Rogers toy-maker Redman & Associates is weeks away from production of a new Rubik's Cube-type gizmo and two of its signature ride-on toys, just in time for Christmas holiday shipping and stocking. These will be the first American-made products for the company that once imported solely from China.
Redman announced last October that it would open a manufacturing facility in Northwest Arkansas to answer Wal-Mart's commitment to buy an additional $50 billion in American-made products in 10 years. The intent is to grow domestic manufacturing and encourage the creation of U.S. jobs.
Around Thanksgiving, Redman moved into a 270,000-square-foot building at 1300 N. Dixieland Road in Rogers, where it has its offices and its manufacturing and distribution operations. The firm also has a distribution center in Long Beach, Calif., where it takes in toys made at a production facility in China.
Manufacturing in China will be phased out by the end of 2016 as Redman increases the capability to make toys in Rogers, said Mel Redman, president and chief executive officer of the family-run company.
"We've gotten geared up 100 percent from scratch," Redman said of the local operation.
In Rogers, Redman has been tweaking and testing its first American-made product -- the Buzzle Ball -- a puzzle "infinitely challenging to people of all ages," as described by the CEO. The ball, with movable parts and a ring around it like the planet Saturn, will hit Wal-Mart stores in August with an initial order of 20,000.
Redman has also started production on two new models of its popular four-wheel, 6-volt battery-powered ride-on toys: one branded Captain America and one deemed Ultra Spider-Man, named for the new version of the Spider-Man character. Spider-Man toys have been a staple in Redman's offerings and were the first ride-on toys sold to Wal-Mart eight years ago. Redman makes the motorized vehicles in seven different characters for children ages 1-3.
Of the 600,000 pieces Redman produces each year, it hopes to create half of those in Rogers next year and all of them locally by 2016, eliminating the need for importing. Using Northwest Arkansas as a distribution point, instead of relying on them to come via ocean freight from China, saves seven days in the supply chain.
"It saves us and Wal-Mart a lot of money," Redman said. "We can make [these toys] for the same price that we could make then in China, within the penny." The company should be able to cut $2 million in shipping costs next year and eliminate the expense altogether in 2016.
Steve Cox, vice president of economic development for the Rogers-Lowell Area Chamber of Commerce, said he expects future manufacturing announcements for Northwest Arkansas. He hesitated to put a timetable on it but said local chambers are fielding interest from companies evaluating the area. In addition to jobs that might be created from manufacturers relocating, Cox said the effect could be felt from existing industries that are asked to provide locally sourced materials.
"There is interest in companies wanting to come to the area, and the economic benefits can trickle down from there," Cox said. "As new businesses start coming, they can start sourcing things locally. That leads to existing industries ramping up production and expanding. That's our hope."
Redman said the company had 1,300 applications for the 17 jobs it said it needed to fill in October. The firm ended up hiring 25 with an average pay of $18.50 per hour.
Cox said the interest in manufacturing positions at Redman speaks well for Northwest Arkansas, which generally ranks high in job creation and low in unemployment. According to the most recent Bureau of Labor Management statistics, Northwest Arkansas led the state with a 4.5 percent unemployment rate. The state's overall unemployment rate, according to those preliminary figures, was 6.1 percent.
"We have a labor market that is ready and willing to work," Cox said. "That is a good thing. We have a low unemployment rate compared to state and the country, but this is still a very hard-working community that wants to go to work."
Business on 06/28/2014