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Quaker to expand non-core business

Fall river, MA — Quaker Fabric has aggressive plans to expand in the top-of-bed home textiles market as well as to broaden its reach in the jobber community and international and contract distribution channels.

At the same time, the giant jacquard manufacturer does not plan to lose its focus on its core residential upholstery fabrics business. "But we expect that the non-residential upholstery fabric segments will grow at a faster rate than our core business over the next several years," president and ceo Larry Liebenow told HTT.

The company's core business has grown more than 12 percent over the past several years. The newer targets "are so big, and we have so far to go," he added. The company, with revenues of $331 million, is one of the big three of American's decorative fabric mills along with Joan/Mastercraft and Culp.

In top-of-bed home textiles, Quaker "will focus only on the decorative end of the market with customers who will take advantage of our styling capabilities, specialty yarns and special finishing techniques," Liebenow related.

To support this effort, Quaker is allocating some 25 percent to 30 percent of its 2002 capital expenditures of $31 million to new weaving equipment, which will include "a significant investment" in an unspecified number of double-width looms for top-of-bed fabrics.

But looms are not the only support for the company's top-of-bed expansion strategy, Liebenow said. A product-specific design team under the direction of Bea Spires, vp and corporate design head, will be focused just on this market.

The expansion of the double-width looms also will affect Quaker's core residential upholstery fabric business, Liebenow said. "We will be able to produce more upholstery fabric as well as benefit from any new technology, construction details or tools that we can bring to the core business from our work in top-of-bed."

This year's $31 million capital expenditure also will include the beginning of site preparation for a 60-acre site here that will be developed in a modular manner, with eventual capacity for yarn-to-post finishing activities of 700,000 square feet to one million square feet.

Quaker currently has 1.8-million-square feet of production space in its main facility and in free-standing sites here. Last year it added 10 percent to its weaving output while at the same time increasing its yarn, finishing and post-finishing capacity.

In addition to pushing its efforts in top-of-bed and accessories home textiles, "we will be able to significantly reinforce our established contract business and the jobber market," Liebenow said.

Unlike many American textile producers that have cut back international efforts, Quaker is moving ahead to expand this business, which accounts for 15 percent to 20 percent of its revenues. The revenues increased 2.3 percent in 2001, Liebenow reported. Domestic sales, he related, increased 11.8 percent, while yarn sales declined 3 percent, largely impacted by the apparel business.

There are two international sales managers based here, "and we have a substantial infrastructure internally."

By the time of Proposte in May, Quaker expects to have "a further significant development in Europe" that will include Western and Eastern Europe. "And we're looking at some more opportunities, but nothing is finalized."

Currently, the company has sales forces or offices and/or showrooms or distribution centers in Mexico City and Guadalajara, Mexico; Canada; Sao Paulo, Brazil; Dubai, U.A.E.; and London.

Liebenow views the company's international business not just from a revenue perspective but also as an influence on the rest of the company's product mix. "What we do internationally has influences on design directions in contemporary and transitional looks —like our color work, the brightening of the palette, which happened globally before it did here, as well as in materials."

Liebenow said the international influence could be felt in the growth of natural products and more natural looks such as raffia and jute effects as well as the use of more cotton and the introduction of wool, linen and cotton/linen blends.

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