Expansion continued in 1886 with an additional glass factory in Stefansruh. The new factory was dedicated to glass rods and tubes, which replaced the production of the shut down Klein Iser factory. In 1886 the central administrative office was established in Polaun, which became the Jos. Riedel company headquarters. However, in the same year, Venetian glassmakers developed a special machine to machine-cut and polish seed beads into perfect tiny donuts. The Bohemian bead production became instantly out-dated and could no longer compete. Josef Riedel Jr. travelled to Venice and recruited three Italian technicians. Their names were Tocellan, Morichetto and Giordani. With the input of Wilhelm and Josef junior, the three Venetian engineers improved and developed the original Venetian cutting machine in the Riedel bronze foundry. It was able to produce 3.000 tons of machine-cut seed beads per year. At the same time, glass manufacturer Ludwig Breit introduced his glass-cut-off-machine. Mechanisation in the Iser Mountains led to significant unemployment. This led to the homeworkers' uprising at the beginning 1890 which culminated in the Wiesenthal Rebellion where workers died in a clash with police. The local government declared a state of emergency. The labour disturbances became so serious that the governor, Count Franz von Thun, visited the Iser region in person. The Riedel family, on the other hand, helped to ease the crisis and supported the unemployed homeworkers with financial grants. Riedel expanded and purchased the world-class glass decorator ‘Vincenz Pohl in Neuwelt’ which opened additional business opportunities to the luxury glass market. The decorated glass produced in this workshop with colourful enamels became extremely popular in Venice, the French market as well as overseas in South America. The demand for luxury glass surpassed supply which made it necessary to open an additional decoration workshop at the Polaun plant. The Polaun plant became increasingly important for business because of its packaging department, paint shop, kilns for firing painted glass, and last but not least a showroom for customers. In 1887, Wilhelm Riedel invented a patented process to machine colour a scalloped edge instead of using hand paint. That same year, the company displayed its first-ever luxury glassware at the prestigious Leipzig Fair. The company was greatly honoured in 1888, when it was invited to be one of only seven glass factories in the Austro-Hungarian Empire to participate in the Exhibition of the Emperor's 40th Jubilee in Vienna.