So, their leftest political statements aside...here's the quandary. Are they right to move because no machine shop was available to produce what they needed or, are they wrong for not investing more into their own operations?

This is the problem that many US companies have, setting up and maintaining your own manufacturing is very expensive, especially when you're competing on a global scale; payroll, machinery, maintenance, properly zoned real estate, safety inspections/compliance, insurance, organized labor, training. Not only is the supply chain limited here in the US, there's a lack of expertise at running a manufacturing operation, there's a lack of people who are willing to do repetitive work, and there's not many consumers willing to pay domestic made product. What needs to get fixed...tax incentives to set-up a US factory or, buy US sourced goods? Increased tariffs? Govt work programs?


Black Diamond cuts 70 positions and transitions manufacturing out of Utah

quote:

Black Diamond laid off 70 employees last week in its manufacturing division of the Salt Lake City, Utah, headquarters, a 22 percent reduction of the Utah workforce and 53 percent of the manufacturing division.

News spread quickly on Reddit. A screenshot of a Facebook post—with the original poster’s name blacked out—received nearly 450 comments. It read in part: “Black Diamond announced to its manufacturing crew that it was being sent overseas. They’re out of a job come September.”

Walbrecht announced the layoffs to all employees on Friday, after the VP of manufacturing gave notice to those 70 employees. He said the cuts are a culmination of Black Diamond's multi-year strategy to migrate away from in-house manufacturing, seek the most capable facilities overseas, and boost its engineering and design staff.

Black Diamond is owned by Clarus Corporation, a publicly traded company.
Employees' last days will be between Sept. 1 and Dec. 31. BD is doing everything it can to support them by hosting job fairs and career-building workshops, providing severance packages, and working with Utah to ensure unemployment benefits. Those 70 will also retain their employee discounts, even after their departure. Meanwhile, the 62 remaining manufacturing employees were assigned new roles at the company.

SNEWS talked to Walbrecht during an exclusive interview on Monday to explain the layoffs and how they factor into BD’s overall “innovate and accelerate” strategy.

....

IOW, there are people in China who will work for slave wages and we’re hiring them

quote:

Originally posted by arfmel:
IOW, there are people in China who will work for slave wages and we’re hiring them

I'd say that sums it up quite well!

quote:

Originally posted by bronicabill:

quote:

Originally posted by arfmel:
IOW, there are people in China who will work for slave wages and we’re hiring them

I'd say that sums it up quite well!

Works for me! One would think that in today's environment in this country that companies would consider more than the bottom line.

I am totally aware of the necessity for companies to turn profits. That is not the issue here, as I see it.

"Black Diamond Equipment is a manufacturer of equipment for climbing, skiing and mountain sports, based in Utah, USA. The company also has a global office in Innsbruck, Austria. The company is owned by Clarus Corporation, which also owns Pieps and owned Sierra Bullets."

https://www.blackdiamondequipm.../sustainability.html

"SOCIAL
"Even though I'm very proud of the products we make, it is the style in which we conduct our business that means the most to me.—Peter Metcalf, Black Diamond Founder

From our headquarters in Utah to our factory in China, we are committed to complying with the highest standards of social responsibility at all our operations. We take care choosing our vendors and partners, and maintain a strict Vendor Code of Conduct, collaborating with our partners to make continuous improvements, apply best practices and conduct annual audits to ensure the safety and fair treatment of all those who work for or manufacture Black Diamond product."

Bring on the tariffs!

What do you bet that the prices will remain the same and quality will decrease? I have North Face products that say “Made in USA” that are going strong, but think the made in China stuff I see in their outlet is junk. Despite “stringent quality control”.

I wonder if they consulted Boy nee Sanders about wage and labor laws????

Not that I agree with offshoring but it is very hard to find and keep skilled workers. We have pushed people away from the skilled trades to the point that we do not have enough to do this work.

I currently have 12 positions open for skilled tower techs and they have been open for a year.

We are bringing in a lot of untrained kids and training them but the attrition rate is 30% or so and the cost to hire and train them is $20K.

Year to date in my region we have spent $1.4M on training people that have left......that's just one region. Not sure of the other regions but if they are similar we as a company have spent $4.2M on these resources that did not make the cut.

That compiled with equipment, real estate and pay and benefits is a huge amount of CAPEX/OPEX.

In many ways the US has screwed itself and unless we change how we train the younger generations we will continue to offshore /import workers.

Black Diamond has always produced good kit, a lot of it is used for rescue or as PPE so I hope they maintain their QA.

Makes you scratch your head and wonder how much of an investment would have been needed to keep the jobs.

In Corning, years ago, a particular order came in for thick and large curved glass panels for a museum front window wall. A $450,000 investment in equipment was not made and the job went to China.

I've done plenty of break-even or worse jobs but ended up with the tools for my labor. At what point can shareholders be told to look to the future?

quote:

Originally posted by Woodman:
I've done plenty of break-even or worse jobs but ended up with the tools for my labor. At what point can shareholders be told to look to the future?

We're in the Instant Gratification Age, Woodman, and that applies to returns on investments as well as everything else.

As for Black Diamond: That's too bad. They made some nice stuff. I don't think I'll be doing any climbing, any more, but, if I were: Black Diamond would be off my list.

The posted link in the OP shows that this is a complicated issue. BD moved manufacturing from China to Utah in 2014. Recalls were issued for dangerously inept work at Utah. The current president seems to have been hired to move production of core mountaineering products overseas (looking at Taiwan) and leave design and new product development in Utah. This is another drastic change of course for BD in the last few years.

2004 finally arrived in Utah

I wonder if they actually have their own factory (ie the way the article is written) or are paying someone else to manufacture? Both typically result in theft of design but the latter tends to produce equal quality knockoffs.

This is the same thing SOG knives did. Their early stuff was high quality. They made a name for themselves and then moved their production to a cheaper source. I have a Chinese (or is it Korean?)(or Taiwan....?) sample of the their product and an early sample. Vast difference. Black Diamond made their name. Now they will sell out. Not a climber but I wouldn't trust any climbing equipment made by cheap labor over seas. Imagine hanging inverted 200 ft up from a Walmart grade carabiner...NOPE!

quote:

Originally posted by Woodman:
In Corning, years ago, a particular order came in for thick and large curved glass panels for a museum front window wall. A $450,000 investment in equipment was not made and the job went to China.

That's one of the crux's that most people don't understand. It's one thing to make the investment for a particularly work order, you source the raw material, hire/retain your necessary work force, they forge/machine/shape/assemble that item into the spec'd item, then deliver it. Say it takes 1-month from start-to-finish, what about the remaining 11-months? would that new machinery been able to secure more business?

quote:

Originally posted by darthfuster:
This is the same thing SOG knives did. Their early stuff was high quality. They made a name for themselves and then moved their production to a cheaper source. I have a Chinese (or is it Korean?)(or Taiwan....?) sample of the their product and an early sample. Vast difference. Black Diamond made their name. Now they will sell out. Not a climber but I wouldn't trust any climbing equipment made by cheap labor over seas. Imagine hanging inverted 200 ft up from a Walmart grade carabiner...NOPE!

Took a course like this in college. The class was divided into teams and each team competed as a shoe company with the others. You could go for high quality/price, middle of the road, or low-quality/price. There were a number of other variables and circumstances, of course, but that was the general gist. Whichever team had the greatest market share at the end won.

It was interesting and fun but the winning team focused on high quality/price for all the weeks of the semester - except for the last one when they went low on both and grabbed most of the market based on their previous reputation. They certainly knew how to game the system but I've always wondered how they would have done if the professor could have surprised us with another 4-5 weeks of competition.

If BD can keep the same quality of product that they have become known for, good for them. If quality declines and the prices drop commensurately, I'm sure the new customers whose focus is price will offset the ones they lose who value top quality.

Here's a (success) story about trying to manufacture a product in America. Not affiliated with them, I just have the first version of their coffee grinder.

Snippets from the link, this is about changing from imported parts to sourcing / building everything in the states.

Some of you may know we started Red Rooster in 2010 around the Camano Coffee Mill (CCM) adding other grinders, home goods & reclaimed furniture along the way. The original grinder mechanism was imported from Taiwan. It was a great mechanism to start with and we have happy customers still grinding their coffee beans all over the world using it. Since the beginning we dreamed of having our own improved mechanism made here in the USA. That journey began in the fall of 2014 as Justin began researching foundries and quickly found out how vast that world is. A little overwhelmed he continued the hunt but with little results.

In the two years that we were working on all the details of having a product manufactured in the USA we were also working on rebuilding and renovating our wood shop. It worked out that we were not in full production and had time to finish the shop. But that is a whole different story and I am sure you will hear about it one of these days. I mention this because things were going pretty smoothly, people were telling us that it usually takes at least 3 years to work out all the kinks in a US supply chain. We were ahead of the game, in the Spring of 2016 we started taking pre-orders and sold out of our first large purchase order in less than two weeks. It was exciting for us to see the initial reaction and support. Shortly after our first release we started to run into some bumps that felt more like road blocks. This is where Keep Grinding comes into the story.

One of the major details we were having a hard time with was the machining. After our cast iron parts are completed at the foundry they have to be machined. There are 10 different holes in our three cast parts that have to be drilled and some tapped too (tapped means threaded to receive screws). Through about a year of trials we ended up purchasing our own cnc mill and bringing that part of the process in-house. Learning even more and breaking a few bits we started machining our own parts. Currently this is where we are at in our story, Justin has been keeping that machine running and we have found a great powder coater close by. From Osaka to Australia to rural Missouri and everything in between, people are enjoying the new & improved Camano Coffee Mill around the world.

You guys, this is exciting stuff! Do you know that there are over 2 dozen US companies involved in this one product? Hard to believe, right? From the foundry, metal stampers, powder coater, metal platers, small parts manufacturers, knob turner, etc., a lot of folks are part of making this product.

Pics of recall. Made in Utah, not China. I'm not a fan of moving manufacturing overseas, but this QC is dangerous! If this is an example of BD Made in USA quality then hell yes; move it somewhere the workers give a shit.

BD has its roots in the old Chouinard company (https://en.wikipedia.org/wiki/Black_Diamond_Equipment). For years (under Yvon), it was THE standard for the US climbing and skiing community. Some of their products were imported but as the customer base grew and product demand increased, overseas sources were required. Quality started to decline many years ago and there are other sources that filled the void. Many of those were imports, "Made in the USA" is not a guarantee of quality or reliability. Think about the preference for "old world Craftmanship"!

quote:

Originally posted by corsair:
So, their leftest political statements aside...here's the quandary. Are they right to move because no machine shop was available to produce what they needed or, are they wrong for not investing more into their own operations?

This is the problem that many US companies have, setting up and maintaining your own manufacturing is very expensive, especially when you're competing on a global scale; payroll, machinery, maintenance, properly zoned real estate, safety inspections/compliance, insurance, organized labor, training. Not only is the supply chain limited here in the US, there's a lack of expertise at running a manufacturing operation, there's a lack of people who are willing to do repetitive work, and there's not many consumers willing to pay domestic made product. What needs to get fixed...tax incentives to set-up a US factory or, buy US sourced goods? Increased tariffs? Govt work programs?


Black Diamond cuts 70 positions and transitions manufacturing out of Utah

quote:

Black Diamond laid off 70 employees last week in its manufacturing division of the Salt Lake City, Utah, headquarters, a 22 percent reduction of the Utah workforce and 53 percent of the manufacturing division.

News spread quickly on Reddit. A screenshot of a Facebook post—with the original poster’s name blacked out—received nearly 450 comments. It read in part: “Black Diamond announced to its manufacturing crew that it was being sent overseas. They’re out of a job come September.”

Walbrecht announced the layoffs to all employees on Friday, after the VP of manufacturing gave notice to those 70 employees. He said the cuts are a culmination of Black Diamond's multi-year strategy to migrate away from in-house manufacturing, seek the most capable facilities overseas, and boost its engineering and design staff.

Black Diamond is owned by Clarus Corporation, a publicly traded company.
Employees' last days will be between Sept. 1 and Dec. 31. BD is doing everything it can to support them by hosting job fairs and career-building workshops, providing severance packages, and working with Utah to ensure unemployment benefits. Those 70 will also retain their employee discounts, even after their departure. Meanwhile, the 62 remaining manufacturing employees were assigned new roles at the company.

SNEWS talked to Walbrecht during an exclusive interview on Monday to explain the layoffs and how they factor into BD’s overall “innovate and accelerate” strategy.

....

And don't forget medical costs, and that damn Obama Care hasn't even kicked in completely yet, when the age rated part of it does kick in, a lot of business will be paying huge increases in premiums on the older employees and you'll see more and more of these types of closures I'm sure. A lot of older employees will be out of work...how is that helping??