by Sale is expected to close in the next few weeks, giving Bermex a strong foothold in US manufacturing
WINCHENDON, Mass. — When a fire broke out in one of its Quebec finishing operations in December, it presented an immediate conundrum for Canadian case goods manufacturer Bermex Furniture.
In addition to the damages and losses, the incident forced the company to shift the finishing operations for its table tops and bases to another finishing facility in the region that primarily finished chairs and side pieces such as buffets.
Fortunately, no one was hurt, according to President Philippe Darveau. But he said it brought the other operation to more than 80% capacity, leaving very little room for growth.
Around the same time, Peter and Linda Saloom, the longtime owners of case goods manufacturer Saloom, were planning to retire. This put the future of the company in question as the family was trying to determine an exit plan from the business, ranging from shutting the operation entirely to a sale of the real estate and equipment, some of which Peter Saloom engineered himself over the years.
Located just over five hours south of Bermex, the company also laid off much of its workforce by the start of the new year, leaving it only about 16 workers as of this week.
Now, following discussions between the two companies, Bermex is planning to purchase the company, not only saving it from shuttering, but also saving the jobs of those remaining workers.
And with a deal expected to close in the next few weeks, Bermex also is looking to bring back about 20 of the people who were let go initially. This would help rebuild the workforce as part of a plan to put the plant on much more solid footing, from both a capacity and equipment standpoint.
The proposed purchase includes the name, the product designs and related IP, the estimated 80,000-square-foot plant and other parts of the business such as equipment and customer lists.
For Bermex, the purchase continues its growth over the years largely through acquisitions of brands such as Midi, Shermag, Jaymar and Dinec, to name several.
“I saw an opportunity to grow through acquisition, which has always been in our DNA at Bermex,” Darveau said, noting that companies it acquires typically have room to grow and get even better at what they do. “We often see great potential, and this is the same thing that is happening with Saloom. When they were about to close because they (Peter and Linda Saloom) are close to retirement, then they are not at their peak.”
He noted that Saloom also has been a family-owned and -operated business that not only shared the type of ownership and values that were similar to those at Bermex, but it also had four decades of experience in wood furniture manufacturing, which is also core to the lines of the Bermex family of brands.
“We are very, very excited,” Darveau said of the purchase. “Saloom has been a competitor for 40 years, and they also have been an inspiration. They have done some great product in terms of design and concept.”
He added that the company also has a strong network of industry relationships and a strong presence at retail, including some stores and markets where Bermex does not currently have a presence.
“They are a strong company and a strong name in the industry, and every time that I went and traveled the States, I would see their product and I was amazed by the quality of their finishes and all the options,” he added, noting that the company will keep the Saloom name. “And the value of the company, the fact that it is a family-owned business really corresponds to my values and to our company and who we are and also who we want to be. It is a natural fit between us and Saloom.”
Much like the Bermex group of companies, Saloom also has a long history in case goods manufacturing, largely specializing in custom dining.
“They are very well equipped, so from day one, we can come in and operate it,” Darveau said. “It is not just a factory that I need to fill with equipment. They also have staff, so I don’t need to hire new people and train them from scratch. … We are not buying an import company that cannot produce quality. That is something that is very hard to teach and very hard to learn, and they know how to do quality furniture.”
“They also know how to work with custom furniture, which has many options and many different SKUs. They know how to manage quality control, and all of this takes years and years to learn and they have been doing it for 40 years.”
For Bermex, another big benefit of the purchase is the ability to bring value-added parts of its own production to the U.S., including assembly and finishing. Producing the bulk of the product in the U.S. versus Canada thus could allow Bermex to avoid any potential widespread tariffs on finished goods imposed by the U.S. government.
“Now, Bermex is becoming an American product,” Darveau said, adding “because it is going to be assembled and inspected there. Most of the value of the furniture is going to be made in the U.S. out of that facility.”
He said having a facility in the U.S. right now “is perfect timing. All the stars were aligned with that. I would have purchased it with or without the risk of tariffs, because the opportunity was really good, but with the fact there might be tariffs, this is just a fortuity that adds to the situation that we are facing.”
Peter Saloom Jr., the current president of Saloom, said the timing of the proposed deal was good in that a buyer has emerged to be able to keep the business going instead of closing its doors.
“We were able to reach a really fantastic and positive agreement with Bermex and their team,” he said, noting that this is a way to keep the business going. “We struck a deal for them to purchase us, and I am talking to you from the factory floor and we are here still taking orders, making furniture and continuing on with the Saloom line.”
“And we are doing everything we can to make this transition seamless for Bermex, who have committed to keeping the Saloom brand going as well as expanding the Bermex production and distribution in the United States, and that is very exciting.
“We are very happy for them and thankful for them for stepping in,” he added. “Our No. 1 focus is to the family and the people who work for me, and it has been that way since the beginning. I know that Bermex has values that are aligned with ours in terms of being family-owned and having the same excellent quality and service. So it is just a perfect match and we are going to do everything we can to help them out and wish them the best in the future.”
“We are thankful to Bermex for stepping up and providing a great opportunity for supporting American jobs and hardworking people in a small community and a family-owned company, and I know their values are lined up with that, so we are optimistic about that.”
