WestPoint Home Plans 2010 Turnaround
Targeting New Retail Channels, International Markets
By Jennifer Marks -- Home Textiles Today, 3/7/2010 12:00:00 AM
New York —
WestPoint Home will make a big branded statement this market as it looks to rebuild its business both nationally and internationally.
“We’re making some headway and starting to do some things,” said John Piazza, president and ceo. “We’re going to continue to try to bring in new brands and new innovation.”
Taking center stage this week will be the launch of Caribbean Joe alongside the second iteration of Izod. Each is being given half of the showroom for adult brands, with presentations in each of fashion bedding, sheets, utility bedding, bath, beach and kitchen.
“It’s an exercise in brand building,” said Albert Sardelli, svp of design. “I think it’s fun to have a brand contrasted with another brand — because that’s a retail story.”
In a separate showroom, WestPoint is focusing on product classifications. This is also where the mill is showing its newest solutions products:
Utlra Loft, a towel with cotton that “blooms,” becoming softer and fuller after washing;Harmony, a varied textured towel with a spa quality;Swift Fit, a patent-pending bed skirt that is easy on, easy off;Right Fit, a fitted sheet with elastic on four sides that fits snuggly to mattresses ranging up to 18-inches deep.
“We’re also expanding beach in a big way,” said Nancy Golden, vp of marketing. “And we’re making a big presentation in throws with different textures.”
WestPoint executives are also working to make this the year that the company — a majority is owned by Icahn Enterprises — reverses years of sales declines, which began nearly a decade ago at its predecessor company, WestPoint Stevens.
“We’ll have sales increases this year,” Piazza told HTT. “Fourth-quarter sales were actually flat. It’s the first time that’s happened in a long time.”
Piazza said the company cut its losses 40% last year and reduced costs 18%.
Its bedding plant in Bahrain has been running at full capacity for nine months and its towel facility in Pakistan for seven months, according to svp of sales Alan Kennedy. The plants have solid booking running well into the new year, he said.
Kennedy also led WestPoint’s team in showing at Heimtextil this past January, part of the company’s effort to carve out a business in international markets. He expects booked business to grow 300% in 2010.
“We picked up a lot of business in Australia last year,” he said. “I think we’re about to establish a presence in the U.K. We’re taking it one big dog at a time.”
As part of its new markets strategy, WestPoint also used its kitchen towel business, launched last year, to crack into the grocery and drug store channels. It also made headway into the college bookstore market.
And in institutional, where WestPoint has long been a player with the majors, the company is considering how to address smaller operators.
In its traditional retail channels, the company sees this as a year of taking more share.
“We are a strategic supplier in many accounts right now,” said Piazza. “Two years ago, I couldn’t say that.”
New York — WestPoint Home narrowed its losses in the fourth quarter as sales continued to slip but were nearly flat, the best quarterly sales performance of 2009.
WestPoint, the “Home Fashion” division of Icahn Enterprises, had net sales of $105 million in the quarter ended Dec. 31, a drop of 1.9%. Operating loss for Q4 was $16 million, tightened dramatically from the loss of $30 million in the year-ago quarter.
For all of 2009, WestPoint net sales of $369 million were down 13.2% from $425 million in 2008, the company said. The full year operating loss was $71 million, beating the year-ago loss of $95 million.
While gross margin on the year was flat at $31 million, Q4 margin expanded from $6 million to $10 million.
Icahn executives said the improved Q4 margin and operating loss narrowing were “due to continuing cost cutting initiatives and moving manufacturing to lower cost locations.”