Business

Brosco to shut Andover warehouse, lay off 60

By Bill Kirk
bkirk@eagletribune.com
Published: November 18, 2008

ANDOVER — The collapsing construction industry, and tumbling economy, just took some more victims.

Brockway Smith Co., known to contractors and lumber retailers throughout New England and the Northeast as Brosco, announced 60 layoffs yesterday as a result of the shutdown of its warehouse and delivery divisions at the company's Dascomb Road headquarters and consolidation of New York and Massachusetts sales offices.

"I've been through two recessions and I don't know if anyone's seen anything like this," said Charlie Smith, president and CEO of the company that was started in Lynn in 1890 by his great-grandfather. "It's at a scale where nobody knows what's going to happen next."

Brosco has had its administrative offices and a warehouse in Andover since 1970, and also has warehouse and sales offices in Portland, Maine, Coxsackie, N.Y. and Hatfield, Mass. It will close the warehouse, delivery division and a work shop in Andover, resulting in the loss of about 50 jobs, and combine sales offices in Coxsackie and Hatfield, resulting in the loss of another eight jobs.

The company headquarters will remain in Andover and continue to employ about 115 people.

Brosco sells to 1,200 retail outlets throughout New England and the Northeast, including well-known local stores like Jackson Lumber and Millwork in Lawrence and Haverhill, Doyle Lumber in Andover, and Moynihan's, which has a location in Plaistow, N.H.

But the company is perhaps best known in the building trades for annually publishing the Brosco Book of Design, "the bible of the industry," Smith called it. It is a small, thick book filled with illustrations and specifications of every window, door and moulding the company sells. Carpenters use it to order from their suppliers for jobs they are doing.

Lately, contractors have been ordering a lot less.

Smith said the business is down 25 percent over the last two years, with the bulk of the downturn coming in the last year or so.

"It's the subprime mortgage problem that created the recession in the home building industry first," he said. "And that has spread to the global recession we are having today."

In the last two years, foreclosures have been skyrocketing as people couldn't make their payments and have been forced out of their homes.

"In the building industry, it's been steadily declining for the last couple of years," he said. "Four to five months ago the subprime mortgage mess hit really hard and sales dropped rapidly."

The layoffs were announced at an employee meeting last Friday. In June 2006, the company employed 882 people. That number has steadily declined, mostly through attrition, to what will be around 550 by the end of January.

Customers who are currently serviced by the Andover warehouse will be serviced by either the Portland or Hatfield facility, Smith said, adding that he hoped there would be no need for further cuts in Portland or anywhere else in the company.

The only bigger expense item, Smith said, was that the company will pay more in fuel costs as delivery trucks make longer runs from the warehouse in Portland, for example, to Merrimack Valley lumber yards formerly served by the Andover facility.

He said he expects to lease out the Andover warehouse.