Category: In the Headlines

In March 2017, Variety Wholesalers, Inc., led by CEO James Arthur ‘Art’ Pope, announced the opening of a new company distribution center in Newnan, Georgia.  The space had been vacant since January 2015 when a former Kmart distribution center closed.  As the new tenant of the space, Variety Wholesalers, parent company of stores like Roses and Maxway, is bringing valuable jobs to the Cowetta County region and again making the area a hub for distribution.  The Newnan Times-Herald covered the economic impact in this recent article.   Distribution center forms the hub that supplies jobs, stores, consumers By: Kandice Bell | June 28, 2017 Link: http://times-herald.com/news/2017/06/distribution-center-forms-the-hub-that-supplies-jobs-stores-consumers Every day, nearly three dozen trucks pull up to loading docks at a massive building in a tree-lined Newnan industrial park. Few local consumers realize how that building affects their daily lives. Among the freight are household products manufactured all over the world, including plastic pitchers, baskets and trash cans from Leominster, Mass. The building is a waypoint in the journey each product makes from raw material to manufacturers to distribution centers like the one in Newnan and then to the stores where consumers select them for their final trip to individual homes. Experts call it the supply chain, and it stretches thousands of miles for each unique product. Recent innovations have sought to streamline the process, such as containerized freight and automated sorting. Even the lowly barcode, a strip of printed lines, has been instrumental in improved efficiency because it allows machines to scan the codes to keep track of inventories. One of the most significant innovations, experts say, is the modern distribution center. Instead of every manufacturer having to haul its products to every retail outlet, the centers consolidate shipping and receiving, saving consumers in the process. As the population of the Southeast continues to grow, distribution centers must be built to supply the stores popping up to sell to the new residents. Georgia handles more than $900 billion in cargo each year, much of it consumer goods moving through distribution centers, according to the Georgia Department of Economic Development’s Center of Innovation for Logistics. Even transactions that don’t occur in stores require distribution centers to handle the growth in e-commerce. Mike Willem, Variety Wholesalers senior vice president of distribution and transportation, holds clothing that is being sorted at the distribution center in Newnan. The clothing will shipped to Roses stores throughout the Southeast. Photo courtesy of The Newnan Times-Herald. The warehouse vacancy rate fell to 5.4 percent nationally in May, the lowest in 30 years, according to the Center for Logistics. Warehouse wages continue to rise. Both trends reflect the soaring demand for distribution centers to keep the supply chain running smoothly. “Poised to play an ever-increasing role in moving goods from producer to customer, Georgia’s businesses and residents are well-positioned to benefit from our world-class transportation infrastructure and emerging technology trends in logistics,” wrote Jannine Miller, director of the innovation center in a May column for The Augusta Chronicle. “… While logistics has been refined and perfected over time, we’re seeing the emergence of new technologies that will make it more efficient than ever to move goods from one place to another. And there are many exciting new things ahead.” Logistics is a major employer locally Nearly 50,000 people in the Coweta area work in the transportation and warehouse sector of the economy, according to the Georgia Department of Labor. That’s roughly one in every 20 people who have jobs. A huge warehouse that helped establish Newnan’s reputation as a distribution hub is once again housing hundreds of jobs and acres of merchandise. The Herring Road facility built for Kmart had been vacant since that company moved out in January 2015. Variety Wholesalers announced last August it had signed a lease with the building’s new owners for 1.4 million of the 1.9 million square feet of space. The area Variety is using, equal to 29 football fields, has space for 80,000 pallets of goods that will be shipped to stock 180 stores across the Southeast for the Roses, Roses Express and Maxway brands. That includes a Roses Express store in Newnan’s Merchant’s Crossing shopping center that recently opened. Among those pallets are plastic items from United Solution’s plant in Massachusetts. It will also serve future stores the company has planned in Georgia and neighboring states, according to CEO Art Pope. “This, for us, was a major undertaking,” said Variety President Wilson Sawyer at the company’s ribbon-cutting event earlier this year. The company was attracted to Newnan because of its location near major highways in all directions. But it was also considering other sites around the Southeast. “I knew they had a lot of options available, but they chose us,” said Greg Wright, president of the Coweta County Development Authority. The building’s size and readiness were major factors in the decision, as was use of the racks and conveyor systems that Kmart left in place, according to executives who say there are few buildings of that size available anywhere in the country. The equipment simply allowed Variety to move in faster and get up and running sooner than other sites. Variety currently has over 300 employees, some of whom had worked at the same building for Kmart, according to Mike Willems, senior vice president of distribution and transportation. And the company is still hiring, currently for truck drivers. Having former Kmart employees is helpful because they are already familiar with the building and its mechanics. Willem said the process of getting the product to stores, especially Roses Express in Newnan, is simple but hard work. Employees can be seen throughout the day sorting and moving products to the correct area. Material in and material out The distribution center receives 35 shipments per day in and ships out to 35 stores per day, with 90 percent of the shipments being sent to the Roses chain. Once the items are received, they are sorted, labeled and scanned to be stored in the correct zone. For instance, when a truck is unloaded from United Solutions, the clothes baskets might be stored in one section of the massive Herring Road structure while the tubs and pails are stored in another. Once the items are put away in the zone, they are ready to be pulled for shipping when needed. “Everything in the building is scanned to a certain zone, depending on the product,” Willem said. “We have zones for clothing, food, etc. We have thousands and thousands of products.” Information from the scanner feeds a computerized inventory that helps them keep up with the products, which range from clothing to household goods, food, and other supplies. When a store needs to replenish its inventory, the store’s computer talks to the distribution center’s computer, then the required products are automatically sent by conveyor belt to the correct truck for shipment. He said technology really helps the company stay efficient. “This is what we do every day,” he said. He said any damaged items that are not repairable are sent back to North Carolina where Variety has its original distribution center and headquarters. Willem said the staff at Variety has been great, making the entire process work to make sure it runs smoothly and on time. In the years since Kmart built a warehouse here, other companies have followed suit, including PetSmart and SYGMA. (Walter Jones contributed to this story)

Video courtesy of Carolina Journal Article courtesy of North State Journal By Donna King | April 12, 2017 RALEIGH — In a press conference Tuesday, the N.C. Retail Merchants Association warned of high prices for consumers and job loss across the state if a border adjustment tax passes as part of the national conversation on tax reform. The border adjustment tax, or BAT, is billed as a way to boost U.S. manufacturing by exempting export revenues from federal tax. However it would also end the deductibility of import costs by corporations and retailers, making imports for production or resale costlier. Retailers say it’s fundamentally unfair to retailers over large corporations that primarily export, and would amount to a 20 percent increase on consumer goods. The cost is estimated to be $1,700 per family per year. “It would tax virtually everything that N.C. families buy: groceries, prescriptions, gas, home goods, shoes, clothing — you name it,” said Andy Ellen, president of the N.C. Retail Merchants Association. “It would slap a giant 20 percent increase on any of those items that are imported. Every morning I drink a cup of coffee and eat a banana. My children eat strawberries year-round. Those products don’t grow here and last time I checked we can’t move the equator.” “The biggest victims of BAT will be working class families who’ve seen wages stagnate in recent years but will be looking at a $1,700 increase in the cost of goods.” Andy Ellen, president of the N.C. Retail Merchants Association The BAT is part of a tax reform blueprint supported by U.S. House Speaker Paul Ryan. President Donald Trump is also working on a tax plan. The quest to revamp the tax code moved to the top of Trump’s legislative agenda after a Republican push to repeal and replace President Barack Obama’s signature health care law, the Affordable Care Act, failed in the U.S. House. To tackle the biggest overhaul of the U.S. tax code since the Reagan era quickly, House Republicans are hoping to avoid the political fault lines in the party, so opposition among conservatives is raising a red flag in Congress. “The total value of imports coming into N.C. was around $52.8 billion. That is equivalent to 11.1 percent of N.C.’s GDP,” said Donald Bryson, executive director of N.C.’s Americas for Prosperity. “A 20 percent BAT would lead to $10.57 billion in new taxes on N.C.’s economy, and on our citizens and businesses. To put that in perspective, in 2014 the state only paid $8.69 billion in federal income taxes. … That’s a significant burden.” Art Pope, who served as a legislator and the N.C. State budget director under former Gov. Pat McCrory, is a force in GOP politics and said he has been in touch with N.C.’s representation in the Washington to oppose a BAT. He said it unfairly targets retailers, especially small ones, over other companies that are capital intensive and can still deduct capital goods like equipment and buildings. “It’s not right, it’s not fair, it’s not tax neutral to let one group deduct all their expenses including capital expenses while retailers cannot even deduct their costs of goods sold,” said Pope. Pope said some of the state’s delegation have decided to oppose it but others say it’s still on the table. The House Republicans hope to vote on a tax reform bill before they leave for summer recess at the end of July. Congressman Mark Meadows (R-N.C.), who leads the Freedom Caucus in Congress and was credited with coordinating opposition to the recent health care reform effort, said the tax reform debate boils down to a decision between the BAT plan, backed by Ryan and deficit-funded reforms. He did not take a position on Thursday but recently said his group could support reforms that are not revenue neutral. “We can get it done before August as long as we are real serious about having real debate. … Debate has to be about changing policy,” said Meadows. “We need to go ahead and start having those discussions today. Let’s look at legislative text.” Two conservative groups, Freedom Partners and Americans for Prosperity, issued results of a survey this week that ranked N.C. as the No. 22 state that could potentially be the most harmed by a BAT, primarily because the retail industry in N.C. is the largest private employment sector with one out of every four jobs tied to retail. The study was sharply criticized by House Ways and Means Committee Chairman Kevin Brady, a Texas Republican who intends to include the BAT in tax reform legislation. “That so-called study will be easily discredited and probably fits the definition of fake news,” Brady told reporters. “It takes one provision, pretends the economy freezes … applies it in our current tax code and comes up with fantasy figures.” Proponents of the BAT refer to a macro-economic theory that says the U.S. dollar will appreciate in value by 25 percent to make up the cost. Pope disagrees. “I live in the real world,” said Pope. “I have to negotiate with individual vendors on individual products ranging from pants, socks, handkerchiefs, each individual item. To imagine that the U.S. dollar is going to appreciate 25 percent overnight to offset that increase tax is not realistic.” Tax reform negotiations are currently underway with hearings anticipated for the summer and action on a measure in August. “We know it takes 500 messages to fill up the voicemail box of a U.S. senator,” said Bryson. “We filled up 24 last week and we are going to do another 24 this week and another 24 next week.”

From Carolina Journal April 6, 2017 John Locke Foundation founder and former chairman Art Pope today was elected chairman of the Lynde and Harry Bradley Foundation, one of the nation’s largest conservative grantmaking charitable organizations. Pope is the owner and chairman of Variety Wholesalers Inc., which owns and operates a chain of discount retail stores with 7,000 employees in 17 states. He’s also chairman of the John William Pope Foundation, a family grantmaking foundation he has led since its creation in 1986. He was a member of the North Carolina General Assembly and, most recently, was the state budget director from 2013-14. “It is an honor to serve as chairman of the Bradley Foundation, an organization which does so much to strengthen the fabric of Milwaukee, Wisconsin, and the entire country,” Pope said in a press release. “Dennis Kuester, the outgoing chairman, and Mike Grebe, our previous president, have done such excellent work and have left a fine example for me to follow. I look forward to continuing Dennis’ valuable work.” The Bradley Foundation’s vision “is for a nation invigorated by the principles and institutions that uphold our unalienable rights to life, liberty, and the pursuit of happiness. Its mission is to restore, strengthen and protect the principles and institutions of American exceptionalism. The core principles which guide the Foundation’s grant making include a commitment to free markets; fidelity to the Constitution with its principles of limited government, federalism, separation of powers and individual liberties; commitment to the fundamental institutions of civil society that cultivate individuals capable of self-governance; and dedication to the formation of informed and capable citizens.”

Former Kmart warehouse back in business By Walter Jones | March 30, 2017 The Newnan Times-Herald  A huge warehouse that helped establish Newnan’s reputation as a distribution hub is Art Pope, Chairman and CEO of Variety Wholesalers, speaks to company executives and county officials during the opening of a 1.4 million square foot distribution center in Coweta County, Georgia. Photo credits to Walter Jones/The Newnan Times-Herald. nce again housing hundreds of jobs and acres of merchandise following Wednesday’s ribbon cutting for Variety Wholesalers Inc. The Herring Road facility built for Kmart has been vacant since that company moved out in January 2015. Last August, Variety announced it had signed a lease with the building’s new owners for 1.4 million of the 1.9 million square feet of space. The area Variety is using, equal to 29 football fields, has space for 80,000 pallets of goods that will be shipped to stock 180 stores of the Roses, Roses Express and Maxway brands. That includes a Roses Express store in Newnan’s Merchant’s Crossing, 50 Bullsboro Drive that recently opened. It will also serve future stores the company has planned in Georgia and neighboring states, according to CEO Art Pope. “We’re looking forward to a long, great partnership,” he told company executives and local civic leaders on hand for a ribbon-cutting ceremony choreographed by the Newnan-Coweta Chamber of Commerce. The Newnan building is the 102-year-old company’s only distribution center outside of its headquarters in Henderson, N.C. “This, for us, was a major undertaking,” said Variety President Wilson Sawyer. The company was attracted to Newnan because of its location near major highways in all directions. But it was also considering other sites around the Southeast. “I knew they had a lot of options available, but they chose us,” said Greg Wright, president of the Coweta County Development Authority. The building’s size and readiness were major factors in the decision, as was use of the racks and conveyor systems that Kmart left in place, according to executives who say there are few buildings of that size available anywhere in the country. The equipment simply allowed Variety to move in faster and get up and running sooner than other sites. Sawyer also gave credit to local and state officials for streamlining the processes for permits, hiring and training. “Lots of communities like to say they are business-friendly,” he said. “But I’ll tell you most of them are not serious about it. The folks here are serious.” With the help of two job fairs offered by the Georgia Department of Labor and training by the Georgia Technical College System’s QuickStart program, Variety has already hired 11 managers and 200 full-time employees, some who had worked at the same building for Kmart. And the company is still hiring, currently for truck drivers. It will eventually have 320 employees here. Shipments begin this week to the first handful of stores from merchandise that has been arriving for six weeks. In the years since Kmart built a warehouse here, other companies have followed suit, including PetSmart and SYGMA. Source: http://times-herald.com/news/2017/03/former-kmart-warehouse-back-in-business

Former state budget director and businessman Art Pope has been added to a bi-partisan Hurricane Matthew recovery committee that includes former North Carolina Governor Beverly Perdue. From the Gary D. Robertson, Associated Press on November 1, 2016 McCrory: Hurricane relief timetable includes special session Gov. Pat McCrory said Tuesday he expects to call lawmakers to a special session next month on Hurricane Matthew relief for eastern North Carolina, looking to Congress for supplemental aid first and developing policy based on recommendations from committees his administration created. Addressing the first meeting of one panel assigned to examine the damage and pinpoint unmet needs, McCrory and other administration officials told participants the actual recovery will be long and hard. “It won’t be a sprint. It will be a marathon,” said McCrory Chief of Staff Thomas Stith, who is also the panel’s chairman. The storm raked the eastern half of the state 3½ weeks ago, dumping up to 17 inches of rain and leading to record flooding along rivers and in the towns and cities adjoining them. Authorities said there were 28 storm-related deaths. While federal damage assessments are continuing, state officials earlier estimated $1.5 billion in damage to 100,000 homes, businesses and government buildings. That doesn’t count agricultural losses. “Our state has gone through a very traumatic, violent and emotional disaster,” McCrory told the Hurricane Matthew Recovery Committee, but “now we need to reinvent ourselves on how do we recover from this.” McCrory laid out a plan that in which the bipartisan committee — comprised of elected leaders, business people, government officials and citizens — would tour hard-hit areas. In early December the panel would fashion recommendations for recovery assistance that wouldn’t be covered with existing funds. A separate panel of emergency management officials would consider more technical issues related to federal and state assistance and address immediate needs. The governor said he would turn in the state’s request for federal disaster assistance on Nov. 14 and wait for Congress to approve it. The state would have to provide matching funds and cover items not included in supplemental federal funds. McCrory said he envisioned calling a special legislative session for early December, although the date could move up depending on the speed of Congress. “I am confident that we’ll be able to recover and rebuild even stronger than what we had before in many of these areas impacted,” he said. The General Assembly likely would be asked to create state recovery programs and permit spending from the state’s reserve fund, now close to $1.6 billion. Laws also would be amended to exempt some schools from the required minimum number of days or instructional hours they must be open. State Budget Director Drew Heath told the committee the state has enough disaster funds to meet immediate needs through January, when the legislature convenes its two-year session. But McCrory told reporters waiting until then to act would hamper long-term recovery planning. The governor said he wanted the recovery committee to raise private and corporate funds to address permanent housing and small business aid. State officials said 250 people are still in shelters and more than 1,500 displaced households are still living in hotels. The committee’s members include former Gov. Beverly Perdue, ex-McCrory budget director Art Pope and current University of North Carolina system President Margaret Spellings. Original story: http://www.wral.com/mccrory-hurricane-relief-timetable-includes-special-session/16183762/