Upstate Company Is Leading Manufacturer Of Artificial Christmas Trees

NEWBURGH, N.Y. (AP) _ In just six years, Si Spiegel and Larry Squarci have soared to the top of one of the Christmas season’s most profitable industries - the artificial tree.

Hudson Valley Tree Inc., located in this city 60 miles north of New York City, is one of the nation’s largest manufacturers of artificial Christmas trees.

In the six years since the company first opened with a mere four employees, Hudson Valley Tree has grown into a $25 million business employing 800 workers year-round with factories in Newburgh and Indiana.

The soft-spoken Spiegel says he never dreamed of such success when he started in 1982.

″I expected a good business, but I didn’t think it would be this good,″ he said during a recent interview in his office, located t one end of the Newburgh plant.

″We originally thought we’d take the higher end of the market and sell locally to department stores and nurseries,″ he said.

But sales are many times higher than originally anticipated. And more than half of the company’s merchandise is sold outside New York state - to department store chains across the country, including Hawaii, Puerto Rico and Alaska.

Spiegel attributes his company’s success to emphasis on customer service and acceptance of the product.

″When I first began manufacturing trees in the early 1960s, 95 percent of the people said they’d never have an artificial tree,″ he said.

Spiegel has been in the artificial Christmas tree business about 30 years. He was president of American Tree and Wreath, headquartered in Mt. Vernon, Vt., until he, Squarci and two others opened their first factory in Newburgh.

The company outgrew that plant within three years and opened a larger one which now employs 600.

In March operations began at Hudson Valley Tree’s plant in Evansville, Ind. Spiegel says that plant, which employs 200, is near most of the company’s Midwest customers.

Spiegel and Squarci designed and constructed the machinery used in the two plants.

″The flow is designed for storage, raw materials, manufacturing, warehousing and shipping,″ he said. ″Raw materials go in at one end and finished goods come out at the other end.″

Hudson Valley Tree manufactures and sells mostly soft-needle trees and is test marketing some hard-needle trees. The company’s hottest seller is the artificial Douglas Fir.

The company sells a variety of trees ranging in size from two to 25 feet high and from $40 to $300 in price. The most popular size is six feet, which sells for about $75, Spiegel says.

Lately there’s been a strong demand for tall trees. ″People who have big homes and big ceilings want that nice big tree,″ Spiegel said.

Artificial trees were first introduced in the 1950s. Roughly 3 million are sold each year, Spiegel says.

He says most of his competition comes from Asian suppliers of artificial trees and producers of live trees.

The live tree business is surging again after a period of shortages in the 1960s and ’70s, according to David E. Baumann, associate executive director of the National Christmas Tree Association.

Baumann says live trees were in short supply until the 1980s because they were taken from the woods and not grown on large farms as they are today. Now there’s an adequate supply of live trees and the competition between live and artificial suppliers is heating up.

This year, for the first time ever, the National Christmas Tree Association plans to spend $1 million on an advertising campaign to promote the natural tree.

Artificial trees are made by running rolls of green polyvinal chloride through a slitter - a knifelike machine - to form the branches.

A number of the branches are then hand-wrapped to a metal rod to create a ″panel″ - a larger branch. An artificial Christmas tree is simply a series of panels hooked on the tree’s rod.

The advantage of the artificial version: They’re perfectly shaped, shed no needles and can be stored in a closet to rise again year after year.

Spiegel thinks that’s why artificial trees will continue to be in demand. He says he’s got much of the East Coast and Midwest covered, and has his eyes turned to the West.

″We never built a sales organization on the West Coast, so it’s a growth area for us,″ he said.