Small Business

America's Knifemakers Are Losing Their Edge


America's Knifemakers Are Losing Their Edge

Courtesy Lamson & Goodnow

In its early years, the Lamson and Goodnow cutlery factory in Shelburne Falls, Mass., employed 500 workers and consumed 200 tons of steel a year, according to a survey of U.S. manufacturing published in 1864. The business has since lost its shine: The company, which still makes premium chef’s knives, steak knives, and an assortment of utensils and accessories, filed for chapter 11 bankruptcy last week.

The business of making knives in America is getting lonely. The number of cutlery and hand tool makers in the U.S. dropped 29 percent from 1998 to 2012, to just 1,200, according to Census data. Most of those companies specialize in making hammers, hatchets, and other hand tools. There were just 188 cutlery makers left in 2012, the first year the census divided the two categories.

Lamson and Goodnow’s problems appear to be many: A since-departed executive squandered resources on a failed business plan, according to court documents; the company’s 19th century factory is poorly suited to 21st century manufacturing, according to the website MassLive. A labor dispute and flood damage caused by Tropical Storm Irene also presented obstacles to the 177-year-old company, which sells some of its products through L.L. Bean and Williams-Sonoma (WSM). The company, which has fewer than $10 million in assets, according to bankruptcy filings, did not respond on Thursday to an interview request.

Beyond Lamson and Goodnow’s particular troubles, the industry faces headwinds common to low-tech manufacturing. The cost of raw materials is rising, and the industry is seeking savings by moving factories to countries where labor is cheaper. That has led to a widening trade imbalance, with the U.S. importing about three times as much as it exports in the cutlery and hand-tool category, according to the research firm IBISWorld.

Lamson and Goodnow listed (sign-in required) its 18-acre, 7-building factory complex with a real estate agent for $2.1 million. That doesn’t mean it’s going to follow other manufacturers to lower-cost shores. Companies selling premium products often lean on their American-made pedigrees, and consumers might balk at the prices for serrated steak knives (a set of four goes for $229.95) or forged meat cleavers ($135) carrying “Made in China” stamps. Chief Operating Officer James Pelletier told local mediathat the company is looking for new factory space near the land it has occupied for nearly two centuries: ”We want to be as close by as we can be,” he says.

Courtesy Lamson & Goodnow

Clark is a reporter for Bloomberg Businessweek covering small business and entrepreneurship.

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Companies Mentioned

  • WSM
    (Williams-Sonoma Inc)
    • $68.24 USD
    • -0.68
    • -1.0%
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