By Craig T. Kojima, Star-Bulletin
Virgie Mateo (front) and Magdalena Duldoloa work in
Crazy Shirts Inc.'s Honolulu plant in this 1996 file photo.
The company plans to close the plant and
move the work to California.
closing isle factory
It will cut 140 jobs here and moveBy Russ Lynch
its main offices to the mainland
Crazy Shirts Inc. plans to close its Halawa manufacturing plant, laying off 140 employees next year, and move the work -- and its headquarters -- to California.
A combination of slipping sales to tourists in Hawaii and the economic advantages of consolidating in one location led to the decision, Randy Yeager, Crazy Shirts' senior vice president and general manager, said today.
The company said that the major job losses will start in March but business slowdowns could cause layoffs before then.
"Our sales are of course connected to the tourism industry and, as everyone knows, tourism sales are off," he said, noting that the decline has been particularly strong with Japanese tourists.
Yeager cited the yen exchange shift that made dollar purchases more expensive for the Japanese, off-price retailing such as the Waikele stores, increased competition in Waikiki and shorter tourist stays.
"It's not a single compelling reason," he said, but coming at a time when mainland sales are growing rapidly it makes sense to move closer to that market.
The consolidation of the company's headquarters and manufacturing to Tustin, Calif., will be complete by the end of 1998, Yeager said. For the past 15 years, the Orange County location has been the base for Crazy Shirts' mainland operations, called TMC, for "The Mainland Company."
Under the new structure, TMC is being merged into Crazy Shirts Inc. About 70 new jobs will be created there and the company said Hawaii employees will have a chance at those jobs.
The Halawa office will remain to manage the company's 26 Hawaii retail stores and the two-store Guam operation. Also staying is the art department, which creates the Hawaii-inspired garment designs, and the advertising department to promote the brand and create the mail order catalog.
Yeager said the company has about 600 employees in Hawaii. Overall, Crazy Shirts and TMC together have nearly 1,100 employees and a total of 57 retail stores.
In a statement yesterday, Crazy Shirts' founder Rick Ralston said the idea of combining the Hawaii and mainland operations had been discussed for years.
Ralston launched the business in 1964, air brushing designs on T-shirts for sale in Waikiki.
Steve Moder, president of TMC and a former executive vice president and general manager of Crazy Shirts Hawaii, will be president of the new Crazy Shirts Inc.
Yeager, senior vice president and general manager of Crazy Shirts Hawaii, will be president of the North American division. Greg Korpita, Crazy Shirts vice president of operations, will head the new manufacturing division in California. The Pacific division will operate from Honolulu, with a president yet to be named.