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Vaughan-Bassett: Still Making It In America — PART 1

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Threatened by imports from China and with factories shutting down all around him, John D. Bassett III did something few other manufacturers did: He fought back.

By Landmark News Service

 

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ABOUT THIS SERIES — The 1994 North American Free Trade Agreement and the opening of China to global trade decimated manufacturing in Southwest Virginia. In this three-part series, we look at how Vaughan-Bassett Furniture is attempting to recover.

VIDEO LINK AT END OF STORY: WATCH AN 11-MINUTE VIDEO INTERVIEW WITH JOHN D. BASSETT III, CHAIRMAN OF VAUGHAN-BASSETT FURNITURE.

John D. Bassett III was winding along the dusty roads of northern China on a three-day fact-finding mission. It was 2001, and the third-generation furniture-maker was gathering ammo for an epic battle to keep his factory churning.
If he could locate the manufacturer of a single dresser, ornate in the style of Louis Philippe, he just might beat the Chinese.
Back at Vaughan-Bassett, his Galax factory, he had already deconstructed the dresser piece by piece, proving the bargain-basement $100 the Chinese were wholesaling it for was far lower than the cost of the materials. The sticker on the back read “Dalian, China,” and now here he was, some 7,500 miles away from his Blue Ridge Mountains, trying to pinpoint the source of the cheap chest of drawers.
If they were going to war, he told his second-in-command son, Wyatt, they needed to heed Napoleon’s advice: Know your enemy.
They toured seven factories before they finally spotted the dresser in a showroom, in the remote reaches of Liaoning province, hours from Dalian. Its maker was happy to give them a tour, hoping the Bassetts would do what every other factory operator in Southwest Virginia was about to do — including the Henry County and Martinsville factories run by other members of Bassett’s extended, furniture-magnate family.
“I’ll sell the furniture to you, but you’ve got to do one thing for me first,” he said. “Close your factories.”
The official had no idea Bassett was on a mission to gather proof that Chinese manufacturers were not playing by the rules, threatening to put a permanent chill on the smokestacks that bore his family’s name. He had no idea the aging patriarch would do the thing that few in his position would do — put people ahead of profits.
John Bassett may have grown up in the ultra-rich world of summer homes, prep schools and chauffeurs. But furniture industry watchers say he has more sawdust in his veins than anyone in the business. As they left the factory, Bassett invoked the name of his grandfather and namesake, John D. Bassett, the man who put Virginia on the furniture-making map.
“He would roll over in his grave!” Bassett boomed in his patrician Southern drawl.
Then he echoed the orders of another favorite warrior, Gen. George Patton.
“When confused,” he told his son, “attack.”

‘Asian Invasion’
Back in the spare Vaughan-Bassett offices, filled with ‘70s-era wood paneling and mismatched chairs, the general called his lieutenant sons to order.
The problem? Jobs were leaving for Asia by the thousands, thanks to NAFTA and the opening of trade to China.
At first, the losses were in textiles — big-brand factories that made pantyhose, towels and sweatshirts. By 2002, more than 9,000 textile jobs had left Henry County for China, where wages were low and environmental regulations lax.
Now the Chinese were coming after furniture — and threatening at least as many jobs.
American factory owners were forging production contracts with Asian plants in a kind of outsourcing stampede. They would leverage the best-known names in the furniture industry, but the people making the dressers would be Chinese, earning $1 for every American worker’s $33.
“The saying was, ‘The dance card is filling up.’ If you didn’t sign with a factory right away, you’d be all alone,” recalled Doug Bassett, John’s oldest son and the company’s executive vice president. A former Republican congressional staffer, he left Capitol Hill to help his brother and dad battle what they call the Asian Invasion.
To hell with the dance card, Bassett told his sons.
Imagine a desert island instead: There is one woman stranded on it, surrounded by 12 men. “I got news for you, boys!” he bellowed. “When you’re the only girl left standing on an island with 12 men, you don’t have to be good looking, somebody’s gonna fall in love with you!”
If Vaughan-Bassett could be the last factory standing in the realm of mid-priced wooden bedroom furniture, they would get the business.
Bassett thought of his workers, mountain folk with an average age of 49. In a town where just 66 percent have high school degrees, many followed their parents and grandparents onto the assembly line.
He thought of his maverick grandfather. A century earlier, the elder John Bassett pooled $27,500 with his brother and brother-in-law to launch Bassett Furniture Industries in their eponymous Henry County town.
He knew the old man conducted business with his sons over long, four-course lunches made by servants in the family home.
His grandfather had started out running a general store and in 1892 helped secure a post office for the fledgling town, which was then named for the family.
The elder Bassett branched into sawmilling and had the chutzpah to talk the fledgling Norfolk & Western Railway into running its new Punkin’ Vine line from Winston-Salem to Roanoke in 1892 — through the middle of his property. With his sawmill, he would even sell them the timber for the ties.
(Legend has it that he sold a railroad buyer many of the same pieces of lumber — more than once.)
A century before offshore production became the norm, the original John D. Bassett had the notion that he could fatten his profits if he quit exporting lumber to America’s furniture center in Grand Rapids, Mich., and make the stuff himself.
He went on to spawn the country’s biggest names in furniture — Hooker, Stanley, Bassett and more.
As the northern factories collapsed in favor of the South’s cheap wages and plentiful woods, no one realized the creative destruction it wrought would repeat itself a century later.

The family elbow
John D. Bassett III grew up in the classic company town of Bassett, where the first workers lived in Bassett-owned homes, were paid in Bassett script, had their babies in a Bassett-endowed hospital — and went to John D. Bassett High. They even wrote their heating-bill checks to Bassett for the leftover factory steam that powered their shotgun homes.
By 1925, the town had 3,000 residents — more than double its current 1,221. “It was a joke that you graduated from high school and went to the University of Bassett Furniture,” said Ward Armstrong, the former state delegate and Bassett native whose father spent a career in furniture.
So it went that the first John D. Bassett sent his descendants into the world: daughter Blanche married the man who would create Vaughan Furniture in Galax and daughter Anne married the founder of Stanley. Other members of the family (referred to collectively by regular folk in Martinsville as “The Families”) begat such companies as Hooker, Stanley, Bassett-Walker and Weaver Mirror.
Bunyan Vaughan was Blanche Bassett Vaughan’s brother-in-law and an early Bassett Furniture manager who left for Galax in 1919 to launch Vaughan-Bassett, with the blessing of — and seed money from — the old man.
Most of Virginia’s furniture companies were launched with the help of the patriarch, who created his own competition while at the same time maintaining a thread of control.
Intertwining his corporate babies with the family tree, he spawned generations of family fortune.
So it went that John D. Bassett III spent childhood summers inspecting lumber and helping his dad check on plant operations en route to Little League games. He enjoyed seeing his family name all over town — especially on the smokestacks — and was reared to believe the factories would one day be his to run.
In 1962, he returned from his post-war duties in Germany to become a Bassett manager and married Bunyan Vaughan’s great-granddaughter, Pat, who was also his distant cousin. (Pat’s grandmother and John’s grandmother Bassett were sisters.)
The family has learned to ward off jokes by beating observers to the punch line: “Listen, I should have crossed eyes and buck teeth, but I don’t!” he jokes.
John Bassett won’t talk publicly about the family split in 1983 that sent him to Vaughan-Bassett, the offshoot run by his wife’s family. He’d spent two decades running Bassett factories in Henry County and Mount Airy, N.C., learning every facet of the business.
Asked if he was elbowed out by his legendarily stern brother-in-law, Bob Spilman, who became Bassett’s CEO, he barked, “Elbowed? It was more like a knee or a foot!”
But that’s as far as he’ll go on the subject, insisting, “I’ve buried that hatchet.”
Spilman, who was 10 years his senior, was already aiming to be the heir apparent by the time John Bassett returned from the Army, according to his wife, Pat.
“I don’t think they ever made up,” Armstrong said.
In 1998, John Bassett tried to buy the empty W.M. Bassett Furniture plant in Martinsville — only to be stonewalled by Spilman, who didn’t want to compete for labor with him and gave it to the city instead. The property lies barren now, another smokestack razed — a symbol of Martinsville’s collapsed economy, with a 16.7 unemployment rate that’s the highest in the state.
Industry watchers say the feud fueled a powerful competition between the two that drives John Bassett relentlessly even now, two years after Bob Spilman’s death.
Told that John Bassett attended both of Spilman’s funerals, in Martinsville and Richmond, one analyst deadpanned: “He probably just wanted to make sure he was dead.”
By the time he arrived in Galax in 1983, the Vaughan-Bassett plant was outdated and operating at a $200,000 annual loss. He dipped into personal resources to help it modernize and grow.
He recalls one competitor telling him: “What little bit of reputation you ever had, you’ve lost it now.”
With the Asian Invasion heating up, conditions were ripe for a black sheep with a dresser-sized chip on his shoulder. He didn’t have the private plane or the fancy office his brother-in-law claimed, but John Bassett had some things to prove.

This story was originally part of the “Picking Up The Pieces” series published in The Roanoke Times, produced in association with Equal Voice News, a project of the nonprofit Marguerite Casey Foundation. Former Roanoke Times photographer Jared Soares participated in the series through funding from the Casey foundation, which provides grants to organizations working on issues behind poverty.

• For Part 2 of this story, see the March 5 edition of The Gazette or visit www.galaxgazette.com. Read how John Bassett assembled a coalition of furniture makers to take the fight to China. They won the battle, but not without casualties — and not without making some new enemies.

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