Buck Knives Story in INC Magazine

Wednesday, July 5, 2006, 17:57 —by mas
This item was posted in San Diego History category and has 7 Comments so far.

INC Magazine wrote a great piece on Buck Knives, which is now available on their web site.  The Buck Stopped Here tells the story of a successful San Diego company that was driven from California due to the high cost of doing business here.  Buck Knives relocated from El Cajon to Idaho Falls, Idaho at the end of 2004.

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7 Responses to “Buck Knives Story in INC Magazine”

  1. KirkH said on Thursday, July 6, 2006, 23:20

    It’s interesting that we’re known for our socialist leanings here in CA but the real problems are caused by the high cost of living due to housing which was in turn caused by the freakishly low interest rates (and resultant speculation) which were caused by a government institution (The Federal Reserve) interfering with free markets. In other words, it’s a national problem that happened to manifest itself in a state with an already large weath divide.

  2. Michael Allen Smith said on Friday, July 7, 2006, 6:13

    Buck Knives didn’t leave San Diego because of the high cost of housing. They left because of the high cost of business. Housing only plays a role when you can’t attract labor, which they had no problem doing. Also, the story indicates they started the move process long before house prices doubled.

    They left primarily because:
    1-High cost of electricity
    2-Electricity shortage (rolling blackouts)
    3-High cost of workers compensation
    4-Higher taxes

  3. ChrisN said on Friday, July 7, 2006, 14:02

    Numbers 1 and 2 were relatively short term – basically Enron screwing CA over to the tune of ~50 billion over two years by maliciously gaming the power grid.

    If you cross those off the list, would Buck still have moved?

  4. Michael Allen Smith said on Friday, July 7, 2006, 14:40

    Probably not. Making knives uses A LOT of electricity, so that was the primary motivation for the move. The lower taxes and workers compensation were more of explanation on why they chose Idaho.

  5. Matty said on Friday, July 7, 2006, 15:52

    Still so sad they left. I loved just going and looking at all the knives. And those are some damn fine knives too.

  6. Joe Crawford said on Sunday, July 9, 2006, 19:22

    Great find MAS. Great story of a business overcoming obstacles. Also remarkable is how well they treated their employees in the process.

    As ot the expenses differences — from the article: Electricity rates were about half what Buck was paying in El Cajon. Workers’ compensation was a third. Wages for manufacturing jobs were 20 percent less than what Buck was paying. According to Potter’s figures, Buck could shave at least $600,000 off its manufacturing costs every year by moving to Idaho.

  7. Sassy said on Monday, July 10, 2006, 10:46

    Buck Knives downsized, plain and simple. They needed to downsize and they needed to do it soon. They could have done it in El Cajon but they would have been left with more space than they needed. When Buck made cuts – they made them deep – utilities, rent, wages, the whole deal.

    As much as this story is about the expense of business in California, this story is about an American manufacturing company who is losing market share to the Chinese – not something unique to California in the least.

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