Luca Ricci, CEO of DeCoro.
By Larry Thomas
Furniture Today,
December 5, 2011
PHNOM PENH, Cambodia - Leather upholstery producer DeCoro, which ceased production in 2009 and vacated its factories in China, has resumed operations here in a new factory that eventually will employ about 1,000 people.
Known as DeCoro Cambodia Ltd., the new venture is headed by longtime CEO Luca Ricci, who said the facility is the first leather upholstery factory in Cambodia.
"DeCoro is back, and as a real Italian company, we will use our knowledge and experience to produce the finest quality, superior dewsigned products at the best possible price," Ricci said.
He said the factory can begin shipping products immediately. Retail customers have the option of receiving their goods from Cambodia's only commercial deep water port near the resort town of Sihanoukville, or using the larger port in Ho Chi Minh City, Vietnam, he said.
DeCoro was founded in 1997 and was the first company to produce upholstery on a large scale in China. Ricci was credited with revolutionizing the leather upholstery business by driving down costs and making the product available at a wider array of price points.
Other leather upholstery producers soon followed DeCoro's path to China.
Eventually, the company had two factories and 2.8 million square feet of production space in Shenzhen, China. Sales peaked at an estimated $300 million in 2006.
In the following two years, however, the company began to struggle after several of its major U.S. retail customers went out of business.
DeCoro shut down without warning in January 2009 and liquidated its assets in China. Its U.S. sales and marketing arm later filed for bankruptcy protection, and court filings at the time indicated sales had fallen to $105 million in 2008.
Ricci said he considered locating his new company in several Pacific Rim countries, but ultimately chose Cambodia because of its low labor costs and a young, intelligent workforce.
"As we teach their young people the business of sofa making, they are learning our craft very quickly. And the quality they put into the job is simply amazing - their work is more precise than we obtained in China," Ricci said. "It is a real pleasure to work with our Cambodian employees and help them to learn a craft and secure a future for themselves in a region previously filled with so much strife."
He described the infrastructure in Cambodia as "challenging" because most roads are in poor condition and the supply of electric power is unreliable. As a result, the factory has a large generator that provides power when the regular power supply slows or stops.
"In many ways, it reminds me of the first time I went to China in 1997," he said. "We faced many of the same challenges."
Although DeCoro is the first upholstery producer in Cambodia, he said several clothing manufacturers have moved facilities from China to Cambodia, and he expects other industries will do the same.
"We love Cambodia because the people are so nice and eager to work, and the infusion of old French heritage creates an exciting culture which we are embracing," said Ricci.
He said some raw materials are available in Cambodia, but noted that the factory is importing leather from Italy and wood from several countries, including the U.S. and Canada.
Ricci said he has not decided if the company will participate in any upcoming trade shows in High Point, Las Vegas and Asia.
He said DeCoro is partnering with the Amici dei Bambini Assn., a nonprofit organization that helps find adoptive families for children in orphanages. He said the company will donate 75 cents for each item it produces to support the group's efforts in Cambodia.
By Larry Thomas
Furniture Today,
December 5, 2011
PHNOM PENH, Cambodia - Leather upholstery producer DeCoro, which ceased production in 2009 and vacated its factories in China, has resumed operations here in a new factory that eventually will employ about 1,000 people.
Known as DeCoro Cambodia Ltd., the new venture is headed by longtime CEO Luca Ricci, who said the facility is the first leather upholstery factory in Cambodia.
"DeCoro is back, and as a real Italian company, we will use our knowledge and experience to produce the finest quality, superior dewsigned products at the best possible price," Ricci said.
He said the factory can begin shipping products immediately. Retail customers have the option of receiving their goods from Cambodia's only commercial deep water port near the resort town of Sihanoukville, or using the larger port in Ho Chi Minh City, Vietnam, he said.
DeCoro was founded in 1997 and was the first company to produce upholstery on a large scale in China. Ricci was credited with revolutionizing the leather upholstery business by driving down costs and making the product available at a wider array of price points.
Other leather upholstery producers soon followed DeCoro's path to China.
Eventually, the company had two factories and 2.8 million square feet of production space in Shenzhen, China. Sales peaked at an estimated $300 million in 2006.
In the following two years, however, the company began to struggle after several of its major U.S. retail customers went out of business.
DeCoro shut down without warning in January 2009 and liquidated its assets in China. Its U.S. sales and marketing arm later filed for bankruptcy protection, and court filings at the time indicated sales had fallen to $105 million in 2008.
Ricci said he considered locating his new company in several Pacific Rim countries, but ultimately chose Cambodia because of its low labor costs and a young, intelligent workforce.
"As we teach their young people the business of sofa making, they are learning our craft very quickly. And the quality they put into the job is simply amazing - their work is more precise than we obtained in China," Ricci said. "It is a real pleasure to work with our Cambodian employees and help them to learn a craft and secure a future for themselves in a region previously filled with so much strife."
He described the infrastructure in Cambodia as "challenging" because most roads are in poor condition and the supply of electric power is unreliable. As a result, the factory has a large generator that provides power when the regular power supply slows or stops.
"In many ways, it reminds me of the first time I went to China in 1997," he said. "We faced many of the same challenges."
Although DeCoro is the first upholstery producer in Cambodia, he said several clothing manufacturers have moved facilities from China to Cambodia, and he expects other industries will do the same.
"We love Cambodia because the people are so nice and eager to work, and the infusion of old French heritage creates an exciting culture which we are embracing," said Ricci.
He said some raw materials are available in Cambodia, but noted that the factory is importing leather from Italy and wood from several countries, including the U.S. and Canada.
Ricci said he has not decided if the company will participate in any upcoming trade shows in High Point, Las Vegas and Asia.
He said DeCoro is partnering with the Amici dei Bambini Assn., a nonprofit organization that helps find adoptive families for children in orphanages. He said the company will donate 75 cents for each item it produces to support the group's efforts in Cambodia.
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