Originally created 11/27/05

Firm wrestles with issue of foreign labor



EDITOR'S NOTE: Building a Business is a yearlong series in which The Augusta Chronicle follows the progress of a local startup company, Everthere Carriers LLC, as it attempts to take its fledgling product to a national market. The following is the 11th story in the monthly series.

When Steve Threet looks up from his desk, he stares directly at a giant map of the United States on the wall.

"I don't want to forget how big this country is," said the president of Everthere Carriers, who has always kept a map of the country in his office.

In recent months, Mr. Threet's thoughts have wandered off the map and across the globe to China.

Mr. Threet takes pride in the fact that his company's trailer hitch-mounted cargo carrier is made in the United States, but China's cheap labor could force him to choose profit over patriotism.

"This is the hardest job I've ever had," a tired Mr. Threet said as he slumped behind his desk during an interview last week.

To keep up with rival cargo carrier companies, a move to China could be beneficial for Everthere, but deciding what to do is causing strife for Mr. Threet.

"There's a lot of anguish involved," Mr. Threet said. "If you think the right thing is to stay 'Made in America,' you have to balance it between what you think is right, and what you think is the right business decision."

The former Savannah River Site employee and his partners founded Everthere more than two years ago to market a lightweight, folding cargo carrier. This year the start-up company hired Warrenton, Ga.-based Jebco Inc. to make the carriers. The protective bags, sold separately, are made by T&G Apparel Inc. in Jefferson County.

A move to China would likely be more profitable for the company because of its low-cost labor, said Jonathan Leightner, a professor of economics at Augusta State University and an expert in Asian economies.

"From a purely economic point of view, if his goal is to maximize profits, and he can move to China ... then the profitable thing to do is move to China," he said. That's provided transportation costs don't exceed the production savings, he said.

Mr. Leightner said Mr. Threet's anguish is understandable.

"When firms start thinking about the local employees, they're not just thinking about profits," he said.

At Jebco, Everthere constitutes a "significant percentage" of business, President James Barrow said. Jebco has seen work slow down because of foreign competition. He said the company has gone from 125 employees to 47 during the past few years.

To help create jobs and increase business, Mr. Barrow said, his company has targeted jobs that can't be done cost-efficiently in China, such as niche products and small-volume production runs.

He also emphasizes his proximity. It takes more than a day to get to China by plane; Jebco is a 35-minute drive from Mr. Threet.

"He can bring us ideas, prototypes, sketches on cocktail napkins and it's done here locally so we have a shorter turnover time," Mr. Barrow said.

While Jebco continues to produce carriers, Mr. Threet is meeting with Chinese manufacturers.

He sees increased demand in the future as a reason the company might move some of the manufacturing overseas, he said. He's quick to add, however, that the carrier might never end up being made there, especially if local costs stay low. The bags, which are more labor intensive, are a better candidate for China, he said.

"All I can do is what's right for Everthere Carriers," Mr. Threet said. "We have to operate with a profit."

This year, the company will lose money, but that is mostly because it has been reinvesting in itself for growth.

Everthere continues to meet potential clients at trade shows and has several pending deals under negotiation.

"There's still plenty of room to grow," Mr. Threet said. "There are a lot of people wanting to carry the product."

As he continues to wrestle with what to do, Mr. Threet keeps one mantra in mind.

"You never look back," he said. "And you try the best you can not to second guess yourself."

Reach Tony Lombardo at (706) 823-3227 or tony.lombardo@augustachronicle.com.

Everthere Carriers

Everthere Carriers LLC is a Martinez-based company still in its infancy. Its primary product is the Everthere Carrier, a lightweight portable metal carrier that attaches to a trailer hitch. The company also is releasing a new product, the Everthere Mobility Carrier, which is a two-piece device that consists of a lift and a new version of the carrier that allows for the transport of wheelchairs and scooters.