National News - September 2005

Smart Textiles and Smart Strategies Key to Textile Industry Survival

Greensboro , NC , August 1, 2005 (TextileWeb) - Companies in the besieged U.S. textile industry can still survive and thrive, but only if they adapt smart, new strategies that make them a global player. Those that rely on quotas and protectionist legislation are doomed to failure.

This is according to a hard-hitting report issued by Anderson Bauman Tourtellot Vos & Company (ABTV), a turnaround management firm and an ALTMA Group, LLC company.

The research, conducted from a wide variety of sources including recent interim management and consulting engagements by the firm, point to growth opportunities that can give U.S. companies the edge and set them apart from competitors.

"New performance-enhanced products represent the future of U.S. textiles," said Peter Tourtellot, Managing Director of ABTV. "Traditional textile products can still succeed with aggressive branding and better management of the supply chain."

His firm's recommendations:

• Outsource production to cut costs and keep prices competitive. Rising costs for raw materials, energy and human resources make it impossible for U.S. textile firms to compete in high-volume, price sensitive categories.
• Tighten supply chain logistics so that finished products can move quickly to customers rather than taking up expensive warehouse space.
• Practice strong branding. No longer able to compete on price, textile firms must increase margins and profits by product differentiation. Today quality is not enough. Fabrics must offer superior aesthetic or performance features that give them a distinct identity.
• Take advantage of "smart textiles" developed from nanotechnology which protect fabric and improve performance without altering its appearance. The military, biomedical and automotive industries are excellent markets for this type of product.
• Explore the technology for non woven products. This is one of few segments of the textile industry that have added jobs in recent years. Personal hygiene and medical supply companies have an increased need for these products.
• Concentrate on core strengths rather than developing non-textile lines in order to reduce risk. Stay within the industry and continuously improve product through technology and research.

"Traditional textile manufacturing has all but disappeared, but textile companies and brands don't have to disappear with them. A strong commitment to technology and a willingness to change will keep them competitive," Tourtellot said.

Overland Park PD Gets New Look

Overland Park , KS , August 21, (The Sun) - Civilians probably won't notice that the Overland Park Police Department is sporting a new look, but police officers say their new uniforms have made a remarkable difference - especially as the mercury soars.

The new navy blue uniform is made of high-tech synthetic materials that are more breathable, and more comfortable, than the previous uniform's gray wool trousers and blue wool-blend shirt.

Lt. Col. Keith Faddis said the old uniforms were able to take a lot of use and abuse, but their durability was easily discounted in the dog days of summer.

"They wore like iron. They lasted for a long time, but they weren't comfortable - they were hot," Faddis said.

It had been about 10 years since Overland Park last refashioned its police uniforms, Faddis said.

The makeover began last year, when officers began field testing more than half a dozen outfits, judging them on durability, comfort, appearance and utility.

The winning uniform of matching navy shirts and trousers made of synthetic materials was found to be the most comfortable, durable and functional.

In addition to being more breathable, Faddis said the new uniforms from manufacturer Bratwear are more water-resistant and lack the unique, and somewhat unpleasant, smell that wool has when it gets wet. To make the uniforms more functional and safe, the police department has replaced the standard metal badge with cloth badges on the new uniforms. Faddis said the cloth badge prevents officers catching the badge on things such as seat belts or causing injuries during scuffles.

The new uniforms can be machine washed, saving time and money used for dry cleaning.

The old uniforms were custom made, which Faddis said meant that sometimes officers would have to wait a couple of months to get replacements for damaged articles.

"We had to wait until we had a sizable order so they would actually manufacture the clothing for us," Faddis said.

For the new uniforms, officers are still measured individually to ensure proper fit but Faddis said the vendor carries the shirts and trousers in standard "off-the-rack" sizes, which eliminates the need for special orders.

Two hundred ten officers and sergeants will wear the new uniforms. The cost of the new uniforms is approximately $1,200 per officer.

Paxar Hosts Brand Protection Seminar

White Plains, NY, August 17, 2005 (Company Release) --Paxar Corporation, a global leader providing merchandising systems including bar code, RFID and identification technologies for leading apparel manufacturers and the retail supply chain, today announced it will host two seminars in Southern California focusing on protecting corporate brands and images. The seminars will be attended by manufacturers and retailers from all facets of the apparel industry.

“Counterfeiting is a potential problem for most successful brands,” said Paul Chamandy, vice president of new business development, Paxar Apparel Systems. “A protection strategy should be part of every corporation’s original brand development.”

On Tuesday, September 13, 2005 , in Newport Beach and again on Thursday, September 15, 2005 , in downtown Los Angeles , Paxar will show participants how to protect their brands and customers from counterfeiting and diversion. Both events will take place from 11:30a.m. to 1:30p.m.

According to Chamandy, the issue of brand protection is becoming increasingly important as production of apparel is moving offshore. Studies indicate that sales of counterfeited product have increased 400% since the early 1990s.

For more info rmation, or if you would like to attend Paxar’s “Protecting you Brand” seminar, please contact Michael Barton at 972.726.7292 or via email at michael.barton@paxar.com.

Paxar products are used the world over by leading apparel brands. Its Monarch products are used by 90% of the top 100 U.S. retailers and their supply chain partners to identify, track and price all varieties of consumer goods. Paxar is a member of EPCglobal, the agency managing the emerging standards for RFID.

For more info rmation on Paxar, visit www.paxar.com

Landau Uniforms Announces PCscrubs as a 2005 Diamond Dealer

Memphis , TN , August 19, 2005 (PRWEB) -- Landau Uniforms recently announced their 2005 Diamond Dealer Recognition Program recognizing PCscrubs, LLC as one of the Diamond Dealer winners for 2005. This selective program recognizes the top dealers who support the Landau brand and the Landau specialty brands in retail stores, catalogs and websites. The recipients of the award received a glass figurine and recognition letter for Mr. Nat Landau, president of the company.

PCscrubs, LLC is a leading catalog and Internet company selling uniforms to the individual healthcare professional. With over 16 years of experience, PCscrubs provides value, variety and service to its many loyal customers. Many order Landau uniforms conveniently from their PCscrubs catalog, web site or shop at the PCscrubs outlet store in Stockbridge, GA.

Besides the Landau brand, PCscrubs offers uniforms from other leading manufacturers such as Cherokee, White Swan and Barco. PCscrubs is also the exclusive dealer for cotton-rich Hospitex A1 scrubs sold to individuals.

To learn more, visit Landau Uniforms at www.landau.com , or Pcscrubs at www.pcscrubs.com

Metlon Selected as Distributor for 3M™ Scotchlite™ Reflective Material

Cranston , RI, August 15, 2005 (Company Release) – Metlon Corporation, Cranston , RI , announced today that it has become an authorized Distributor of 3M™ SCOTCHLITE ™ Reflective Material. This formalizes Metlon’s 25-year relationship with the company, serving as a contract converter for a wide variety of 3M’s proprietary applications. This designation signifies a larger volume of business for Metlon nationally, although the Northeast will be the primary territory.

Specifically, Metlon is one of only two companies nationally categorized as an authorized One Star Distributor, distinguishing the company whose focus is converting and reselling roll goods, and slitting and supplying partially finished components to garment and accessory manufacturers. Metlon will not manufacture any finished product, or compete with other manufacturers.

We welcome this opportunity to work more closely with 3M,” comments VP Wayne Etchells. “Strengthening our relationship with them in this way not only opens the doors to new business, but also creates an opportunity for us to provide better service to them as we learn more about their product lines and product requirements.”

At the same time, this new alliance enables 3M to provide additional service and ongoing support, from sales and marketing to technical training.

For more info rmation, contact Metlon Corp. at (401) 467-3435.

G&K Services Fourth-Quarter Profit Rises Slightly on Revenue Growth

Minneapolis, MN, August 16, 205 (AP) -- G&K Services Inc., a supplier of uniforms to workers in the manufacturing, hospitality and auto industries, on Tuesday reported its fiscal fourth-quarter profit edged up 4 percent, driven by higher rental and direct sales revenue, but higher energy costs restrained results.

G&K reported earnings of $9.8 million, or 46 cents per share, compared with $9.5 million or 45 cents per share, in the prior-year period.

Revenue rose 7 percent to $207.4 million from the prior-year period, which included an extra week. Stripping out the extra week, revenue jumped 15.1 percent.

Wall Street's consensus view for the quarter was 47 cents per share, the average of seven analysts surveyed by Thomson Financial, on estimated revenue of $204.5 million.

Gross margin from rental operations declined to 36.1 percent from 37.6 percent in the prior-year period, which G&K attributed to higher energy and acquisition integration costs.

Full-year earnings rose to $39.9 million, or $1.88 per share, from $35.4 million, or $1.69 per share, a year earlier. Revenue grew to $788.8 million from $733.4 million last year.

Looking ahead, the company forecast first-quarter earnings of 45 cents to 48 cents per share on revenue between $204 million and $207 million.

Analysts' consensus estimate for the current quarter is 49 cents per share on revenue of slightly under $205 million.

The forecast includes the impact from expensing stock options, which is expected to lower earnings by 2 cents per share, as well as continued high energy costs, G&K said.

Companies Tap Youth Market For New Uniform Designs

Daytona Beach , FL , August 21, 2005 (News Journal, as reported by Valerie Whitney) - Kaylee Smith loves khaki clothing.

"You should see my closet," Smith, 18, said during a recent interview at the Chick-fil-A restaurant on West International Speedway Boulevard where she works. Come fall, her wardrobe will feature some new khaki -- a new uniform Chick-fil-A is preparing to roll out.

The current Chick-fil-A uniform of black pants and a black golf shirt is about 5 years old, said Gary Harris, owner/operator of the Speedway location.

"It's been good," he said, but corporate officials have determined they need to change the company's image. The new uniforms are designed to be more upscale, he said.

Chick-fil-A isn't the only company looking to update it uniforms. Fast-food giant McDonald's also is planning a makeover. Both companies, as well as other businesses, say continued sales growth depends on their ability to tap the youth market for both customers and staff.

Young workers contacted at several other area eateries have definite ideas about what they have to wear for work. Teia Berube, 16, said she would like to see more details on the black shirts, hat and apron that she wears in her job at a Subway restaurant in Holly Hill.

Lisi Diaz, 18, said the uniforms worn by Publix cashiers definitely don't make a fashion statement.

"It does keep everybody equal, however," said Diaz, who started working part-time for the grocer when she was 16.

Sometimes a worker's duty can make wearing the uniform a challenge. "The shirts can get hot in the summer when we're doing drive-through, but otherwise they are OK," said Crystal Quinones, 25, another local Chick-fil-A employee. "I feel like a professional person working in them," Quinones said.

If nothing else, uniforms save time when getting ready for work, some workers said.

Jon Kaye said he doesn't mind the khaki pants and blue golf shirts required of Best Buy employees. "It's easier in the morning not having to try and pick out what to wear," Kaye said.

Harris, of Chick-fil-A, said students appear to be more sensitive to style, even as it relates to uniforms, than adults. The new shirts and hats are comparable to pieces from mainstream chains such as the Gap or Banana Republic, according to a company spokesman.

"We polled our owner-operators and team members extensively last year. One comment we heard stood out: "We want to look different because Chick-fil-A is different," David Rissier, the chain's brand environments senior consultant, said.

The new uniforms feature more tailored tops, optional accessories like caps and visors, and pants cut with respect to gender.

There also are more color options available to complement the earth-toned color scheme of the chain's newer locations, the article said. Individual owner-operators have the option of choosing particular styles or colors for their staffs.

Advertising Age magazine reported recently that marketing whiz Steve Stoute of Translation Consulting & Brand Imaging has been hired by McDonald's to lay the groundwork for a uniform switch that would include a celebrity designer.

The goal is to capture the spirit of being young forever, McDonald's spokesman Bill Whitman said.

It's unclear if the new look will sell more burgers, but experts say cool clothes could help its mass-market image and make its entry-level jobs a little more attractive.

If the fashion is good, employees will probably see getting the clothes as a good reason to take the job, said Rick Levine , publisher of Made To Measure, a uniform industry trade publication in a recent Washington Post article.

"My first job as a freshman in high school was at Long John Silvers, back when they had those little pirate hats and a fake earring," Levine said. "Try to get a kid today to wear that. No way. Now, they've all got golf shirts."

Experts say a McDonald's fashion statement could cause a ripple effect in the restaurant and uniform industries, as others jump to emulate the chain's hip looks.

"They're firing the first salvo with a new uniform," said Harry Balzer, food industry analyst for market research firm NPD Foodworld.

"The restaurant industry is very much a 'me too' world. When you find someone who's done something successful, you find a way to bring it into your business, too."

Pre-Civil War Textile Mill Loses Battle to Imports

Tallassee, AL, August 15, 2005 (Seattle Times, as reported by Jay Reeves) — The old stone mill along the Tallapoosa River once made fabric for both slave clothes and Confederate uniforms. It survived the Civil War and the economic struggles of the next century, employing entire generations of families.

But Tallassee Mills, described by its South Carolina parent company as the nation's oldest cloth factory, is closing after 161 years. With walls a yard thick and floor joists made from pine logs, the plant is the latest U.S. mill to lose the fight to foreign imports.

The closing isn't the death knell it once would have been for Tallassee, about 35 miles northeast of Montgomery . The longtime mill city is also home to a factory that makes airplane parts, GKN Aerospace, and Neptune Technology Group, which makes water meters.

But the loss still hurts economically: More than 300 people are losing their jobs in a town of only 4,900. It is also a psychological blow to a town that is losing the very thing that made it a community.

There was a time when almost everyone in Tallassee worked at the plant and lived in the mill village of small homes overlooking the factory. Workers shopped in the company store and went to schools and doctor's offices housed in company buildings.

More than 350 U.S. textile plants have closed since 1997, and the industry has lost about 194,400 jobs in the past five years, according to the National Council of Textile Organizations. Low-priced imports from China and elsewhere get much of the blame.

Rodney Griffith, administrative manager at the Tallassee mill, said foreign competition finally got the best of his nonunion factory, where the average wage is $12.50 an hour, plus benefits.

"We have managed to run this mill longer than anyone expected," said Griffith, who started 35 years ago as a cost accountant. "We probably got another 10 years out of it."

Tallassee Mills, owned by Mount Vernon Mills of Mauldin, S.C., dates back to 1844, when workers began producing heavy cotton cloth used to make both grain sacks and slave clothes in a one-story building that also turned out Confederate carbines during the Civil War.

A much larger mill was built beside the original structure in 1852, and it turned out fabric for uniforms worn by Confederate troops.

With the mill set to close in late September or early October, no one is sure yet what will become of the old building. A local historical-preservation group has purchased the oldest mill buildings, but it's unclear whether the rest of the operation will be put up for sale.

Officials at Mount Vernon Mills, which has operated the Tallassee plant since 1900, say no U.S. factory has been making cloth longer than the one they operated for so long in eastern Alabama , a historic survivor now bowing out in a global economy.

China Suddenly Losing Ground on US Apparel Import Market

August 9, 2005 , Emerging Textiles - US apparel imports from China were clearly affected by the first embargoes placed by Washington at the beginning of July, preliminary data reveal. China 's shares of the US import market declined in a large number of categories as a clear sign that the threat of other embargoes in the near future is depressing Chinese sales to US importers and retailers.

US imports from China continued generally rising in the seventh month of the post-quota period, but they grew at a lower pace while even losing market shares at the same time.

In cotton categories, shipments from the PRC were even down for a small number of products. In category 342 (cotton dresses) that is not yet threatened by a US embargo, imports were down from 735,000 dozen in June to 366,000 dozen in July.

This is only 96% of the average level of imports from China in the first seven months of the year, against 136% in June.

In categories that were placed under embargo, shipments not surprisingly declined to very low levels.

Imports were stopped by July 7 in category 338 (cotton knit shirts) with entries falling from 2.63 million dozen in June down to 480,503 in July.

In category 347 (M/B cotton trousers) that was subject to an embargo on July 8, imports plunged from 1.88 million dozen in June down to 178,059 dozen in July.

Shipments continued being strong in man-made fiber categories where embargoes were not yet placed, by contrast.

As US total imports continued surging in a large number of categories, China 's shares of US import market generally fell.

In addition to categories subject to embargoes, shares also decreased in several categories that are not threatened by US safeguards.

China 's apparel exports are clearly destabilized by Washington 's answer to post-quota surge in Chinese shipments.

Terry Manufacturing, an Alabama Town's Pride and Mainstay, Goes down in Disgrace

ROANOKE , Ala. , August 28, 2005 , ( The Atlanta Journal-Constitution, as reported by Mike Tierney) Staring blankly through a ground-level window, a sentry in military garb stands guard over the darkened building.

But no. On closer inspection it turns out to be a mannequin – among the last remnants of this deserted red-brick plant once bustling with a few hundred textile laborers under the banner of Terry Manufacturing. He is modeling one of the millions of uniforms stitched here over four decades and worn by soldiers, forestry workers and fast-food cooks.

Appearances at the factory deceive, just as they have with the downfall of the company, once the largest black-owned apparel producer in the country, and its disgraced president/CEO, Roy Terry, 60.

In a series of lawsuits, prosecutors and businesses have alleged that Terry and his younger brother, Rudolph, executive vice president and fellow Morehouse College graduate, steered the business into bankruptcy. Charges included check kiting, creating a bogus company, raiding employee pension funds, and cheating investors, suppliers and banks.

The siblings are accused in two bankruptcy filings of acquiring real estate near and far while supporting a "champagne lifestyle" that almost involved a notorious, ear-biting boxer.

Roy, a lifelong Roanoke resident who became the first chief of a prominent black-owned company snared in the federal crackdown on corporate malfeasance, pleaded guilty to 13 counts of felony fraud this summer — two years after bankruptcy was declared and a judge ordered the doors shuttered. Sentencing is scheduled for Oct. 13, with prosecutors recommending 11? years.

Rudolph, who relocated years ago to southwest Atlanta , served eight months and paid $800,000 in restitution for mail fraud.

In court, Roy 's lawyers insisted he was merely trying to unclog cash flow problems and save the family business, rooted in this city nine miles across the Georgia border. He and Rudolph declined to comment through their lawyers, but much of their story is told in court documents.

The sordid details of the collapse left the 7,000 townsfolk in a collective state of shock. Many hold J.A. Terry, the men's late father and the company's founder, in the highest regard. Roy was beloved in the black community and respected by many whites, even by the establishment he sometimes riled with civil rights activism.

"It like to knock me over," Mayor Henry "Spec" Bonner said.

Civic-minded business owner

Away from work, J.A. Terry's life centered on church. He served as a deacon. Roy 's passions tilted toward the political. Roanoke had dodged much of the racial turmoil that beset Southern towns in the '60s and '70s, but brush fires erupted later — often with Terry among the igniters. "Some [objectives] were good, some were bad," judged Bonner, who is white.

School matters got Roy 's attention, from a high school principal threatening to cancel the prom if interracial couples attended to the city declining to reappoint one of his employees to the school board. After the board flap, he invoked comparisons to the slave era, lowered the American flag outside City Hall to half-staff and filed an unsuccessful lawsuit. Organizers of rallies might use Terry Manufacturing equipment to print fliers or its property as a spot to gather. Roy did not prohibit employees from activism. In fact, he encouraged it.

Supporters and critics alike credit Terry with starting the local Boys and Girls Club. He helped sponsor achievement awards for black students.

"He was a business owner who felt a civic obligation," said Jerome Gray, state field director of the Alabama Democratic Conference, a black caucus. "Some people just want to be rich."

Some in Roanoke subscribe to the theory that the Terrys were the prey in the demise of their business. "I think they got duped, maybe by some fella in Atlanta ," downtown hardware store owner Wyner Phillips said. "Most people who know them share my opinion."

Scruffy beginning, then a break

J.A. Terry walked out of a bank owned by Phillips' parents in nearby Wadley with a loan. Thus was Terry Manufacturing born in 1963 — five sewing machines that stitched women's blouses inside a plant erected with lumber from a torn-down mansion.

In a state clinging to the vestiges of segregation under Gov. George Wallace, Terry provided jobs, mainly to black women — some single mothers, few educated beyond high school. An appreciative citizenry celebrated J.A. Terry Day in 1969, a mixed-race crowd of 800 filling the armory for a banquet.

Funeral home director Charlotte Clark-Frieson, who recently buried Terry's widow, called them "two unforgettables, pillars in the community."

Come the mid-'70s, he was turning control over to his sons. The elder Terry ultimately joined his other son, William, who'd had a falling-out with his brothers and left the plant. He started a church furnishings endeavor that still operates in Roanoke .

Terry Manufacturing grew steadily, then took a quantum leap in 1988 with the first of several lucrative minority set-aside contracts with the federal government, mainly to clothe U.S. troops in battle dress. Its handiwork was also seen across the counters at McDonald's, Burger King and Church's.

The company trophy case made room for the 1989 Minority Manufacturer of the Year from the U.S. Small Business Administration.

Its next coup came in 1994, triggering a run of fortune. A hard sell to the Atlanta Olympic committee brought the Games' first merchandise license for a black-owned firm. A plant with 35 workers, soon to expand to 50, revved up in Hapeville, churning out souvenir garments geared toward the summer of '96.

Then, in later years: Revenue, spurred by Olympics sales, leapt to $35 million. The company struck a licensing agreement with the National Hockey League, the first black-owned clothing manufacturer to do so with a major sports league. Black Enterprise magazine ranked it among the nation's high-impact minority businesses in 2003, with revenue of $49.5 million.

Mark Traylor, whose family operates a Roanoke nursing home, was an Atlanta Hawks season ticket holder reaching for Terry-tagged jerseys tossed into the crowd. "There was a sense of pride," he said.

But the reports of profits rolling in, along with the accolades, were deceptive. The brothers were taking unethical and illegal steps, with growing desperation. As Terry Manufacturing seemed to thrive, it was slowly coming apart at the seams.

Downward spiral of deception

In the summer of 1995, Roy began amassing a string of nine loans for himself and the company from five Ala­bama banks. Prosecutors said the first was obtained legally, while the others, beginning four years later, were not. Roy , they claim, submitted fabricated financial info rmation.

Three of the loans were partially guaranteed by the U.S. Department of Agriculture, which took a hit of up to $16.5 million.

Roy also began borrowing from a half-dozen private investors, ostensibly to buy fabric either through a previously secured option or at a deep discount. Neither avenue existed, prosecutors said, and the loans violated his agreement with the banks.

For example, Roy solicited a loan from a couple who were falsely told it would fund a clothing manufacturing deal with a national radio personality. Roy arranged the deal, prosecutors say, to pay for the company's operating expenses.

Further, Roy approached a businessman in Eatonton , Ga. , who loaned him several million dollars to capitalize a new venture, Terry Promotional Products. It never was created, prosecutors say.

And so it went, a staggering chain of events in which Roy wound up exaggerating the company's assets by more than $35 million, according to prosecutors.

He deposited multiple copies of the same check in two different banks, artificially inflating the balances by nearly $8.6 million.

Investigators found memos in which Roy labeled the company's financial situation as hopeless even as loans continued to be sought and erroneous books kept. Said one: "Will this just complicate & prolong everything if we know it is helpless?"

Some financial records were unavailable, according to court documents. News reports indicate an intruder broke into company offices within days of the bankruptcy filing, shredding bank statements and stealing documents from locked cabinets.

Predating all of the misdoings traced to Roy was a scheme involving Rudolph, who ran the company's Licensed Apparel Division out of metro Atlanta .

The younger brother executed a plan in 1997 with the CEO of the Atlanta-area firm Floodgates, which was supposed to have applied logos to shirts and shipped them to Terry Manufacturing.

The work was never completed. According to court documents, Floodgates, based in Lawrenceville, submitted $12 million in phony accounts receivable to Commercial Factors, an Atlanta collections company. To generate short-term financing for Floodgates, it periodically bought the accounts receivable at a discount.

Commercial Factors was conned into wiring $11 million to Floodgates. Rudolph pleaded guilty to signing off on the bogus invoices.

Some supporters of the Terrys, black and white, seized upon the case to back their belief that one or more Atlantans led them astray, that they were taken in by evil forces in the big city 90 miles to the northeast.

George Beck, Roy 's attorney, blames the company's decline partly on NAFTA, the trade agreement that shifted many manufacturing jobs to other countries.

"His sales plummeted," Beck said in an interview. "He did what he had to do to try and keep the doors open. He didn't want to just close down shop and terminate all those jobs. He just borrowed beyond his means."

Blaming NAFTA did not fly with prosecutors, who point out that the core of Roy 's business was contracts secured by the federal government and that the business was one of only two providers of McDonald's uniforms. They argued in court that those deals could have sustained the company for years had it entered bankruptcy at early signs of trouble and presented a plan to reorganize long before it did.

Defense Department contracts amounted to $58.3 million from 1997 until the company closed, according to news reports. The Defense Department did not return calls seeking verification.

Still unresolved is a bankruptcy court case filed by the Terry Manufacturing trustee against the Cintas Corp., the largest uniform supplier in the United States .

It alleges that Cincinnati-based Cintas, rebuffed in efforts to produce McDonald's uniforms because it was not minority-owned, formed a joint venture with Terry Manufacturing that existed in name only. Further, the suit says, Cintas essentially took over the company and secured deals with McDonald's franchises in Canada .

The total tab for the criminal activities, prosecutors say, falls between $20 million and $50 million lost by creditors and investors. The company trustee maintained that some funds were applied to repaying personal loans to the Terrys.

One of the smallest amounts may have inflicted the most pain.

Investigators concluded that Roy neglected to deposit $175,000 into the company's 401(k) profit sharing from early 2001, even as he filed statements indicating the pension plan was solvent. The funds were withheld from paychecks earned by people making $10 an hour or less.

That money may not be recovered.

Fear gnaws at workers

Roy Terry called a special meeting of his 300 employees. It was early summer 2003.

"I very seldom saw him," said Renee Goss, a 20-year laborer, who mainly applied buttons to flaps. "Whenever he came out, it had to be important."

Terry advised them that shipments of cloth for uniforms were late and that he would shut down the main plant and one on the bypass, probably for a few weeks.

Goss was grateful to work there, even with what she described as low pay and benefits. Her hourly wage was $5.85. For most, the rate ranged up to $8.50, while an inspector, such as Gloria Wright, pulled down $10.

"Anybody who wanted to work and needed a job could come get one at Terry," Wright said.

Once there, many who needed help found it. Wright recalled Roy 's wife, a company official, paying the bill for someone who could not afford to have a tooth pulled.

Workers were allowed to stay home as long as necessary to care for sick children. For many years, a bus carted youngsters to the Boys and Girls Club. At the plants, the Terrys held catered parties and talent shows.

With all work in hiatus, gossip about permanent closing prompted several employees to withdraw some savings from their retirement funds. Goss yanked out about $1,700 of her $2,000.

"Had I known what would happen," she said, "I would have gotten it all."

Their source for news on the company's expiration: the local newspaper, the Randolph Leader.

"I didn't understand why," said a bitter Mary Jo Rowland, a mother of four who made $5.50 for putting lapels on camouflage outfits. "[ Roy ] should have called a meeting and told us, rather than us read it in the paper."

While admitting they have not kept abreast of the array of accusations against Roy , most want to believe that he pulled the plug as a last resort.

"I feel bad about what happened to him," said 22-year employee Linda Rowland (no relation to Mary Jo), a mother of five recently separated from her husband. "I pray everything works out for him."

Goss is not so forgiving. "We went out on a lie," she said, noting that the second car her family just acquired had to be returned.

Why, she wondered, didn't he try cutting back workers' hours to continue? Why did not he think of preserving his father's legacy?

"We would have sacrificed," Goss said. "It was selfishness, greed and lavish living."

Goss, like so many others, has heard about the "champagne lifestyle" for which the Terrys were cited in bankruptcy court.

They were depicted as having joined private clubs, taken junkets to Las Vegas , hired limousines, leased private boxes at sports and other events, and entertained elaborately.

If true, said attorney Beck, the expenditures were for entertaining clients. Prosecutors found evidence of real estate acquired not only in Alabama and Georgia , but also in Jamaica , perhaps worth millions of dollars.

Court documents say the brothers spent "tens and perhaps hundreds of thousands of dollars of critical capital of Terry Manufacturing" in a futile effort to promote heavyweight fighters — including Mike Tyson, infamous for, among other discretions, chomping a slice off Evander Holyfield's ear.

Beck dismisses such depictions of Roy . "That," he said, "does not seem consistent with the Mr. Terry I know." Most cases of corporate fraud involve "a golden parachute, an island [home] in Antigua , multimillion-dollar profits. Mr. Terry is a very modest person of modest means with a modest home."

Both Terrys' annual take-home pay was shy of $84,000, and Roy kept several checks uncashed, Beck said.

A few dozen Roanoke residents interviewed for this story say they observed no evidence of extravagance. Roy 's split-level brick house is assessed for tax purposes at $124,850 — well above the county average but no mansion.

"They didn't flaunt their wealth around here," said Randolph Leader Editor John Stevenson.

Tom Staples was back in town recently, eager to get an update on the Terrys. As a U.S. Army staff sergeant in Iraq , he was alerted to the company's crash-and-burn from the Leader, sent by his sister.

"I couldn't believe it," Staples said.

If not for the downfall, Staples' work uniform back in the Middle East might have come off a sewing machine at the brick factory. But Terry's garments are gone, with few exceptions — one being worn by the mannequin peering out from the abandoned plant, standing guard over a place that no longer needs it.

G&K Services Announces the Retirement of Richard Fink, Chairman of the Board, After 41 Years with G&K Services

G&K Services, Inc., Aug. 26, 2005 (Business Wire), a market leader in branded identity apparel programs and facility services, today announced that Richard Fink, age 75, Chairman of the Board of Directors, has decided not to stand for re-election to the Board at the company's upcoming annual shareholders' meeting scheduled for November 10, 2005, and will retire as its Chairman at the conclusion of the meeting. Mr. Fink also will retire as a G&K employee effective on December 31, 2005 . A G&K Services employee for more than 41 years, Mr. Fink has served the company as President from 1970-1993, Chief Executive Officer from 1993-1997, and as Chairman from 1981 to the present. Mr. Fink has been a member of the G&K Services Board of Directors since 1968.

"Dick Fink has been a key factor in G&K's success during his 41 year tenure at the company and is largely responsible for shaping G&K into the company that it is today," said Lenny Pippin, President and Chief Executive Officer of The Schwan Food Company and chair of the G&K Corporate Governance Committee. "Dick has led G&K's board of directors and overseen the strategic long-term vision for G&K during its entire history as a public company. He has added incredible value to the company, and its shareholders have been the beneficiaries. He also has served as an invaluable guide and mentor to members of the G&K executive team."

"Serving and leading G&K during the past 41 years has been an honor and an experience that I have enjoyed immensely," said Richard Fink. "My departure from the company comes at a time when all the pieces are in place for its continued success, and I believe G&K has an exciting future with the current executive team. I'm looking forward to spending more time with my family and friends, and to watching the company continue to grow from the outside."

The company also announced that Richard L. Marcantonio, currently President and Chief Executive Officer, is named Chairman of the Board, replacing Mr. Fink, and the company's Chief Executive Officer. Mr. Marcantonio, age 55, has served as President and Chief Executive Officer of the company since January 1, 2004 , prior to which he had been President and Chief Operating Officer of the company since July 2002.

"I am deeply honored to have earned the continued trust of the Board of Directors, and look forward to a robust future of growth and success for G&K," stated Marcantonio. "At the same time, I understand the huge legacy being left here by Dick Fink as he enters his retirement. As Mr. Pippin indicates, Dick has been my mentor over the years and all of us with ties to G&K owe him our gratitude and admiration."

"Rick Marcantonio has demonstrated during his tenure with the company and in his leadership on the Board a keen business sense and an attention to detail and business integrity that deserves our support and respect," stated Pippin. "The members of the Board look forward to working with him in helping to take the company to ever greater levels of success."

The company's Board of Directors also created a new position of Presiding Director, in a move consistent with best practices in public corporate governance, and elected Mr. Pippin to the post. Chosen from among the Board's independent directors, the Presiding Director will work with the Chairman to help assure the Board operates as a true strategic partner of management in serving the interests of the company's shareholders.

Effective with Mr. Fink's retirement on December 31, 2005 all Class B common stock of the Company convert to Class A common stock. Under a Stockholder Agreement that effectively expires with Mr. Fink's retirement, each share of Class B common stock has had a voting power equal to 10 shares of Class A common stock. The Stockholder Agreement affects 1,474,996 shares of Class B common stock. The conversion of Class B shares to Class A shares eliminates the super-voting rights under the Stockholder Agreement. Each Class B share has the same monetary value as a Class A share, and the conversion will not affect this valuation.