American-Made Works Big Time at Haleyville's Exxel Outdoors
When all the competitors moved their plants to China, one U.S. sleeping bag manufacturer in Haleyville dug in, survived and continues to thrive.
Owners Armen Kouleyan (left) and Harry Kazazian
Photos by Cary Norton
Barbara Garrison was destined to make sleeping bags, right down to her initials: BAG.
And her dedication to her profession, her employer and her employees have made her something of a hero in the small Alabama town of Haleyville and nationwide in some circles — earning her the 2014 STEP Ahead Award by Women in Manufacturing.
At the plant where she is now Plant Senior V.P., Garrison has faced the threat of seeing her plant closed and moved to Mexico, struggled through convoluted tariff barriers, survived tornadoes, and still manages to produce 2.2 million sleeping bags a year at the Exxel Outdoors plant in Haleyville, making it the largest producer of sleeping bags in the Western Hemisphere.
The plant was founded in 1981, when Garrison joined the company as an office manager. Production started slowly, she says, but after a few months, sales began to increase and the company got an account with Montgomery Ward. The company was sold to Brunswick in 1990.
Ten years later, Boulder, Colorado-headquartered Exxel Outdoors, founded by CEO Harry Kazazian and Armen Kouleyan, bought the Haleyville company from Brunswick.
The sleeping bags were to be added to an array of Exxel Outdoors products that — unlike the Alabama-made products — are not made in the U.S.
Brands currently made at the Haleyville factory are Master Sportsman, Exxel Kids (licensed with Disney, Marvel Entertainment & Sanrio copyrights), and private label bags made for retail customers. They are sold at Wal-Mart, Academy Sports and Dick’s Sporting Goods.
That Alabama business, big as it is, is part of one of the largest privately-held collections of outdoor recreational gear brands in the U.S., including mass market brands Master Sportsman, Wenzel, Tailgaterz by Wenzel, X20 Water Sports, Exxel Outdoors Kids, Suisse Sport and Insta-Bed. Mid-market brands include Slumberjack (for hunting), and premium brands are Sierra Designs (backpacking and mountaineering), Kelty (backpacking and car camping), and Ultimate Direction (hydration packs for ultra-running).
“When Harry and Armen bought the company in 2000, I was employed here,” Garrison says. That’s when the battle to keep the plant in Haleyville started.
“They liked (the Haleyville plant), but their real interest was in buying the company and relocating, because they were manufacturing in Mexico at the time,” Garrison says.
“We got there to find the operation was nearly shuttered,” Kazazian says, “but we were surprised when we saw how much potential it had. What really grabbed our attention were the people. We saw a strong leader in Barbara, and most of the employees were so eager and proud of what they did.”
“After they bought the company,” says Garrison, “I realized this was a dream of my own that I could fulfill through them. And they were willing to put more money into the company and let me develop it in a vision that I thought would be successful.
“So instead of them liquidating and moving the equipment to Mexico, they moved equipment from Mexico to Haleyville. We had to eliminate a few jobs so we could save the rest of the jobs, and we completely changed the production process in such a fashion that we could compete with China.
“I called Harry and Armen and said I wanted to share the savings with the employees, and they didn’t hesitate or ask to think about it, they just said do it.
“Harry and Armen joined me in putting the employees first. They are just that kind of people. We melded together very well.”
“All of our competitors had moved to China for cost-savings,” Kazazian says. “Our friends thought we were crazy to buy a failing U.S. factory. But we took a calculated risk, and, obviously, it turned out to be a great decision.”
Garrison has had no formal training in manufacturing. “I just take a common sense approach to everything, even accounting. I have learned by application, and I am not ashamed of that.
“The people — our mechanics, the ones who actually work on the equipment — made the equipment better, and that makes them proud. When we were changing our production flow, we took input daily from the people. It was the people who did the job.”
Kazazian says one of the first steps after buying the Haleyville plant was to meet with employees to see what could be done to make the operation better and faster. A proprietary process was developed that enabled the plant to make sleeping bags at a lower price than bringing them in from China.
“When we first brain-stormed with our in-house engineers, we came up with machine designs that no other sleeping bag factory had — or will have. Our engineers built them from the ground up, right there at the plant,” he says.
“We have what we call cellular manufacturing,” Garrison says. “There are four cells out there in the plant, and everybody in the cell makes the same amount of money. It doesn’t matter if they garnet the sleeping bag, quilt the sleeping bag, put a zipper on the sleeping bag — if you touch that sleeping bag, you get paid the same amount of money.
“It has worked out very well to do it that way, because if one of them gets a little bit behind, another one picks it up and helps them get through the bottleneck.
“Most of the year we run four, 10-hour days and then have a three-day weekend. Now, when the heat gets here, even though our production flow is air-conditioned, the machines get hot and when that happens, we come in at 6 a.m. and work until 2 p.m. so they don’t have to go into the heat,” says Garrison.
In 2010 the Haleyville plant, the last sleeping bag manufacturer in the country, faced closure because of a loophole in the Generalized System of Preferences, a trade policy adopted by Congress in 2006 that allows certain products to be imported from developing nations free of tariffs to stimulate their economies. It created a reverse-tariff situation, where sleeping bag factories in Bangladesh were completely circumventing all tariff exposure, while Exxel was subject to substantial taxation.
With the help of Alabama Sen. Jeff Sessions and Rep. Robert Aderholt, who lives in Haleyville, the trade policy extending favorable treatment for imported sleeping bags was changed, giving the Haleyville plant a new lease on life.
Another important victory in trade policy, says Kazazian, is the recent approval by Congress of the American Manufacturing Competitiveness Act of 2016, also known as the Miscellaneous Tariff Bill, co-sponsored by Aderholt.
“Exxel and thousands of other U.S. manufacturers have been put at a disadvantage for years by steep, anti-competitive taxes on raw materials necessary to produce our goods. This bill provides for a process where these unfair tariffs can be suspended. That will free up funds at U.S. plants to expand production and provide more jobs,” Kazazian says.
He says he’s hopeful that the Act will reduce taxes Exxel currently pays to import its shells from China — an input not made domestically. Trade officials will check to make sure there are no U.S. producers who are sources for the shell materials.
As if trade issues were not enough of a challenge, the Haleyville plant also faced natural disaster — the tornadoes that struck the state in 2011, including the neighboring town of Hackleburg.
“There were a lot of our employees from there who lost their homes. But it hit all around this area, and the only thing we could do to help — besides monetary help, and that was not what they needed at the time — was to hand out sleeping bags, so we had lots of people going lots of places handing out sleeping bags,” Garrison says.
“I can’t say enough about the owners of our company and how much they appreciate the people and the community,” Garrison says.
The employees themselves are a close-knit bunch, most of whom have been with the company through the travails.
“The people are a lot of it,” says Tracy Wright, a sewing machine technician who has been with the company 32 years. “We are a very close-knit group. But we need to quit trading with foreign countries and make things over here.”
Wright says when he learned the plant was staying in Haleyville, “I felt wonderful, I cried. It was the best feeling I have ever had.”
Seventy-two-year-old Winnie Jo Bennett, who says she has no plans to retire anytime soon, simply says, “They been good to me.”
“I have tremendous faith in American ingenuity and American workers,” Kazazian says. “Given an even playing ground with the rest of the world, U.S. manufacturing can win big.”
Kazazian says the company’s Haleyville factory is running at a profit that has merited expansion from three to four production cells, with production line employment last year increasing by approximately 15 percent.
“We’re on track to produce well beyond two million sleeping bags this year,” says Kazazian. “We’re expanding on some strong licensing partnerships we have. We’re upping our production of our Master Sportsman brand bags with the biggest names in camouflage patterns, Realtree and Mossy Oak. And for our Exxel Kids brand, we’ll be producing hundreds of thousands of kids’ bags for Christmas season, with the hottest new character graphics from Disney, Marvel Entertainment and others. On top of that, we’re looking at some exciting new products to make here (Haleyville) in the near future.”
Bill Gerdes and Cary Norton are freelance contributors to Business Alabama. Gerdes is based in McCalla and Norton in Birmingham.