Heimtextil Exhibitors Expect Lower Attendance
Carole Sloan -- Home Textiles Today, January 14, 2009
Frankfurt, Germany — Global business challenges, changing currency rates and a general malaise in home furnishings sales are expected to have a major impact on the international home textiles business this year.
Despite these over-riding concerns, some exhibitors from both Asia and Europe at Heimtextil here this week are planning for increases over 2008. But at the same time, there is a recognition that retailers will be planning tighter inventories, relying more and more on suppliers to bear the inventory burdens. Overall, many suppliers are looking for increases in their export sales despite the sense that consumers globally are pulling back on spending.
With the outlook so questionable, exhibitors here expect attendance from retailers around the world to be down dramatically.
For British-based Ashley Wilde, the current economic conditions are producing a positive/negative situation, said Nick Jones, export manager. The dollar value has helped enhance sales of decorative fabrics in the United States. But at the same time, the purchase price on ready-mades from China has increased. Overall, the company expects higher sales for '09 due to increased growth in the Kylie Minogue bedding brand and increased distribution of the kai and Ashley Wilde labels.
Textrade is planning for an increase this year compared with 2008, and expects that U.S./Canada business will increase beyond its 30% share of total sales, despite both U.S. and Chinese currency changes, according to Jenny Gruber, president of Textrade USA, the American arm of the Indian-based supplier.
A shift in how customers are ordering — smaller quantities, and closer to needs — as well the currency fluctuations are causing Tai Yuen Textile of China to forecast a lower sales rate for this year, said Suzy Wu, sales representative. A similar outlook is projected by Ra Kamaraj, managing director for India's Kwalitee Fabrics who noted that a reduction in buying power rather than currency changes were the basis for the company's outlook.
Josef Koelker, managing director for Germany's Wulfing also expects business to be down versus 2008, but since only about 20% of its business is in the U.S./Canada market the impact of the dollar is not that great in terms of sales. The dollar's value, on the other hand, is affecting the cost of cotton which is traded in dollars, as well as the cost of spinning, energy, labor and chemicals, he said.
Pegging overall business this year as about the same as 2008, Dagmar Schwedt, director of Germany's Ernst Feiler sees a world-wide recession for low and medium level products but a significantly lower decline for high end and long lasting products. In addition, acquisition of new customers is difficult because of the global crisis, Schwedt noted.
For Tanveer Ahmad, executive manager of marketing at Pakistan's Arif Textiles, this year should be better than 2008 despite the currency changes, fluctuating oil prices and more increases in commodities. Similarly, Hemant Sharma, vp of Hanung Toys & Textiles of India sees business better this year versus last, but expects a lot of pressure on pricing because of last year's liquidations, which created insecurity as well as low demand. New product launches will drive planned sales increases for Towellers despite the surrounding economic crisis, said Mahjabeen Obaid, design director. Towellers sells only in U.S. dollars and sees consumers world-wide reacting to less disposable income.
The currency fluctuations have been the No. 1 issue for Italy's Zambaiti, according to Claudia Parati, general manager of the company's U.S. division for sales both in the United States and countries not in the Euro zone. Looking at this year's outlook, she said the company is planning global sales equal to last year, but there will be a general reduction of inventory levels and more attention to price targets.
Sales will remain at about the same level as last year for Vamaltex of Portugal, according to Lorena Pimenta, designer, and distribution by country is expected to hold to the levels of '08 with Europe the major share at 60%, U.S./Canada at 38% and Asia at 2%. Looking at currency pressures and the global business slowdown, Pimenta said the former reduces the company's capacity for negotiation while the latter has impacted consumption, and differences in stock management from retailers.
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