Made in Minnesota: Hype vs. Reality

Made in Minnesota: Hype vs. Reality

While business booms for industrial manufacturers, makers of soft goods struggle to scale.

J.W. Hulme is tiny compared to some of the manufacturers you’ll read about in our cover feature—barely a buckle on the bag that represents one of Minnesota’s strongest industries. Yet the 114-year-old St. Paul leather goods brand has received a disproportionate amount of media attention since its 2008 revival.

Everyone loves a great American turnaround story, and J.W. Hulme had all the elements: locally made-handcrafted classic bags; a slump that threatened jobs of longtime leatherworkers and prompted consumers to reflect on deal vs. value; and a big-time investor who brought the brand back from the brink and onto the shelves at Barneys New York, where luxury shoppers willingly paid $995 for a briefcase and the chance to boast of their support of American-made goods.

A decade has passed since J.W. Hulme became that shining star of the American heritage movement, which sparked renewed interest in many longstanding Minnesota brands, including Red Wing Shoes and Faribault Woolen Mill Co. But the economics never matched the hype. J.W. Hulme, which now sells almost exclusively online, hasn’t been profitable since Olympus Capital Investments came on board 10 years ago. Last fall, J.W. Hulme made the difficult decision to shutter its factory on West Seventh Street in St. Paul and outsource manufacturing to Minneapolis–based Softline Brand Partners, which produces goods both domestically and abroad for a wide range of consumer brands, including Room & Board, Allen Edmonds, and Red Wing Shoes.

“If we’re just making our own brand in our factory, we didn’t have enough volume to cover the overhead, drive efficiencies, or invest in innovation,” J.W. Hulme CEO Claire Powell recently told Ingrid Case, who reports on the manufacturing industry’s successes and challenges in this issue. “To make it work, we could have made products for other companies, but that takes a lot of time, energy, and focus; plus then we’d be in a different business.”

J.W. Hulme laid off its 28 production employees in November. Now Powell and a small executive team are focusing primarily on product design and marketing. They’re trying to keep enough made-in-Minnesota products to preserve the loyalty of consumers who value local, but for the brand to survive, they need to broaden their customer base. I wonder: Would shoppers be as eager to pony up for a J.W. Hulme bag made in China?

Despite the buzz about American-made goods—coming from the White House as well as the grassroots maker movement—Powell thinks quality matters more to consumers than country of origin.

“Being a local brand is important to us,” Powell says. “But the main thing people want is the high-quality, beautiful leather, and unique look and feel that we have.”

So once again, J.W. Hulme exemplifies something much bigger than a leather goods collection. This time, though, it’s no fairy-tale ending. The challenges of sustaining, let alone scaling, a soft goods operation—particularly one with old equipment and labor-intensive production—are growing more dire for some American brands. In December, another iconic label, Woolrich, closed its Pennsylvania mill after 170 years. Now that Woolrich isn’t manufacturing in the U.S., the Wall Street Journal reports, the brand can turn its attention to a new flagship store in Manhattan and higher-end clothing partnerships with other brands that also manufacture overseas.

South of the Twin Cities, Faribault Woolen Mill continues to weave blankets and scarves in Minnesota, at a century-old facility. But now that its revival story is old news, how does the textile brand continue to evolve while staying true to its roots?

“The initial attraction, that emotional connection—the story, the craftsmanship—gets people to buy, but it’s not necessarily obvious why they’d buy again,” Faribault CEO Tom Kileen says. “We need to get customers to think about us more often—both through product development and messaging.” What about manufacturing?

“Owning the manufacturing end of a seasonal business is incredibly difficult,” says Softline CEO Adam Blitzer. “Talks about reshoring are engaging and exciting, but we have not seen a material amount of production brought back. We are able to meet the needs of our customers whether it be a country-of-origin mandate, the ability to scale production, or replenish fast-moving product with short lead times.”

The silver lining for those employees laid off from J.W. Hulme: Plenty of technical and industrial jobs are available locally; several were hired by Softline, Blitzer says. And when you go beyond bags and blankets, opportunity abounds at factories throughout the state. The challenge, as you’ll read in our story, is persuading more students of what Osman Mussa, featured on the cover, figured out in his first semester of college: Hands-on skills immediately open doors to good-paying jobs. The spotlight on artisan craft goods should also be shined on the nuts, bolts, pipes, and engines that make everything work.