Citing the effects of counterfeit lighters and high gasoline and
fuel prices, officials at Zippo Manufacturing Co. announced late
Wednesday afternoon that more than 100 people will be laid off.
Zippo, McKean County’s largest employer, will lay off 121
workers effective Friday. Officials cite the lay off is in response
to “significant overstaffing due to a recent decline in
business.”
Greg Booth, Zippo’s president and chief executive officer, said
“Overall business through May of this year was fairly good and only
slightly behind last year’s volume during the same period. However,
sales from June through the present have been off significantly, in
the U.S. and certain overseas markets.”
According to a press release, officials said that in the U.S.
market, the company has experienced a reduced demand in
“convenience store, domestic wholesale and fulfillment business
segments.”
The reduction in sales are due to four factors – the continued
availability of counterfeit Zippo lighters; the “often confusing”
Transportation Security Administration regulations which “deter
airline passengers from purchasing or carrying Zippo lighters; the
dramatic spike in gasoline and heating fuel prices; and ongoing
anti-smoking pressure here and overseas.
The press release also said that while many overseas markets had
strong sales this year, there were substantial declines in lighter
orders from Japan and China.
Earlier this year, Zippo filed a complaint with the U.S.
International Trade Commission alleging seven companies manufacture
and/or sell lighters that look like Zippo lighters in the U.S.
Last month, Booth told The Era that these counterfeits are
“costing us sales … it is not a small dollar problem, it’s a
substantial one.”
He also said that company officials are working with the Chinese
government about solving the problem.
“In essence, they play off our world famous shape and trademark.
They sell the lighter … and make more.”
It seems as though it was a matter of time before layoffs would
come.
“It damages Zippo. It damages the economics of the entire
community. It will start taking sales away, it starts taking jobs
away. It’s a major impact on the community,” Booth said last
month.
Booth explained to employees Wednesday, “We truly regret these
layoffs but business conditions have simply forced us to reduce
costs in all areas including personnel levels. Should business pick
up substantially in the months to come, we hope to be able to call
back some of those who were laid off.”
The company has also had some setbacks with the BluFlame
project. The BluFlame is a butane refillable lighter.
Booth was not available for further comment Wednesday night.
Messages at both his office and home were not returned.
The company’s hardship brought on by federal issues was not lost
on U.S. Rep. John Peterson, R-Pa., but the lawmaker lauded the
company for its commitment to the area.
“I am always disappointed when there’s a layoff,” Peterson
said.
“I wish there were 100 Zippos in my district. I don’t know of
any other company as dedicated to local employees, so committed to
keeping jobs home at Bradford.”
As a former businessman himself, Peterson acknowledges the
volatility of markets and economic shifts.
The congressman also focused on what the company has done to
stay in business as long as it has – next year it celebrates its
75th anniversary. Peterson cited the company for modernizing its
equipment and partnering with the Bradford Area School District to
teach high school students technology that is also employed at the
company.
Peterson also professed to continue to help.
“We are continually committed to helping with commerce … we
spent endless hours with TSA and are prepared to do more if
needed.”
For a while, Zippos weren’t allowed in checked luggage on U.S.
airliners.
After company officials and federal lawmakers spoke against the
measure, the Department of Transportation and TSA relented and
allowed fueled Zippos in checked baggage if it is in a plastic,
vapor-tight box.
Peterson also said it is not unusual for companies to “right
size” when the market changes.
“Hopefully, business will start to pick up and they will bring
people back. They have to be able to adapt.”
In the past few years, Zippo has employed about 800 people.
Zippo generally has a “warm weather” layoff during the summer, but
had not had a general layoff in several years.
This year, 104 people volunteered for the warm weather
leave.
