DeBall Velvet To Resume Production
October 31, 2007
UPPER GRANBY, Canada -- DeBall Velvets Inc. will commence full production at its velvet mill here on Monday, Nov. 5, according to Stephan Sayer, sales director.
American Jobbers said they are breathing a sigh of relief in the wake of this news. DeBall makes a huge color range of high-quality cotton velvets which could not easily be replaced in the market, industry insiders said. 'Malaga,' a DeBall quality introduced in 1981 is extensively sourced by The Robert Allen Group, but this quality cannot be replaced because there is no equal to it available, trade sources said. There is some overlap of qualities with J.B. Martin velvet, but this company produces much shorter runs than DeBall which is a major velvet supplier to the U.S. furniture industry.
DeBall is considered by many customers to be on a par with European mills in its ability to produce and finish cotton velvet with one of the most advanced production plants in the world.
In order to work out its financial difficulties, DeBall chose to end production for three and a half weeks but Sayer said DeBall will catch up in one month's time. "I have contacted all of our customers and everyone has been behind us from the beginning of this process," he said. "Nobody cancelled their orders."
In order to offset the declining US dollar (some 20 plus percent since the beginning of 2007), DeBall management cut its salaries and the labor union also made cuts in salaries. DeBall employs between 80 and 100 people at its manufacturing facility near Montreal. Additionally, to meet the cost saving goals, all three DeBall showrooms were closed in New York, High Point and Montreal, Sayer said. Showroom personnel will regroup in Upper Granby at the mill. DeBall was losing 20 plus percent from its profit margin due to the devaluation of the American dollar. ''Our raw material costs rose by the same amount," he confirmed.
"Everyone, including our customers, has been behind our emergence from pre-Chapter 11 proceedings," Sayer said. DeBall filed for pre-bankruptcy on Oct. 5 and had ceased production in order to buy time to find new sources of capital.
"Our previous banking relationship was terminated by a money losing bank. In fact, this bank terminated all loans with Canadian exporters including DeBall, based on the drop in the US dollar. We fortunately found a new source of capital that was willing to work with DeBall but it was conditional making the cuts in our costs. We have been successful in our efforts, so full production will resume.'' DeBall filed for insolvency in October with $13 million in debts and $6.3 million in assets but with the new financing in place, the company expects to meet all of its financial and production goals. DeBall's president, Chris Wood and DeBall consultant Cornelius DeKort could not be reached for further comment. However, it is well known that the pair was working behind the scenes to put DeBall on solid ground.
American Jobbers said they are breathing a sigh of relief in the wake of this news. DeBall makes a huge color range of high-quality cotton velvets which could not easily be replaced in the market, industry insiders said. 'Malaga,' a DeBall quality introduced in 1981 is extensively sourced by The Robert Allen Group, but this quality cannot be replaced because there is no equal to it available, trade sources said. There is some overlap of qualities with J.B. Martin velvet, but this company produces much shorter runs than DeBall which is a major velvet supplier to the U.S. furniture industry.
DeBall is considered by many customers to be on a par with European mills in its ability to produce and finish cotton velvet with one of the most advanced production plants in the world.
In order to work out its financial difficulties, DeBall chose to end production for three and a half weeks but Sayer said DeBall will catch up in one month's time. "I have contacted all of our customers and everyone has been behind us from the beginning of this process," he said. "Nobody cancelled their orders."
In order to offset the declining US dollar (some 20 plus percent since the beginning of 2007), DeBall management cut its salaries and the labor union also made cuts in salaries. DeBall employs between 80 and 100 people at its manufacturing facility near Montreal. Additionally, to meet the cost saving goals, all three DeBall showrooms were closed in New York, High Point and Montreal, Sayer said. Showroom personnel will regroup in Upper Granby at the mill. DeBall was losing 20 plus percent from its profit margin due to the devaluation of the American dollar. ''Our raw material costs rose by the same amount," he confirmed.
"Everyone, including our customers, has been behind our emergence from pre-Chapter 11 proceedings," Sayer said. DeBall filed for pre-bankruptcy on Oct. 5 and had ceased production in order to buy time to find new sources of capital.
"Our previous banking relationship was terminated by a money losing bank. In fact, this bank terminated all loans with Canadian exporters including DeBall, based on the drop in the US dollar. We fortunately found a new source of capital that was willing to work with DeBall but it was conditional making the cuts in our costs. We have been successful in our efforts, so full production will resume.'' DeBall filed for insolvency in October with $13 million in debts and $6.3 million in assets but with the new financing in place, the company expects to meet all of its financial and production goals. DeBall's president, Chris Wood and DeBall consultant Cornelius DeKort could not be reached for further comment. However, it is well known that the pair was working behind the scenes to put DeBall on solid ground.
