by Marianne White
Source: Can West News Service
Original Article: Click Here
Crocs closes Canadian plant amid sales slump
Canwest News Service
Wednesday, April 16, 2008
QUEBEC -- The closing of the only Canadian plant of Crocs -- which is also the birthplace of the colourful footwear -- was denounced yesterday as a "pure case of savage capitalism" by the Quebec government.
Citing high production costs and a slowdown in consumer spending, Crocs announced late Monday it was moving its Canadian production to its other existing lower-cost plants.
Economic Development Minister Raymond Bachand slammed the Colorado-based company for laying off more than 600 workers at its Quebec City plant. "They wanted to send a signal to the markets that they are doing something and they decided to flush away Quebec," Bachand said.
"I don't have a lot of hope for the workers when I see this type of attitude," he added.
Bachand said he was sad to see this Quebec success story become ancient history.
The funky Crocs shoes were invented in Quebec City by Foam Creations founders Marie-Claude de Billy and Andrew Reddyhoff.
The Quebec company was relatively unknown until joining forces in 2002 with three Colorado businessmen who wanted to market the unusual resin shoe under the brand name Crocs. After that, the plastic sandal quickly rose to the top of the casual footwear world.
Crocs president and chief executive officer Ronald Snyder said the company had to remain competitive and consolidate production in Bosnia, Brazil, China, Italy, Mexico, Romania or Vietnam.
"This type of decision is always hard to make because it affects the lives of people who have contributed to our company's success. Unfortunately the laws of competition demand sacrifices and require us to meet challenges for the good of the company," he said in a statement.
In February, Crocs laid off about 262 workers at its Quebec plant. Another 407 will lose their job permanently in July at the latest, bringing the total number of layoffs to 669.
Snyder said the company will maintain its Canadian Crocs boutiques and about 100 sales and marketing jobs in Quebec City.
Crocs shares were pounded on financial markets following the announcement. The stock closed at $10.11 on the New York Stock Exchange down more than 43 per cent, or $7.68.
© Times Colonist (Victoria) 2008
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