“We are delighted to join the Centre Lane Partners family,” said CEO Mads Ryder in a statement. “We have spent the last 18 to 24 months shaping our operational platform for growth. We have invested in branding and strengthened our e-commerce capabilities, and with the support of Centre Lane, we are looking forward to building on the vision that has made Lenox so unique since its founding in 1889.”
The move comes amid a tumultuous time for Lenox. In April of this year, the company permanently closed its factory in Kinston, North Carolina, citing the challenges posed by the coronavirus pandemic. Then in July, the company announced that it would close all of its outlet and warehouse stores, again pointing to COVID-19.
Ryder, who joined the company in 2018, has been hoping to do for the Philadelphia-based Lenox what he did for Royal Copenhagen in Denmark: Streamline the product selection and make the brand's tabletop assortment relevant for a younger audience. “It’s a little bit early [to say], but there’s no doubt that the [current] range is very broad; I think we will need to focus it more,” he told BOH at the time. “But what we really need to do is get to the young consumer—and also activate some of the old stuff, but make it appealing to [a new generation].”
Centre Lane Partners is a New York–based private equity firm that, according to a statement, “invests in the equity and debt of middle market companies in North America.” The company has investments in home world consumer brands like flatware maker Oneida, glassware manufacturer Anchor Hocking, and 175-year-old home fragrance company Candle-lite.
“We are very pleased to be investing in Lenox Corporation,” Mayank Singh, a Centre Lane managing director involved with the deal, said in a statement. “The company’s brands are synonymous with tabletop. Lenox leads the industry in quality, design and innovation, and we look forward to partnering with management to participate in the next phase of Lenox’s transformation and growth.”
Centre Lane is acquiring Lenox from Clarion Capital Partners, which purchased the company in a bankruptcy auction in 2009.
Below, Ryder shares the thinking behind the move (it had been in the works pre-pandemic) and explains why he's energized by the change in ownership.
You had been pushing for a sale, even before the pandemic—what was the rationale at the time?
To create more freedom for the initiatives we wanted to implement and more flexibility. The market is not easy, and a lot of our big customers have been [struggling]. Around Christmas last year, Bed Bath & Beyond started to restructure, and so did Macy’s. We had taken some steps, but we also lacked the financial muscle to take the next steps. That was the idea behind getting new ownership fresh hires and fresh capital in.
Unfortunately—or fortunately, you could say, depending on which angle you are looking at—[the pandemic] forced us to take a lot of steps to reduce our company. We closed down our retail stores [because] we had to. We also had to close down our manufacturing in the U.S.
COVID put the whole sales process on hold. And then we got into firefighting mode. And in that firefighting mode, we found a plan and a strategy that we were able to sell the company on. [It was] a much better platform than pre-COVID—I would say that COVID accelerated a lot of the initiatives that we would have [had] to take.
So you would have looked into closing retail stores and shutting down the factory, COVID or no?
Maybe not the factory, but at least the retail stores, yes.
Were the retail stores just not profitable?
It’s [about] profitability, but also complexity. We’re in manufacturing and retail and wholesale and e-commerce and the catalog business—and the company is not that big! At some point,we simply needed to take complexity out [in order] to reduce costs and be profitable.
With retail out of the picture, what channel do you want to maximize?
We have the perfect platform to grow from now—a platform that can service a wholesale environment that is [now] highly dominated by e-commerce. For example, Macy’s is brick and mortar but also e-commerce. We’re able to service Amazon and Wayfair, as well. The single most fantastic thing that has happened in the COVID period is [the growth of] our own e-commerce and our ability to drop-ship straight to consumers.
Our own e-commerce has grown dramatically, about 30 percent. We've also seen that we've been able to focus the company to a higher degree on younger consumers—young families, and young households in general. We have seen tremendous growth in the younger target groups, as well as tremendous growth in dinnerware. That’s right in the core of what we’ve tried to do in the last couple of years: Going after young consumers and making sure that we focus more on the core of the business, which is tabletop.
As opposed to more intricate pieces?
[Instead of] home decor and figurines and ornaments.
It’s sad to close a factory, and a lot of people loved Kinston. What’s the hardest part about giving up manufacturing in the U.S.?
The biggest challenge is actually the communication around it. Less than 10 percent of our sales had been Kinston-manufactured products in the past year. Kinston was doing fine dinnerware and bone china, and we’ve seen both categories decline dramatically over the last [several] years. We’re all going to a more casual world and a more casual lifestyle—casual has grown tremendously the last three years for us—but Kinston specialized in the fine.
Tell me about the new owners. It seems like they have a small roster of home brands. What are their immediate plans?
I don’t want to comment too much on their plans yet because I don’t know them well enough, but I know that one of the reasons why they bought us was [because] they saw a platform they could grow from.
How are you feeling personally? You moved from Copenhagen to Philadelphia to transform Lenox, and it’s been a tumultuous few years. Are you in it for the long haul?
I feel great about it. I don’t want to be the Dane coming to the U.S. and closing down a 130-year-old company—that’s not the way I'm wired. I want to be the Dane who came over here, helped this company through a tough time, and then got out on another side with the new ownership and showed the world that this company, although it’s 130 years old, is very vibrant and energetic and that we can grow. We did it when I was back at Royal Copenhagen in Denmark, and that company was 250 years old, so we can do it here.
I feel this [sale] is the best thing that could ever happen to our company. Now it’s up to us to show our new owners that they have made one of the best decisions they could ever make.