Viking Range Corporation Business Information, Profile, and History

Company Perspectives:

In spite of tremendous growth and success, Viking remains essentially the same entrepreneurial company it was at its inception. This small, close-knit company culture serves Viking and its customers well, and strongly contributes to the company's on-going growth and success.

History of Viking Range Corporation

Viking Range Corporation manufactures and markets a wide range of professional kitchen appliances for home use. The private company, based in Greenwood, Mississippi, is best known for it upscale ranges, but also offers ovens, refrigerators, freezers, dishwashers, disposals, and ventilation products. In addition, Viking offers professional-grade countertop appliances such as a blender and stand mixer, a line of cookware and cutlery, and a complete set of outdoor cooking products, including gas grills with hoods, warming drawers, gas woks, outdoor refrigerated beverage centers, stainless steel cabinets, as well as professional barbecue tool sets and gloves. Viking maintains three factories in Greenwood, and operates a dozen Viking Culinary Arts Centers across the country, where cooking lessons are given and the company's products are available for purchase. The company's products are also sold through high-end dealers, housing contractors, and kitchen specialists. Internationally, Viking products are retailed in more than 80 countries.

Early 1980s Origins

Viking was founded by Fred Carl, Jr., whose father and grandfather were building contractors in Greenwood, Mississippi, once the cotton capital of the world but a town that had fallen considerably in stature. Carl grew up wanting to be a designer or an architect. While he was in college at Delta State University studying architecture, his father lost his business, and because Carl had signed some loans for him, he had to go to work in construction and selling office furniture to pay off the bills. After a decade of toil he emerged as the leading contractor in the area, known for the industrial-style kitchens he incorporated into contemporary houses. He set up a showroom to display upscale kitchen products, such as cabinets by Rutt, ranges by Thermador, and Refrigerators from Sub-Zero and KitchenAid.

Around 1980, when he could finally afford to remodel his own kitchen, his wife, along with two clients, asked Carl to find a better stove than the residential models available through regular channels. His wife came from a family of cooks and had grown up using a massive, hand-built Chambers stove featuring six burners and two ovens, but these ranges were no longer available. Manufacturers had abandoned the upper-end market in favor of producing the least expensive models they could, choosing to compete on price rather than quality. Consumers who wanted something better, and could afford it, began installing commercial ranges, the kind found in restaurants, but they faced several problems. Commercial ranges were illegal in some communities for use in a residence, primarily because they weren't insulated and used large burners, posing a fire hazard when placed next to wooden cabinets in a typical home setting. They also required overhead venting, special gas lines, and sometimes overhead sprinkler systems in order to meet building codes. In addition, commercial ranges were energy hogs and did not come with a broiler, forcing consumers to buy a separate wall oven as well. Just as residential stove manufacturers were uninterested in this market, so too were the commercial food-service companies, who were afraid of liability risks. Carl recognized a niche opportunity and began to pursue a dream of building a professional-grade range for residential use.

After paying visits to restaurant-supply houses and meeting with salespeople, he began to work on a design, which he completed in 1981 after 18 months of work. In essence, he combined elements of the residential stove with ones used in commercial food service: keeping the look of a professional range along with the high performance, but adding automatic ignition and an oven broiler. He now took his "range project" to manufacturers, hoping to find a partner, but none were interested. Rather than quit, Carl decided to drum up interest in his concept by contacting kitchen designers featured in trade magazines. He had his range design done in an airbrush version, printed a brochure, and mailed them to key designers. The ploy worked, as a buzz about upscale ranges began to circulate in certain circles, and he began to receive telephone calls from people around the country who urged him to press on. In 1983 Carl selected the Viking name and had a logo designed, a year later the company was incorporated, and in 1986 the first Viking prototype was approved and received AGA approval for meeting safety standards.

Carl arranged to have the Viking range manufactured by U.S. Range Corporation, based near Los Angeles. His first order came from New York City, from Patricia King who was a passionate cook and wanted a restaurant stove but had balked at the idea of giving up so much kitchen space for ductwork and insulation to comply with city ordinances. Her architect gave her one of Carl's brochures for the Viking stove, priced at $3,000, and she promptly sent a $100 deposit. At this stage Viking consisted of two unpaid employees, Carl and his assistant, Tawana Thompson. The contract manufacturer, which was undergoing a number of management changes and treated Viking like a poor country cousin, shipped King's range nine months later and six months late. The black enamel unit had a number of problems: electric pilots that didn't work, gas leaks, a wiring harness that melted, and oven doors that refused to stay open. Diligently, Carl and friends he recruited worked through the problems with King on the phone and even dispatched a local appliance repairman to help out and flew in engineers. According to King, her stove may have been rebuilt four times. It wasn't until early 1988 that it was finally working properly.

The initial Viking product line included ten models of gas ranges, ranging in price from $2,700 to $4,700. They featured oversize burners capable of handling large utensils and infra-red broiling. Because of the price, Carl had some difficulty lining up appliance dealers to handle Viking ranges and opted instead to set up his own network of dealers and regional distributors, creating an air of exclusivity. His timing proved fortuitous because a number of KitchenAid distributors had their franchises terminated in July 1986 when KitchenAid opted to go factory-direct. About half of Viking's initial 28 independent distributors were former KitchenAid distributors.

Because U.S Range proved unreliable, Carl tried a contract manufacturer in Tennessee in 1988 before deciding to make the ranges in-house. Carl and an employee, Ron Ussery, a former appliance repairman, took apart one of their own ranges to reverse engineer it, determining which parts could be bought and which ones they would need to have built. Carl took on ten partners--a group that included his doctor, several farmers, and an insurance agent--raising more than $125,000. He then rented a small abandoned factory in the area, hired a manufacturing chief and 30 workers, and in late 1989 the first Viking Range was assembled in Greenwood in a 35,000-square-foot facility. By 1990 all production was occurring at the Greenwood facility. Two years later the company opened a new 100,000-square-foot plant to handle production.

Because of the manufacturing problems the company endured in the beginning, it was fortunate that for about three years Viking had the market to itself and was able to stake out a strong position. The company added smaller ranges, hoods, and wall ovens. Because the Viking range had such a unique look compared to residential stoves, it did not match the other appliances in the home, offering the company an opening to apply the professional-grade idea to other appliances and create an integrated kitchen concept. In 1992 Viking added dishwashers to its lineup. A year later it began manufacturing its own line of commercial quality disposers for the home. The company also added trash compactors.

In 1992 some of Carl's investors grew impatient and threatened to take over the business, but Viking was able to obtain backing from Stephens Inc., the Little Rock, Arkansas, investment bank that took Wal-Mart public. Stephens bought the company with Carl and named him chief executive. He now had the resources to recruit seasoned executives and completely redesign Viking's range top product lines. The company was also able to launch a very successful print and television advertising campaign, created by Jackson, Mississippi-based Ramey Agency.

These investments would pay off in 1994, but the company almost became a victim of its own success. It hired more workers and went to three shifts, and was still unable to meet demand. It took customers 20 to 22 weeks to receive the Viking ranges they ordered, and the backlog was soon worth some $20 million in orders. The company was in danger of losing customers and dealers when it changed its manufacturing approach, adopting practices developed by Toyota, such as building each product from order and managing inventory at the assembly line. Eventually, the company was able to reduce the time between order and delivery to just nine days. Instead of 14 days, finished inventory would stay on the plant floor for little more than an hour.

Because Viking was so behind on orders there was no need to spend money on advertising, but as production got up to speed the company again began to advertise its products in 1996. The company was also able to take the next steps in creating an integrated kitchen. It created a new division, Viking Specialty Products, which received a $1 million empowerment grant from the Department of Agriculture's Rural Business Enterprise Grant Program. The division looked to develop stainless steel cabinets and outdoor grills. Later in 1996 Viking began shipping its first side-by-side commercial-style refrigerators, completing the basic integrated commercial-type kitchen. As had been the case with ranges, institutional refrigerators were robust but lacked certain features consumers had grown to expect from residential models, such as temperature controls, adjustable door shelves, ice makers, and separate meat and produce compartments. Maytag handled the manufacturing of the premium line of 84" refrigerators, a contract that would be taken over by Amana in 1999. Viking acquired equipment from Amana a year later and moved it to Greenwood to take refrigerator production in-house.

New Products in the Late 1990s

Viking added outdoor gas grills and electric ranges and rangetops in 1997. A year later the company introduced electric thermal-convection ovens and gas woks. Viking also opened a new plant for ventilation products and began to produce its own hoods and warming drawers. In 1999 Carl came up with an idea to drum up more business and grow the Viking brand. Just as Land Rover had opened up driving schools where people could drive a SUV to see if they wanted to buy one, Carl decided to open what would be called Viking Culinary Arts Centers, where people could spend an evening or an entire weekend learning how to cook gourmet meals--using a Viking range, of course, which would then be available for sale along with professional caliber cooking utensils. The first centers were opened in 1999 in Memphis and Nashville. The program received a boost in 2000 when Viking acquired San Francisco-based HomeChef, Inc., picking up four HomeChef locations in California that were converted to Viking Culinary Arts Centers. Other centers would open in or near such cities as Atlanta, Cleveland, Dallas, New York, Philadelphia, San Francisco, San Jose, and St. Louis.

Viking continued to add new products in 2000. To complement its outdoor gas grills, the company brought out a set of high-end barbecue tools--spatula, tongs, fork, knife, and brush--priced at over $100, twice the price of the most expensive tool sets on the market. The tools were made out of stainless steel and used wooden handles impregnated with epoxy to make them weather resistant. The barbecue tools represented the next step in achieving the company's new goal: creating an integrated, virtual outdoor kitchen. Other products, such as an outdoor refrigerator, beverage dispenser, and warming drawer would also follow. Also in 2000 Viking introduced its Designer Series Line, which gave customers a look different from the commercial-style products, offering simple shapes, clean lines, and refined details that subtly accented a kitchen rather than making a statement.

In 2001 Viking established Viking Europe SAS, to distribute Viking products in the European market, In addition, the company grew by acquisition, picking up Rutt Custom Cabinetry of Goodville, Pennsylvania, and Heritage Custom Kitchens of New Holland, Pennsylvania, after their parent company, Classic Kitchen, filed for Chapter 11 bankruptcy protection.

Viking also ventured further afield, becoming involved in the hotel business in 2001 by acquiring Greenwood's historic Hotel Irving and adjoining downtown property, which was located within walking distance of Viking's corporate headquarters. The purpose was to provide comfortable housing for the company's many corporate visitors: Each year some 30 groups of 25 to 30 people traveled to Greenwood from around the world for three-day tours and training sessions. Hotel Irving would be remodeled to include 50 rooms and suites. Some of the nearby property was set to be converted into luxury condominiums. Revitalizing downtown Greenwood was also a long cherished dream of Carl, who now devoted considerable time to the endeavor.

Viking restructured its distribution network in 2002, creating three new distributorships in the eastern United States and another in western Canada. Later in the year the company broadened it international business by making Moscow-based Electromir the distributor of Viking products throughout Russia. In 2002 Viking also introduced smaller gas ranges, 24 inches wide, to accommodate urban apartment dwellers who had the money and the desire to buy a Viking range but lacked the space. Another unusual step the company took during the year was to become partners with its executive chef, Wally Joe, who earned acclaim as Chef de Cuisine of K.C.'s, a world-class restaurant in Cleveland. Joe's new establishment, located in Memphis, would serve as a laboratory of sorts for Viking, to help the company in its continued efforts to design equipment for the residential market.

Viking moved into the small appliance area with the introduction of a blender and stand mixer, and in 2004 opened a research and development center in Starkville, Mississippi, for advanced product development. On the retail side, the company launched a wedding and gift registry program at its Viking Culinary Arts Centers and Viking Home Chef stores. Although competitors had emerged in the high-end stove and kitchen appliance market, and took turns as the latest media darling, Viking had by now established a strong brand, and management continued to demonstrate an innovative spirit that was likely to keep the company growing and prosperous for some time to come.

Principal Divisions: Viking Specialty Products; Viking Capital Ventures.

Principal Competitors: Electrolux AB; Maytag Corporation; Sub-Zero Freezer Company, Inc.

Chronology

• Key Dates:
• 1981: The first drawing of a Viking range is completed.
• 1984: The company is incorporated.
• 1987: First Viking Range is sold.
• 1990: Production is moved to Greenwood, Mississippi.
• 1992: Stephens Inc. forms partnership with management to buy the company.
• 1996: The first Viking refrigerators are shipped.
• 2000: Refrigerator manufacturing operations are moved to Greenwood.