Wood-Mode’s pride in woodworking craftsmanship — what has kept it a highly regarded staple in the cabinet making industry — may at least be partly to blame for its closure, according to an industry analyst.
The privately-held company's sudden closure of its 77-year-old Kreamer plant and layoff of nearly 1,000 employees surprised workers, lawmakers and industry insiders.
Freedonia Group analyst Matt Zielenski said Wood-Mode may have struggled to keep pace with manufacturers that have added automation and not relied so heavily on hand-crafted artisanship in an industry “doing quite well.”
"New home building is up and people want more kitchen and bath cabinets,” Zielenski said. “There has been a trend in people investing in tall kitchen cabinets."
Custom cabinetry is a “harder sell,” that coupled with rising cost of component pieces and the automation may have affected Wood-Mode’s bottom line, Zielenski said.
"Wood-Mode is well-regarded for high-quality cabinets but they need to sell more and more product to a smaller and more competitive market," said Zielinski.
Upon learning the news of Wood-Mode's closure Monday, Conestoga Wood Specialties chief operating officer Chris Watson said he received texts or calls from about 25 colleagues.
"It's the saddest day in our industry," he said. "Wood-Mode was the gold standard everyone wanted to aspire to."
Changes in the industry have been a result of trade battles between U.S. and Chinese manufacturers and the shifting buying habits of younger customers, said Watson.
By embracing new trends over the past decade and using more synthetic materials, Conestoga, which employs about 1,100 workers at its five locations, including two plants in Beaver Springs and Beavertown in Snyder County, has been able to keep up with the changing needs.
The company will be investing at the two Snyder County locations to meet the increasing demand for domestic door and component items, including a $1.2 million expansion at the Beaver Springs plant, he said.
Former Wood-Mode employees who declined to be identified said in recent months their questions to upper management have gone unanswered.
Snyder County Commissioner Joe Kantz said his attempts to reach Wood-Mode management in the last year have also been unsuccessful.
Kantz is still trying to determine what happened to the once thriving company that was the largest employer in the county for decades.
“From what I’ve been hearing they had suppliers who weren’t supplying goods until they got paid,” he said.
Several employees said the company was still receiving plenty of orders but were unable to pay bills.