Ironclad Outsources Warehousing and Fulfillment Services

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Not all outsourced work is done overseas.

El Segundo-based Ironclad Performance Wear Corp. announced last week it will outsource its warehousing and fulfillment operations to another company based less than 50 miles away.


The performance glove and apparel manufacturer entered into a warehousing agreement with Valencia-based Advantage Media Services Inc. in order to focus more directly on the August rollout of an expanded clothing line that the company hopes can revolutionize work apparel.


“Fulfillment is a growing concern for a company of our size,” said Ed Jaeger, Ironclad’s president and CEO. “We created the category of work-specific or task-specific gloves and now we’ve taken that a step further. We are transforming from a glove manufacturer to an apparel brand.”


The company, which has made work gloves since it was founded in 1998, is expanding its so-called “performance apparel” line of work clothes. The intent is to create a branded line of fashionable, high-performance apparel for construction and industrial workers, much like Nike and Reebok have done for athletic apparel and Columbia Sportswear and The North Face have done for outdoor apparel.


Ironclad, with annual revenue of just under $10 million, has between 7,000 and 10,000 retail locations in its distribution network, but Jaeger said he expects to boost the number of locations by about 500 by the end of the year as a result of the new apparel line.


But Jaeger has even bigger plans. In the hopes of doubling the size of his company, he relieved his company of its warehousing and fulfillment operations through the Advantage agreement.


“If you’re going through growing pains, this is pretty much the way to satisfy it,” he said. “I’ve got the ability to grow in their warehouse.”


Jaeger said the arrangement is open-ended but would likely last for at least three to five years. Financial terms of the agreement were not disclosed.


Ironclad will be moving its inventory from two local sites to a Los Angeles warehouse run by Advantage. In addition, Advantage will handle the packaging and shipment of Ironclad’s products and the assembly of its promotional materials.


“Ironclad’s service needs fit in perfectly with our core competencies,” Advantage President Jay Catlin said in a release.


Steel Earnings Expected


Along with its metal-making contemporaries, Los Angeles-based Reliance Steel & Aluminum Co. is set to release earnings that experts believe will reflect a stable steel industry.


North American steel companies will release their second-quarter earnings reports starting this week, and while a hiccup in sheet steel prices could keep some companies’ earnings flat, Reliance is showing signs of a strong quarter.


Analysts Timna Tanners and PT Luther with UBS Investment Research expect the strong cash positions of Reliance and Charlotte-based Nucor Corp. to generate better-than-expected second quarter earnings. Both companies, they say, have been bolstered by recent acquisitions.


Reliance’s stock rallied last week in anticipation of a strong quarter, with share prices rising $5.21, or 9 percent, for the week ended July 11, hitting $62.14, just shy of its 52-week high.


But the good times could be short-lived for Reliance and the rest of the steel industry the third quarter is generally the toughest for steelmakers.


Northrop Nets Navy Contract


Defense contractor Northrop Grumman Corp. seems to have a love-hate relationship with the U.S. Navy.


Even as the Navy engages in a rather public feud with the Los Angeles-based company over the quality of its shipbuilding, the Pentagon last week awarded Northrop a $408 million contract to build three new E-2D Advanced Hawkeye surveillance aircraft for the Navy.


Northrop first unveiled the plane in April the fruit of a six-year development effort after the Navy awarded the company a $2 billion contract in 2001 to build two test aircraft.


Work will finish on the new contract by August 2010 and the Navy hopes to begin flying the planes in 2011.


News of the contract comes as Navy Secretary Donald Winter and Northrop Chief Executive Ron Sugar find themselves engaged in a public spat, trading sharply-worded letters over the company’s recent shipbuilding performance.


Winter wrote a letter dated June 22, calling out Northrop for its shoddy construction on a number of ships, including the USS San Antonio, which he said had “numerous outstanding deficiencies.” Indeed, a review of the San Antonio showed more than 5,000 problems with the ship.


Sugar responded in a June 29 letter, saying issues ranging from funding to design changes to Hurricane Katrina adversely affected the company’s performance.



Staff reporter Richard Clough can be reached at (323) 549-5225, ext. 251, or at

[email protected]

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