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Capital Spending Suppliers

Supplier capital spending

Supplier '03 $Mils. % of '02 sales
Mohawk Industries $130.0 3.8%
WestPoint Stevens 50.0 2.9
Dan River 16.0 3.3
Pacific Coast Feather 3.5 1.1
Hollander 2.0 1.0
Brentwood 1.8 1.3

Hollander Home Fashions

Boca Raton, FL

'03 capital spending—$2.0 million

'02 capital spending—$2.0 million


"So far this year we've done a lot more automating," said Leo Hollander, ceo. "We've reinvented, actually reconfigured some older equipment that allows us to re-fluff the feathers that we're washing in China and bringing into this country compressed. We're putting in new electronic weighing equipment. We're constantly working on things to bring down the labor cost. Our U.S. labor costs so far this year are down about $730,000. And last year we brought our domestic labor costs down almost $3 million, all through automating and updating our plants and equipment. You have to make yourself more efficient. You don't have a choice today."

Mohawk Industries

Calhoun, GA

'03 capital spending—about $130.0 million

'02 capital spending—$112.0 million


Mohawk, now the nation's fourth-largest home fashions supplier through its Mohawk Home unit, spent almost $112 million last year, and will spend even more this year to update its plants and modernize equipment. This year, Mohawk said in its 10-K annual report, the cash "will be used primarily to purchase equipment to increase production capacity and productivity." In general, Mohawk said, "capital projects are primarily focused on increasing capacity, improving productivity and reducing costs." From 2000 to 2002, Mohawk spent about $238.3 million on capital projects, and this year's spending will bring it to a four-year total of almost $370 million.

Brentwood Originals

Carson, CA

'03 capital spending— $1.8 million

'02 capital spending—$10.0 million


Spending returns to normal levels this year after the decorative pillow producer spent about $10 million in 2002 to buy 45 acres of land and put up an entirely new plant in Walls, MS. This year, said Loren Sweet, ceo, the big item is a new conveyor system for the new plant, which includes an extensive array of scanners, directional gates and loading facilities. Additional capital went for new pickers and blowers to add pillow capacity in the company's other two plants. The key to growth and taking market share, said Sweet, is riding herd on supply chain and logistics issues.

WestPoint Stevens

West Point, GA

'03 capital spending—$50.0 million

'02 capital spending—$46.0 million


Despite the pressure on its cash flow from a debt load that propelled the company into bankruptcy earlier this month, WestPoint Steven is stepping up its capital spending by almost 9 percent this year, to $50 million. Even so, that's far from the hundreds of millions the company once spent as it added capacity and modernized its plants. Predictably, routine maintenance eats up much of the capital budget, with other spending going for regulatory issues and routine business needs, and the remainder of the budget aimed at unspecified items designed to modernize equipment and take out costs.

Dan River

Danville, VA

'03 capital spending—$16.0 million

'02 capital spending—$12.4 million


Dan River boosts its capital outlays by almost a third this year, and predictably the lion's share of the budget, in the range of $8 million to $10 million, goes for routine maintenance and upkeep on its plants. Additionally, the company is installing new, replacement print ranges in its Brookneal plant to modernize sheeting capacity. Additional money will be spent to upgrade systems that enhance supply chain management. The company converted to SAP logistics systems several years ago, and says it's spending money on routine upgrades to keep its systems current.

Pacific Coast Feather


'03 capital spending—$3.5 million

'02 capital spending—$3.5 million


"In 2002, we spent about $3.5 million on capital projects, and this year we'll spend right about the same. Maybe a little less, but right about the same," said Joe Crawford, cfo of the nation's sixth-largest home fashions supplier with about $350 million in 2002 sales. That puts the company's level of spending at about 1 percent of sales, and well beneath the ambitious levels of recent years, including $12 million in 2000 and about $5 million in 1999. This year, as in 2002, said Crawford, "about a third of the spending is going to IT stuff, information technology improvements, and the rest of it, the remaining 70 percent, is for the replacement of aging assets."

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