Lakeland, FL, Nov. 18--Florida Tile Industries Inc. announced Monday it will close its Lakeland manufacturing plant, just days after it was purchased by a Washington, D.C.-based merchant bank, according to the Lakeland Ledger.
The decision will mean the loss of 127 jobs at a plant opened in 1954 that had as many as 700 workers in the 1970s.
The closing will start in January and be complete by the middle of 2004, officials said.
Founded by Jimmie and Leon Sikes, the company boasts that it is the second-largest producer of glazed ceramic tile in America. But business has been hurting, officials said.
Several years of significant decline in the demand and sales of the wall tile and trim produced in Lakeland prompted the decision, officials said.
"Over the last decade or so, consumer and builder preference has shifted away from basic wall tile and trim to more fashionable, highly designed products that we manufacture and distribute at our other two facilities in Kentucky and Georgia," said Matt Galvez, recently appointed chief executive officer, in a statement.
Production will be consolidated to Florida Tile's Kentucky and Georgia sites, he said, "to better utilize their production capacity, lower our excessive operating expenses and help put the company on track to a better financial position."
Galvez told employees of the decision to close the plant Monday at a 4:30 p.m. meeting, according to Keith Lee Rupp of Nissen-Rupp Public Relations. He told them Florida Tile will work with state and local agencies to provide employees with available services to deal with the loss of jobs.
Officials said workers in some "selected positions" will have the opportunity to relocate to Lawrenceburg, KY, or Shannon, GA.
Executive and customer support positions, management, design and marketing jobs--a staff of about 62 people--will remain in Lakeland.
Florida Tile's headquarters will move to a new site in Lakeland, Rupp said. The existing buildings and property--about 20 acres--at the Lake Wire site will be sold, Rupp said. "New office space has not been selected yet, and there has been no word on when that move will happen," Rupp said.
News of the decision to close the plant was released within days of the Nov. 11 announcement that Milestone Merchant Partners' investment fund, MMP Capital Partners, had purchased Florida Tile Industries Inc. from Illinois Tool Works. Milestone Managing Director Gene Weil said then, "Our objective is to buy controlling stakes in underperforming companies, and work with them to make them better performing companies."
Illinois Tool Works put Florida Tile on the market in 2001.
CEO Galvez said the closure was painful but necessary. "By the end of this year, imported ceramic tile will make up almost 80 percent of the U.S. market," he said in a statement. "The sheer number of countries and factories shipping ceramic into the U.S. now is staggering. In order for a U.S. producer to compete and survive, whether the product is ceramic tile, citrus or furniture, they've got to consolidate where possible, improve efficiencies and add value.
"Our Lakeland plant consolidation, though painful, is necessary to keep the `mother ship' afloat and steaming forward."
Florida Tile's new chief operating officer, Scott Fullerton, said in the statement a plan is in place to ensure no interruptions in service. Investments will be made in new technology, jobs and processes in Kentucky and Georgia to enhance product capabilities in the coming year, he said.
