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MailTribune.com
  • Local vendors sympathize with Harry & David, hopeful for future

    'Every retailer in the community will feel it, if people working for Harry & David are losing jobs'
  • Mike Stitt has been around long enough to weather the ups and downs of both his own company and other businesses. It's all part of economic cycles.
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      Wells Fargo Bank* - $198,362,000
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      Creditors holding 20 largest claims against Harry & David
      Wells Fargo Bank* - $198,362,000

      Harry & David Pension Plan - $27,400,000

      Convergys CMG - $2,222,905.50

      R.R. Donnelley Receivables -2,170,978.96

      FedEx - $1,185,578.44

      Google Inc. - $872,661.63

      Ada Valley Gourmet Foods - $827,987.74

      Guittard Chocolate Co. - $585,628.44

      SAP America Inc. - $562,171.43

      IBM Corp. - $531,186.35

      Nautical Furnishings Inc. - $455,734.68

      InfoLogix Inc. - $450,372.91

      AmeriCold Logistics LLC - $441,273.82

      Smucker Specialty Foods - $439,345.84

      Achatz Handmade Pie Co. - $397,481.58

      American List Counsel Inc. - $395,430.26

      Rockwell Architecture - $359,654.42

      Southern Bakeries LLC - $340,974.12

      Hines Nursery - $291,293.74

      * Wells Fargo Bank is the trustee listed in court documents for the senior fixed notes and floating rate note bondholders with two separate claims, one for $140,192,000 and another for $58,170,000. Clarification: This statement has been updated to clarify Wells Fargo's role.
  • Mike Stitt has been around long enough to weather the ups and downs of both his own company and other businesses. It's all part of economic cycles.
    His firm, AA Electric on Table Rock Road, works on charging and starting systems for Harry & David's fleet of forklifts, tractors and trucks. It's a specialized field and a niche he's filled for decades.
    During the gourmet food and gift direct marketer's slide into Chapter 11 bankruptcy, Stitt has taken a long-term view.
    "This is a troubling time," Stitt said. "All we can do is work together. Do we need the money? Yes, but so do they. They needed a product from me and I said, 'Just come and get it and we'll sort it out later.'
    "I don't expect to abandon them, nor do I expect them to abandon me; I don't see any other way around it."
    Stitt is among the 1,400 vendors to whom Harry & David potentially owes money. (No local firms are among the Top 20 list of creditors.)
    "Fortunately, they don't owe me a great deal of money and the realist in me wonders about recovering that money," Stitt said. "However, if they survive, and I'm sure they will, it will work out."
    Tim Simpson Sr. of Simpson & Associates, a Medford concrete repair and seamless epoxy flooring system company, said Harry & David's problems are problems for the entire Rogue Valley to some degree.
    "We would like to see them succeed and work their way through bankruptcy," said Simpson, who has been plastering, repairing concrete and applying industrial coating to Harry & David facilities since 1993. "More important than current debt, however, is their contribution to the community as a whole. Their ability to reorganize is most important to the city of Medford right now."
    Vendor work for Harry & David has a bigger local impact than most people realize, Simpson said.
    "We do business with many other vendors that do business with Harry & David," he said. "When they lose income, it's more than them individually, it has a snowball effect."
    Every past layoff, coupled with those that may come later, creates ripples.
    "Every retailer in the community will feel it, if people working for Harry & David are losing jobs," Simpson said. "Dollars in the community are not just spent once, but repeatedly. The retailer pays his employees, who rent an apartment in a complex or make their auto payment, and it just goes on and on. It's exponential when you calculate employee spouses and children. If families are required to relocate, it affects the school system's head count and the school district's operating income. So everything is connected."
    Cindy Warwick of A+ Embroidery in Gold Hill has provided logo and stitch work on hats and bags for Harry & David for the past six years.
    "I know a lot of people there from over the years and everybody is hoping they will come back that much stronger," Warwick said. "Harry & David just becomes the fabric for everyday life around here. It's important to hang onto that because everyone's connected."
    Craig Taylor, who operates A Better Weigh Scale LLC in Gold Hill, has sold and serviced every scale used by the company from here to Hebron, Ohio, for the past nine years. His relationship goes back more than two decades and several owners.
    "It's more prudent to recognize your issues and deal with them effectively," Taylor said. "Filing Chapter 11 indicates a good thing to me; it means they are reorganizing and not closing their doors. Harry & David has longevity and I'm not concerned whether they will be here, at its roots they are sound and stable. My only hope is that the outcome will be the best for all interested parties."
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