ITG Identifies Keys to Growth

Brent Felgner, Carole Sloan, February 21, 2005

Assets that are duplicated in Asia and this country are one of the keys to the growth of the Interior Fabrics division of International Textile Group (ITG).

With the announcement last December of a joint venture between ITG and Hong Kong-based China Ting Group, “We see them as partners with a lot of weaving capacity — and good ones — and they will have the same performance requirements as the American weaving market,” said Derrill Rice, president of the Interior Fabrics division that will work with China Ting.

As American suppliers of home textiles and furniture migrate to China and neighboring countries for manufacturing, “We will need to make these products in Asia. But we also will have the ability to make the same products in the U.S. — but they definitely will be more expensive,” Rice explained.

Interior Fabrics will provide the dyeing and finishing capabilities in Asia with China Ting providing the weaving capacity, he said.

Important in the mix for domestic and global markets, he added, is the introduction of Solar Cone, the company's outdoor/indoor performance fabric that was introduced at Showtime in January. “A large percentage of this will be produced in China, but we will design and develop it here and develop and sell it in China,” Rice said.

Looking at the synergies between Burlington Contract, Cone Jacquards and Solar Cone in the home area, Rice said “there are many. Cone Jacquards has many capabilities in the hospitality business that could work with Burlington Contract, which is more directed to the commercial office business.”

Looking at the decorative/upholstery fabric segment of the business, Rice noted, “Burlington is out of residential and Cone Jacquards hasn't had the resources to develop globally. They have been focused on domestic production.”

Cone Jacquards, he related, has had a significant percentage of its business in the top of bed segment, which will move more offshore. “We're not a commercial house in terms of look and price. We're not for large quantity needs but for providing specific fabric solutions — residential/jobber markets and hospitality in the medium to upper design segment.”

With the new offshore activity, there is potential also for top of the bed product, window coverings — produced both domestically and overseas — and decorative fabrics.

The company's specialty home furnishings stores in China are expected to hit 25 units this year ranging from shops-in-stores to free-standing units.

“The furniture and lamps will be bedroom focused as will the textile product. The furniture will be an accent to the experience,” Rice said. “We will design the products in-house and manufacture them in China. The textile product will focus on simple top of the bed and window coverings — but it will definitely have an American feel when you walk in the store.”

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