WOOSTER, OHIO — Rubbermaid Inc. will sink about $51.5 million into a distribution hub, launching a consolidation plan the firm unveiled in 1998.
The center will add 250,000-500,000 square feet to Rubbermaid's 1.2 million-square-foot Wooster plant. The plant will be one of four U.S. hubs Rubbermaid will use in the future.
The hubs eventually will replace nine sites used to manufacture and ship housewares. Some of those plants will be consolidated, a spokeswoman said, although she did not identify which will be closed.
Rubbermaid estimated the hubs could save about $300 million a year.
Of the $51.5 million investment, about $40 million will be spent on machinery, she said.
No layoffs are planned at the Wooster plant, which employs 1,800, the spokeswoman said.
``As a matter of fact, we may add some jobs,'' she said. ``We'll retain and retrain the employees to operate more competitively.''
Construction of the Wooster plant addition will begin in June, with completion expected in 2001. It will take two or three years to build the four hubs, the spokeswoman said.
Other facilities will become feeder plants to the hubs, which will distribute home products to four zones.
``They have to be centrally and well-located to serve our customers better,'' she said. The hubs will be equipped with computers for electronic ordering.
Rubbermaid, which plans to merge with Newell Co. this month, has not specified where the other hubs will be located.
As part of a reorganization plan implemented in 1995, Rubbermaid has closed nine plants in the past three years.
While Rubbermaid initiated its streamlining plan before it entered merger talks with Newell, the program is similar to ``Newellization,'' which is aimed at improved efficiency. The alliance between the consumer-products manufacturing giants, involving a tax-free exchange of shares worth about $6 billion, will create a company with about $7 billion in annual sales. The deal has been approved by the Securities and Exchange Commission. A shareholders vote for final approval was held March 11, but results were unavailable at press time.
The combined firm, Newell Rubbermaid Inc., will be based in Illinois, although the exact location has yet to be determined. In addition to a distribution hub, Rubbermaid's present Wooster headquarters will house its home products division along with procurement and operations units.
