New Balance has opened its fifth manufacturing space in North America. This one is in Methuen, Massachusetts.
While many retailers are struggling to preserve relationships with overseas vendors and manufacturers, against pandemic uncertainty and shaky foreign relations, one is doubling down on its presence in North America.
New Balance, a privately held business known for its cushioned sneakers and retro-inspired workout gear, has opened a manufacturing facility in Methuen, Massachusetts, the company announced Monday. The move strengthens its reliance on North America for production, as businesses try to navigate an obstructed global supply chain, said President and Chief Executive Joe Preston.
The move comes as prominent business leaders are considering whether globalization as we know it is coming to an end. Larry Fink, chairman and CEO of the world’s biggest asset manager, BlackRock, said last week that Russia’s invasion of Ukraine has upended the world order that had been in place since the end of the Cold War. Over time, that could result in U.S. businesses lessening their reliance on foreign economies to grow.
New Balance said the 80,000-square-foot space recently underwent about $20 million in renovations.
Currently, almost 100 people are employed at the facility, where they make New Balance’s most popular Made 990v5 running sneaker. New Balance said it aims to more than double the size of its workforce there as well as its production capabilities by year’s end. It will help to produce an additional 750,000 pairs of sneakers annually.
“It’s part of our overall mantra of controlling our destiny, which has really come into play in the last couple of years with with Covid,” said Preston, in a phone interview. “The supply constraints have certainly impacted our business, but we were still able to grow [revenue] over 30% in 2021.”
The Boston-based shoe company is building on its current production capabilities in the U.S. Including the Methuen space, New Balance owns five manufacturing facilities across Maine and Massachusetts that employee about 1,000 workers. These spaces help to put together its line of “New Balance Made” sneakers, which are at least 70% domestically manufactured and make up a limited portion of U.S. sales, according to the retailer. New Balance said its worldwide sales totaled $4.4 billion last year.
According to Preston, the goal is to keep growing in North America — a move that is core to the brand’s “Made in America” ethos.
“It differentiates us from our competition, if we make product and don’t outsource all of our production,” the CEO said. “That helps in the quality and the craftsmanship.”