Home Source in Robust, Strategic Growth
September 14, 2008,
In an era when home textiles suppliers remark that there are but a few retailers — 15 to 25 majors — in their sights, it's unusual for a supplier to also point to 1,500 specialty stores on their customer roster.
After seven years of building the company to provide the products and services needed by these disparate communities, Home Source now is at the $50 million to $55 million revenue level and is looking to hit $100 million in two to three years.
While building its position in the marketplace with innovative products including bamboo and Microcotton, it has just signed on as the bed and bath licensee for Portico, a lifestyle brand of eco-friendly products. The relationship with Portico will include fashion bedding, bath, robes, throws, blankets and decorative accessories, said Gregg Haft, president of Portico.
Also new for Home Source this market is the invitation-only preview of its license with contemporary fashion house Diesel, to be shown at the Diesel apparel showroom here.
The growth pattern for Home Source, Sorgeloos told HTT, "is with brands and key retail players in all channels, and a fresh approach."
In addition to the Portico and Diesel alliances, the company is exploring the potential of about a half dozen others, he said. "This will offer us the next level of business growth beyond those two brands." This year, he noted "is a transition year designed to build the infrastructure, establish long term financing, and focus sales efforts in preparation for rapid top line growth, and adding brands."
The team at Home Source has decades of experience in the home textiles world. Sorgeloos was at J.L. Hudson, then J.P. Stevens and WestPoint Stevens. John Fraley, vp, was with WestPoint, Fieldcrest Cannon and Ex-Cell Home Fashions. The company's design maven is Phyllis Moore, an alumna of Fieldcrest Cannon, while Eric Loges brings experience from WestPoint Pepperell, WestPoint Stevens and Springs.
Over the next two years, Sorgeloos commented, "We will rollout new brands and bed product in a push to expand our customer base, top line growth and increase profitability."
The company's customer base includes big box, department stores, catalogs and club retailers among the major players.
But a critical piece is the 1,500 high end specialty retailers, whose interests are being watched over by Keith's son Scott Sorgeloos, vp, who now heads the Home Source Boutique division.
While the merchandise for this retail channel parallels the major players' products, there are critical differences, Keith Sorgeloos explained. Of the 1,500 stores on their books, 800 reorder core product on a regular basis. With the tightening of the economy, many are now ordering weekly, rather than the twice-a-month or monthly pattern than had been the norm.
Using the Microcotton bath program, as an example of how the specialty channel differs from the bigger retailers, Sorgeloos noted, "On average they feature eight colors, but we offer large color swatches on rings that they can special order from the 24-color range. We do monogram events and all styles have good photos."
Additionally, few of the majors carry all the items offered in the Microcotton program, which include shower towels, finger tip towels, hair towels, three sizes of a cotton reversible bath rug, and a 24-color ottoman ribbed matelasse shower curtain. All can be drop-shipped to consumers, he noted.
Key to the company's success with the specialty retailers, Sorgeloos remarked, "is our affiliation with One Coast," a rep firm that now represents them in the Southwest, West and Northwest.
Another new thrust for the company is the hospitality market, which will be enhanced by the new Portico license, Sorgeloos believes. That effort is being spearheaded by Craig Benepe, a longtime veteran of the home textiles world via the table linens market and WestPoint Stevens. Benepe also is responsible for developing the firm's business with catalogs.
Bedding will be a major focus in 2009, especially at the upscale specialty tier. This market, the company is showing two new beds, each with 14 components that can be structured to a store's wants.
Bath and accent rugs, beach and fashion bedding also are in the company's growth sights, Sorgeloos commented.