Rinker on Collectibles: What Does Bankruptcy Mean To Collectors?
The early January 2009 announcement that Waterford Wedgwood PLC is entering receivership, the British form of bankruptcy, is the latest indication the traditional 20th century ceramic industry is facing difficult challenges in the 21st century. In addition to Waterford and Wedgwood, the group also owns the Hutschenreuther, Johnson Brothers, Rosenthal, and Royal Doulton trademarks. Hutschenreuther has survived only as a Rosenthal trademark since 2000.
The bad news begins in June 2008 when Goebel announces the end of production of Hummel figurines. In the mid-1990s, the “MI Hummel Club” claims to have 270,000 members, 200,000 of whom live in the United States. Goebel has distribution centers in Great Britain, France and Hong Kong plus a production facility in the United States. A decade later, the primary and secondary Hummel market is in collapse. When Goebel declared bankruptcy in 2006, investors jumped in to save the company and Hummel figures. The company was saved. The Hummel figures were not. Today, Goebel manufactures gift and household items. Remaining Hummel inventory was sold. News accounts stood silent concerning the disposition of the Hummel molds.
Pfaltzgraff closed its 39 Pfalzgraff factory stores, eight Farberware outlet stores and six clearance stores in late September 2008. Pfalzgraff’s York County (PA) distribution plant closed ealier this year. Lifetime Brands, Inc. acquired Pfalzgraff from Susquehanna Pfalzgraff in 2005.
During my tenure as executive director of the Historical Society of York County from 1ate 1972 to early 1977, Pfaltzgraff was in its golden age, supplying stoneware dinnerware in a variety of popular patterns to department and big box stores across America. I toured the plant on several occasions. Louis Appell, Jr., president of Susquehanna Pfalzgraff and a person with acute business acumen, is a member of the Society’s Board of Directors. Appell retired in 2002.
Recently I questioned whether or not I am too old to write this column. First, many of the things I used during my youth and early adulthood have become collecting categories in the antiques and collectibles price guides I edit. Some are now in museum collections. Second, many of these objects are no longer in production. The category histories in the price guides are revised to include the frightening sentence: “Ceased production in 19xx (or 20xx).”
The movie stars who appear in the black and white films shown on TMC, the Turner Movie Classic cable channel, are dead. Yet, I recognize almost all of them. My grandfather’s Hudson Hornet is one of the first cars I drove. When you mention “Hudson” to anyone under 40, they think river, if they think at all. Even poor “Henry” is forgotten.
Enough laments. What does all this mean to collectors?
Bankruptcy does not necessarily mean that a company is going out of business. Many companies, especially larger ones, emerge from bankruptcy as healthier corporate entities. The company moves forward, continuing to produce the same products it did prior to the bankruptcy. Plafzgraff is very much in business. While it no longer operates outlet stores, it has a very active online storefront.
Yorktowne, a popular pattern in the 1970s and 1980s, is still among the company’s five best-selling patterns, along with Naturewood, Napoli, Tea Rose, and Winterbury. Folk Art and Village, two other popular 1970s/80s patterns, still are available. The only change is sale location. An Internet sale Web site replaces multiple brick and mortar sale sites.
It is business as usual at Waterford Wedgwood. Deloitte, an international accounting firm serving as receiver, has the option to keep all or parts of the company operating, sell off brands, or shut down some operations. In less than a week, Deloitte announced it has a nonbinding “letter of intent” with KPS Capital Partners LP, a firm specializing in bankruptcies, employee buyouts, restructuring, turnarounds, etc., to acquire several of the brand names. Other potential buyers are likely to emerge.
Jane Kahn, a friend whose Internet savvy far exceeds mine, shares an e-mail she received from Replacements, Ltd., calling customers’ attention to the problems in the ceramics industry and suggesting that now is an excellent time to purchase pieces needed to complete dinnerware patterns before supply is exhausted. The supply, especially for popular patterns, will not run out. Popular patterns will remain in production. There is no need for panic buying.
The 21st century continues to change the how, what, when, where and why of collecting. Many axioms that governed the antiques and collectibles trade for centuries no longer hold true. An object becomes more valuable once it is no longer produced is an example. While subject to question in the 1980s and 1990s, this axiom’s death is attributable to the Beanie Baby retirement debacle at the beginning of the 21st century. Retirement means nothing if the production numbers are high. Supply exceeds demand and always will. Retirement is nothing more than an artificial sales device designed to promote the sale of current objects. Collector edition manufacturers played the mold-retirement and limited-number-of-firing-days cards numerous times in the 1970s and 1980s. Time has proven neither are true value-added factors.
When the British surrender at Yorktown in 1781, a military band is reputed to play a march entitled “The World Turned Upside Down.” Scholars have discovered this story is a myth. Musical historians have yet to discover a song with this title in the late 18th century. This aside, the title appropriately describes developments in the antiques and collectibles field in the 21st century.
Hummel figurines are a case in point. Tens of thousands of collector-speculators entered the Hummel figure market in the late 1970s and early 1980s. Collectors drove the market, a market fueled by a continuous rise in secondary market value, the creation of a collector’s club, the introduction of pseudo-limited edition pieces, and price guides whose authors supported a false view of market worth by increasing values in each edition.
The secondary market collapse of Hummel figurine prices begins in the early 1990s, almost a decade before the death knell occured. Back before I know better or understand the ramifications of what I am doing, I include a “What’s Hot” and “What’s Not” in the introductory material to “Warman’s Antiques and Their Prices.” When I place Hummel figurines in the “What’s Not” list in one edition, I receive an irate letter from a member of the Southern Iowa Hummel Collectors Club demanding I come to Iowa and explain myself.
Goebel still owns the Hummel molds. Will there be an occasional reissue? The odds are high there will be. If sales are successful, there will be others.
Goebel’s cessation of the production of Hummel figures after 74 years marks the end of an era. Not many products can boast a 74-year life span. Barbie turned 50 this year. Will she survive until she is 74? Count me among the doubters.
The cessation of the production of Hummel figures also marks the beginning of the end of remembrance. As each year passes, the number of individuals who collect and/or remember Hummel figurines diminishes. Older collectors will die far faster than new collectors can replace them. Will Hummel figurines still be in price guides, whether electronic or printed, in 25 years? The answer is maybe. Will the same be true 50 years from now? The answer is no. Hummel listings will be gone.
What does all this mean to collectors? It means that there are no guarantees of long-term collectability. Every collecting category has to prove its viability on a daily basis. Each change needs to be evaluated and interpreted. Some interpretations will please while others will disappoint. We need to be prepared to take the bad with the good.
Rinker Enterprises and Harry L. Rinker are on the Internet. Check out his Web site.
You can listen and participate in “WHATCHA GOT?” Harry’s antiques-and-collectibles radio call-in show on Sunday mornings between 8 a.m. and 10 a.m. Eastern Time. It streams live on http://www.gcnlive.com on the Genesis Communications Network.
“SELL, KEEP OR TOSS? HOW TO DOWNSIZE A HOME, SETTLE AN ESTATE, AND APPRAISE PERSONAL PROPERTY” (House of Collectibles, an imprint of the Random House Information Group), Harry’s latest book, is available at your favorite bookstore and via Harry’s Web site: http://www.harryrinker.com
Harry L. Rinker welcomes questions from readers about collectibles, those mass-produced items from the 20th century. Selected letters will be answered on this site. Harry cannot provide personal answers. Photos and other material submitted cannot be returned. Send your questions to: Rinker on Collectibles, 5093 Vera Cruz Road, Emmaus, PA 18049. You also can e-mail your questions to firstname.lastname@example.org. Only e-mails containing a full name and mailing address will be considered. Please indicate that these are questions for WorthPoint.
Copyright © Rinker Enterprises, Inc. 2009
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