Transition at the Top
Dynamic Activity in 2005 for HTT's Top 5 Supplier Giants
By Jennifer Marks -- Home Textiles Today, 1/9/2006 12:00:00 AM
New York — —
New York — In the face of competitive pressures from retailer-direct programs and a corps of emerging off-shore manufacturers, the leading U.S. home textiles suppliers produced just slightly more gainers than decliners in 2005.
Among the 88 rankings for which year-over-year comparisons are available, 45 were gainers, 30 posted declines and 13 eked out flat sales numbers.
It was a year in which many U.S. suppliers made strategic decisions about which categories were worth continued pursuit — and which were better off left alone.
WestPoint Home — the new incarnation of the former WestPoint Stevens — chose to walk away from unprofitable business, and its numbers showed the impact. Among the six categories in which it is a top supplier, WestPoint recorded double-digit sales declines in all but two: blankets and down/down alternative comforters. In both those cases, its sales came in flat.
Rival Springs Industries snapped up a lot of the business WestPoint let drop — though certainly not all — in preservation of as much top-line volume as possible. Although Springs recorded double-digit sales declines in five of the 10 categories in which it charts in HTT's annual survey, its declines were not as steep as WestPoint's.
Hollander Home Fashions was another leading player to place its bets more wisely. In the down/down alternative comfortable category, Hollander yielded the floor to cheaper imports, resulting in a 22% knock to sales volume. However, it fired up its efforts in mattress pads and sleep pillows, putting the emphasis on better constructions and higher priced goods. The effect: a whopping 70% jump in mattress pads and a 27% leap forward in sleep pillows.
Among the companies that recorded gains, 55% of them rang up as double-digit; last year only 46% of the gains came in a greater than 9%. Once again, three of the five biggest gainers boosted annual sales by more than 50%. They were: Hollander Home Fashions, up 70% in mattress pads; Berkshire Blankets, up 67 in its core blanket category; and The John Ritzenthaler Co., up 62% in kitchen textiles.
One-third of the rankings that posted declines did so at double-digit rates, and more than half of the 16 double-digit fall-offs in the survey came from WestPoint or Springs. The only other supplier to post multiple double-digit slips was Louisville Bedding, off 16% in foam pads/toppers and off 11 percent in mattress pads.
On a category basis, foam pillows and toppers continued to soar. Four of the five top suppliers recorded double-digit gains of 16% or better. That had to come as good news in the face of tough, serial raw material price increases last year.
Leading decorative pillow suppliers lost the most ground as a group, with four of the five leaders posting sales declines of 4% to 14%. Only Fashion Industries, the smallest player in the ranking, managed to move the needle on sales: up 10%.
In towels — where off-shore manufacturers have been building up capacities at a furious pace and one of the hardest-fought categories after quota elimination in January 2005 — results for the leaders were mixed. Pain hit the top two towel suppliers hardest. WestPoint and Springs saw sales ebb by 28% and 18%, respectively. But #3 1888 Mills and #4 J.R. United each grew their sales, by 26% and 10% respectively.
That said, it's worth noting that while 1888 and J.R. United managed to grab an extra $47 million in share between them, it would appear the vast majority of the $215 million in share lost collectively by WestPoint and Springs moved off-shore.
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