Waterford Crystal Wedgwood China is in Trouble

The recession isn't just limited to American soil. On January 5^th, Waterford Wedgwood went into administration, a British term similar to bankruptcy protection.

Luxury crystal and ceramics just don't have a place in today's economy. But it isn't just the price of their goods that puts people off. Trends in dinnerware have changed greatly. In the old days people used to have their "good china," that they would save up for or get as wedding gifts. Today people don't go out of their way to buy a separate "good china" set. Instead most people buy a midrange priced dish patterns that they love.

Waterford-Wedgwood, while classic, hasn't kept up with the latest trends when it comes to interesting and modern patterns. In the past five years they've tried to play catch up by hiring designers such as Vera Wang and Marc Jacobs. Despite that, they haven't been able to successfully re-brand as the go-to company for cutting edge design.

Waterford was founded in 1783 and Wedgwood was founded in 1759. The two companies came together in 1986, when Waterford acquired Wedgwood. Waterford closed for about 100 years in 1851, when high taxes made it impossible to operate.

The companies have been struggling for several years. So much so, that stock has plummeted to less than one euro cent per share since 2004. (As of 2009, they go for about 1/10 of a cent). The CEOs have pumped money into the company, and even appealed to the Irish government, to no avail.

In the UK paper, The Guardian, Jack Walsh, mayor of Waterford, has recently appealed directly to the government. With the death of the brand, he says that Ireland puts their tourist industry at risk.

"Waterford Crystal is a huge national brand and its importance goes beyond even the manufacturing plant in Waterford. It is not just the workers at Waterford Crystal that are affected by this. Nationally, it's the whole hospitality industry as well," he said.

Walsh claimed the end of Waterford Crystal in Ireland would have a negative impact on Irish tourism as well as adding to the Republic's rising unemployment. More than 300,000 tourists visit Waterford every year, with the crystal factory being one of the city's biggest attractions for foreign visitors, he said.

"Waterford Crystal is one of only a handful of iconic Irish brands and the gallery and the visitor centre at Kilbarry are among the most popular visitor attractions in the country. Given this, it is of major strategic importance that this company not be allowed to slip in to oblivion."

The mayor called on the Irish state to intervene and help shore up the company and the brand. -- http://www.guardian.co.uk/business/2009/jan/05/waterford-crystal-ireland

The thing that seems to have but them on the brink is the unwillingness to move the business to countries with cheaper labor. Much of the business has now shifted to Indonesia, where they employ the majority of their workers.

So why aren't we talking about this? Skilled workers in Ireland and England can't compete with skilled workers who are willing to work at lower wages.

These sorts of problems are mirrored in the U.S., where jobs are shipped across the boarder and overseas on a regular basis.

Why don't these countries impose taxes on imports that make the prices competitive with what their own countries can produce?

http://www.nytimes.com/2009/01/06/business/worldbusiness/06plate.html?hp

http://www.guardian.co.uk/business/2009/jan/05/waterford-crystal-ireland