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AMS on upswing after client loss

The company has also secured Foreign Trade Zone status for another building

Posted: September 15, 2013 2:00 a.m.
Updated: September 15, 2013 2:00 a.m.

Employees of AMS Fulfillment package products to fill orders and ship them out. Within six months the company is already recovering from the loss of a major client.

When AMS Fulfillment in Santa Clarita was notified that it would be losing its largest client, Toms Shoes, earlier this year, the third-party order fulfillment company prepared to scale back — but, by September AMS found itself in a much stronger position than it had originally projected.

“Six months ago we were projecting that we’d only need 250,000 square feet of space,” said CEO and managing partner Ken Wiseman.

Instead, after acquiring new clients, AMS had to re-sign some of the building leases the partners had planned to let expire.

Today, the company is leasing 480,000 square feet and it has retained at least 225 employees, Wiseman said.
“Encouraged by recent sales, we made the decision to sign an additional lease,” he said.

While the Valencia-based company leased up to one million square feet at the beginning of 2013, the space was spread out over 13 different buildings throughout the Santa Clarita Valley.

But retailer Toms’ needed AMS to house a new automated workflow in a single space equalling some 500,000 square feet.

The dilemma for AMS was that they could not find a building large enough, fast enough. Industrial vacancy rates have hovered in the two percent range, demand has been strong, and no one had been building for years during the Great Recession. AMS even offered to build a new facility, but that option would not meet Toms’ timeline either.
Some 200 employees were affected by the loss of Toms.

But, within six months of being notified by Toms of the loss — AMS is already recovering — it’s growing and expanding again.

“Because of incoming business we just had to re-sign a lease for a 100,000 square foot building,” Wiseman said. “We’re encouraged by recent sales.”

One of AMS’s newest clients is HBC - the Howard Berger Co. Inc. – a hardware, plumbing, paint and home environment products company.

The volume of HBC products literally took over two of the buildings AMS had been planning to vacate, Wiseman said. And the influx of new business from HBC saved over 30 jobs.

“We’re managing a portion of their west coast business,” he said. “They have their own distribution centers on the east coast and are looking to AMS to support their west coast business. They’re in a growth mode themselves.”

Calling the last six months a “roller coaster,” AMS had been pursuing new clients aggressively and in all has saved 100 jobs in total, Wiseman said. The company has also tried to remain in touch with former employees who haven’t yet found work so they can re-hire them as business grows even more.

AMS has also just had a second building approved as an activated Foreign Trade Zone — which brings plenty of time-saving and economic benefits to its customers who might import goods — and is in the process of having a third building approved.

“It gives us more flexibility as to where we may locate clients,” Wiseman said.

Once the company feels it is on stable ground after losing a big client and gaining several new clients in a short period of time, it plans to reach out to other local companies again who might benefit by importing their parts or goods through AMS.

“We want to walk before we run,” Wiseman said.




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