $150 a month the company will pay a worker in Vietnam compares to $1,920 a month paid to Eugene workers, who also get a health package and a 401(k) retirement benefit.

You’ve probably seen Whittier’s products and you may very well have some in your house or office. The company produces indoor and outdoor wood chairs and tables, benches, and furniture such as bar stools and entertainment centers, mostly of birch and alder. Whittier generally uses solid hardwood rather than a lot of veneer and composites like many other manufacturers. You can buy its products at stores like Bi-Mart, Fred Meyer, furniture retailers, unfinished furniture stores, etc.

My family has had some Whittier Wood Products bookcases and an entertainment center for years. It’s been good furniture.

Whittier’s work force has dropped below 200 after reaching a high of 450 in 1999, according to reports.

Here’s a formerly solid, well-managed company that produces very nice products for a reasonable price, that’s been forced to dump its workers and go overseas. It’s a refrain we’ve all been hearing for the last decade or more.

I’ve written about this before, namely when I said that the arrival of the Super Wal-Mart in Lebanon did not portend good things for the business community in this area, even if the store does offer cheap prices.

That column elicited some complaints from readers who reminded me, in effect, that the market is free and cheap prices are good. They’re right. The market is free, as it should be, and cheap prices are generally good – as long as they’re not destroying businesses that are providing jobs for our own people.

We Americans think in the short term and we think mostly of ourselves. We don’t see the big picture very well, particularly as we head down to the department store to buy the latest and greatest (cheap) merchandise to fill our houses.

We’re not the only ethno-centric country in the world, but we’re probably the nation that is the least aware of the rest of the world. Well, maybe North Koreans are less aware of the rest of the world.

And that self-centeredness tends to be individual as well.

It’s a complex world we live in, but if you boil it all down, the main reason these Whittier employees are looking for new jobs is because we Americans never bothered to think about the consequences of running down to the department store to buy that new whatever with the Made in Wherever sticker on it. I mean, shoot, it was a better deal.

But when we bought that shirt, that clock, that frying pan, that karaoke machine, or that entertainment center for less, very likely made by some native working for a few bucks a day in some overseas sweatshop, we put another nail in the coffin of a U.S. manufacturing plant.

It’s sobering to think where all this is probably going to lead, both locally and nationally. Blue-collar jobs are disappearing here, though there is plenty of demand for our raw materials at those overseas factories. Manufacturing is going overseas for almost everything we use.

Other than lost jobs here, that may not be a huge problem – as long as we’re getting along with everybody. But what would have happened in World War II if all our manufacturing capabilities had been overseas and most, if not all, of our major corporations had significant business interests in countries that might not always be our friend?

I’m not the first to say this, but this Whittier Wood Products story just brought it home a little closer than most of the news I read.

On another note, though, Wal-Mart is now crashing the generic drug market. It announced last week that it will sell some 300 generic prescription drugs for as little as $4 for a 30-day supply.

I’m not a big fan of drug companies, which, I suspect, are taking me and a lot of other people for a ride, especially those without insurance, for a ride. So maybe a little hard-nosed competition in the drug arena might be good for us all. But on the other hand, if manufacturers have to start making drugs in, say, Mongolia, to meet a giant retailer’s ultimatums about what price it’s going to pay as the dominant player in the market, let’s just hope Mongolia stays real friendly with us for a long time.