Wood Flooring International (WFI) founder and ceo, Bill Jopling, told NFT that he had no option but to initiate the “orderly liquidation” of his nine-year-old company after the abrupt closing of the multi-state distributor Hoboken Floors.
Jopling said debt left unpaid by
Hoboken, including “a bunch of bounced checks and a bunch of containers
stranded in port,” left WFI unable to meet its financial obligations. He noted
the 25 workers were laid off and that a skeleton crew of “about 10” people
remains to tie-up loose ends in WFI’s headquarters in Burlington, N.J.
“I’d call it a domino effect,” said
Jopling, whose company specialized in exotic species including Brazilian
cherry, Caribbean rosewood and Australian cypress. “We never expected that
Hoboken would just shut down.
“When I found out about it I wanted
to do the right thing.” He said he called his creditors and voluntarily began
liquidating assets. “We had a pretty
good company but a weak ledger sheet,” he said.
The closing of WFI is one of a
number of repercussions arising from Hoboken’s Chapter 7 bankruptcy filing in
early November after 77 years in the flooring business. Hoboken is believed to
have 1,000 to 5,000 creditors. Its bankruptcy filing came on the heels of
claims against Hoboken by suppliers.
The closing of Wayne, N.J.-based
distributor also prompted a flurry of activity among suppliers seeking new
distributors. Many of Hoboken’s customers were also left scrambling to find
products needed to complete scheduled jobs.
While the overall slump in the
flooring business is widely seen as the main reason for Hoboken’s demise,
another factor frequently mentioned is the company’s ownership change two years
ago. The new owner, the private equity firm Code Hennessey and Simmons, is said
to have put more pressure on the bottomline despite the industry’s downturn. It
also sought to immediately expand. Shortly after the purchase, Hoboken merged
with the Elkridge, Md.-based flooring distributor Superior Products. Prior to
the bankruptcy filing, Hoboken Floors operated 26 locations around the country.
WFI’s Jopling stressed that he
harbors no ill will for Hoboken’s long-time management team Ira and Joel
Lefkowitz. The two brothers had stayed with the company after the acquisition
two years ago, but departed for other opportunities earlier this year.
Jopling noted that his
decision to forego bankruptcy protection and deal directly with creditors may
be a plus for any of his future efforts in the industry. “It isn’t like our
suppliers and customers hate us,” he said. Asked about his future plans, the
55-year-old executive said he was a bit beleaguered by his experience, but is
still unlikely to look beyond the industry he has worked in for most of his
career. “I’ll be selling flooring somehow, don’t ask me why.”
Bankruptcy Fallout: Hoboken's unpaid bills force exotic hardwood supplier to close
December 11, 2007