Restructuring at Kellwood leads to layoffs and changes in operations

On July 2, SNEWS® first broke the news Sun Capital was restructuring Kellwood into four separate entities and in our SNEWS View we stated that we hoped this did not mean layoffs. It did not take long for the restructuring axe to fall, however, as by the next week, those dreaded meetings to inform staff that their services were no longer needed began.
Author:
Updated:
Original:

On July 2, SNEWS® first broke the news Sun Capital was restructuring Kellwood into four separate entities and in our SNEWS View we stated that we hoped this did not mean layoffs (click here to read).

It did not take long for the restructuring axe to fall, however, as by the next week, those dreaded meetings to inform staff that their services were no longer needed began. One who received walking papers had been at Kelty 27 years, we were told.

Though no one would confirm details on the record, insiders told SNEWS what has occurred thus far and offered insight into what might be expected through the rest of 2008. Here is what SNEWS knows to date:

1. American Recreation Products has now been re-formed into three distinct divisions. Slumberjack no longer exists as a separate division and the brands within that division, which include Browning, Slumberjack and the Wenger license for outdoor products in North America, are now under the Kelty division. Both Kelty and Sierra Designs now form what is being referred to as the Boulder Outdoor Specialty Group. The second division is Royal Robbins, operating, as before, independently out of Modesto, Calif. And the third division is what is known as the Mass Market Business and includes Wenzel and its licensees and it remains operating out of St. Louis, Mo.

2. Geoff O’Keefe, who has been the president of the Slumberjack division since May 2007 (click here to read that story), now heads up what is being referred to internally as Shared Services, which includes operations, finance, customer service and marketing. His title is vice president, we are told. His division serves both Sierra Designs and Kelty and to some extent, Royal Robbins. Kenny Ballard remains president of Kelty and Paul Gagner continues as president of Sierra Designs.

3. As many as nine employees have lost their jobs in Boulder and as many as 14 in St. Louis, we have been told. It is rumored that the Glasgow facility may be on the chopping block, as well as another 30 jobs by the end of the year -- but again, no company executives would confirm or deny this on the record.

4. George Grabner remains at the helm of ARP.

5. The company position we were told, again, off the record, is that the restructuring has been done to gain needed efficiencies and to ensure each brand is able to continue to operate as a fully independent and viable business. To that extent, even though there are now shared functions between companies, each brand (Royal Robbins, Sierra Designs, Kelty, Slumberjack, Browning and Wenger) remains entirely separate in terms of product development and sales.

SNEWS® View: Insiders told us that Gagner, Ballard and O’Keefe are putting shoulders together to ensure the work they have been doing for the last two years to grow the company does not become derailed by the reorganization and loss of staff. This does not surprise us at all, as the three are good friends who have little ego invested in this other than a collective desire to see all that has been accomplished in restoring brand positions (certainly with SD) not get derailed -- a potential in any downsizing and restructuring of this scope dictated by private equity likely eager to see an investment show returns sooner rather than later.

We are surprised a bit at what is being viewed by many as a dismantling of a growing Slumberjack division. On the other hand, if a company is going to create a shared services division, you certainly could not ask for a more able or talented person to run that efficiently and profitably than O’Keefe.

While we have not met the folks from Sun Capital, and are sure they are fine folk, this is one of those times when we would question if the decision to reorg with a sterile dollars-and-cents approach to business is in the best interests of not only the industry, but of the retailers these brands serve and, closer to home, the people whose families depend on the jobs that are being moved about or eliminated like so many chess pieces on a board. If Ballard, Gagner and O’Keefe were not on board this ship, we might be more inclined to say it’s in danger of sinking. As it is, we hope Sun Capital quickly starts listening to their advice and stops dictating a future with deaf ears and blind eyes.

Related

Sun Capital restructuring Kellwood into four separate entities

SNEWS® has learned from inside sources that Sun Capital, which acquired Kellwood on February 11, 2008, has initiated a restructuring that will divide the company into four separate entities, all owned by Sun Capital. American Recreation Products (Sierra Designs, Ultimate ...read more

marmot

Marmot restructuring leads to 6 layoffs

Marmot laid off 6 employees last week because of a restructuring process intended to make the brand more relevant in the global marketplace. Those laid off included Tom Fritz, vice president of marketing, and VP of Sales, Andy Welling. Fritz had been with the company for 18 ...read more

REIlogo.jpg

REI restructures staff with undisclosed number of layoffs

The nation’s largest outdoor retailer, Recreational Equipment Inc., laid off an undisclosed number of employees this month, officials confirmed with SNEWS. The layoffs were conducted across the board — from the company’s headquarters in Kent, Wash. to its 127 stores nationwide — ...read more

StarTracLogo.gif

Star Trac restructures, seeks new capital after president’s resignation, huge layoffs

Star Trac hit a bump in the road on its recently accelerated growth path and has been forced to make massive layoffs and quicken its search for capital investors. Although not totally unexpected -- the company has been talking to investors for 60 days, the consumer division was ...read more

Rossignol_logo2.jpg

Did you hear?...Layoffs at Rossignol Group underscore challenges as company restructures

In an April 23 news release (click here to read), the Rossignol Group confirmed previous announcements in late March that it would be laying off 30 percent of its workforce globally. In total, this adds up to approximately 450 people now out of work. SNEWS® requested information ...read more

Teko_Logo_Feb2009.jpg

Teko Socks restructuring, moves U.S. operations to Bozeman

Teko Socks is restructuring the company, signing an operations agreement with Hyalite Outdoor Group and moving its U.S. operations from Boulder, Colo. to Bozeman, Mont. Financial details of the partnership were not disclosed. The move comes after the company’s latest CEO Rich ...read more

Outdoor financials: Restructuring charge rattles Kellwood's Q2, plus Forzani, Big 5, Quiksilver, Wellman, Amer, Fiskars

Restructuring charge rattles Kellwood's Q2Kellwood Co. (NYSE: KWD), parent of Sierra Designs and Kelty, was hit with a second-quarter net loss stemming from charges of $93.4 million related to a restructuring plan aimed at boosting growth. The company is gearing up to sell or ...read more

Outdoor financials: Kellwood Q4 profit dragged down by restructuring charges, plus Dick's, Eddie Bauer, Outdoor Channel, Stride Rite, Wellman, Sport Chalet

Kellwood Q4 profit dragged down by restructuring chargesKellwood Co. (NYSE: KWD), parent of Kelty, Sierra Designs and Wenzel, said profit fell 44 percent in the fourth quarter, largely due to a restructuring charge and other expenses. Net income for the quarter ended Feb. 3 was ...read more

EndofWorld_KingCartoon.jpg

Industry Watch: Tracking layoffs, closures and downsizing

SNEWS® continues tracking layoffs, closures and trimming in the outdoor and fitness industries to give perspective on the depth of the economic crunch. In a story on Feb. 2, 2009, we began a chronological chart showing companies and their layoffs or closures by date with links to ...read more