Many members of the military, industrial workers, and U.S. Olympic team athletes all benefit from products made by Vibram, a manufacturer of high-performance soles. With its 2015 acquisition of North Brookfield-based Quabaug Corp., its longtime partner, Vibram officially put its name on a manufacturing plant in the U.S. The company is in the midst of a multi-million dollar investment campaign in its workforce and facility.
Vibram USA President and CEO Michael Gionfriddo spoke about the campaign, Vibram’s business model, and making things in Central Massachusetts.
If I walked into your store on Newbury Street in Boston, what would I be able to buy?
You would be able to buy some of the finished products. We sell Vibram FiveFingers shoes, for running, fitness, and leisure activities. Also, you’d see Furoshiki, our wrapping shoe concept that we developed, for more casual events and activities. We also try to promote customers’ products. We are a component supplier to a lot of brands that make finished shoes. We supply companies like New Balance with rubber outsoles. They would do the final assembly, but it would be collaboration on the design and material we would offer them for the intended purpose of that product.
We supply to over 1,400 partner brands, and in each case, it’s either a specially designed product for a customer, or in some cases the customer will use our open collection. We do that for smaller customers who are just starting up, who don’t want to make investments in molds for unique products. They can find something from our open collection to meet their requirements.
How did your acquisition of Quabaug help your company?
Quabaug and Vibram have a long history of working together. In 1965, Quabaug entered into a license agreement with Vibram in Italy and has been producing Vibram soles since 1965 here in America. That license ended in 2010, and from the time period of 2010 through 2015 the companies still worked very closely together but with no license agreement in place. On a long-term basis, the reason the acquisition was done was Vibram wanted to have a manufacturing presence and innovation and development in America, in addition to operations in Italy and China. This made sense for both companies as we looked ahead towards the future.
So this is your first U.S manufacturing facility?
Yes, it’s Vibram’s first manufacturing facility in U.S.
But you recently celebrated 100 years of manufacturing in the U.S.
It’s tongue-in-cheek. Quabaug has been in North Brookfield, producing products for 100 years. Vibram is celebrating its 80th anniversary in 2017, but because we did the acquisition we were celebrating 100 years of operations in North Brookfield, even though Vibram was not associated with Quabaug for the full 100 years. The first production with Quabaug started in 1965.
At the time of your anniversary celebration, you announced a multi-million dollar campaign that will support the company going forward. Why did you decide to do that and how far along in it are you?
When we did the acquisition in 2015, we recognized that in order to be a viable company for the future, we were going to have to invest in and modernize some of the operations. We had to do that in 2016. We invested $6 million in operations, and we have an approved capital budget for 2017 of $4,278,000 that will be used for replacing equipment, upgrading some processes, automation, doing an number of lean manufacturing events to improve workflow as a way to improve costs and continue to be competitive in the marketplace.
We will do some work with MassMEP to help us, and we’ve added staff to help coordinate those activities internally. We just added the staff as of the third of January, so right now we’re going through the orientation process. We have made a concerted effort to add a lot of additional young engineering talent. We’ve recruited and added a number of people from Worcester Polytechnic Institute, Rensselaer Polytechnic Institute, and UMass Lowell, in the chemistry and industrial mechanical engineering areas.
How do you ensure a steady stream of talented and qualified employees?
You want to make sure the work environment is positive for all the people who come in and join the company. We try to be proactive in sharing in what’s going on in the business. We also want to provide opportunities to grow into another position if they have an interest. We have a good management team that has a great relationship with the workforce. We have a lot of people who have been here for many many years. We act just yesterday had a service award program, where we were able to award 40 years plus service awards, along with 35, 15 and 1 year.
When good people join the company, we want to make sure we provide them with opportunities and certainly retain them as we go forward.
How many employees do you have?
Right now, we have 325 associates in Massachusetts. As we invest our requirements will change a little bit through some of the automation and productivity. I would say [we'll hire] within the 15-25 people range.
What do you like about being in Central Massachusetts?
We have a great workforce that’s here that supports the company. Most recently we’ve had support from Congressman McGovern and Congresswoman Tsongas, who have been very helpful in passing the National Defense Authorization Act, which includes a Buy America provision for athletic training shoes, which in the past was not the case. It means that now the military will have to purchase made in America shoes, versus in the past most of the shoes being supplied to recruits were made outside of the country. That will add some production volume here in North Brookfield.
Also I would say in Massachusetts, we have a great educational system that produces a wonderful workforce when needed.