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HTT's Top 15 Supplier Giants

HTT's Top 15 Supplier Giants
(sales in $millions)

Est. '08 Sales '07 Sales % Change Significant Events
1 1 ( '07) Springs Global US $1,108 $1,435 (revised) -23 After slashing expenses, Springs Global US is now becoming more focused on generating top-line sales, halting further erosion of its business in a lousy retail environment, fluctuating exchange rates and its move of infrastructure out of the States to Mexico and South America. The company is looking to migrate still more of its manufacturing and warehousing operations out of the United States, even as it tries to reignite interest in its brands, including the fall relaunch of Springmaid. No less important is the further development of its private label business, following the direction set by key customers and despite the apparent contradiction in marketing strategy. Finally, Springs is actively seeking to build its global sales, particularly in Brazil and the rest of South America, effectively diluting the influence of the U.S. marketplace.
2 3 ( '07) Mohawk Home $624 $624 0 For Mohawk Home, 2008 represented its first full year as a soft flooring-focused operation, having shed its lagging textiles businesses — woven throws, bedspreads and decorative pillows — in late 2007. While some sales losses were felt with the departure of these auxiliary products, the company filled the void quickly by expanding its area, accent and bath rug offerings. Bath rugs came in flat for the year, as the business sustained itself, but area and accent rugs saw healthy growth of 9% as the company gained new business with home centers.
3 2 ( '07) WestPoint Home (WestPoint International) $430 $683.7 -37.1 The next time someone insists Carl Icahn is all about a scorched-earth strategy of investing, just point them west — to his WestPoint Home investment. Or might his patience with this giant be linked to other considerations? For WestPoint, it really doesn't matter. Mission One this year is taking aim in the general direction of profitability after having shed what it has repeatedly identified as unprofitable revenue for the last two years. A smaller, ostensibly leaner and quicker company has emerged, and while more organizational changes are likely in the next 12 months, WPH is under the gun to begin producing results (read: operating profit or EBITDA). Through the third quarter, with the recession still deepening, WPH gave up 40% in sales but cut its loss in half. Gross margins — essentially nonexistent at the end of last year — have begun to rise. Sara Lee vet John Piazza joined the company as president and ceo in late summer, vowing to focus the company on innovation.
4 5 ( '07) Welspun USA $401 $349 15 After nearly a decade of diligently building market share in the towel business, Welspun set itself up for the next wave of growth in 2008. Early in the year, the company opened manufacturing facilities in India and Mexico to produce fashion and utility bedding. Shortly thereafter, Welspun flipped the switch on a bath rug plant in India. On the branded front, the company debuted a collection leveraging the designs of home sewing/crafts celebrity Amy Butler, integrated the upscale, Portugal-based Sorema bath operation it acquired in 2007, and nabbed the Waverly license for bath towels, bath accessories; and bath, accent and scatter rugs; down and synthetic filled comforters and blankets; pillows; and mattress pads.
5 6 ( '07) Sleep Innovations $310 $316 -1.9 Sleep Innovations recorded slightly lower sales in the memory foam category in 2008 as a result of the challenging economic conditions and slowed consumer spending. The company was able to maintain core comp-store sales through technology innovation and new distribution. However, Sleep Innovation's absorption of higher commodity and distribution costs impacted the bottom-line. The company filed for Chapter 11 in October, but plans to emerge in the middle of first quarter 2009. Michael Fux, Sleep Innovation's founder, will resume his role as ceo at that time.
6 4 ( '07) Pacific Coast Feather $303 $352 -13.9 Consumers' turn away from performance and enhanced products toward basic price points, along with the generally poor retail environment, set sales back in the down/down alternative comforter, mattress pad and sleep pillow categories. Pacific Coast Feather was also a casualty of Linens 'n Things' failure and was owed $1.6 million when the retailer went down. The company continued to pursue innovation, as with its patent-pending Embrace comforter, and also looked to new opportunities in hospitality, where it has long been a player.
7 8 ( '07) Shaw Living $288 $288 0 Shaw continued to immerse itself in its earth-minded initiatives, expanding its recyclable rug offerings and refining its manufacturing operations to more eco-friendly methods. But its two soft floor covering categories — area/accent rugs and bath rugs — suffered stunted, flat sales as the economy continued its downward trend through the end of the year. Sales were status quo in number but not in venue — the supplier saw its business shift more toward discount department stores and home centers.
8 9 ( '07) Maples Rugs $270 $270 0 Even in what the company has described its most challenging year, Maples Rugs balanced its sales, keeping them flat in both area/accent rugs and bath rugs. This 100% domestic supplier of tufted rugs increased its placements with discount department stores and mid-price chains but lost sales with the broad closing of LNT, Mervyns and Value City as well as sales declines at some of its existing customers.
9 7 ( '07) Hollander Home Fashions $254 $295 (revised) -13.9 Sales volume declined due to economic conditions and the loss of retail doors through store closings and liquidations. Jeff Hollander, ceo, said overall results met expectations. Some programs were discontinued due to inflation in raw material prices. Many of those were replaced with more trend-right programs, he said. "Operating efficiencies continue to improve to drive our business in this tight economy, and increased volumes are anticipated for 2009 based on new placements," he added.
10 10 ( '07) Franco Manufacturing $229 $260 -12 A top contender for "The Most Secretive Company in the Home Textiles Industry" — though others could challenge it for the title — Franco keeps much of its business under the radar. The Franco clan is even more circumspect about its non-textiles investments, which at one point included the consortium that acquired, and then sold the Pillowtex assets. On the licensing side, Franco signed an agreement to translate the "fun fine art" of Will Bullus into kitchen and table textiles for department stores, specialty chains and other mass market retailers. It also signed with Cartoon Network Enterprises to produce bedding, beach towels and bath accessories for the Bakugan property.
11 12 ( '07) CHF Industries $202 $222 -9 Total business was running ahead of 2007 through the end of August, then hit the wall as consumers stopped spending and retailers stopped buying. CHF also got stuck for a little over $1 million when Linens 'n Things filed for bankruptcy. The DKNY business "is well up," according to Frank Foley, CHF president and ceo. The company expanded DNKY distribution beyond department stores by selling into Bed Bath & Beyond. Donna Karan Collection and DKNY Pure remain exclusive to department stores. The remainder of CHF's bed and bath business in both adult and juvenile "is pretty consistent in all phases and all bases, right around where we'd expect it to be," said Foley.
12 13 ( '07) Divatex $186 $200 -7 After its initial appearance on the Top 15 last year, the company kept its nose to the grindstone in 2008. Like many others, Divatex lost business when Linens 'n Things tumbled into bankruptcy, then folded. Divatex continues to run lean and access a network of mills around the globe with which it has strong ties.
13 14 ( '07) Louisville Bedding $180 $185 -2.7 While the mattress pad business was down slightly from 2007, the bed pillow and feather and down business showed incremental growth, making the company results somewhat flat for the year overall. The main factor undermining potential gains was the general state of the economy across the globe. According to ceo Steve Elias, Louisville Bedding maintained a strong balance sheet thanks to its history of conservative financial management.
14 11 ( '07) Croscill $160 $231 -30.7 At the close of a tumultuous year that saw first the bankruptcy then the liquidation of major account Linens 'n Things, the family owned company sold in November to managed investments fund Patriarch Partners LLC. Glenoit/Ex-Cell ceo Barry Leonard has added Croscill chief executive responsibilities to his plate. Glenoit is also owned by Patriarch. Croscill as a brand struggled in recent years as major department store and specialty store accounts shifted to house brands and exclusives. Patriarch plans to build on the strength of the core brand, pursue consumer marketing to drive demand and expand internationally.
15 15 ( '07) Brentwood Originals $149 $169 -11.8 A longtime major supplier of decorative pillows and soft window treatments to Linens 'n Things and Mervyns, Brentwood stood to lose when the chains fell off the face of the retail landscape. Adding salt to the wounds were sales declines at other major customers as consumers cut discretionary spending. Buoying the company in light of these losses was Brentwood's expansion into the institutional business and some specifically targeted bedding products.


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