GETTING A HANDLE

Foothill Ranch-based Hampton Products International Corp. has built itself by making household fixtures fashionable.

The company makes more than 7,000 products in all, including padlocks, door handles, light fixtures, hinges, towing gear and tie downs.

Hampton, which the Business Journal estimates at more than $125 million in yearly sales, is perhaps best known for its Brink’s brand of padlocks.

Its products are sold through Wal-Mart, Lowes, Home Depot, Ace Hardware and other retailers.

What could be the most intriguing thing about Hampton is that Chief Executive Kim Kelley is considering breaking a trend by bringing some of its manufacturing to Southern California.

“With a combination of automation, brains and hard work, we think some products can be made economically in the U.S.,” he said.

Hampton already works with 11 factories in China, two in Taiwan, two in Italy and one in the Philippines.

But in China, where labor costs are on the rise in part because of new regulations, it is becoming less economical, Kelley said. The Chinese currency rising against the dollar is another factor working against it, he said.

“These trends probably aren’t going to change over the next couple of years,” Kelley said.

Plans for a local factory could be ready by the end of the year. The plant would design parts that could be produced on specialized equipment and then assembled by workers trained by Hampton.

Kelley said he hopes a highly automated factory could rely on a mix of skilled and entry-level workers.

Orange and Los Angeles counties are potential spots for the plant with workers who fit the bill, according to Kelley.

“I’ve seen it done in China, and companies in the Midwest have been successful with it,” he said.

Hampton would continue to work with its existing factories. Chinese companies likely would contribute to plans for the new plant, Kelley said.

Hampton competes with big names, including Black & Decker Inc., Stanley Inc., Ingersoll Rand Ltd., Fortune Brands Inc. and Cooper Lighting Inc.

Black & Decker runs its Kwikset and Weiser Lock units from Lake Forest, unofficially making the area the “lock capital of the world,” Kelley joked.

The U.S. market for door locks is estimated to be about $2 billion yearly, according to Kelley. About $3 billion worth of home light fixtures are sold here each year. Padlocks do about half a billion annually.

Business hasn’t been hurt much by the housing slump, Kelley said, since Hampton gets most of its sales through stores catering to homeowners, rather than homebuilders.

But the weak dollar and rising commodity prices have made it more expensive to buy stainless steel, copper and aluminum needed to make the company’s products.

Most of Hampton’s door locks sell for less than $50 and are bought by people moving into a home, redecorating or replacing old locks, Kelley said.

The company also makes upscale products. Along Newport Coast, Hampton is designing custom door hardware for Villa Del Lago, a 12-acre estate being developed by luxury home broker John McMonigle.

Other Locks

Door locks aren’t the only kind that Hampton sells.

A recent boost came from a Transportation Security Administration rule that requires airline travelers only to use an approved luggage lock that can be opened with a skeleton key carried by TSA screeners.

Hampton makes the TSA approved locks. The market for the travel locks is estimated to be about $50 million a year, according to Kelley.

Each fall, the company also gets a boost for its padlocks from the “back to school crowd,” Kelley said.

In 1998, Hampton hooked up with Richmond, Va.-based Brink’s Co. to bring the security company’s name to padlocks. The bid to combine Brink’s reputation with Hampton’s “quality construction” has worked, Kelley said.

Other company brands include Dream, Create and CreataLight by Hampton, Keeper, Mountain Security and Lynx.

In 2005, Hampton acquired Connecticut’s Keeper Corp., a maker of automotive security hardware, tie downs, bungee cords and electric winches.

Dale Hampton, a former 3M Co. worker, started Hampton in Denver after coming up with a colorful, weatherproof spare tire lock. He got the idea after he was unable to remove a rusted lock from the spare on his pickup. He started Hampton Lock by selling spare tire locks to dealerships and other pickup owners.

Kelley and 50 other investors bought Hampton in 1990. There now are 100 shareholders, he said.

The largest stake belongs to Kelley, who’s also chairman. He’s run the company since it was bought nearly 18 years ago.

“We’re always exploring merger and acquisition opportunities, and an IPO might make sense for us one day,” he said.

Kelley, a seventh generation Cleveland native, has a background in sales and marketing. Earlier in his career, he worked for Reebok International Ltd., PepsiCo Inc., Welch Food Inc. and Procter & Gamble Co. He said he always wanted to run his own show and thought Hampton would be a good fit. Kelley came across Hampton while working as a consultant in 1990.

“I knew I could bring real branding to the hardware business,” he said.

One of his first changes was to come out with different colors for locks. He recently added colors to knobs and other hardware to have them match different home themes.

In 1991, Kelley brought the company to Orange County, where this year it will occupy 300,000 square feet,mostly warehouse space,and employ about 165 people.

OC was chosen for its entrepreneurial culture and location near the ports of Los Angeles and Long Beach, according to Kelley.

Hampton’s products arrive via cargo ships and then are trucked across the country. The company’s corporate office and warehouse is about a quarter mile from where the Santiago fire burned in October.

Kelley’s executive assistant, Jo Ann Nicol, cooked for firefighters and the media during the fire. Her efforts earned her an appearance on “The Ellen DeGeneres Show.”

Kelley said he’s a big believer in charity, with a portion of Hampton’s profits going to various nonprofit groups each year.

“Our people believe strongly in using their resources to help others,” he said.