Down on Main Street
A reply to an email arrived in my inbox the other day. It read, in part: “After 99 and 1/2 years and four generations, the ‘community’ bank refused to renew our line of credit. Would love to discuss this issue.”
It was a message from Jack Coleman, who was winding down operations at his fourth-generation lumberyard and home center in Harrodsburg, Ky., not far from Lexington.
Most of the time when you talk to a 99-and-a-half-year-old company, the conversation takes the form of a hopeful celebration looking back at major decisions and looking ahead at another 100 years.
Those are easy conversations. This one was hard.
Coleman has an impressive resume as a leader — 14 years in the Kentucky state legislature, a past president of the Kentucky Building Materials Association, and a bank director for 13 years. He is the great-grandson of company founder Clell Coleman. But the forces acting on the economy, his market, his business and the banks were too much for Coleman’s Lumber and Home Center. And since the situation facing Coleman’s Lumber unfortunately is shared by others, it’s important to explore the reasons.
“You have a perfect storm,” he told Home Channel News in a recent phone interview. “You have businesses that have lost money, banks that want to pull back, and regulators that have been in these banks looking at all the issues and requiring severe measures by the local boards. It’s just a perfect storm. And nobody in Washington seems to be listening.”
Coleman still describes his career in the LBM industry as “blessed,” but the demise of a company is naturally frustrating. At one time, the business had about 32 employees, but staff dwindled to about 13 or 14 near the end. “They’re our family,” Coleman said.
The last couple years have been particularly tough on the business. One clear problem has been customers’ inability or unwillingness to pay for services. As cash-strapped customers file bankruptcy and the liens and judgments pile up, the business simply starved.
“What we’re witnessing is the disassembling of Main Street,” Coleman said. “We’re protecting Wall Street, and witnessing the demise of the small businesses. We asked our bank for an extension, and they flat out refused.”
Such experiences have given Coleman sympathy for those who joined the Occupy Wall Street movement. But as a former legislator with knowledge of the system, he remains confident in it. He recommends a fix from within — through the power of the ballot and political pressure.
As a politician, Coleman was a member of the Democratic Party, but he feels both parties have blown their opportunity to address the key issues of housing and jobs. Lumber companies and Main Street businesses all over Kentucky and beyond are hurting, he said. And there seems to be no concern for small business owners.
“My intentions are to be able to walk off this property and say to my great grandfather, my grandfather, my father and this community that we did the right thing for the right reasons, and we finished this thing honorably,” he said.
As Coleman’s doors shut, the parking lot was full. Business was picking up in 2011. But the damage was done. “I’m concerned about the rest of the country,” he said.
Fourth-generation family businesses deserve a better fate.
— Ken Clark
[The following are responses to an HCN Daily item about Herman Cain’s 9-9-9 tax plan, built around a 9% business tax, a 9% individual tax and a 9% national sales tax. It would also eliminate the mortgage interest deduction.]
“I’m for [the 9-9-9 plan]. What no one is talking about is the undercurrent of money from illegal activities that this plan will catch and tax at least 9%. Currently no revenue is generated from this source. Would it be great if this didn’t exist? Yes. Is that realistic? No. This plan will catch money on BOTH sides of the ball. Wages being paid to illegal residents will at least get caught when they spend their wages, and money earned by persons engaged in illegal activities will get taxed when they spend it. The underground economy will always exist, and it is being taxed at 0% right now.”
— Kent Porter
Porters Building Centers
“Almost anything is better than what we have. His plan is simple, fair and will spur economic growth. I think any criticism of his plan or others similar is spurred from a misconception that too little tax revenue is our problem. There is already too much tax revenue. The problem is an oppressive government growing on credit terms at our expense. No government in history has ever been close to this big, and it was unsustainable years ago. Herman Cain’s solution is great for the revenue side. I hope he has a great plan about the spending side and the massive shrinkage of government that must happen if we are to survive.”
— Jeff Wilson
“In my discussions about this plan, most people forget that it is supposed to eliminate all other federal taxes, thus simplifying and lowering some things in our life. I’ve asked numerous young people and they are against it, thinking that now they will pay more in taxes until I ask them if they buy gasoline, fly on a plane, or use a cell phone. To which they say, ‘I didn’t know all those had federal taxes on them.’ Like most things, the media plays people to whatever slant they land on. I’m still undecided for a couple of reasons:
“1. Will they ever really eliminate other taxes, permanently?
“2. Will there be a ceiling that the 9-9-9 [plan] will never increase?”
— Erv Sweet
“What are the unintended consequences of the plan?
“No deductions for that home improvement loan and 9% more cost added to building materials. We know how quickly a 10% increase kills a category in the store.
“No tax on used merchandise? How long before an ugly underground economy emerges that skirts building codes.”
— Tom Fromelt
Southern Yellow Pine
“In our market (New Hampshire), Southern Yellow Pine is used primarily as pressure treated, and mostly in exterior decks. The result of decreased design value changes would most likely cause us to increase member size and reduce spans. It’s hard to say what impact that might have on the market. It will make the finished price of a deck project higher for sure. But, will it be enough to stop people from building these decks? Probably not.”
— Eric Murphy
East Coast Lumber
“The Southern Forest Products Association (SFPA) does not test lumber or establish design values. SFPA is not a lumber rules-writing agency. The SFPA’s primary function is to market lumber products and to help users understand Southern Pine grading rules and design values developed by the Southern Pine Inspection Bureau (SPIB) and approved by the American Lumber Standard Committee (ALSC).”
— Southern Forest Products Association
Sunday hours and home centers
“If I am an applicant seeking a job from a business that is open seven days a week, and I firmly believe that working on Sunday or Saturday would conflict with my religious beliefs, I have two options:
“1. Apply elsewhere. This is America. You get to choose where you want to apply for a job. Apply at a workplace that is open Monday through Friday.
“2. Be upfront to the selecting manager that you are not available on Saturday (for Sabbath) or on Sunday. The employer can then decide if your schedule will fit into the current pool of employees.”
— Paul Rodriguez
Hayward So You Can Build
Santa Maria, Calif.
Lifetime Brands acquires Creative Tops, Creative Tops Far East
Garden City N.Y.-based Lifetime Brands, a provider of kitchenware, tabletop, home decor and lifestyle products, has acquired Creative Tops Limited and Creative Tops Far East Limited (CTFE).
Creative Tops is a wholesale provider of tableware, kitchenware and giftware products in the United Kingdom. CTFE is based in Hong Kong and provides sourcing and other services for Creative Tops and its customers.
For its fiscal year ended March 31, Creative Tops and CTFE had combined net revenues of about $42.3 million.
"The acquisition of Creative Tops and CTFE represents a compelling, multifaceted opportunity that will allow us to accelerate our growth and to strengthen our business,” said Jeffrey Siegel, Lifetime’s chairman, president and CEO. "Creative Tops is a highly regarded provider of private-label and branded housewares products.
"The acquisition reflects our ongoing commitment to building shareholder value through growth in revenues, net income and diluted earnings per share. Together with Lifetime’s established partnerships in North and Central America, this strategic combination creates a global leader in the housewares business with a focus on quality and innovation."
Creative Tops markets its products to department stores, supermarket groups, home and garden centers and other housewares retailers and independent shops in the United Kingdom, and retailers in Australia, France, Germany, Italy, Ireland, Korea, the Netherlands, New Zealand, Norway, Russia, South Africa, Spain, Taiwan and the United States.
CTFE provides product design, sourcing, quality assurance, ethical compliance and audit, merchandising, logistics, order fulfillment and other services for Creative Tops, as well as for its global retailer partners that choose to develop their own in-line or seasonal offerings and promotions.
Lifetime was advised by Livingstone Partners, trans-Atlantic corporate finance advisers specializing in cross-border M&A.