John-Richard, a Greenwood company that began 40 years ago as a sideline enterprise with a handful of workers and has grown to become a global manufacturer with more than 700 employees, has been sold.
The purchase of the luxury home furnishings manufacturer was announced Monday by Alex Malouf, the company’s founder and until this month its CEO.
“I feel like I’m leaving the company in great hands,” he said.
Malouf and his family stockholders sold the company for an undisclosed amount to a partnership that includes The Dorman Group of Companies, Merit Capital Partners and Alan Galbraith.
The Dorman Group and Merit Capital are both investment firms based in Chicago, and Galbraith has been serving as John-Richard’s president during its most dramatic period of growth. He becomes the CEO with the acquisition.
“I am extremely grateful for the opportunity Alex Malouf gave me more than 15 years ago when I joined John-Richard,” Galbraith said in a prepared statement. “Working with Alex has been an honor and an exciting journey.
“I was tasked with transitioning the company from an entrepreneurial family business based in Greenwood, Mississippi, to the multinational luxury home furnishings company it has become today. The future for John-Richard, even in the challenging times of a global pandemic, is brighter than ever.”
John-Richard has two manufacturing facilities in Greenwood as well as three in Asia — one each in Vietnam, India and China. It also has a permanent showroom in High Point, North Carolina, where the world’s largest home furnishings trade show is held twice a year. The company’s employment is around 750, according to Malouf, with 175 of those working in Greenwood.
John-Richard will continue to be based in Greenwood. The purchase includes the company’s corporate headquarters, and the new owners will also be leasing additional space from the Malouf family. Combined, John-Richard will have about 450,000 square feet of manufacturing and distribution space in Greenwood. Alex Malouf said he anticipates the new company’s local employment to rise.
“I expect them to grow rather rapidly and be a wonderful asset to this community.”
Malouf founded John-Richard in 1980 as a sideline business to Malouf Furniture, the company started by his father that he joined and helped grow to become one of the largest retail furniture stores in the Delta.
Borrowing from Malouf’s middle name and that of a former partner, John-Richard began with five employees and a 10,000-square-foot warehouse. Starting with framed wall art, the company steadily added new lines of high-end home furnishing products — mirrors, lighting, furniture, botanicals and accessories. Today, the product line includes between 6,000 to 7,000 items, with some 1,400 new items introduced every year and about the same number discontinued.
“We covered the entire category of a home,” Malouf said. “You could come to John-Richard and furnish your home.”
Malouf, who turned 79 in October, said he had decided with his wife, Pat, about a year ago that “it was time for us to sell our companies and to move on.”
He had early conversations with The Dorman Group and Merit Capital, but talks cooled temporarily because of the COVID-19 pandemic.
Initially, the virus outbreak stopped nearly all of John-Richard’s operations. All five factories shut down for the month of April, although Malouf said the company continued to pay all of its employees domestically and offshore.
“We came back in May not knowing what to expect,” he said. “But once we reopened, orders began to flow in on a daily basis. Then the orders began to come in so fast that we now have a three- or four-month backlog of product and it continues to grow.”
The so-called “nesting effect,” the tendency of people during the pandemic to stay put and upgrade their home surroundings, has been a boon to John-Richard and other home furnishing companies.
“We’re taking in 50% more orders than we normally get, and the company is extremely healthy,” Malouf said, noting that even before the pandemic the manufacturer was experiencing its highest stretch of sales ever.
The convergence of factors — Malouf’s age, the strain of managing a sometimes volatile international business, and the travel restrictions and other precautions imposed by the pandemic — convinced him to proceed with turning the company over to new ownership.
The sale includes other changes for the Malouf family as well.
Shane Malouf, Alex’s son who has been John-Richard’s vice president of manufacturing, will be leaving the company in December. He will take over managing another family business, Malouf-Carr, which leases out manufacturing space and owns commercial land and timberland. Shane Malouf and his wife, Angela, will also take over two other real estate companies, John Richard Investments and Pemberton Mortgage Investments, in addition to a real estate venture that Shane Malouf already owned.
Another son, Gardner Malouf, will assume ownership of a 90,000-square-foot furniture store in Foley, Alabama, that he has been managing.
Both sons as well as Alex and Pat Malouf’s other two children supported selling John-Richard, the largest of the family’s enterprises.
“All four of my children were stockholders in the company,” Alex Malouf said. “I was excited about sharing the proceeds of that money with them.”
As for Alex Malouf, he has cleaned out his office at John-Richard — an emotional moment, he said — and moved his things to the furniture store he built on U.S. 82 in 1978. He plans to scale back his workload but not fully retire. He wants to help position Malouf Furniture, which is already drawing from a 100-mile radius, to become an even greater shopping destination, while leaving the day-to-day oversight to Bob Milam, the store’s manager since 2007.
“Since I was a young person, I’ve had a great fire in my belly to grow and do well,” Malouf said. “That fire has been diminished somewhat, although I still have a few sparks.”
•Contact Tim Kalich at 581-7243 or firstname.lastname@example.org.