From THE VIRGINIAN-PILOT, by KIMBERLY PIERCEALL
There’s an obvious metaphor in the 100 concrete piles, each driven 70 feet deep, bracing the new foundation of Stihl Inc.’s U.S. headquarters.
“For me, this is not just a building, but a statement of intent,” said Nikolas Stihl, the advisory and supervisory board chairman for the German family-owned Stihl Group.
That intent appears to be bolstering the roots the company has built in Virginia Beach since arriving in 1974.
Even as the threat of a global recession looms and a trade war hinders exports and imports, Stihl spent $32 million to build its new domestic headquarters and make other fixes to its sprawling 150-acre campus across from the Lynnhaven Mall, and executives are holding onto an optimistic outlook. As long as there are trees, leaves and grass, they say, they’ll be making and selling their outdoor power equipment.
“I always like to say we’re in a growing business,” Stihl said. “Because, outside it’s growing and all this green stuff needs to be cut.” Weather is more important than the hub-bub surrounding a possible recession, he said.
As for the China-U.S. trade war, the company has had to pay some tariffs, but Stihl said the company has always had several supplier options in case it needed to shift operations. Plus, the company makes many of its own components that are later assembled at its factories, including in Virginia Beach.
“That obviously helps us when there are external factors,” said Bjoern Fischer, president of Stihl Inc., the German company’s U.S. division.
“We’ve always looked at it from a very long-term perspective,” Fischer said, noting that the company hasn’t shifted manufacturing away from the U.S., including in 2009 as the recession took hold, and instead invested in its U.S. operations.
For this latest investment, an 80,000-square-foot office that puts several of its departments under a single roof, Stihl also got help from the city – a $500,000 economic development investment program grant. Would the company have still built its new headquarters and remained in Virginia Beach without it?
“Of course,” Stihl said. “But I take it as a sign of appreciation from the city of Virginia Beach.”
The Virginia Beach Development Authority has gifted the company $1.8 million total on five occasions since 1996 as Stihl expanded. The company also received $700,000 from the state in 2005 for an expansion and $921,604 in 2015 for retraining workers.
“We’ve been partnering for 45 years now,” Stihl said, describing the company’s relationship with the city and noting the two have grown together. “I think we were actually the first company that broke ground in that area. So, I think, in some ways, we’ve been instrumental in the growth of that area as well.”
Fischer said that every award helps, including in keeping investment in the area by hiring local contractors like those who helped build the company’s new headquarters. HBA Architecture and Interior Design of Virginia Beach was one. Fischer said the grant was “much appreciated and certainly helps us continue on our path of growth.”
Virginia Beach Mayor Bobby Dyer, in a speech at the building’s dedication, said the city appreciated Stihl’s “vote of confidence” with its latest investment in the area.
The company’s local presence has grown from 50 employees in 1974 to 361 by 1994 to the current level: 1,906 workers.
“This building was built in such a fashion that it allows us to grow, so we actually have some empty cubicles and empty offices. This is all there to help us be prepared for the future and be ready for the growth,” Fischer said.
Stihl joked that Fischer had proposed a much smaller building originally.
“We told him, ‘please, spend a little more. We want bigger,’” Stihl said.
The company debuted its new building with fanfare and multiple generations of the Stihl family of Germany in early October.
There was, of course, a log-cutting instead of a ribbon-cutting, which included the Virginia Beach mayor holding up his chainsaw, proclaiming: “We need this for the budget.”
A large ice sculpture in the shape of the company’s new building had a trough of chilled shrimp at its base. Mementos featured the building’s image burned on slices of wood. Many of the men wore Stihl orange ties as they watched demonstrations of the “biggest and the baddest” backpack leaf blower and a new chainsaw that can go from zero to 62 mph in less than a quarter of a second.
Like much of rain-soaked Hampton Roads, the company’s campus has become accustomed to collecting water during storms. A new retention pond will help with that. With the use of the concrete supports, the new building sits two feet higher than the old one, too, on the exact same spot. The company had brought in an arborist to figure out a way they could preserve as many trees as they could, which led to building the new headquarters exactly where the prior one sat. Its occupants had been working in other parts of the campus during construction.
The new building has been sound-proofed, too, deadening the sound of buzzing fighter planes from nearby Naval Air Station Oceana practicing overhead. In the open office space layout, there are white noise machines so that neighbors’ conversations and other ambient sounds don’t interrupt.
Inside the new headquarters, a twisting sculpture of the company’s chain saws dating back to 1936, are arranged in a DNA helix pattern standing nearly 33 feet tall.
The first floor has been expanded for training Stihl’s more than 9,000 dealers on the products and how to display them, with help from a concept store in the lobby. As consumers become more reliant on online orders arriving at their door, the company’s outdoor power equipment still is carried only at authorized dealers. Some of those dealers sell the company’s products online, but require in-store pickup. Nikolas Stihl doesn’t see that business model changing anytime soon.
“Of course, you can’t ignore the internet. That’s not something we would do. But, you know, Mr. Bezos, owner of Amazon, is now pouring a lot of money into brick-and-mortar stores because he just can’t live without them. And despite all his successes, still, 90 percent of all American retail is in brick-and-mortar stores.”
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