Planning designs for Reno market
March 2, 2015
Seattle-based outdoor-gear maker Cascade Designs will move about 100 jobs, nearly one-fifth of its workforce, to a new manufacturing and distribution facility in the Reno area as it seeks to keep costs down while expanding.
The company said it needs to grow, but doing so in the Seattle area is too expensive. The main reason is the skyrocketing cost of real estate, especially for the space it leases around the city to house its merchandise.
"We're running out of space in Seattle," spokesman Martin Maisonpierre said. After scouting several locations in the West and Mountain states, the decision was made to come to Reno, although Salt Lake City was also in the running.
The company's top brass are passionate about the outdoors and access to the Reno-Tahoe region played a strong role for the expansion, especially on the product testing end.
In terms of distribution, Reno is the perfect spot, especially access to California, which is the company's single-largest retail market, said Maisonpierre.
Another concern is labor costs. Seattle employers are now required to pay to a minimum wage of $15 per hour. Labor costs add up, especially as Cascade competes with brands that rely on cheap overseas labor, Maisonpierre said.
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The privately held company, which makes outdoor sleeping mattresses and other equipment under the brands Therm-a-Rest, MSR, Platypus and others, will keep the bulk of its operations in the Emerald City where it owns a significant chunk of real estate south of downtown. Some 300 to 350 Cascade employees will continue to work in Seattle.
"We want to remain a Seattle company," Maisonpierre said.
By diversifying its operations, it can "hopefully work on our manufacturing costs to where we can continue to add jobs in Seattle," he said.
The facility in Reno will open in August and is expected to be fully operational in the first quarter of next year. Maisonpierre said the company still is negotiating the final terms of the lease and wouldn't disclose the location Cascade Designs is eyeballing.
All affected employees have been offered the opportunity to relocate to Reno, with six to 10 months' notice and with severance pay for those who stay through the transition. It's unclear at this point how many will move.
"They've got plenty of time to make that decision," Maisonpierre said.
He said the jobs in Reno will pay $10 an hour or more. Many of them will be on the more labor-intensive, less-specialized end of the spectrum. A lot of the more complex, high-tech manufacturing will remain in Seattle, Maisonpierre said.
Founded in 1972, the business owns seven separate brands, which it sells direct-to consumer and via retail partners such as REI, its biggest customer, said Maisonpierre.
He said part of the reason Cascade is opening a facility in Reno is because it remains committed to U.S. manufacturing. The company also has another facility, in Cork, Ireland, to serve European outdoor enthusiasts.