Over the past few years, importing products from China amid a volatile supply chain has meant high tariffs, escalating shipping-container costs, and long lead times for office-chair maker All33—but it isn’t taking the margin hit sitting down.

This month, the company reshored its manufacturing, moving to a vertically integrated Tennessee facility that includes 100,000 square feet of production space and 33,000 square feet of office space.

All33—named for the 33 vertebrae it works to support with its chair—was founded in 2017, landing investments from Bruce Willis and Snap’s Evan Spiegel and a Shark Tank appearance featuring Justin Bieber. It first started manufacturing in China, simply because there was no affordable way to do it stateside, CEO Bing Howenstein told Retail Brew.

“Making a chair is hard. It takes a lot of investment, big tools—there’s a lot that goes into it to build something like this,” he said. “There was really no other way to do it just because of the cost of expensive tooling and all these things that you can’t do it here anymore—you can, but it would be five, six times the price.”

Pulling up a chair

The company began evaluating moving manufacturing to the US in 2019 after being hit with 25% tariffs on imports, which “eats at your margins and makes it very prohibitive to compete,” Howenstein noted.

• The supply-chain chaos over the past two years has only made margins worse. Shipping a 40-foot container from China to the US used to cost the company $3,500, he said. Lately, it’s been $20,000+.

“‘Prohibitive’ is the word that people would say about building in America pre-pandemic,” Howenstein told us. “But if you add the tariffs and those logistics costs, we’re actually now able to come out ahead.”

The move to the US will add five points to the company’s gross margin to produce the $999 chairs, Howenstein shared. Click here to keep reading.—EC

In the seven months since Starbucks workers in Buffalo, New York, voted to form the coffee chain’s first union last December, employees at more than 200 individual Starbucks stores around the country have cast their own ballots (with nearly 200 also filing petitions to do so). And workers across the service industry and retail world are taking notice.

“I see workers talk about Starbucks, even when they’re in other industries, as a model,” Anastasia Christman, senior policy analyst at the National Employment Law Project, told Retail Brew.

Here and now: While the store-by-store approach to organizing is different from the factory-era model, it’s a tactic that has seen success in high-turnover industries once considered by some to be un-organizable, Christman explained.

“I think a lot of people would sort of write off retail, thinking that those workers would move in and out,” she said. And while worker change might be high, “that doesn’t mean that they don’t have a long-term investment in the problems that they see that need to be solved. And so, they’re organizing anyway.”

Other workers appear to be following the baristas’ lead. The National Labor Relations Board (NLRB) reported that it received 1,174 union representation petitions in the first half of the 2022 fiscal year—a 57% increase YoY.

Among those petitions were some notable retail firsts:

• REI: Workers geared up for unionization at the outdoor retailer’s SoHo store earlier this year by filing for a union election in January. In March, the union won in an 88-14 landslide. Workers at a store in Berkeley, California, then filed a petition with the NLRB in June.
• Amazon: In April, workers at a Staten Island Amazon factory voted to become the retail giant’s first union. That win followed a failed vote in Bessemer, Alabama, where workers went back to the polls in March after the NLRB found Amazon had “improperly interfered” in the first election, held last spring, according to CNBC.

From Apple to Trader Joe’s to Chipotle, click here to read more.—MA

On Wednesdays, we wear pink spotlight Retail Brew’s readers. Want to be featured in an upcoming edition? Click here to introduce yourself.

We feature a lot of cool readers with cool jobs in Coworking, and today is no exception: Meet Katie Mason, who is the senior R&D manager at Yasso, the frozen-treat brand. She’s been with the company for six years—in which it has tripled sales, according to Yasso. We’ll let Katie tell you more.

How would you describe your job to someone who doesn’t work in retail? I develop the recipes for the products you find on-shelf at your local grocery store.

One thing we can’t guess about your job from your LinkedIn profile: I’m not always in the lab creating new products. There is also a lot of leg work behind the scenes in working with our co-manufacturing partners to scale and launch innovation.

What’s your favorite project you’ve worked on? Our Poppables product was such a new and exciting concept for the brand, and really allowed us to start venturing more into the snacking category.

One trend that you’re excited about right now: Snacking! Brands, including Yasso, are continuing to launch smaller, more snackable products, which are fun to eat and allow more flexibility and variety throughout the day.

What’s your favorite hot treat? Bhakti Chai oat milk latte.

Today’s top retail reads.

Taking stock: How big CPGs, from Constellation Brands to Mondelez, are planning for a possible recession. (Food Dive)

Buying in: With all the recent challenges in the US (inflation, anyone?), BNPL companies like Klarna have set their sites on international markets. (ModernRetail)

Kick up your heels: Manolo Blahnik’s recent victory in its 22-year-long trademark battle with China will have a notable impact on other luxury brands entrenched in IP disputes. (Jing Daily)

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