With its watercraft division now fully consolidated in Old Town, Maine, Johnson Outdoors held a celebration last week that drew state and city officials, corporate executives and rank-and-file employees to a showcase of its newly refurbished 136,000 square foot Old Town Canoe facility. 

 

In June of this year, Johnson Outdoors announced plans to close its manufacturing facility in Ferndale, WA, and consolidate plastic boat manufacturing in Old Town. About 100 jobs were affected.
The consolidation, which was completed ahead of schedule, is expected to save more than $4 million a year beginning in fiscal 2010. But the new facility has also been designed to further maximize production efficiency while reducing energy use by 50 percent. In addition, an estimated additional 48 jobs will be created in Old Town as a result of the consolidation. The facility currently has 182 employees, including 17 newly hired full-time positions resulting so far from operational consolidation.


As a result of the consolidation, the company's Ocean Kayak and Necky Kayaks brands are now being produced in Old Town. The consolidation also involved the transfer of operations from two separate sites in Old Town, ME, to the refurbished facility. The new factory, a converted distribution center, also serves as the U.S. warehouse and distribution center for all the company's paddle boat and accessory brands, which include Extrasport personal flotation devices and Carlisle paddles, and is the hub for all related watercraft support services and functions. In total, the facility serves as a warehouse and distribution center for up to 200,000 boats, 200,000 paddles and 100,000 PFDs annually.
Transformation of the Watercraft business began in March when the company merged leadership of its Watercraft and Marine Electronics business units under a single group vice president.           

 

At the time, Kelly Grindle became group vice president, Watercraft & Marine Electronics.  In May, brand sales for the two businesses were combined and Watercraft marketing was restructured to simplify and streamline customer communication. At the time the consolidation was announced in June, Grindle, in a letter to customers, wrote that Johnson Outdoors had been undertaking a comprehensive effort to transform its Watercraft division in order “to reach and maintain acceptable profit levels, which in turn allows us to continue to invest in innovation and sales and marketing programs.”

 

A primary driver of the consolidation, he said, was the recognition that maintaining both East and West Coast sites “adds both complexity and costs for everyone. We need to make significant changes to serve you better and position our business for continued success, and that’s what we’re doing.”


He mentioned that a “highly capable and experienced team” would be leading the move to single-site manufacturing, and praised the “skilled local workforce with proven expertise in plastic, wood and canvas boat production” in the Maine facility. The timing was also good since Johnson Outdoors has sufficient inventory to meet demand for the remainder of the 2009 season and would have the new facility up and running in time to handle 2010 needs.


Johnson Outdoors said last week that production capacity has increased 20% at the refurbished Old Town Facility due to more modernized processes. The improvement comes despite reducing the amount of ovens used  in production to eight from 13 previously. Energy use will also be cut by nearly half, primarily due to the transition from  dirty oil to clean natural gas energy.


Old Town Canoe was established in 1898 and became a Johnson Outdoors brand in 1974 when Sam Johnson purchased Old Town Canoe from former owner Dean Gray for $1 million. Old Town Canoe is largely credited with the industry's transition from aluminum boats to plastic canoes and kayaks. “Old Town, Maine, is where the plastic boat industry was born,” Helen Johnson-Leopold, chairman and CEO, remarked at the ribbon-cutting event held last Tuesday.


At the event, John Baldacci, the governor of Maine, proclaimed November 10 “Old Town Canoe Day” to commemorate the milestone.
Johnson Outdoors decided to expand in Maine rather than in Washington or elsewhere after working out a package of economic incentives with the city and state. Among the incentives offered by the city was an interest-free loan for about $694,000 and the securing of a $200,000 Community Development Block Grant (CDBG) for the company to make investments in the new Old Town facility.


“In June, we made a commitment to convert our distribution center in Old Town, Maine into an energy-efficient state-of-the-art manufacturing and office facility, and bring more jobs into the local community,” said Johnson-Leopold. “Such an effort could not have succeeded without the assistance of a great many people locally and throughout the state. We are grateful for the support of Governor Baldacci and the City of Old Town enabling us to continue our 100-plus year tradition of quality boat production in Maine.”


Old Town Canoe’s trademark wood-and-canvas models will continue to be made and restored at the facility. Johnson Outdoors noted that sixty different canoe and kayak models use up to 8 million pounds of plastic resin at the facility each year. The newly constructed oven pit is 26 feet wide, 94 feet long and 7 feet deep. Ovens operate at 500 degrees Fahrenheit. The facility also recycles 75% of its waste materials, measuring 700,000 pounds to date.


Meanwhile, the old historic Old Town Canoe property will be taken over by the city of Old Town. Although officials are still exploring options for the land, some are pushing to create a museum to highlight the city's manufacturing heritage.