Take your best shot
December 10, 2001,
To say this has been a frustrating year would be putting it mildly. But it has been a particularly frustrating year for the Davids of the world.
Here's what all you Davids need to bear in mind as you look ahead into 2002 and beyond: None of this is permanent.
American industry is replete with triumphant Davids, and this industry has plenty of its own tales to tell in that regard.
When Veratex launched 10 years, it was a pip-squeak start-up in the land of bedding giants: WestPoint Pepperell ($1.2 billion), Fieldcrest Cannon ($974 million), The Bibb Co. ($325) and Home Innovations ($142 million), to name a few of the more prominent.
While most of those companies still exist (albeit in merged form), it's worth noting that Veratex is still with us, still growing, and projecting sales of $50 million this year. Pooh-pooh the figure if you like, but realize that nine years ago, the company was making less than $1 million.
TJ Maxx had no free-standing home stores until 1992, when, despite the fact that the country remained in the grip of recession, it decided to expand its home merchandising expertise into a new chain.
Today HomeGoods may not rank as one of the giants, but it's still growing and has been turning in some of the company's stronger performances this year, including a 12 percent comp increase in October.
The company now sees the potential to grow to 400 stores. While specialty formats have offered similar growth forecasts only to fall into ruins, HomeGoods gets its juice from TJX — the No. 8 home textiles retailer — and that makes its odds better than average. And these days, better than average is pretty good.
If you were holding a discussion about top suppliers six years ago, Mohawk wouldn't have entered the discussion. It not only wasn't part ofHome Textiles Today's vaunted Top 15 vendors, it wasn't even one of the Top 5 area rug vendors. And we all know that if you're not one of the top players, you're a small fry.
Guess someone forgot to tell that to Mohawk. Today, with some $600 million in home textiles sales, Mohawk is the fourth largest home textiles company in the country. While it needs to add another $300 million or so to knock Pillowtex out of the No. 3 spot, Mohawk has a couple of things going for it right now that No. 3 doesn't: double-digit sales growth and the wherewithal to acquire new businesses.
And, hey, Mohawk doesn't even make sheets!
Sure, the Goliaths are important, but they are not invulnerable. More importantly, they all start out as Davids. Remember that when Sam Walton opened his 100th discount store in 1974, he was still a regional guy, and Kmart was the dominant retailer on the discount scene. Six years later, Wal-Mart broke the $1 billion mark and never looked back.
The important thing is to follow the formula that worked for the very first David: Aim for the soft spot, be fearless and give it everything you've got.
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See the September 2017 issue of Home & Textiles Today. In this issue, we look at the Attack of the Killer Third Tier: Monster off-pricers are climbing to the top of the food chain, plus New Products: 40 pages of new products debuting at the New York Home Fashions Market; Home Stores: TJX unveils first U.S. HomeSense store; Clicks to Bricks: Boll & Branch moves from digital to physical retailing; and much more...