Direct-mail marketing firm shuts Elm City plant, laying off 380 workers

Posted October 23, 2008
Updated October 24, 2008

— Direct-mail advertising firm IWCO Direct is closing its plant in this small Wilson County community of 1,500 and laying off some 380 people.

Most of the employees were told at a meeting Thursday morning that they were out of work immediately. A “skeleton crew” will finish up a “couple of projects,” company spokesperson Deborah Haskel told

IWCO, which is based in Chanhassen, Minn., formally closed on its acquisition of the plant from Cox Direct Media last December. It had invested “upwards to $25 million” in facility upgrades over a two-year transition period after agreeing to acquire the facility in October 2006, said Haskel, the firm’s vice president of marketing.

The company cited the recent economic downturn as the reason for the closure.

In some cases, employees will be offered an opportunity to transfer to IWCO’s Minnesota headquarters, Haskel added. The entire Elm City facility’s equipment and operations are being moved to Minnesota, and some 250 jobs will be added there to accommodate the additional work, IWCO said in a press release.

As the economy has slowed this year, direct-mail marketing campaigns have shrivled as well, Haskel explained.

“This was a very completely marketplace decision,” she said. “The U.S. Postal Service recently reported there have been 9 billion fewer pieces of mail this year, and this has been particularly the case in some of our largest market segments, such as credit card applications.”

While IWCO has not lost customers, the amount of advertising done through direct mail has dropped, she said. In some cases, marketing budgets have “dried up.”

Elm City faced loss of the plant in 2006 when Cox Target Media said it would close the plant as part of its Valpak operation. Some 440 people worked there at the time. That October, IWCO said it would purchase the facility, retain most of the extant work force and invest $18.9 million in upgrades over three years. It also announced plans to add 98 jobs.

In a statement Thursday on the about-face, IWCO Chief Executive Officer Jim Andersen the company needed to act “aggressively” due to the economic environment.

“These are difficult actions we must take to aggressively and pre-emptively react to the industry-wide decline in volume,” he said. By consolidating operations, Andersen added IWCO will benefit from “enhanced operating efficiencies, utilization, and productivity to deliver both postage optimization and low-cost, high-value marketing solutions.”


This story is closed for comments.

Oldest First
View all
  • DeathRow-IFeelYourPain-NOT Oct 23, 2008

    We will see a lot of layoffs as the economy dives. But the only people, who will really feel the pinch, are people who get laid off or people about to retire soon. The rest of us might feel it by a smaller, or lack of, a pay raise. But that's small compared to the layoffs or retirees. As long as you don't get laid off, or are about to retire, we will all make out fine in the long run. This is actually a good time for Mutual Funds. If you keep buying into your retirement accounts, you purchase more stocks with the same amount of money. When the market recovers, you make out like a bandit.

    So, as long as you don't get laid off, or are about to retire, you all will be fine in this small bump in the road.

  • Qwerty27807 Oct 23, 2008

    And how many taxpayer-funded incentives were given to this company?

  • hdsoftail Oct 23, 2008

    Good close all them junk mail places

  • krisandbruiser Oct 23, 2008

    And so another company bails out of eastern NC. Does the governor care? Heck no, he doesn't even know where eastern NC is. He would not attend a new company opening in Goldsboro because his helicopter was grounded, it would have been as fast and cheaper to drive, but no, he has to fly.

  • JustAName Oct 23, 2008

    Junk mail also employees the folks that make the machines that create the mail. So, more than just these guys will be affected.

  • LOC Oct 23, 2008

    That is about how many people who live in Elm City..!! That is crazy..

  • gr Oct 23, 2008

    Not killing the economy just have no use for them - no kids, no is a personal choice

  • foetine Oct 23, 2008

    so only 130 jobs were really lost - feel Good Elm City!

  • crfutrell Oct 23, 2008

    Ghostrogue, good catch on the 250 jobs in Minnesota.

    Tough break for Elm City.

  • Armando de Cabana Boy Oct 23, 2008

    Yea! Less junk mail! Sorry for the folks that lost there jobs though. And you are right Psychobabble.