Merillat Industries, LLC

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Merillat Industries, LLC

5353 West U.S. Highway 223
Adrian, Michigan 49221-9461
U.S.A.
Telephone: (517) 263-0771
Fax: (517) 265-3325
Web site: http://www.merillat.com

Wholly Owned Subsidiary of Masco Corporation
Incorporated: 1946 as Merillat Woodworking Company
Employees: 4,200
Sales: $564 million (2003 est.)
NAIC: 337110 Wood Kitchen Cabinets and Countertop Manufacturing

Merillat Industries, LLC, a wholly owned subsidiary of Masco Corporation, is the largest manufacturer of cabinetry for the kitchen, bath, and home in the United States. The company's main product lines, from high end to low end, include Merillat Masterpiece, Merillat Classic, and Merillat Essentials. Merillat, which operates 11 manufacturing plants located throughout the United States, is a key component of the MascoBuilder Cabinet Group, which in 2003 generated 28 percent of Masco's $10.94 billion in revenues.

Early History

Merillat was launched in 1946 as Merillat Woodworking Company by Orville and Ruth Merillat. In the early days, the company manufactured custom kitchen cabinetry at a 2,400-square-foot plant in Adrian, Michigan. Merillat's original product line, Merillat Kitchens of Birch, was sold mainly to local consumers. It was also available through two modular housing manufacturers based in nearby Toledo, Ohio.

By the mid-1950s, consumer demand for Merillat products was increasing significantly, as was Merillat's market share. To cope with increasing demand, the company moved to a new, 15,000-square-foot, modular kitchen cabinet manufacturing plant, also located in Adrian. The firm also implemented several new marketing strategies, including a two-step distribution system designed to provide more efficient product delivery. Revenues surpassed the $1 million mark in 1959.

Throughout the years, Merillat continued to position itself as a leader in the manufacture of cabinetry. For example, the company instituted a mechanized assembly line that was able to manufacture its kitchen and bath cabinets—with self-closing hinges, high-pressure laminate construction, and aluminum drawer glides—more quickly. In 1962 Merillat received a patent for its self-closing hinges, which replaced magnetic catches, leading to a new level of industry awareness of the company's technological advances.

In the mid-1960s, Merillat introduced a product line with reversible doors and drawer fronts, featuring two different wood grain-designed Formica brand laminates. The company also developed a hollow core laminated door, moving away from birch and toward the lightweight, highly durable products that the market was demanding. To stay ahead of increasing demand for its products, Merillat expanded its Adrian plant to 76,000 square feet in 1964, and to 135,000 square feet in 1966.

In 1968 Richard Merillat, son of the company founders, obtained a design patent for the "Romance" cabinet line. "Romance" was awarded a patent for using injection-molded plastic doors—an industry first. Prestique, a styrene material used in "Romance" cabinet production, provided the look and feel of wood, while being resistant to moisture damage.

In 1971, the 25th anniversary of the founding of Merillat Woodworking, the company was renamed Merillat Industries, Inc. Soon after, the company introduced cabinets with solid oak, double-doweled front frames and vinyl-laminated particle board end panels. By the mid-1970s, Merillat had expanded its product line with the introduction of an oak raised-panel cabinet called Forest Oak. In 1976 the firm built a manufacturing facility in the town of Jackson, Ohio, for the production of solid oak front frames.

Taken Over by Masco in the 1980s

The opening of the Jackson plant signaled a growth period during which Merillat Industries became by 1985 the nation's largest manufacturer of cabinetry for the kitchen, bath, and home. By the mid-1980s, the firm had more than 2,000 employees in seven plants throughout the country: Adrian, Michigan; Jackson, Ohio; Lakeville, Minnesota; Culpeper, Virginia; Atkins, Virginia; Rapid City, South Dakota; and Las Vegas, Nevada. In 1982 the company moved into a new 21,000-square-foot corporate headquarters in Adrian. Three years later, Richard Merillat assumed the position of president of Merillat Industries, while Orville Merillat was named chairman. Also in 1985 Masco Corporation purchased Merillat for $144 million.

The evolution of the company continued in 1986 with the opening of a door frame and veneering plant in Mt. Jackson, Virginia. In addition, the Jackson, Ohio, and Culpeper, Virginia, plants were expanded that year. In 1988 a 43,000-square-foot addition tripled the size of Merillat's headquarters, enabling the company to better meet the increasing demands of the market.

In 1991 Merillat opened two additional manufacturing plants. The 75,000-square-foot plant in Atkins, Virginia, was opened to manufacture door panels. A new 225,000-square-foot plant in Loudenville, Ohio, was built to manufacture the Amera cabinetry line. Amera was introduced to provide product alternatives in the expanding remodeling market, which was becoming increasingly populated by sophisticated and upscale consumers. The Atkins and Loudenville plants brought Merillat's total manufacturing plant count to ten facilities and more than 2.5 million square feet. Merillat also had distribution centers in Denver, Colorado; Orlando, Florida; and West Palm Beach, Florida. The company sold its product through a network of 100 distributors and specialists who worked directly with major building contractors and individual remodelers.

1990s New Product Introductions

In January 1992 Merillat introduced six new oak raised-panel cabinetry styles with full overlay design into its ready-to-install cabinetry lines. Alexis and Alexis Arch provided a light finish, Bristen and Bristen Arch provided a medium finish, and Cambric and Cambric Arch provided a pickled finish. The products were all available with optional mullion doors with glass inserts.

The following year, Merillat introduced four new frameless maple raised-panel cabinetry styles: Kingsley and Kingsley Arch with natural finishes, and Rockingham and Rockingham Arch with pickled finishes. Also introduced at this time was a new generation of Merillat's traditional overlay light, medium, and pickled-oak cabinetry with the addition of full-concealed hinges, a new edge profile on doors and drawer fronts, and Merillat's own dual captive WhisperGlide drawer and tray system.

In 1994 Merillat introduced the Premium Woods, a line of three new wood species in traditional overlay, raised-panel cabinetry. The Premium Woods included Preston Cherry, which was available in Nutmeg finish and red-toned Paprika; Darlan Hickory, which was available in Nutmeg and honey-colored Cider; and Shetland Maple, which was available in natural finish and oatmeal pickled finish. At that time, Merillat offered more than 40 traditional and contemporary cabinet styles in cherry, maple, hickory, and oak. In addition, Merillat cabinets were offered in three oak finishes, two cherry finishes, two hickory finishes, and two maple finishes. They were also available in one vinyl and four melamine laminate colors. Cabinet doors in the ready-to-install line had a variety of style treatments, including raised center panels with square, arched, and cathedral styling, square recessed panels, mullion doors with glass inserts, and flush contemporary doors, some with sculptured oak pulls and trim.

Merillat also offered more than 100 "Customizers" accessories for the kitchen and bath. The Customizers program provided builders or remodelers with a wide range of accessories. For example, the Appliance Garage provided a convenient stowaway area for appliances, and the swing-out pantry helped make the homeowner's kitchen accessible but not cluttered. Other accessories included drawer dividers, tip-out hampers, and a hutch. The program was supported by a full package of marketing materials and trade publication advertising. William H. Ficken, Merillat's vice-president of marketing, told Professional Builder and Remodeler that he believed the customized package of accessories was very important to the builder as well as the buyer. "The Customizers Program addresses the fact that there is a need to properly accessorize the kitchen and other areas of the home," he said. "Builders who upsell will have a good sales margin opportunity in these option packages."

Amera was another Merillat cabinet product line that offered customization and attention to detail. Amera kitchen products came in more than 50,000 combinations, including traditional framed and European frameless construction, 21 traditional and contemporary door styles, four wood species, six wood finishes, five laminate colors, and a full range of storage features.

By the mid-1990s, Merillat was well established as an upscale manufacturer and marketer of high-quality products. An article that appeared in the Detroit News noted that Merillat kitchen products were used in the 1994 renovation of the Manoogian Mansion, the traditional home of Detroit's mayor. Merillat attributed its success to its focus on brand awareness, according to Professional Builder and Remodeler. "Our customers recognize that our name creates a quality impact and awareness."

Merillat continued to expand and otherwise tinker with its product line in the late 1990s. The Amera line was expanded in 1997 to encompass more than 300 combinations of door styles, wood species, and finishes. The following year the company began offering its customers a streamlined cabinet selection process that featured standard architecture, a uniform assortment of cabinet sizes and accessories, and a simplified naming system. Clay Kiefaber was named president of Merillat in 1998, having joined the company in 1989 as director of just-in-time planning. In 1999 Masco entered into a strategic alliance with Pulte Corporation whereby Merillat Industries and Quality Cabinets, a sister company of Merillat within the Masco empire, became the primary cabinet suppliers for Pulte through 2002. Pulte was one of the largest home builders in the country.

Company Perspectives:

Since Orville Merillat began custom-fabricating kitchen cabinets in 1946, Merillat has grown to become the nation's largest manufacturer of cabinets by focusing on the needs of our customers.

Early 2000s and Beyond

By 2000 Merillat's 11 manufacturing plants were churning out the equivalent of 1,000 kitchens' worth of cabinets per day. The firm's 11th plant opened that year in Ocala, Florida. This state-of-the-art kitchen and bath cabinet facility encompassed 240,000 square feet of space. During 2001, Masco changed Merillat into a limited liability company (effecting a name change to Merillat Industries, LLC).

Merillat that same year introduced its Organomics concept, a word created from the combination of organization and ergonomics. The Organomics system was aimed both at eliminating clutter and disorganization and, according to Doug Austin, advanced design manager for Merillat, allowing "homeowners to perform household tasks without excess bending, reaching and running around." A key aspect of the system was dividing rooms into zones for specific tasks; for example, in the kitchen, the zones might be the sink, food preparation, cooking, storage/display, planning, and eating. After identifying the different zones in a potential kitchen, a homeowner could then select the cabinetry best designed to meet the tasks that would be performed in each zone. Merillat simultaneously introduced lines of cabinets for home office and home entertainment use that also incorporated Organomics into their design.

In January 2002 Merillat closed its plant in Lakeville, Minnesota, shifting production to its plants in Adrian and Las Vegas and the new plant in Ocala. One factor in the closure was excess capacity in Merillat's system of manufacturing facilities, but the company was also in the process of realigning its production resources to meet the growing demand in the Southeast and Southwest. Keith Allman, vice-president of manufacturing for Merillat, noted that "as construction in these areas continues to outpace national averages, it is vital for us to have significant manufacturing resources in those regions." The opening of the Ocala plant was part of this same realignment as was the closure in March 2002 of Merillat's plant in Loudenville, Ohio. The Amera line had been produced at the latter plant, but this line was discontinued and replaced with the Merillat Masterpiece semicustom, premium line of cabinetry. Masterpiece was part of a new three-tier line of products that also included two lower end offerings, Merillat Classic and Merillat Essentials. Production of the Masterpiece line began at a plant in Middlefield, Ohio, owned by KraftMaid Cabinetry, Inc., another Masco subsidiary. Masco had typically taken a hands-off approach to its array of subsidiaries, but poor financial performance had forced it to seek out new approaches, one of which was encouraging cross-subsidiary cooperation, such as that between Merillat and KraftMaid. Meantime, Merillat sales were estimated to have fallen from $650 million in 2001 to $550 million the following year as Masco eliminated distributors in order to sell more cabinets directly to builders. Continuing to seek business in the fast-growing Sunbelt, Merillat announced in December 2004 that it would build a new manufacturing plant in Los Lunas, New Mexico, located just south of Albuquerque. The $36 million, 260,000-square-foot facility was expected to begin production in the fall of 2006.

Principal Subsidiaries

Merillat Corporation; Merillat Transportation Company.

Principal Competitors

MasterBrand Cabinets, Inc.; American Woodmark Corporation; Elkay Manufacturing Company.

Key Dates:

1946:: Orville and Ruth Merillat launch Merillat Woodworking Company in Adrian, Michigan.
1962:: Merillat receives patent for self-closing hinges, which replace magnetic catches on cabinets.
1971:: Company is renamed Merillat Industries, Inc.
1985:: The same year that Merillat becomes the leading kitchen/bath cabinet manufacturer in the nation, Masco Corporation acquires Merillat for $144 million.
2001:: Masco reorganizes Merillat as a limited liability company.
2002:: Company introduces its Merillat Masterpiece, Merillat Classic, and Merillat Essentials lines.