A widely recognized name brand and available product continue to be advantages for La-Z-Boy’s Furniture Galleries.

MONROE, Mich. — In its third quarter 2022 conference call, La-Z-Boy Inc.’s leadership detailed the extent to which the company is working to keep pace with order fulfillment and onboarding new manufacturing employees.

“Within our own manufacturing operations — which comprise the majority of our wholesale business, lack of availability of component parts, including electronic chips and actuators — continued to disrupt production plans but at a higher level than we expected,” said Melinda D. Wittington, president and CEO.

However, its wasn’t just lack of parts that were the issue, but also, people, she added. “Beyond the obvious direct production delays, these outages drove inefficiencies as manufacturing cells are trained on specific unit styles and need to retrain on other styles until parts are available. This was exacerbated by such a large portion of our manufacturing staff being relatively new, given our significant capacity expansion, including three new facilities in Mexico over the past year.”

According to the company’s latest 10Q, La-Z-Boy added manufacturing cells at its Mexico cut-and-sew operation, adding second shifts and weekend production shifts to U.S. plants, and temporarily reactivated a portion of its Newton, Miss., upholstery manufacturing facility that was closed in June 2020.

In addition, La-Z-Boy opened a leased upholstery assembly plant in San Luis Rio Colorado, Mexico, and a leased sewing facility in Parras, Mexico, during the third quarter of fiscal 2021 and the first quarter of fiscal 2022, respectively. During the first quarter of fiscal 2022, the company signed a lease to open additional manufacturing capacity in Torreon, Mexico, which began operations at the end of the third quarter of fiscal 2022.

“So the first thing is we’ve got three brand-new plants that we’ve opened in Mexico, as well as the labor challenges in the U.S. ,” said Whittington during the conference call. “So, we’ve got a lot of new people making furniture. And we’ve talked in the past about it takes six to nine months to sort of get them up to average, kind of average throughput. And when that many people are new, that probably slows that down a little bit.”

Underscoring the focus on labor, the company sent seasoned teams to analyze operational efficiencies at newer facilities to help with employee training and output. La-Z-Boy even helped their suppliers to staff extra work shifts to be able to produce component parts.

Despite ongoing supply chain issues that are being worked out, Whittington noted “a lot of going forward is within our own control of getting better, getting our folks trained and being able to weather those things so that we continue to make progress.

“And at the end of this, we’ll have a better distributed footprint of where our manufacturing facilities lie across all of North America that sets us up with a better overall structure, cost structure and service structure than we had pre-pandemic, even though I think some of the external headwinds will probably — inflation and so forth — will exist for the longer term.”

Jean Marie Layton is senior editor for upholstery at Furniture Today. A design and furniture aficionado, she has worked as a writer/editor in industry and non-profits, in academic administration and in retail furniture sales. She pursued a master’s degree in the history of design at Parsons/Cooper-Hewitt and has a BA in history from Mount Holyoke College and an MA in liberal arts from Stanford University. Reach out to Jean Marie with your story ideas, tips and more at jlayton@furnituretoday.com

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