Kyle Jensen / The Record — Interstate Label Company, in Freeland, filed for Chapter 7 bankruptcy on June 30.

Longtime Freeland label manufacturer files for bankruptcy

Interstate Label Company, the longtime label manufacturer in Freeland, filed for Chapter 7 bankruptcy on June 30.

Company’s President Cliff Bjork said the business had struggled for years so he decided to liquidate its assets. He purchased the company from Martin Schmidt in 2005, who started Interstate Label in 1971.

“Business had declined since 2008 with the fall of the economy,” said Bjork this week. “It was overcapitalized, so it got into financial difficulties.”

Bjork sold the property, which is located on Main Street in between Harbor Avenue and Newman Road, on May 17 to All Island Storage for $1.1 million. The property is 3.04 acres, and the industrial light blue building which housed the label company is 16,000 square-feet, according to the Island County Assessor’s Office’ website.

Although the space appears well-suited for a storage company, All Island Storage owner Nathan Davis said he doesn’t plan to open up another branch of his business.

“We have no plans of storage development there, it was just a real estate investment,” Davis said.

After filing for bankruptcy and selling the property, Bjork now is focusing on his other label company, Birch Labels. It’s located in the same building he sold to Davis; he’s renting 6,000 square feet of space. As the sole proprietor of Birch Labels, Bjork purchased some of Interstate’s contents and printing equipment.

Bjork says Birch Labels offers the same services as Interstate Label Company.

When Bjork first purchased the business in 2005, he estimates the company’s annual revenue was between $2-$2.5 million. At its peak, he says Interstate employed as many as 20 people.

The company employed six people when the company filed for Chapter 7. Bjork added “many” of the employees have been rehired by Birch Labels.