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This Md. business moved production here from Asia

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At almost three times the size of its original staff and responsible for half of the company’s products, Chesapeake Bay Candle’s Glen Burnie factory is embracing its young and unique U.S. success.

While the company was started in an Annapolis basement in 1994, all of the production was overseas until 2011, when CEO and co-founder Mei Xu decided to bring some of the manufacturing back to the states.

“We’ve always been based in Maryland,” said Xu, CEO and co-founder of Chesapeake Bay Candle. “It started with me 21 years ago living in Annapolis… after more than 15 years of designing and selling out of the area, we brought [manufacturing] back here in 2011.”

The company originally considered building a factory in another state like Texas and California to take advantage of lower labor costs but eventually decided to place it in the state where the business was created.

“In the end we decided to make [the factory] near where we really got inspired,” Xu said. “It gives our company a chance to collaborate between design and production.”

When the recession hit in 2009, the economy in Asia was actually experiencing a boom, according to Xu. Average wages in China have grown by double digits each year since 2004, according to China’s National Bureau of Statistics. The minimum wage in China also saw its biggest increase, at almost 25 percent, in 2011. And in 2012, many experts claimed work in China wasn’t the cheap labor it used to be.

With Chinese wages finally “catching up” and adding on to existing antidumping duties, Xu and co-founder David Wang moved production to Vietnam and then eventually decided to move some of it  to the U.S.

The company’s new plant would save shipping costs, automate the production process, speed up the response to market demand and earn more profits with a higher-quality, made-in-the-U.S.A product, Xu said.

At least that was the idea. But the early years weren’t quite a smooth start.

“We had a hard time setting up the factory because it was our first time back in the U.S.,” said Dong Li, a production manager at the Glen Burnie plant. “We lacked experience … the personnel weren’t stable.”

After two years of “struggles” according to Li, the factory became more profitable and continued to grow. Li, who started as an employee in 2011 working in the factory’s fragrance testing lab, worked his way up to a supervisor in quality control and is now the factory production manager.

Since its start in 2011, the factory has added a second line for candle production and increased its number of employees — from a 20-30 person staff to more than 100 who produce around 800,000 candles a month but have the capacity to produce 1 million, according to Xu.

“At a time when so many jobs are being shipped overseas, small businesses like Chesapeake Bay Candle are working hard to keep and create jobs here at home,” said Rep. Chris Van Hollen (D-Md.) in an email. “They are the cornerstone of our state’s economy.”

Chesapeake Bay Candle sells its products to U.S. retailers like Kohl’s and Target and also to international stores, according to its website. While Xu said she hopes to continue to grow in the U.S., some production will have to remain overseas. The candles produced in China and Vietnam are “pretty labor intensive” in terms of design, and retailers in Europe “demand fast turnaround and lower prices,” according to Xu.

Despite the company’s involvements with large national and international retailers, Xu still sees Chesapeake Bay Candle as a small business.

“I would think we are a small business in the sense of our mentality,” Xu said. “We are a midsized company but we have a very entrepreneurial spirit.”

Now that the company has seen success with manufacturing in Maryland, Xu said she hopes to grow and add more showrooms and offices around the country. While the company has the equipment to expand and double its production in the U.S., it wouldn’t be beneficial to create another factory, Xu said, since the Maryland one is a convenient distance away from most distribution centers.

“We hope there is going to be some other office or showrooms outside of Maryland,” Xu said, including a more permanent office space with better access to retailers and space to collaborate.

“[Xu and Wang’s] story of starting a business in a garage then eventually re-shoring jobs from China to Maryland … is a testament to the quality of Maryland’s workforce,” said Sen. Ben Cardin, D-Maryland, in an email. “Chesapeake Bay Candle is a prime example of something I deeply believe — when given the opportunity, American workers will outcompete foreign competitors.

Xu said she hopes her company can continue to expand its market share in the U.S. and overseas, connecting with consumers through more pop-up stores and retail partnerships and growing in all categories of fragrance.