Nicholson File Leaving the Country

Any one see this article? Nicholson File closing next year Top News CullmanTimes.com, Cullman, Alabama

What I just don't get is where they would be saving anything? How much labor does it take to make a file? If I had to make them I would think that I would start taking some plate in the appropriate thickness stamp out blanks, do a primary cut in robotic-ally loaded jigs, heat treat and finish grind. Is that how they are made? With so many identically shaped and sized items, spare a few different grinding patterns I would think this all can be automated so that there is little to no labor in the final product. Where are they saving anything?

I noted that they have 60employees. I don't know what the cost of living down there is but say average employee gets $60K (counting pay +benefits) that means the labor is $3.6Million a year for a plant like that. No idea how many files sell each year but I would think that it should be less than pennies per file.

Once Nicholson goes away will anyone still be making files in the USA?

Adam

The third paragraph says it all...

its owned by bloodsuckers

My guess is that they would move overseas even if it was a wash dollar wise.

Well there goes another one. Guess I probably wont buy from them anymore after the move overseas.

Dont know if it would do anygood, but have found a place on Apex's site where you can e-mail them. Think I will. If enough people do it, maybe it might have an impact. Probably wont, but you never know.

We need to finally start taking a stand somewhere.

Doubt it will do any good but I emailed them that I would rather pay a premium for good quality made in USA tools. And that I will no longer purchase Nicholson files.

Apex Tool Group

There is an email link in the above URL.

Probably the high cost of union labor that drove them away....

It's not only the cost of labor that moves companies out... TAXES are a huge reason.

Let's all repeat the mantra, "If they make me pay taxes I'm gonna leave."

Yep, nobody should have to pay taxes. And all those nasty unions made the
companies move down south. Where they were happy with the non-union labor.
Until they weren't anymore.

"You probably know that we have been analyzing many different ways to strengthen our new company so that we can achieve sustainable, profitable growth for the long-term."

Click to expand...

I think that statement from the article sums it up quite neatly. Profits are far more important than employees

I e-mailed my comment. All of these bloodsucking bastards are ruining this country and not one thing is being done about it. I told them that as long as their files are made anywhere but USA, they couldn't count on me buying any more of them and I've bought a substantial number of files from them over the years.

Maybe it won't make a bit of difference, but it felt good anyway.




Frank



Home

Ah, poor little souls, that the home of Free Enterprise can only wynge about how hard done-to it is.
Get a grip!
The real story is can you compete?
If the answer is no, then buy their version.
My brother is the Weaving Shop manager for Abraham Moon - Abraham Moon and Sons Ltd, Guiseley Leeds, UK - Abraham Moon
They beat all the Chinese mills. How? Because they run the best machinery 24hrs a day.
What do you do?
Alan

There are other reasons for a company to relocate. There are overseas markets that are just a lot larger than the US market is today. Often (usually) foreign locally made products are of lower quality and the demand for better products is strong enough to justify entering the market. The larger the market, the more competitive it is, hence, larger sales numbers are possible, they can only be achieved by selling at the right price, which is always going to be less - usually much less than the cost of products produced in the US.

I don't know the management of Nicholson and have not heard their justification for making their decision, though it is likely to be the same as other companies facing similar circumstances. If they don't make the move, they will face increasing foreign competition, first with low quality products - not a big problem, then with products of increasing quality - a growing - eventually fatal problem, as foreign producers increase their quality / reduce costs to improve their regional and foreign market share.

For manufacturers, it is black and white, either enter larger markets with plans to gain significant market share now, or wither and die. This is the hard reality. Such decisions are not easily or lightly made. If a company cannot make a profit, then why go through all the hassles and problems of running a business? If they cannot make a profit or survive, then what should they do? What would you do, if you were facing this situation? In many cases, it is to make a difficult decision to enter a larger market.

If you are the decision maker, how would you like to have to decide to keep your production in a country with increasing legal, regulation, administrative costs and growing competition. Or move abroad to a country where you don't speak the language, know many people, have no established relations with quality suppliers, understand the customs or ways of doing business, establish new production mostly with new workers who do not share the same standards - your top technical workers would have to come to the new foreign operation, if they won't, you are already dead, oh yes, and establish a new market in a region that is already filled with competitive products made by local companies who do not share your weaknesses.

I'm not trying to justify their decision. It's just that we - as Americans - need to understand the REAL situation and respond accordingly. If we don't improve the situation for manufacturers on US soil, this trend will certainly continue.

Dead businesses benefit no one. If a company cannot survive, they will not be providing pay checks or paying taxes. In many cases for smaller companies, it is much more likely that they understand the reality of their situation. Making the decision to re-locate in a foreign country is a matter of survival, both for the company and their top technical and production people.

Tom

Just how big can the domestic file market be? I see us using more sophisticated tools for working metal, while in many developing nations a file may be a very important tool.

Unless this country gets it regulatory burden under control, look for more companies and entire industries continue to leave.

Just look at what Congress is poised to massacre with the food safety bill. Many small food producers will be forced out of business. Already small toy manufacturers have gone away, and its practically impossible to LEGALLY run a small foundry in many areas. But does the Feds ever rescind regulations? No, just pile more on. Anymore these bills are written by the larger players in a particular industry, adding stuff that they have no problem complying with, but placing a burden on the smaller concerns that cannot afford it. Can the guy down the street making some toys to sell at the flea market afford $30,000 to test the paint on his creations? Hell no, but Mattel already has a full scale R&D lab and can do those tests for the cost of the labor. So the guy down the street has to close his shop. Another American dream squashed, brought to you by those very same assholes who claim to be "representing" us. Then they puff up their chests on the news proudly proclaiming that they just secured an earmark to create 30 jobs at some propped up favored company.

AlanBeckett said:

Ah, poor little souls, that the home of Free Enterprise can only wynge about how hard done-to it is.
Get a grip!
The real story is can you compete?
If the answer is no, then buy their version.
My brother is the Weaving Shop manager for Abraham Moon - Abraham Moon and Sons Ltd, Guiseley Leeds, UK - Abraham Moon
They beat all the Chinese mills. How? Because they run the best machinery 24hrs a day.
What do you do?
Alan

Click to expand...

You are a real comedian, aren't you? Too bad your people bent over for the rest of the world. That isn't my fault! It ALSO doesn't mean that WE should.
You are missing the point that our, or any other country's government isn't in existence to shaft their own people. At least, they AREN'T SUPPOSED to be.

Jeff

windmillman said:

If you are the decision maker, how would you like to have to decide to keep your production in a country with increasing legal, regulation, administrative costs and growing competition. Or move abroad to a country where you don't speak the language, know many people, have no established relations with quality suppliers, understand the customs or ways of doing business, establish new production mostly with new workers who do not share the same standards - your top technical workers would have to come to the new foreign operation, if they won't, you are already dead, oh yes, and establish a new market in a region that is already filled with competitive products made by local companies who do not share your weaknesses.


Tom

Click to expand...

When you put it this way, the first option is MUCH more preferable!

Jeff

Rick Rowlands said:

Can the guy down the street making some toys to sell at the flea market afford $30,000 to test the paint on his creations? .

Click to expand...

Why would he have to? Shouldn't that info be available from the paint mfg? If the guy puts hazardous paint on, yeah, his problem. He doesn't need to test, just choose the right paint. What am I missing? If the gov. wants test results of the paint, the guy can give them the MSDS from the paint company. I doubt the toy maker is going to be making his own paint.

Jeff

It was sad when Simonds left, this really hurts.

adammil1 said:

What I just don't get is where they would be saving anything? How much labor does it take to make a file?

Adam

Click to expand...

There are a lot of steps to make a file. First the blanks are stamped out, next they are run through a straightener. The blanks are then ground flat and finally draw filed to remove the grinding marks. At this point the file is cut. Heat treated and finally sharpened. I don't know how Nicholson sharpened files, Simonds blew an abrasive over each tooth using steam as they felt that produced a sharper file.
Yes it could all be automated....

Rick might not have correctly framed the nuances or may have chosen to cut out the details in his description, but he is spot on on what is happening.

In this county (maybe state?) it is now illegal to use home baked goods at a school benefit bake sale. How sick is that, and who do you think might have been behind the legislation? A bake sale here, another there, sounds like small potatos. But now what you have is multinationals with a program sold to the school systems or volunteer organization head offices everywhere. Well worth a few hundred K $$$ lobby fees in Albany.

Worse than the money is the model of serfdom it sets for society: no doing for yourself, no real community organization or involvement, just send $$$ and pay since you can't do it yourself. No pay no play. Go home and watch TV, it's too dangerous for you to be trusted making cookies & apple pies.



I don't think people understand that somewhere along the way the US decided that the primary area for new job creation was the regulatory sphere. We can't make anything anymore, but we can soak up jobs by putting people to work regulating what's left, & creating paperwork and an environment that employs millions in industry merely overseeing compliance. This is what used to distinguish the former red bloc countries.

smt

jdj said:

Why would he have to? Shouldn't that info be available from the paint mfg? If the guy puts hazardous paint on, yeah, his problem. He doesn't need to test, just choose the right paint. What am I missing? If the gov. wants test results of the paint, the guy can give them the MSDS from the paint company. I doubt the toy maker is going to be making his own paint.
Jeff

Click to expand...

Hello JDJ, Added cost is still added cost. Period. Added costs moved to another level of production are still added costs. The cost of the paint goes up proportionally, along with the cost of product liability insurance and countless other costs legislated into the system and this all woks to increase the final product cost. If we want this level of security in our lives, we can have it, but at a cost as our products become less and less competitive in the world market. We are competing with countries that do not share our concerns or interests and laugh all the way to the bank every time we impose additional restrictions, requirements, compliance and exposure to legal risk that we have imposed on ourselves.

Was the possibility of lead in the toy's paint a real risk to begin with? I can't say, but I and a lot of other members of earlier generations grew up chewing the paint off of our lead soldiers and crimping lead weights on fishing lines with our teeth and drank water from copper plumbing systems with lead/tin soldered joints and ate and drank from pewter utensils and still wnt on to have long healthy lives.

Tom

Funny, I read the article as suggesting that "we're losing money big time here and the shareholders are outside with a castrating kife" and "we already have these other plants which make money, are in the places we sell all the product anyway" so, since we'd rather make money than be castrated, we'll do this.

Regulatory burden and "agency capture" are surely part of the issue.

Another is the "take no risk, however weird or remote" - don't let kids walk or ride a bike to school, take them early by bus and then have a supervised exercise program instead... (?!?!?)

Flip side is what I'll call simply "regulatory fear" - which in some small ventures yields rules like "no employees ever". Why? Because reading the long list of laws makes your head hurt. Because the fear that some little thing will yield a huge fine or jail time. That an employee fired for being useless will sick OSHA on you, and they'll find *something*. That your plant will be unionized with help from government, and obstructionist behavoir will follow. (Work rule disputes and the like.)

Solution - move elsewhere, where the hassles and risk of hassles is smaller, and the market is bigger.

You can complain about how this is unfair to employees (may well be) or is unpatriotic, or whatever - but the reality is that people make choices. And regulatory issues, tax issues, and "can we make a profit" issues affect those choices.