Purchase allows company to continue operations under its legacy brand
CONOVER, N.C. — Upholstery manufacturer Our House Designs is acquiring custom upholstery manufacturer Leathercraft Furniture, one of the oldest leather manufacturers in the U.S.
For customers, the purchase means they can continue to buy custom products from a leather upholstery specialist with more than 70 years of manufacturing experience. Since 1980, the company has been run by CEO Staley Keener, whose father started the business around 1952.
Keener will be retiring with the sale of the company.
For Our House Designs, the purchase will expand its custom line with a similar product mix that is slightly lower in price than the Our House leather and fabric assortment, giving it a better and best mix at the upper end. It also will expand OHD’s mix of product to include more motion furniture.
While officials did not reveal a purchase price, Our House Designs President Parker Maricich told Home News Now that the deal is an asset purchase that includes the company name, intellectual property and some equipment, as well as customer lists.
While it will keep the Leathercraft name, the purchase does not include Leathercraft’s Conover production facilities. Thus it will move production from those operations to Our House Designs’ 75,000-square-foot plant about 8 miles away in Hickory. Production, he noted, is planned to start around Jan. 16.
The purchase does not include the Leathercraft frame shop as Our House purchases its frames from outside vendors.
Altogether, Maricich said, the company will be taking on about eight to 10 of Leathercraft’s 45 employees, who will be building the Leathercraft line “right off the bat. It’s very important at our level that we have consistency in product and quality.”
Although not all jobs will be saved with the sale, the purchase avoided the company ceasing operations altogether as a deal earlier last fall fell through.
“We are planning on hiring a number of their employees, and we are going to be able to save a number of the factory jobs,” Maricich said, noting that they will be part of the team of about 24 employees at OHD. “The plan is to run the two companies parallel because it is still a very strong name and customers are still sending orders and they have a great sales team.”
He added that while the purchase does not include the frame shop, which employed around nine workers, there could be a need to bring on other frame shops or specialists into the mix.
“It takes a village, and luckily, we’re in a great village,” he said of the regional talent in this particular field.
And with some area sources said to be in need of good talent, he believes the frame jobs will be filled quickly.
Overall, he added that the purchase of the brand made sense on a number of levels.
“They have been at it for more than 50 years,” he said. “They have some great relationships and some great customers out in the marketplace.”
While the product lines are similar in that both mainly produce leather upholstery, along with a smaller percentage of fabric, Leathercraft is stronger in motion. For example, in addition to its stationary line, Leathercraft manufactures motion chairs, sofas and sectionals to name a few core product segments, which is estimated at more than half the Leathercraft business. Our House primarily sells stationary upholstery.
“They do an incredible job with motion, which we do not currently,” Maricich said, noting that Leathercraft also produces sofa-sleepers. “We do recliners, but they really have gotten into the motion category. Having domestic motion is a big deal for them.”
He said the Leathercraft line is also at a slightly lower price point, with a main difference being that the OHD frames are solid wood and Leathercraft uses some plywood.
“So they would be better, and best would be the OHD assortment,” he said adding that both also employ eight-way hand-tied construction.
With production beginning this month, the goal is to align lead times to OHD’s six to eight weeks.
“Leathercraft will be six to eight weeks,” he said, noting that while “things have slowed down in the last few months, they have kicked it up in recent weeks.”
“And we’re expecting a learning curve,” he added of bringing a new line into OHD’s Hickory plant. “But we will have people there to help. But you know one thing the last few years have taught us is to expect the unexpected. And everybody in our factory, we have been through the wringer with challenges, but it doesn’t slow us down anymore. Everyone is very resilient.”
Merger and acquisition specialist Stump & Company of Charlotte, North Carolina, exclusively represented Leathercraft Inc. as investment banker.