WestPoint Home Makes its Case
By Jennifer Marks -- Home Textiles Today, 2/10/2008 12:00:00 AM
New York —
After a long period of radio silence, WestPoint Home is preparing to make some noise.
The reorganized company is coming into this week's New York Home Fashions Market with a focused message: It's an off-shore mill operator with direct import capabilities; its foreign plants stack up well against competitors on cost; and WestPoint does not plan to cede opening price point business to other mills.
"Our big points are price point and innovation," said Joe Pennacchio, ceo. "We're going to show how competitive we can be at the lower end. And we're going to show innovation, which we believe will separate WestPoint from the others."
"Short of raw materials, three factors that have the most influence are labor, energy and taxes," said Pennacchio. "Pakistan is clearly the lowest cost among countries where a lot of textiles are made. Though Bahrain is slightly higher in labor, the energy costs are as close to nothing as one can get, and there are no taxes of any kind. Layer in the factor that goods come into the U.S. duty-free, and from where we're sitting, we're delighted."
To underscore that pitch, WestPoint plans to show 20 new towel samples this week, all made vertically in the Pakistani plant. The opening price point bath towel can retail at $1.99, said Pennacchio. "We are going to be very aggressive in this market on towels."
WestPoint will also focus heavily on color during the market, said Albert Sardelli, svp of design. The company is expanding the color palette in its range of Stay Bright, bleach-resistant towels and sheets. "The greatest overlap of any retailer from price sensitivity to customer experience is solid color," he said.
In addition, the company is introducing a quick-dry towel, which it developed for the institutional side, that requires only 15 minutes in the dryer.
In terms of fashion direction, WestPoint is showing three lifestyles. Manor, the most formal, emphasizes cotton and silk constructions in rich colorways. High Rise skews contemporary, with a palette in medium tones and silvery colors. Haven is relaxed casual, with soothing hues and twill weaves.
Pennacchio noted that although the company shuttered most of its domestic production last year, "our product development guys down south are still here. Our R&D is still here."
He added: "We've taken all our lumps. We still carry hundreds of millions in the bank, not to mention a line of credit we never use. We have zero debt."
The only production that remains in the United States is filling and finishing for utility bedding as well as the Vellux blanket plant, he said. Last summer, WestPoint expanded its Bahrain facility, "and if we get the business, we could double it," he said.
The plan moving forward is to focus on building profitable business.
"If our company ends up between half or three-quarters of a billion [dollars] and we're profitable on an EBIT basis, fine," Pennacchio said.
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