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Sock and Awe

How Ric Cabot and Darn Tough Vermont saved the last hosiery mill in New England


Published November 14, 2012 at 10:30 a.m.

Gail Scelza left her East Charleston home at midnight last Friday to be first in line at the Cabot Hosiery sock sale in Northfield on Saturday morning. At 4:30 a.m. — a half hour before the doors opened — she’d already been waiting for two hours at the factory that sells Vermont-made socks at deep discounts over two consecutive weekends during rifle season. It’s the Green Mountain equivalent of queuing up for the latest Apple invention.

This year’s buying frenzy started two and a half hours earlier than usual — a decision embraced by the practical Vermont women gathered in the heated vestibule between the factory’s inside and outside doors at 4:45. They included Tinmouth’s Marie Regimbald, her friend Debbie Frederick of Wallingford — a self-described “sock-sale virgin” — and Cindy Wisniewski of Waterbury, who recognized Scelza from sock sales past.

“This is the bomb,” said Wisniewski, who got up at 3:30 to ensure the best selection of socks. Her reaction to the suggestion that there might be extra inventory this year and perhaps some two-for-one deals? “Yessss!” she cheered with both arms outstretched over her head.

By 4:50, more folks — including a young man — had crowded into the vestibule; outside, a line of customers already extended to the parking lot. By 8:30, hundreds of cars would line the roads between the factory and Route 12, which runs through downtown Northfield. Their drivers come for deals on dress, sport and kids’ socks. While they last, 40-pound bags go for $10.

But “if you want the Darn Toughs,” Wisniewski clarified, “you gotta come early.” Her new friends murmured in agreement. “Once you’ve worn ’em, there’s no going back.”

Wisniewski was referring to the high-end hosiery brand the Northfield company launched in 2004: Darn Tough Vermont. After years of making private-label socks for price-sensitive, big-name retailers, Ric Cabot and his dad, Marc, decided to design their own.

“Best sock ever” is how Marc Sherman of Burlington’s Outdoor Gear Exchange describes the niche product that saved Cabot from bankruptcy and “redefined the top-end sock market.” Even at full price, which can run more than $20 a pair, Sherman sells twice as much Darn Tough as SmartWool at his Church Street store — as many as 600 pairs a day during the holiday shopping season.

At the annual sock sale in Northfield, six weeks before Christmas, you can pick up the reject Darn Toughs — stamped “irregular” or “second” — for as little as half price.

Cabot’s balance sheet suggests the brand’s popularity is not just a “buy local” phenomenon. Contracts with various branches of the U.S. military, which have an American-made requirement on large acquisitions, have been great for business. Darn Tough’s line of no-nonsense “tactical” socks now accounts for about a third of the company’s revenue.

But the growth of Darn Tough’s “specialty” line is what Cabot is banking on: Sales are up 43 percent over last year, which was up 79 percent over the year before. Customers all over the world, especially in Japan, South Korea and Canada, are discovering Vermont’s gourmet socks are worth the investment.

To meet the demand, roughly 130 people — up from about 75 four years ago — work three shifts a day at Cabot Hosiery Mills. When the company constructs a 20,000-square-foot addition this spring, they’ll have more room to design, manufacture, package and ship at the Northfield factory — the last remaining sock mill in New England.

By all measures, Cabot Hosiery’s Darn Tough Vermont is shaping up to be the state’s next global success story. “Everything that went into making them the last folks standing on the commodity side of the business in the United States translates into building a foundation for a super-strong organization going forward,” says Secretary Lawrence Miller of the state’s Agency of Commerce and Community Development. It starts with “solid quality,” he notes. “That was the anchor for Burton, for Ben & Jerry’s, for Green Mountain Coffee Roasters — really stable, consistent quality that delights the customer.”

Darn Tough’s “awesomeness” inspired Beth Halasz and Jim Fleenor to drive 600 miles from Ohio to Northfield last weekend. Fleenor said it’s hard to find the socks in Cleveland, and Cabot Hosiery doesn’t sell them online — yet. Searching for information, Fleenor and Halasz discovered a Seven Days video about the sock sale on YouTube (right). They decided to drive to Vermont and “make a long weekend of it.”

The couple had spent the previous night in Killington, but got up at 1:45 to arrive before the dawn’s early light. “We haven’t slept all night,” Halasz reported cheerfully.

“People keep asking, ‘Are you up here to ski?’” she said. “No! We’re up here to buy socks!”

If the sock fits...

It would be an understatement to say that Darn Tough customers have strong feelings about their hosiery. After a lifetime of wearing socks that are too hot or not warm enough, that bunch up in boots and wear out after a single season, they can’t say enough about Cabot’s foot-hugging alternative. With the slightest encouragement, they’ll lift a pant leg to show ’em off.

Appreciating Darn Tough is a two-step process: There’s the initial thrill of a firm fit with reinforcement padding in all the right places. Then there’s the long-term realization that your feet are warm but not sweating; the toe seam — if there is one — isn’t digging into your cuticles; and, wait, that favorite pair of socks you’re wearing has been kicking around for almost a decade.

“They’re durable, guaranteed for life, and they fit,” says Sherman, who confesses Darn Tough is the only brand he wears unless he’s “at the end of a laundry cycle.” His first encounter with Darn Tough, soon after it launched, was at the 2004 Vermont City Marathon. Every runner received a free pair of Darn Tough’s classic running quarter socks.

“Almost everyone I have introduced to the socks has become evangelical,” Sherman says.

Spreading the word with passion — and a journalism degree from the University of Colorado Boulder — is 47-year-old Ric Cabot, Darn Tough’s evangelist-in-chief. The business brain behind the brand, he descends from a short line of sock men. Cabot’s grandfather owned mills in the Carolinas and New Hampshire, back when “socks were being made here. Garments were being made here. There was cut and sew here,” he says, and textiles were considered “a viable business.”

Cabot’s dad, Marc, followed his own father into the business, and the two men worked together for a while. Marc was living in Riverdale, N.Y. — where Ric grew up — working as a textiles sales rep in 1978, when he decided to buy and revitalize a defunct Northfield mill. For years, Marc commuted to Vermont to run the business. Now the 73-year-old makes the weekly trip from his home in Maine and stays Monday through Thursday in a nearby motel. Cabot employees describe him as “personable” and “a salesman through and through.”

It was Marc who opened the doors for Scelza and company last Saturday morning at 5 a.m. and thanked them as they rushed into the factory. Ric showed up a few hours later. Despite having undergone double knee surgery the week before, he was also out on the floor.

The younger Cabot left a publishing job in Manhattan to join his father at the factory in 1989. “I always felt that it was my destiny,” Ric says. And Vermont appealed to him. “As corny as it sounds, I like nature and being outside.” He settled in Stowe, where his wife runs a real-estate business. They have two children, ages 7 and 9.

Business was good during Ric’s first decade at Cabot Hosiery. “You could be successful in being a good manufacturer, in providing a quality product at the right price,” he recalls.

He helped lure some of the biggest brands, including Gap, Banana Republic and Old Navy, to Northfield, where the factory produced private-label socks for all of them.

“That’s how business was done,” Ric says. “The goal was to grow bigger” on the assumption that mutual dependency would benefit both parties. But without equal ownership, he eventually discovered, “you have all that size on a very shaky, unsteady and potentially fickle foundation.”

At the beginning of the new millennium, Ric says, the big clients started shopping around, playing competitors off one another to get the best possible price for goods. As a contractor, Cabot Hosiery didn’t have many options. “You squeeze labor, you squeeze benefits. You look for any way you can to keep the machines running,” says Ric, relating a tale that could describe almost any segment of American manufacturing threatened by outsourcing.

In the end, he and his dad found they were operating Cabot on desperation and fear. And the business wasn’t working financially, either. Sales were down — from roughly $7 to $5 million a year — and the company owed Chittenden Bank millions of dollars.

When it defaulted on some loans, Ric remembers, the bankers came in for a meeting. As they were leaving, “they backed out of the room as opposed to turning around,” he remembers. “They were like, ‘No surprises, right? No surprises?’ thinking the minute they left, we’d go Chapter 11.”

The Cabots did just the opposite: Both took out third mortgages and reinvested in the business, “but not in the same old thing,” Ric qualifies. “That’s when I came up with Darn Tough.” In retrospect, he says somewhat reluctantly, “Almost going out of business was probably one of the best things that ever happened to me.”

Darn savvy

Ric Cabot doesn’t mind telling anybody who will listen: “I consider myself the best in the business.” Boastful as it sounds, the claim is probably true. The younger Cabot learned all about the technical aspects of manufacturing from his dad and other experts at the factory — people with decades of experience.

But paired with his technical knowledge is a rare talent for merchandising and marketing, which is precisely what Cabot Hosiery needed in 2004.

With fresh, third-generation eyes, Ric saw an unfilled niche in the market he and his dad knew so well: “There were some really good socks out there, but they weren’t that comfortable, they didn’t last and they didn’t fit well,” he says.

Ric envisioned a high-end sock brand that Cabot would own and focused “on what the proper DNA of a sock should be.

“We knit something people had never put on their feet before,” he says. “It was high needle, fine gauge, density without bulk. It was form fitting.” The high-wear areas are reinforced — the most obvious example being Darn Tough’s knee-high ski sock, which features subtle padding where the boot hits the shins and ankle bones.

Ric also came up with a clever name that perfectly conveyed the spirit of the endeavor. “Darn Tough is a lot of things: It’s Northfield, it’s the textile manufacturing industry in the United States. I wanted to say we’re surviving and we’re going to survive. These socks are going to last, and they’re not going to be a disappointment.”

To that end, he informed his dad that Darn Tough Vermont socks would be guaranteed for life or the customer’s money back.

How often does he write a check? “It’s .003 percent of sales,” says Ric, who handles any serious complaints personally. If the company were doing $10 million in annual sales, that would work out to be $30,000 in revenue checks. It’s a small price to pay for a big claim that’s emblazoned on the packaging of every single pair of socks.

Ric is involved in all aspects of communicating the Darn Tough brand, from the graphics on the catalog — the bold headline is “I like to ______ in my Darn Tough socks” — to the intentionally slapdash ads and signage for the sock sale. The two-for-one deal was announced on a “sign” assembled from pieces of copy paper that had been taped together. Asked why the company doesn’t invest in a large-scale printer, Ric says half-jokingly, “That would look too slick.

“One of my favorite things is the PR and the press,” he says. And it shows. “If a press release is too wordy or too choppy, or there’s no lede, I’ll change it,” he explains.

He tells the company story with the intensity and rhetorical repetition of a campaigning politician. “We’re pulling back all the curtains. We’re pulling back all the hype. We just make socks and we do it better than anyone else,” he says.

A discussion about competition turns into a lesson in brand awareness. “What three things do you want people to know about you? What makes you unique? If you don’t have three things, or 10 things, or a handful of things that people can remember and understand, then it’s going to be really tough to sell anything.”

OGE’s Sherman agrees that Ric is “relatively serious” and can be “intense,” but “he’s got a good sense of humor. He’s a genuinely caring person.”

That comes through loud and clear when Ric talks about all the jobs America has shipped overseas: “We let all those jobs go. And for what reason?” When he talks about Cabot’s employees, many of whom are not college educated, he’s an empathetic realist. “It’s hardcore, dyed-in-the-wool manufacturing; I make no illusions about it,” Ric says. “We work hard, and we get dirty and we get sweaty and it’s frustrating.”

What are the employee benefits beyond having a paying job in Northfield? The company recently reinstated its 401(k) program and upped the match. It contributes 65 percent of everybody’s health insurance.

“I’m on the floor all the time, every day. And my father’s here most of the time, too,” Ric says. “I remind people that we rely on them. I thank them for coming to work. I try to make it fun and crazy and weird and interesting.”

Nothing provides all of that more reliably than the sock sale, during which Cabot Hosiery employees are transformed from factory workers to cashiers, security guards and ambassadors. It’s definitely a strain on the workforce: By next Sunday, when the sale comes to an end, almost every Cabot employee will have worked 14 days in a row and contributed to selling more than 100,000 pairs of socks.

But the event is also a masterful exercise in human-resource management and public relations. Customers get to see the real people who run Cabot — not some temps hired to work the sale. And the workers get face time with the people who buy and love the products they make.

Donald Provoncha normally manages the dye house, but he was running a cash register, and loving it, last Saturday. He had been in a major car accident two days before, but that didn’t diminish his enthusiasm. “This is where it all comes off,” he said. “You get to talk to all the people who buy our stuff.”

Provoncha served time in jail before he came to work at Cabot seven years ago in a job that paid $7.50 an hour. “They never held it against me,” he said. “I worked my way up, and only because they disregarded everything that happened to me in the past.”

“I tell people, ‘You start here, and you don’t make much money, but the way you’re treated makes up for everything,’” Provoncha added. “It’s nice to know that the people who own the place take pride in what they do. This place is great. It deserves to explode. I’d never go anywhere else.”

Close knit

Cabot Hosiery doesn’t look to be going anywhere else, either. Ric references the Spanish conquistador Hernán Cortés, who burned the ships that brought him to the New World so his men would make the most of the opportunity. “That’s sort of how it is here,” he says. “We are committed to staying here. There are no ships leaving.”

On a lighter note, he adds, “And Darn Tough New Jersey just doesn’t have the same ring to it.”

Cabot Hosiery is planning for a future with less military business. Maybe a name change that combines the two brands into Cabot Darn Tough Vermont. And Ric says he’s “taking a good hard look” at online sales.

The forthcoming expansion will create more room for the growing “specialty” side of the Darn Tough brand, which “has just skyrocketed” over the past four years, according to Ric. That means having socks in more than 1000 sizes and varieties in stock at all times — the mill prides itself on same-day shipping.

But having too much inventory is inefficient and expensive, which is why Cabot just hired Brent Blevins, formerly of Williston’s defunct Resolution, to improve production planning. He’ll most likely have a say in which knitting machines are making men’s micro crew mesh running socks and how many are shooting out colorful women’s lifestyle varieties in stripes, spirals, flowers and polka-dot patterns.

Darn Tough changes its designs every year, many of which are created by Poppy Gall, cofounder of ISIS, a women’s activewear company. It’s another merchandising strategy: The best way to get people to buy more socks — that never wear out — is to make them “collectible.”

The patterns are created on a computer, “which tells the machine to stripe in this color, or create this polka dot on these needles at this time,” Ric explains. “This finger goes in, this finger goes out.” When a hundred-plus knitting machines are churning out socks, with dozens of colorful cones of yarn suspended above them, it looks like something out of Willy Wonka & The Chocolate Factory. Each whirring contraption costs $35,000.

What’s Cabot Hosiery’s secret ingredient?

“If it was just one thing, anybody could do it,” Ric says. “If it was just the machines, anybody could buy that. If it were just the yarn, they could buy that, too,” he says of the 750,000 pounds of merino wool Cabot sources from the U.S., New Zealand and South America. “What you can’t get is 34 years of manufacturing in the same small, rural town. The thing that makes us the most successful, that nobody can buy, ever, is the people who work here. That’s our biggest asset.

“We’re in it together.”

The Cabot Hosiery Mills annual sock sale continues this Saturday, November 17, and Sunday, November 18, 8:30 a.m.-4:30 p.m. in Northfield.