CJ Buck, Buck Knives

CJ Buck is now the fourth generation of Buck men to make and sell some of the world's best-known knives. He and his family moved the company from San Diego to Post Falls a few years ago - a "perfect combo pack" of interstate and airport access and elk hunting.

A quick history of the company:
My great grandfather was Hoyt Heathbuck and he was a 12 year old blacksmith in Leavenworth, Kansas. He was actually an apprentice blacksmith. Started making knives - he wasn't really into knives - he was more into the metallurgy. He loved the heat treat, he loved the forming, he loved the craftsmanship. Knives just gave him an outlet for that desire. My great granddad was a blacksmith, he was a preacher and he was a logger so imagine winning an argument with this guy on any level you want to take it. He was in the Pacific Northwest raising a family. My grandfather ended up joining the coast guard and then joining the navy which located him in San Diego, California so he went from Washington State to San Diego, California.

My great grandparents had ended up in Mountain Home, Idaho, and Hoyt was pastoring a church in Mountain Home. My great grandmother's health was failing so they decided that they needed to leave winter behind and get into more mild climates so they actually moved in with their son, Alfred Charles Buck, my grandfather.

My grandfather was a 35-year-old bus driver raising 4 kids in San Diego, California and had never, ever made a knife in his life. He never even contemplated making a knife. And when his dad moved in with him, he taught him how to make knives. And my grandfather was wise enough to realize that this little business, in a 10 by 10 lean-to on the side of the family garage was an opportunity to help the family made ends meet and so he - in about a 3-year period because my great granddad passed away not too long after that - so in about a 3 year period he taught his son how to make knives and then all through the 50s my grandfather kept it going with my father, my uncle and my grandmother's younger brother. The four of them made knives, sharpened saws, tuned lawnmowers.

We incorporated in 1961 with about 12 people making 25-30 knives a day and nowadays we churn out over 2 million a year.

Why knives?
The knives were just something that resonated with people. They were small, it was easy to get the materials for them so I think it was just something that he could do. And the great thing about manufacturing - what I love about manufacturing - is that you're actually creating value. So you are taking a few dollars worth of materials and you're creating a 50 dollar knife. You've created value. That's the beauty of manufacturing and I think that's one of the tragedies of this country losing so much manufacturing. You've actually lost the creation of value.

A lot of service industries take dollars and just move it around. Manufacturing actually creates wealth. Building a home actually creates wealth. The whole aspect of manufacturing is so critical to the future of this country.

On what made it work:
My grandfather didn't know any better. He really wasn't a businessman to start. He was a custom knife maker. He wanted to churn out an awesome product, he wanted to guarantee it for life which is what we still continue to do to this day. He wanted to take care of customers, he wanted to sit down, visit with you, find out what you need, craft something that satisfied those needs. That is what drove him - the interaction is what drove him.

When you think about how Buck started - my grandfather for 10 or 12 years had done nothing but interact with consumers, state of the art market research, state of the art product development. He was the guy. He talked with customers, figured out what they needed, built things that answered - or surpassed - those needs and he chose 6 or 8 models to be the first product line that Buck Knives built after our incorporation.

He actually chose the most popular models that he had been custom making and made a streamlined product line for this new corporation called Buck Knives Inc.

On the rough patch that led the company to look for a new location:
Our market place started changing pretty dramatically. A lot of our competition is strong American brands that import product and the margins, the price points that they were able to hit really created a competitive advantage over us trying to manufacture just in the U.S. so in 1999 we actually lost money. We lost a little less money in 2000. In 2001 we were right on the verge of being profitable again, tightening our belts, really controlling the business and 9/11 hit. And you have to understand, the knife industry depends on the fourth quarter of the year. The knife industry depends on hunting season and Christmas because a lot of knives are given as gifts so when you pull the wheels off of the economy in the 4th quarter, you really hammer the knife industry especially hard.

Nine-eleven was a double hit because of the travel restrictions on airlines and such for knives that there was a lot of inventory that was inside airports that had to find an immediate home. It was now illegal so all of that inventory was out finding homes, the wheels had fallen off the economy, nobody was buying a lot for Christmas and it just threw us back into a lost position again - and we realized our current business model was just too vulnerable. So in 2001 we made the decision to adopt the Toyota production system - lean manufacturing in our operation. We made the decision to revamp our sales structure - how we approach the market place and we made the decision that we would relocate out of San Diego, California, where we had been for 60 years and found a more competitive place to be - which was Post Falls, Idaho.

On his own role in the family business:
My growth through the company was such a non-event, like it was implied. Someday I was going to be leading the family business. So I never took it as seriously - it just wasn't as precious to me as it should have been. So in 2001, when we were staring failure in the face and literally if our brand wasn't as strong as it was and we could have failed as a company, that lit a fire. And realizing we had to put this business on much more solid ground, we had to get our heads around what we were about and then we had to pursue flawless execution in everything we did and that's been our driver.

Why leave California?
When we first started looking at relocating our company U.S. labor was the driver. We wanted to manufacture in the United States so the cost of labor and the availability of labor was going to be important. The cost and availability of utilities was going to be important. So we looked at the southeast and we looked at the northwest. Those 2 areas seemed to have the best combination of lower priced labor, lower cost of living - so happier employees - and that lower cost of utilities. And both areas were business friendly because they had to be. Now the family's desire comes into play. Where do you want to live and the northwest was really kind of coming home for us.

Probably the 2 biggest cost drivers in leaving California were workers comp and utilities. Now at that time, the tail end of the '90s, San Diego was getting hit with blackouts, we were getting hit with enormous increasing, or unreliable utility costs - wild fluctuations. Super expensive one month then it would drop down the next month. The surcharges and - you can't run a business if you can't control your costs.

The other one was workers comp and when we looked at relocating to Idaho our workers comp cost for insurance in California was well over a million dollars. In Idaho it was a couple of hundred thousand dollars. Hugely different - and the reason California had one of the highest workers comp premiums and one of the lowest actual payments to injured workers, the system court hearings, attorneys fees, filing instructions. There was so much that the system absorbed out of those dollars. When we moved to Idaho, Idahoans look at workers comp as you get hurt, you get better, you go back to work. That's how the workers comp system works in Idaho. In California you get hurt, you file a law suit, you take 6 months off, you come back, you decide it still hurts you take another 6 months off. It's just a different system than what happens in Idaho.

One of the key factors that really made our decision for Idaho was a conservative business friendly legislature because lots of other things ebb and flow. Lots of other things change. Utility costs are going to change, water shortages are going to change - although we're not having one now. So utility costs are going to change, labor costs, labor availability - those things are all going to change. The thing that you need most of all is a conservative and consistent business friendly legislative climate. And what I will give to the state of Idaho and to Governor Otter is a focus on keeping government as small and unobtrusive as possible. That's a real key to business health.

You're double thinking all regulations, you're really trying to give businesses as much freedom as they can to create wealth and your state will benefit. That was a real key decision maker. We're exit 2 on I-90. We are just over the border from the state of Washington. We looked at Washington. The legislative climate in Washington was way too close to what we left behind in California. It just made no sense move from one state to another that was marching in a very similar path and direction.

So we looked at Oregon and Idaho. What we eventually decided was that Idaho had the legislative climate that we needed - but being this close to the border still allowed us to tap into the labor pool that the Spokane valley represents and so it was a magic spot. We're right off the freeway, we're 20 minutes from an airport and we're 15 minutes from elk hunting. Tell me where else you're going to find that little combo pack.

On making the move:
Relocating this company was much, much more difficult than I thought it would be. And I heard the stories - it takes you 2 years to get your feet back on the ground, it's going to wipe you out, blah, blah, blah and I paid attention to none of it. I just knew that Buck was going to get up here, we were going to hit the ground running, we were going to show people how it was done. Then it was a gut punch for 2 years. I had not realized the value of the long term loyal employee base that we left in San Diego and just what they were truly contributing to the company. I just had not acknowledged that to myself.

So we moved up here, we get people who were not yet trained making lots of mistakes, we had egg on our face in the market place, we had quality issues, we had delivery issues. Then come to find out that about the time you get somebody trained they get another opportunity and they leave and in 2006 unemployment in Idaho was around the 2 ½ percent range so we were losing people right and left. We had this transitionary workforce that we were just struggling every time we'd just about get somebody trained they were gone. I was hugely more impactful.

Now where we are we have this loyal workforce that has been with us long enough that they are well beyond an entry wage someplace else so it makes sense to stay. They've become excited about being a part of this legacy. And as you walk through the factory you see people really caring about what they are doing and about the product they are producing. And we try really hard to make sure that the employees here get contact from customers - that they understand that this little - it's not a little piece of steel they are building. It's a memory. This little thing they are working on is going to be knife that that guy gets from his grandfather and cherishes for the rest of his life. It's important and what you're working on is important.

Any advice?
I'll say if you're building your building it's going to cost you twice as much as you think it will and if you're trying to prepare for being off speed for a period of time take your best guesstimate and double it. That's my biggest advice.

On the personal experience of moving:
I've been hunting and fishing in Idaho for years so I'd been up here deer hunting, up here bear hunting, as a kid we used to come up here and go camping. So moving to Idaho for me was like living in your vacation land.

I was surprised at my lack of culture shock moving from San Diego to Post Falls. I found the people up here warm, I found the people up here motivated. They are intensely proud of Idaho as a state and of their community and of moving forward and being responsible. I love the whole sense of self reliance that Idaho is kind of based on.

Does it help to be in an outdoorsy place?
One of the cool things about getting people who will actually use the products to build them is that they understand what they are building and there's a passion. If you get a hunter building a hunting knife he's going to care how sharp it is. He's going to care how tightly it's assembled and how solidly it's assembled because he gets it. They know that this product is not going to be on a shelf. It is going to be out there getting some serious use and they better put their best effort into it. And to me that was one of the rationales of why it was important to be in an outdoorsy area - that you get people who understand the importance of what they are working on.

There is something about manufacturing Buck Knives here in Idaho that just makes sense to people. It's where you should be. You should be in Idaho. And we used to say yeah, we're in San Diego. Really? You're in San Diego? Because you don't think of San Diego as a hunting Mecca although there are a ton of outdoorsmen in California. No, Idaho just makes perfect sense to be when you are manufacturing hunting knives.

One of the really cool elements of having people build and design stuff who know what they are doing is there is a tendency to avoid gimmicks. And so anything that we build onto a knife has to work. And these people - if we're building a gimmick into a knife that we all know isn't really going to work but people will buy it anyway, it just makes us all ill. The stuff has to work. If it's there, if we put something on a Buck knife, it's because it works. It's not just because it looks good, it's not just because it's a bell and whistle that might trick somebody into buying our stuff. It works.

Our R & D staff right now is virtually all hunters and fishermen. It's important. It wasn't on the resume requirements but it's important.

On the production side:
Product-wise we probably have about 100 products in our catalogue that we actively support but then there are variations of products - so we're probably talking about 250 different products that are running through our factory.

Our production facility is really kind of divided up into 2 main areas. Half of the company is focused on the fabrication of parts, the other half of the company is focused on the assembly of knives and in the shipping of the product. So we start with raw steel. We laser cut parts, we fine-blank - kind of a punch-press process - parts. We grind, we heat treat, we shape and then parts are delivered into the assembly cells where knives are assembled on a one at a time.