Suppliers sweating out aftermath of IP announcement
Published 12:00 am Friday, January 24, 2003
NATCHEZ &045; Ronnie Killingsworth doesn’t know what Monday morning might bring.
Killingsworth, field administration manager at HB Zachry, is just one of hundreds of employees who, while they do not work at International Paper’s Natchez mill, have jobs that depend directly on the plant.
HB Zachry’s Natchez location performs capital and maintenance work exclusively for the mill, which announced Thursday it would close by the middle of the year.
Simply read: Unless they can find jobs at the company’s other locations &045; which remains to be seen, said Killingsworth &045; HB Zachry’s 53 Natchez employees will have to seek work with other companies.
&uot;They (IP) have to give us 30 days’ notice&uot; when the contract with HB Zachry is terminated, said Killingsworth. &uot;They haven’t given that notice so far. But it could be the middle of next week, it could be Monday morning &045; who knows?&uot;
And most of that business’ workers are &uot;homebodies&uot; who do not want to move to other areas for jobs,&uot; Killingsworth said. In both human and economic terms, he said, the IP closing &uot;will have a big impact.&uot;
Although companies like HB Zachry will probably see the most direct impact from IP’s closing, logging companies that supply wood for the mill’s operations won’t be far behind.
&uot;We do probably 80 percent of our business with International Paper,&uot; said Charles Cameron, owner of Cameron Logging in Natchez.
The news comes at a time when the rising cost of equipment is not keeping pace with prices such companies get for hauling logs, Cameron pointed out.
&uot;And I wouldn’t be surprised if other companies cut their price&uot; in response to the IP news, said Cameron, whose business employs 10 workers.
Jake Middleton, whose Big M Supply supplies the mill with everything from paper products to cleaning supplies, said that the mill, &uot;as far as monthly sales go, would probably be in the top 10 for us. They were &045; and still are &045; a good customer for us.&uot;
What’s left to do when you lose such a large account? Since Big M sales representatives are constantly making &uot;cold calls,&uot; or unsolicited visits, throughout southwest Mississippi to drum up new business to replace such losses. &uot;If you’re in sales, you’re going to lose 15 percent of your business every year, so you can’t become complacent,&uot; Middleton said. &uot;The visit might not pay off immediately, but it could six months down the road.&uot;
Middleton, who also serves as a Natchez alderman, laments the effect IP’s closing will have not only on its direct suppliers, but indirectly on businesses throughout the Miss-Lou.
&uot;It’s kind of a domino effect,&uot; he said. According to figures from the Associated Press, the mill has a $33 million payroll.
And using state-supplied multiplier figures, each dollar paid to a manufacturing employee creates 81 more cents in the local economy as it’s spent on everything from groceries to gas to school tuition.
That makes the calls economic developers make to companies to &uot;sell&uot; Natchez even more important, Middleton said.
With people like Mike Ferdinand, executive director of the Mississippi Development Authority, selling Natchez, &uot;I think we’re going to make it through this,&uot; Middleton said.