Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.
Speaker 2: You're listening to Bloomberg Business Week with Carol Masser and
Speaker 2: Tim Stenovek on Bloomberg Radio.
Speaker 3: We talked about salt manufacturing the US, I should say
Speaker 3: the President in the White House talks.
Speaker 1: About it a lot, and the important of just really
Speaker 1: one hundred percent manufacturing have targeted big tech companies who
Speaker 1: still have manufacturing elsewhere and they really just want to
Speaker 1: be everything one hundred percent made in the USA.
Speaker 3: Yeah, and there's been a lot of attracting investments into
Speaker 3: the US is certainly a big theme here in twenty
Speaker 3: twenty five. So our trade deals, changing global flows top
Speaker 3: of mind for investors, which is why it's kind of
Speaker 3: a great time to check in with our next guest,
Speaker 3: whose company does manufacturing in the United States has been
Speaker 3: doing so for one hundred and sixty years, is a
Speaker 3: great read to on the US economy, US business and
Speaker 3: also consumers. So it's nice to have back with us.
Speaker 3: Ross wid Moyer. He is president and CEO of Barabau Mill.
Speaker 3: He also held a senior merchandising roles are several I
Speaker 3: should say, at Target and he joins US from Minnesota.
Speaker 3: Ross good to have you back with us? How are you?
Speaker 4: I'm well, thanks for having me on today.
Speaker 3: So you know, I was thinking about this, We were
Speaker 3: thinking about this and getting ready for you to join us.
Speaker 3: I think we talked in July. Tell us about the
Speaker 3: past few months. What's changed in terms of process, strategy,
Speaker 3: outlook and really your outlook too. On the US economy.
Speaker 4: Yeah, I would say a couple of things on that front.
Speaker 2: Number One, you know, for us as a US manufacturer,
Speaker 2: it's been business as usual, and I think other manufacturers
Speaker 2: I've talked to, not only here in Minnesota, but around
Speaker 2: the country, it's been anything but business as usual. So
Speaker 2: you know, from that standpoint, it's it's been a good
Speaker 2: thing for our company. It's been a good thing for
Speaker 2: our employees, you know. I think the the other piece
Speaker 2: I would add to that is, you know, with all
Speaker 2: of the noise around tariffs and what that's going to
Speaker 2: mean not only for manufacturers and consumer products, but also
Speaker 2: for the consumer, there's a lot of noise and I
Speaker 2: think it's caused a bit of an undercurrent of economic uncertainty,
Speaker 2: which heading into the holiday season, you know, can be
Speaker 2: a little bit scary for those of us who are
Speaker 2: in the retail business, particularly a fourth quarter driven retail business.
Speaker 2: But we're still despite all that, really optimistic about the
Speaker 2: upcoming holiday season.
Speaker 1: Your company has reported record revenue growth for around four
Speaker 1: consecutive years and launched over one hundred new products. What's
Speaker 1: driving that momentum and what lessons do you wish to
Speaker 1: parlay to those who are saying that it's impossible for
Speaker 1: things to be one hundred percent made in the USA.
Speaker 4: Yeah, well, you.
Speaker 2: Know, I wouldn't say it's impossible because we've been doing
Speaker 2: it for one hundred and sixty years here in Minnesota,
Speaker 2: and we have a proven product. We've been perfecting our
Speaker 2: woolen cotton blankets that we make here in Minnesota also
Speaker 2: in Maine, I should say over that course of time,
Speaker 2: so you know, made in America is we were doing
Speaker 2: made in America before made in America was cool. But
Speaker 2: I would say that they're really with a new found
Speaker 2: investment in American manufacturing, developing the workforce, reinvigorating a plant
Speaker 2: like we did here in Minnesota. We put a multiple
Speaker 2: million dollar effort and investment into our mill here in
Speaker 2: the States with new equipment to help modernize us and
Speaker 2: get us not only out of the nineteenth century, but
Speaker 2: into the twentieth and eventually the twenty first century, and
Speaker 2: that's really kind of helped us gain this new found
Speaker 2: momentum we have as a company as a brand, and
Speaker 2: we're really excited about it and we'd love for others
Speaker 2: to follow in our footsteps as well.
Speaker 1: And you've recently been able to lower prices permanently also,
Speaker 1: which is something very rare in the manufacturing space. Can
Speaker 1: you walk us through any specific changes that you've made,
Speaker 1: whether it's technological or more procedural, that made that possible.
Speaker 4: Yeah.
Speaker 2: No, I think that's been the big news coming out
Speaker 2: of fairboughm Minnesota, is that we've been lowering prices while
Speaker 2: others are raising prices, especially in this hyperinflationary environment we've
Speaker 2: experienced over the last up of years. And we've been
Speaker 2: able to do that all the while raising wages here
Speaker 2: with our workers in Minnesota.
Speaker 4: Which're really proud to have done that.
Speaker 2: But really for us, it's about the investment in new
Speaker 2: equipment and helping automate the manufacturing of a craft.
Speaker 4: That we've been doing for one hundred and sixty years.
Speaker 2: And I think sometimes automation is a bit of a
Speaker 2: dirty word particularly if you're in the workforce, it oftentimes
Speaker 2: means replacing workers with machines. We're doing anything but that
Speaker 2: where we're continuing to grow employment here at our plant
Speaker 2: in Minnesota and in Maine, but we're able to make
Speaker 2: more product as a consequence.
Speaker 4: Of the new high speed, high.
Speaker 2: Tech machinery we've invested in invested in over the last
Speaker 2: couple of years, and that's allowed us to make blankets
Speaker 2: more cheaply, and rather than pocket all that game, we
Speaker 2: wanted to pass it on to our consumers because we
Speaker 2: know that they're getting pinched from all corners of their
Speaker 2: life and it's the least we could do here as
Speaker 2: a great American and in the great American company.
Speaker 3: Hey, you know, I am curious too about selling, Like
Speaker 3: I'm on your website right now. I mean, how much
Speaker 3: is direct to consumer? How much is and forgive me
Speaker 3: for not knowing like retail or do you have partnerships
Speaker 3: that you sell at you know, existing retail?
Speaker 4: Yeah, we do it all.
Speaker 2: We you know, we've really over the last five years
Speaker 2: made a strategic pivot from a long run contract based
Speaker 2: manufacturer into more of a short run, nimble, customizable direct
Speaker 2: to consumer marketer and merchant merchandiser, and that's really helped
Speaker 2: us grow our business. You talked about our top line
Speaker 2: sales growing over the last four years. We're expecting this
Speaker 2: to be a record year number five for US. But
Speaker 2: we also do a lot of partnerships with different brands
Speaker 2: around the country.
Speaker 4: Coach and Supreme have been too that we worked with.
Speaker 2: Not to mention the fact, we've been making blankets for
Speaker 2: the US military since before World War One, and we
Speaker 2: were just awarded a five year Army contract, so now
Speaker 2: we make blankets for both the US Navy and the
Speaker 2: US Army, so anybody who enlists will get a blanket
Speaker 2: made here in Fairbeam, Minnesota. So it's a multi channel
Speaker 2: approach to retailing that we do, driven largely by direct
Speaker 2: to consumer as you mentioned, but strategic wholesale and contract
Speaker 2: manufacturing as well.
Speaker 3: What's the biggest part of your revenues and revenue growth?
Speaker 3: Is it the direct to consumer?
Speaker 2: It is the direct to consumer, and that really starts
Speaker 2: with product. You know, I've been around a lot of
Speaker 2: consumer product companies over the course of my career, and
Speaker 2: newness is the lifeblood of any consumer product company. Newness
Speaker 2: and unique product, and we have a lot of unique product,
Speaker 2: which makes me really optimistic about the holiday season because
Speaker 2: I think regardless of any consumer uncertainty, those retailers that
Speaker 2: have unique, differentiated product are poised to win.
Speaker 4: And we think we fall in that category.
Speaker 2: With our city maps, our flag blankets, our artist collections,
Speaker 2: we have a lot of unique products you can't find
Speaker 2: anywhere else, all of which is made here in the
Speaker 2: United States.
Speaker 1: It seems like matter if your peers are facing margin
Speaker 1: pressures and arising input cost but you're striving and if
Speaker 1: you must. What would you say is the biggest pain
Speaker 1: point when you produce and manufacture everything in the US?
Speaker 1: Is it labor? Is it just competing with overseas prices?
Speaker 1: Is it just the cost of these materials? What would
Speaker 1: you say it is?
Speaker 4: Yeah?
Speaker 2: I think you know, historically it's been cost it's been
Speaker 2: more expensive to produce here in the United States that
Speaker 2: it has been let's say in China, because of what
Speaker 2: we pay our workers, and we pay our workers a
Speaker 2: good and a fair wage here. We want them to
Speaker 2: be able to sustain good middle class lifestyles here in Farbough,
Speaker 2: Minnesota and also out in mom With, Maine, where we
Speaker 2: produce our cotton blankets, so it's an important part of
Speaker 2: our mission as a company. But I will tell you
Speaker 2: with the tariffs in place, that cost gap has shrunk.
Speaker 2: We have a proven product that we've been making for
Speaker 2: over one hundred and sixty years, and we're made here
Speaker 2: in the United States. So if you go back to
Speaker 2: the old operational middle of winning on cost, quality, and flexibility,
Speaker 2: we think we can wear on all three aspects of
Speaker 2: that of that model. And that's why we're really excited
Speaker 2: about where we are today and why we're really excited
Speaker 2: about the future.
Speaker 3: You know, we talk a lot with you and also
Speaker 3: in general this year, certainly with President Trump and the
Speaker 3: White House about you know, manufacturing coming back to the
Speaker 3: United States. You know, what would make manufacturing easier for
Speaker 3: you in the US?
Speaker 4: Is it?
Speaker 3: I mean, you want to pay workers what they're worth,
Speaker 3: you know, especially in an economy where we talk about
Speaker 3: a ca shaped economy where not everybody's doing so well
Speaker 3: and people can't afford to, you know, put food on
Speaker 3: their table or provide housing. I mean, it's just really
Speaker 3: tough for a lot of Americans, not just a few,
Speaker 3: but a lot of Americans. So when you look at this,
Speaker 3: what would make it easier.
Speaker 2: Yeah, I think, you know, I talked to a lot
Speaker 2: of manufacturers and I chair the Manufacturer's Council here in
Speaker 2: the state of Minnesota, and the number one issue I
Speaker 2: hear from manufacturers and we feel it as well, is
Speaker 2: is finding not only workers and a workforce, but a
Speaker 2: skilled workforce that can do the type of work we
Speaker 2: need them to do with state of the art machinery
Speaker 2: that we've invested in over the last two years. So
Speaker 2: I think I think there has to be a renewed
Speaker 2: focus on investing in education in this country, particularly vocational education,
Speaker 2: starting not only a two year vocational schools, but all
Speaker 2: the way to high schools and even middle schools.
Speaker 3: So you don't need so you don't need somebody necessarily
Speaker 3: with a college degree.
Speaker 2: No we I mean, you know, I tell people all
Speaker 2: the time, if if you post on indeed for a
Speaker 2: weave technician, you're gonna be sitting by your computer a
Speaker 2: long time waiting for people to.
Speaker 4: Fill that out with experience. So we train people. It's
Speaker 4: an apprenticeship business.
Speaker 2: And so what we need are people with mechanical aptitude,
Speaker 2: who are willing to work, who are willing to learn,
Speaker 2: who are curious. And I think those are skills that
Speaker 2: can be trained, certainly in middle school all the way
Speaker 2: to high school and if need be.
Speaker 4: Up to two year vocational colleges as well.
Speaker 1: What about looking ahead? You said that you've been making
Speaker 1: things in America even before it was cool. Well, now
Speaker 1: that is cool or what is encouraged? Do you believe
Speaker 1: that the current momentum in US manufacturing here is sustainable?
Speaker 1: Like what if everyone really does manufacture in America? Is
Speaker 1: that something that can.
Speaker 3: Be Yah, Well, we have enough workers, especially if.
Speaker 1: We need work materials and everything.
Speaker 2: Yeah, that's the key question is I think do we
Speaker 2: have the workers to do that? I think workers coupled
Speaker 2: with state of the art technology, you know, where you
Speaker 2: can have the same number of workers like we do here,
Speaker 2: but if we have the right technology, we can actually
Speaker 2: produce more product.
Speaker 4: You know.
Speaker 2: That's kind of the secret sauce, and that's what we
Speaker 2: have to figure out as a country, as a society.
Speaker 2: It's not going to be an easy task. I don't
Speaker 2: think it's going to be as easy as maybe it's
Speaker 2: sometimes made out to be in the media. But those
Speaker 2: of us who are doing it are working at it
Speaker 2: really hard, and we're working at it with like minded
Speaker 2: companies as well, because it's good for our companies, it's
Speaker 2: good for our communities, it's good for our investors too.
Speaker 3: All Right, we're gonna have to leave it there. Ross.
Speaker 3: Always good to get some time with you, Ross, and
Speaker 3: maybe we can get another chat with you as we
Speaker 3: get closer to the holidays, because the season is just
Speaker 3: around the corner. Although we have to get through.
Speaker 1: Halloween first Halloween, and Thanksgiving.
Speaker 3: And Thanksgiving, but you know how it goes around here.
Speaker 3: It's like Christmas or the holidays, all of it's coming.
Speaker 3: Ross Win Moyer. He's President CEO of Ferrebau MIL joining
Speaker 3: us from Minnesota.