BIZ WRK-SHINOLA-QA 5 TB

Shinola president Jacques Panis at the watch bar in its new gold coast location.

CHICAGO (TNS) — Detroit, and the idea of jobs making a very different kind of motor in the Motor City, is a big part of upscale watchmaker Shinola’s brand.

But Shinola also has strong Chicago ties. A local tannery supplies the leather Shinola uses in its watch straps. Three Shinola stores have opened or are opening in the Chicago area by this fall. The company wants to set up a manufacturing plant on the city’s South Side, though Shinola President Jacques Panis has declined to say what it may make and when it may open.

Over the years, Shinola has branched out to new products — some built in-house, some with outside partners — from bicycles to leather goods to turntables. What ties it all together? Panis said Shinola is trying to create U.S. jobs by finding ways to make, or at least assemble, goods in the U.S. that are often produced overseas.

The interview has been edited for length and clarity.

Q: How did you come to Shinola?

A: I’ve worked for our founder (Tom Kartsotis) for about 10 years at a company called Reel FX. We built a virtual world for kids there — that was the project I was leading.

Q: This seems like a bit of a switch.

A: It is, but even the virtual world we were making was about creating an environment and a platform to engage, tell stores and educate. So when you think about the digital realm we were working in, and this place we’re working in today, there’s a lot of similarities.

Q: You say the stores are designed to activate customers’ senses. What does that mean?

A: You get the sight of the store — the colors, the warmth of the wood, the lighting. You can hear the Shinola turntable playing and the Shinola candle burning, and the team is going to eventually offer you a Shinola cola as well. And the last sense we want you to experience is feel. Our watches are out where you can pick them up, (along with) the leather goods, so you can feel the textures. It’s a really wholesome experience that engages individuals on a personal level.

Q: Was there something the Shinola team saw when creating the brand that made you think the story around heritage and being made in Detroit would catch on the way it has?

A: It was our mission from the get-go to create jobs in the United States and, in creating jobs, design well-made, very high-quality goods. It was always our goal to tell that narrative and share the story of this brand and the city of Detroit. There’s an incredible history there of manufacturing. Our motors power the watches, so when you think about building engines, there’s no better place to go do it.

Q: Do you think it could have worked as well elsewhere?

A: Detroit was our No. 1 choice. It just took time to find space and work with our partners to make sure they were comfortable with what we were doing.

Q: You’ve introduced a much wider range of products. How do you decide where to branch out?

A: What we’re looking for is products that traditionally, at scale, have gone offshore and are being made in other parts of the world. We look at those categories and try to figure out where we can innovate and invest capital in those categories and bring those manufacturing jobs back here in the U.S.

We have to be able to build things here. Our supply chains are global, we have parts that come from all over the world, and we build it here.

Q: You say Shinola still wants to open a manufacturing facility on Chicago’s South Side. Are there other cities where you’re considering something similar?

A: Not at this point. We do have another brand in our portfolio, Filson, which makes bags and some outerwear in Seattle.

Q: So why Chicago?

A: Chicago is a city with a rich manufacturing heritage. If you look back at the history of the city, what was made here and still is made here, and you look at the South Side of Chicago and what is truly needed from a societal point of view there, we don’t know of a better place, off the top of my head today, where we would go.

Q: When you’re doing some sourcing overseas, and some in the U.S., where do you draw the line?

A: About 80 percent of the parts of our turntable are made here in the U.S. It’s not about drawing a line, it’s about what is possible and what is not possible, and the cost of the parts. It’s achieving a price point that’s right for our consumer, and it’s about quality. We’re not going to jeopardize quality just because we can have (a component) made in the U.S. versus offshore, but then we add it on to the final product here in the U.S.

Q: Last year, the FTC raised concerns that Shinola’s marketing overstated the extent to which some products were made in the U.S., and Shinola agreed to add language about the use of imported parts. Do you think that affected how people felt about the brand, or sales?

A: I don’t think so. People that know it and people that want to know it can see what it is and understand what it is. We were never an American-made thing, that wasn’t how we built this. We built this on job creation.

Q: The idea of bringing manufacturing jobs back became very topical in the past election. Did you try to capitalize on that?

A: We don’t want to capitalize on politics, it’s not really who we are. It allowed for some very interesting conversation. It creates some exposure for the brand, but it’s not something we’re out stirring up or looking for specifically.

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