Cascade Designs Inc. will move 100 distribution and low- end manufacturing jobs from Seattle to Reno, NV later this year in a bid to accommodate growth and avoid a more than $1 million hit under Seattle's new minimum wage ordinance.
The company is working with architects to convert an approximately 100,000-square-foot warehouse in Reno to its use. The facility is expected to open in August and become fully operational in the first quarter of 2016, which gives affected employees six to 10 months to decide whether to relocate or find other work. Cascade Design is offering to pay relocation expenses for a handful of management employees who will spearhead the move. The company will continue to employer 300 to 350 people in Seattle.
“We ran out of space in our Seattle facility quite a while ago and have been leasing space around Seattle to store product and it’s gotten to a point where it's no longer feasible,” Cascade Designs spokesman Martin Miasonpierre told The B.O.S.S. Report Jan. 12.
Seattle's new minimum wage law accelerated plans
When the Seattle City Council voted unanimously last summer to phase in a $15 an hour minimum wage beginning April 1, 2015, the company accelerated its search for new manufacturing and distribution space.
Because it employs less than 500, Cascade Designs would have been given seven years to comply with the ordinance, which was designed to address income inequality.
“The majority of our employees are making more than $15 an hour, but it would still be a hit of several million dollar, which would be less money we would have to devote for R&D and other initiatives,” said Maisonpierre.
Cascade Designs Vice Chairman David Burroughs came out publicly against the ordinance, arguing that it would make the company less competitive, particularly in an industry that sources so much product from Asia.
Burroughs father John Burroughs co-founded Cascade Designs in 1972 with two engineers who lost their jobs amid a massive layoff by Boeing. The trio invented a closed cell sleeping pad that launched the Therma-a-Rest brand and the company. Today, Cascade Designs owns eight brands focused on the camping, hiking, snow sports and adventure travel markets. Its flagship brand MSR makes tents, stoves, cookware, snowshoes, poles and avalanche safety gear. It also owns and makes SealLine drybags, Platypus hydration systems, ECase cases for mobile electronics, Packtowel camp towels, Hummingbird waterproof luggage and travel accessories and Tracks trekking poles.
Reno DC to also house manufacturing and assembly operations
Cascade Design plans to shift distribution of all those products to the Reno facility in the first quarter of 2015. The company will also move some labor-intensive manufacturing and assembly work on lower-technology products to Reno. For example, production of Therm-a-Rest's Ridgecrest sleeping pads, which still use closed cell foam technology, will move entirely to Reno.
“We rely a lot on IP (intellectual property) and trade secrets so we envision products that require more IP protection will stay in Seattle,” said Maisonpierre.
The company expects the move will lead to job growth at both locations over the next three to five years. In Seattle, for instance, Cascade Designs will have room at its headquarters site to pursue new manufacturing and R&D initiatives.
“We had to make a lot of decisions in Seattle based on what we can and cannot do due to space limitations,” said Maisonpierre. “Now space is no longer a limit.”
Cascade Designs evaluated several locations, including Salt Lake City, but selected Reno because of the availability of flights, the city's proximity to customers in California and the quality of life.
“Everybody who works for us, from distribution to vice presidents and president, the outdoors is a huge part of their lives, so proximity to Tahoe was key,” Maisonpierre said.