Knoxville brand gets run into the ground

Put through the mill

Day or night, the White Lily flour mill on Depot Street never closed. One shift would follow another as the mill worked to keep up with heavy demand for its products, remembers Mike Cruze, who spent 32 years at the plant, 15 of them monitoring the milling operation from a control room. "The bottom line is, those machines were not to stop for any reason, except lack of product or for maintenance," Cruze said.

But by June 30, the 125-year-old mill will shut down for good and its 72 employees will be out of work.

In March, parent company C.H. Guenther & Son Inc. announced the closure of White Lily Food Co., with 39 employees to be laid off May 1 and the rest on June 30. The reason given in a press release was that the company had lost a "co-packing agreement" with J.M. Smucker Co., which bought the White Lily name in 2006.

C.H. Guenther President and CEO Dale W. Tremblay said in the release that Smucker had notified him that it was ending its supply agreement with his company and would be moving production of White Lily products into one of its own plants.

So, it is possible that Southern baking name brands White Lily flour, Three Rivers cornmeal and other products will remain on grocery shelves, but they won't be produced in downtown Knoxville. Steve Phillips, spokesman with C.H. Guenther & Son Inc., did not return repeated phone calls for comment.

With the closing of the White Lily mill, Knoxville will lose another economic icon. White Lily joins the ranks of name brands and large employers like Standard Knitting Mills, Swan Baking Co., Lay Packing, Levi Strauss & Co. and others that either no longer exist or have moved out of Knoxville.

What eventually would become White Lily got its start when J. Allen Smith came to Knoxville from Elberton, Ga., in 1878 and opened a grain business - J. Allen Smith & Co. - near McGhee Avenue downtown in 1882. Soon, it was producing 100 barrels of flour and 200 bushels of cornmeal a day, and by 1884, Smith had moved it to its present location on Depot Avenue at Central Street.

Over the years, the company built a reputation throughout the South for producing flour that was second to none. In a 1979 article in the Milling and Baking News trade publication, then-White Lily President Ted Pedas described how the company milled flour to an "extra fine" degree, trapping air in the mix to give it a light, fluffy quality. Besides flour and cornmeal, White Lily produces pancake, biscuit and muffin mixes.

But another key was the right wheat, said J. Charles Smiddy, former vice president of sales for White Lily.

"What made White Lily flour so exceptional is that it was 100 percent soft wheat, which lends itself better to making cakes, pies and such as that than hard wheat," he said.

Smiddy, who joined the company in 1952 as a route salesman and retired in 1996, said he got to watch it grow to reach its heyday.

"I would say 1980 to 1995 was the growth era. That's when it really spread out," he said.

He served the company under several owners. In 1968, J. Allen Smith & Co. was bought by Great Western United Corp. Then in 1972, the Dixie-Portland Flour mills acquired the business. Under Dixie-Portland, the mill went through a major modernization program in 1975.

As a frenzy of corporate mergers took hold in the 1980s, White Lily went through about five owners in six years. San-Antonio-based Guenther became owner in 1995.

During the 1980s, White Lily was competing within a market that was shrinking as families spent less time baking, but it was a dominant player in that market.

"When I left, we had a 67 percent share of the market in Atlanta, and Atlanta is the major market in the Southeast," Smiddy said.

In 1988, the company held 68.5 percent of the retail market in Knoxville and nationally was the fourth-largest-selling brand of flour.

"It was one of the finest products that you could buy anywhere in the food business," Smiddy said.

Besides top-notch products, Smiddy believes the integrity of the original owners and the dedication of those who worked there made White Lily so successful. There was always resistance to any suggestion of cheapening the product, and with most of the mill's owners, that was never an issue, Smiddy said.

"Usually, when they saw how well we were doing, they just left us alone," he said.

The company went through turbulent labor-management relations in recent years. On July 24, 2003, White Lily locked out 68 employees after labor negotiations broke down. During 14 weeks of the standoff, the union filed an unfair labor practice complaint against the company. The National Labor Relations Board ruled in the company's favor, but not before the company had a union representative arrested for criminal trespassing, claiming he was harassing a security guard.

When a contract was finally signed and workers returned in November 2003, they learned that 15 workers were being laid off because two product lines were being discontinued.

Tailor-made success

The closing of White Lily Foods means the loss of another established downtown business, yet even within a block or so of White Lily, companies like John H. Daniel clothing company, Regas restaurant and Lay's Market are either thriving or transforming to meet a new business climate.

John H. Daniel, at 120 W. Jackson Ave., has been a Knoxville-based maker of men's suits since 1928. According to the company Web site, John H. Daniel employs more than 200 master tailors from 17 nations and tailors clothing for more than 600 private labels throughout the United States, England and Europe.

The company has gained international recognition for making suits for Fox News commentator Bill O'Reilly. which he wears on his "The O'Reilly Factor" program. John H. Daniel gets a wardrobe credit at the end of each program.

"This has been huge for us," said Benton Bryan, John H. Daniel CEO. "We get calls from all over, e-mails; it's been very positive," he said.

The company has picked up other high-profile clients as well, including Vice President Dick Cheney and retired Gen. Norman Schwarzkopf, who commanded coalition forces during the 1991 Gulf War.

"You would be surprised at the celebrities we make suits for," Bryan said. "We have a coat in the works now for Tiger Woods."

In fact, the company makes the traditional green jackets given out each year to winners of the Masters Tournament, the most prestigious and high-profile Professional Golf Association tournament. It also tailors the uniforms that new captains receive when they take command of U.S. Navy Aegis missile cruisers.

The company got some national recognition for its business model through a Wall Street Journal story. The April 15, 2005, article by Michael M. Phillips described how in an era in which U.S. garment companies are either closing or moving operations overseas because of low-wage competition, the John H. Daniel Co. has found success by reversing that strategy. Rather than relocate production, the company has searched abroad for master tailors and relocated them and their families to Knoxville.

"Everything is done right here, on site," Bryan said.

Ironically, another factor that has contributed to the success of John H. Daniel lately has been the worsening economy, Bryan said.

"As the economy tightens up, men tend to reach for a suit," he said. "Men look for any advantage they can get, and a suit has traditionally always been one."

Still cutting it

In 2000, the family that had operated Lay Packing Co., known for its Three Little Pigs trademark of meats, sold the plant it had operated on Jackson Avenue for 80 years to Hamilton Fairfield Inc. of Portland, Maine. Hamilton Fairfield later filed for bankruptcy and closed the plant in 2002, putting 95 employees out of work.

That didn't spell the end of the family business, however. The Lay family held on to the adjacent Lay's Market, the original family business opened in 1907.

"We are now in our 101st year of operation," said Lay's Market President Edwin Lay Jr., whose great-grandfather, T.L. Lay, founded the company.

Lay's Market, at 622 E. Jackson Ave., sells beef, pork, cheese and a full line of food service items including canned and frozen vegetables to both wholesale and retail customers.

"If you want a special cut, you can call ahead and we'll have it ready for you, or you can just show up and order a cut," Lay said.

Lay's not only sells U.S. Department of Agriculture-inspected meat, it has a U.S.D.A. office on site, Lay said.

The company seems to have a modest but stable customer base, with a lot of customer loyalty, he noted.

"We did a survey of our customers, and I recall the average length of loyalty was about 15 years. We have multi-generations of people coming to shop," he said.

The company's business is about 75 percent wholesale and 25 percent retail, but Lay has noticed the retail end growing.

"It may indicate more people willing to shop downtown," he said.

JFG Coffee Co. maintained a roasting facility on Jackson Avenue from 1945 until 2005. Reily Foods Co. of New Orleans, parent company of JFG since 1965, temporarily moved its headquarters to Knoxville after the devastation of Hurricane Katrina. It has since moved back to New Orleans but in the meantime built a $12 million roasting facility off Sutherland Avenue and moved the JFG operation there.

However, the six-story former JFG building at 129 W. Jackson will not be sitting idle, at least not for long, according to David Dewhirst, a downtown developer and new owner of the building. He plans a $7.5 million renovation project that would result in office/retail space on the ground floor and about 54 apartment units.

Dewhirst has already received some help from city and county governments in the form of tax increment financing to help offset the cost. In December 2006, the Metropolitan Planning Commission approved historic overlay zoning for the site. The building dates to 1889 and housed about 10 different companies before JFG acquired it.

A magical place

It's too early to say what will happen to the White Lily facility after it is closed or what will become of the workers, but Cruze guesses many of them will retire. Turnover was never high at White Lily, he said.

"As the place modernized, they didn't need to hire as many people, so you've got guys who have been there 30 and 40 years. Some joined right out of high school," he said.

A lot of the work at the mill is just hard physical labor, but Cruze said he was fortunate to have one of the jobs that was more mental than physical. He sat in a control room overlooking the other floors and used computers to control the self-rising flour operation.

"From there, every conveyor in the packing department was operated by computer by me," he said. "I had four monitor screens plus six or seven other screens going to different areas of the plant so I could see if I needed to check on something or go change something. It really keeps you on your toes," he said.

Quality control was a paramount concern at White Lily, so even though Cruze had equipment to monitor the quality of each product batch, that wasn't enough.

"You would have to go take samples to make sure the blends were correct. We would mix corn with cornmeal and it's all done by machine, but you would have to go and physically get a sample and send that to the lab to make sure the integrity (of the mix) remained," he said.

Cruze would place the sample in a metal chute that carried it to the lab White Lily maintained on site.

"Sometimes, you would have to get a sample by hand every five minutes, and there goes your lunch break," he said.

Cruze started with some of the more menial jobs at White Lily and in his three decades there watched the plant change.

"When I hired in with White Lily, everything was belt-driven," he said. "Motors drove big leather belts that turned pulleys. They had gotten away from steam and were converting to gas and about 20 years ago, or 25, they started modernizing and moving everything through the mill with blowers through pipes," he said.

He also watched the workers change. They were a rough, independent bunch when everyone was young, but they have mellowed into a more close-knit group, especially in recent years when they have had to deal with labor battles, layoffs and now face the closing of the mill, Cruze said.

"These were some of the hardest men I have ever seen in my life, but I've seen these hardened guys walk around with tears in their eyes," he said.

Cruze has mixed feelings about his years with White Lily Foods Co. He described himself as sort of an on-again, off-again employee. He has his own business, Cruze Naturescape Landscape Consulting, and when White Lily needed to trim staff, he volunteered to be laid off so men who needed to support families could keep working. While not retired, Cruze currently is not working at White Lily.

The work could be demanding, requiring constant attention to the processes and sometimes 80-hour weeks. The atmosphere at work, especially during the labor disputes, could be harsh. Cruze believes that closing the Knoxville operation and moving production to another plant is at least in part an attempt by the company to get away from using union workers.

"Efficiency-wise, they took down one of the best models in the business. I don't know why they did that," he said.

On the other hand, Cruze said company management was very accommodating when he launched his landscaping business 15 years ago.

"The management actually respected what I was doing. Normally, a company doesn't look too favorably on an employee doing outside work," he said.

Even the period in which workers were locked out of the plant gave him a chance to take classes in landscaping. And White Lily provided him with years of steady work and good pay, Cruze said.

"That's how I put my kids through college and bought a home and all," he said.

Just as some downtown businesses have had to evolve, Cruze said he plans to commit fully now to the business he built from the vision that grew in his mind during the years he stared at monitors up in a glass box among pipes and conveyors inside a windowless building.

"Even when I worked at White Lily, I've always been a gardener at heart. I always had a vision of building a rooftop garden at that place," he said. "I would go up on the roof at night and look down on Knoxville. It was just a magical place."



Anonymous said...

Very informative article.
Knoxville is a hub of business.
Many for years!
I am still wondering what cornmeal I will use

Anonymous said...

Three Rivers Corn Meal has been used by my family for years. why do we have to lose such a good product . listen to all of us who want to have this in our kitchens . the product is so good . please don't take this away from us .

Anonymous said...

It's very sad that in this lifetime everybody gets use to something or everything then when you go to sleep at night and wake up it's gone. Three Rivers Corn Meal has been in our family for years, and know with a blink of an eye it's gone, so please bring it back to the shelfs.There is nothing else compaired to this corn meal, it's a very good product.

vickie said...

Why does another company come in and take our corn meal away from us because they bought the company or moved it or whatever,These companies are like politicians..they never know when to leave well enough alone.
Bring back Three Rivers Corn Meal.

Anonymous said...

My family, like so many, have used Three Rivers Cornmeal for 100 years. I have recently tried another brand which did not compare to Three Rivers. My Thanksgiving dressing was awful this year and of course there was "no" dressing for Christmas. I am so upset that I would pay to have it shipped to me if I could only find where to order it from. If anyone can tell me if Three Rivers is sold somewhere... please do. I can't imagine "no more dressing" and my cornbread... well I am just lost.

Cavender Family said...

PLEASE Smuckers BRING BACK Three Rivers Cornmeal - the way it was done for so very long.

Nothing still compares in 2017!!

Tena Elkins said...

It's 2018. I have looked and looked for a cornmeal as good as Three Rivers. It has yet to be found. Three Rivers has been in my family for years and years. There is NO better. BRING CUSTOMERS BACK THREE RIVERS CORNMEAL

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