Workers stitch firm back to health

TIGHT KNIT: Since its founding 27 years ago, North East Knitting has expanded into medical devices and military gear. Pictured above is owner Rosalie DaRosa with her sons, from left, Alex, Eric and Michael. / PBN PHOTO/BRIAN MCDONALD
TIGHT KNIT: Since its founding 27 years ago, North East Knitting has expanded into medical devices and military gear. Pictured above is owner Rosalie DaRosa with her sons, from left, Alex, Eric and Michael. / PBN PHOTO/BRIAN MCDONALD

The founding of North East Knitting Inc. in Pawtucket from the ashes of a bankrupt elastic-textile maker 27 years ago followed a Hollywood script as much as a business textbook.
Workers who had been at odds with management before the company collapsed, many Cape Verdean immigrants, banded together to purchase enough factory assets to keep their jobs.
Then, during an era of steep decline in the New England textile industry, the reborn company not only survived, but grew.
Last year, North East Knitting posted sales of $11 million.
“We had a lot of people who had worked 16 or 17 years and I knew that they were good workers,” said Rosalie DaRosa, the president of North East Knitting, who spearheaded the worker takeover in 1986. “I felt strong enough to say, ‘if this is going to go in auction, maybe we can buy a few machines and start it up. I know what machines to buy and we will be out of a job anyway, so why not try to make it happen.’ ”
DaRosa first moved from Cape Verde to Italy when she was 14 and family members were leaving the island off the West African coast to seek better opportunities.
After four years in Italy, she followed her father to southern New England and Pawtucket, where he had found a job at the International Stretch factory on Conant Street. Working beside her father on the shop floor she quickly learned how to use all of the textile machines the company had.
While change is now part of North East Knitting’s business model, a series of ill-fated changes by the owners of its predecessor International Stretch led to that company’s demise.
In the 1980s, a younger generation of the company’s New York-based ownership began barring any language but English in the factory and ended the incentive-pay system that had been in place, DaRosa said.
“They didn’t believe in having people who didn’t speak English and they hired more expensive people,” DaRosa said. “They brought in a new manager and within six months everything was cash on delivery.”
After the bankruptcy, DaRosa convinced the former plant manager, who owned a local restaurant, to join her, other workers and a group of investors in a bid to buy the company back. For $300,000, they were able to buy the factory lease and enough machines to begin operating again.
Most of the company’s textile equipment was made in Italy and DaRosa’s ability to speak Italian helped in negotiations with the manufacturers there.
As the years went by, she became the company’s largest shareholder and her three sons, Eric, Alex and Michael, are now vice presidents.
Although the early years of North East Knitting marked a return to many of the ways International Stretch had been run, the past two decades have seen it evolve and diversify.
North East Knitting realized it would need to expand into higher-value textiles and more specialized markets to survive.
The company invested in new machines that allowed it to produce more- expensive woven fabrics, in addition to knitted fabrics, and pursue markets outside of apparel.
From the birth of the company until about 1999, North East Knitting’s sales were almost entirely of narrow elastics used in clothes and bed linens, such as waistbands and the corners of fitted sheets.
But by 2003, after expanding from knitted into woven fabrics, North East Knitting sales were migrating to new markets such as medical devices and military gear.
As it has expanded into new products, North East Knitting has also been exploring markets outside the United States.
Michael DaRosa said the dollar’s decline in value in the past few years has made the company’s products attractive to buyers in Europe.
Now medical devices are the largest segment of North East Knitting’s sales, with military gear the second largest and clothing third.
The company’s fabrics go in a number of medical products, including post-surgical belts, abdominal binders, soft casts and braces for “just about any kind of sprain where elastics help the healing process,” Michael DaRosa said.
On the military side, the company’s elastics are a part of body armor and reflective safety vests.
“Had we not made those calls, we might not be around,” Michael DaRosa said about the investment in new machines and migration into new markets. “You have to be willing to change and embrace it.” •

COMPANY PROFILE
North East Knitting Inc.
Owner: Rosalie DaRosa
Type of Business: Textile manufacturer
Location: 179 Conant St., Pawtucket
Employees: 105
Year Established: 1986
Annual Sales: $11 million

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