Home offers hope
By Don Hogsett -- Home Textiles Today, 10/11/2002 12:00:00 AM
NEW YORK —
The U.S. economy is barely stumbling along, the stock market's in a tailspin. Consumers are fretting about a possible war with Iraq, and they're worried about their jobs.
And heaping even more pain onto the pile, a West Coast port lockout has suppliers scrambling and retailers running scared. Alarmed suppliers can't believe what they're hearing and are asking in dismay, "You really expect me to fly this stuff in?"
And there's supposed to be a silver lining in all of these dark clouds? As a matter of fact, it looks like it. There really may be a light at the end of this very long tunnel. Whatever else is happening at retail, sales of home fashions are still holding up. Now if someone would just tell the retailers so they can free up some open-to-buy. But as home fashions suppliers know all too well, when apparel hits the skids and women stop buying eyeliner, stores tighten up on everything else.
And they turned off the spigot with a vengeance during the third quarter, putting home fashions suppliers under remorseless pressure, postponing deliveries and thinning out their stockpiles, hoping to forestall later markdown pressures.
But as retailers were running scared and playing Chicken Little, the reality is that home fashions sales have held up relatively well — particularly strong earlier in the year, and picking up again once past the summer doldrums. And the evidence isn't just anecdotal. Week after week, the Redbook Retail Sales Average reports that home goods are among the strongest performers at retail. Month after month, when it breaks out retail sales, the U.S. Department of Commerce notes that sales of home-related goods — notably home furnishings and appliances — are standout performers.
Still don't think that consumers are sprucing up their homes, even if they're shunning apparel? Just ask Bed Bath & Beyond, where same-store sales jumped up by 8 percent during the third quarter. Or how about Pier 1, where same-store sales climbed by almost 6 percent during the summer quarter.
Even Kmart, struggling through bankruptcy, and losing money, is doing relatively well in its home fashions department. For all the hand-wringing that's going on about Kmart, consider this: Even after losing a big muslin program there, and even after Kmart has shuttered hundreds of stores, WestPoint Stevens' sales to Kmart will be virtually unchanged this year. And flat comparisons, after Kmart has shut all those stores, and after you've lost a big program, means comparable sales are actually higher. Not what people expected of Kmart or WestPoint.
Things aren't so bad at Springs Industries either. The company may have gone private, and numbers may be hard to come by, but it's pretty clear by now that sales were up at a double-digit pace earlier during the year and even now are up in the mid single-digits. Or ask Kevin Finlay, an ex-mill man, whose Ellison Textiles startup for Alice Mills is going strong and making money after only two years in business.
A great danger now is that vendors and retailers alike could turn into prophets of doom and gloom, virtual self-fulfilling prophecies, creating the very circumstances that they fear. Their blinders may be on so tight they just can't see the light that's really there at the end of the tunnel — a home fashions business that, by and large, is still holding up. Now if only retailers would kindly take note and stop starving categories that still have some life in them.
As industry old-timers like to remind us — the octogenarians and alter kuckers who helped to build this business, who still talk fondly about the push-cart days of Orchard and Grand Streets — "You can't sell out of an empty basket."
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