Window Treatments Look to Rally Back From 2008 Slump

Jill Rowen, June 22, 2009

It may be time for another curtain call, as window treatments are beginning to rally back from the economy of ’08. In HTT’s latest stats, window treatments showed a 12% decline in sales for 2008, to $2.075 billion from $2.357 billion in 2007.

But what the numbers don’t show is the outlook of many vendors — almost optimism — anxious to move forward. It boils down to consumers still wanting new things, retailers realizing they have to merchandise new things, and a slow but perceptible increase in consumer confidence.

“Consumers are cautious, but still buying,” noted Carl Goldstein, senior vp, S. Lichtenburg. “In a recession, people tend to stay home more, and window treatments offer a relatively inexpensive way to bring new décor into the home.” According to Goldstein, basics remain strong for the company, with moderate-priced goods outselling higher-end material.

Frank Foley, president/ceo, CHF, agrees. “There’s greater attention paid to how to re-freshen the home, and that usually means improved attention to the curtain category,” he noted.

“It’s definitely survival of the fittest,” acknowledged Barry Goodman, vp national accounts, Commonwealth Home Fashions. “People are still buying goods but not spending as much. We’ve seen people trading down. If they used to spend $19.99, now they’re looking at $14.99.” For Commonwealth, black-out products as well as indoor/outdoor goods for “the fifth room” are doing well, according to Goodman.

“Every category has suffered deflation over the last six months; but curtains have held up exceptionally well,” noted Foley.

“Window treatments are generally a higher price point item and not as much of an impulse purchase,” noted Loren Sweet, ceo, Brentwood Originals. “The customer is still responding to new items.” For Brentwood, growth in small patterned fabrics is ongoing.

As the marketplace corrects for the roller coaster called the economy, something has shifted in the way some business is done. Vendors report much more testing of programs than in the past, and, obviously, more interest in promotional sales. “Retailers are looking at promotional goods, getting in a container and selling it out,” noted Goodman.

“Instead of testing in 800 stores, a retailer may only test in 150 locations before rolling a program out,” said Jason Carr, principal, Softline Home Fashions. Carr reports that its faux silk and “drier” linen looks have been doing well. “We’re keeping the pulse going, and are optimistic about 2010. Though its been a difficult year overall, we’ve continued to grow, including expanding into Canada.”

For Chip Scala, president, Waverly Division, Ellery Homestyles, a well-recognized brand name has helped the division weather the economic storm. “Our advantage is that we have a broad design base and can offer a coordinated, layered look. It helps to have a solid brand,” he said. In fact, new designs that are more contemporary than the florals that Waverly has been known for are helping spur some sales, as well, he said.

The same kind of transitional design trend is also working at Croscill. “New items have done well for us,” said Jack Mahon, vp merchandising/product manager for window, Croscill. “But the box is only so big and that means working very closely with key customers to develop products, and really focusing on individual accounts.”

“Sometimes the biggest issue in the market is that it’s more about the deal than the product. I believe in our product and the value of the products we bring to market,” he said.

Many vendors agreed that the box is shrinking to their disadvantage. The loss of many retail doors, both in moderate goods (Linens ’N Things) as well as in the higher end (Expo and Fortunoff) have them reeling. In HTT’s findings, home textiles specialty chains dropped 29% from the previous year, due to the consolidation. Catalogs and other direct-to-consumer channels continue to play a major role in the category. According to HTT’s figures, the direct to consumer channel fared well in a difficult economic climate. That channel showed only a 4% decline in the window treatment category for 2008.

Added to the changing distribution picture is the fact that retailers are being more conservative in their spending habits and keeping inventory low.

“Retailers are being very responsive and very responsible,” said Foley of CHF. “Nobody is buying more than they need to.”

All in all, the results of ’08 haven’t dampened the mood going forward. “We know that business is in a recession,” noted Goldstein, “But we choose not to participate.” It’s all in the attitude.

Distribution Channels ($millions)
2008 total retail sales: $2.075 billion down 12.0% from $2.357 billion in 2007

% of Total 2008 Sales 2007 Sales
*Other includes warehouse clubs and military exchanges
Mid-Price Chains 45.10% 935.8 1,051.0
Discount department stores 31.10% 645.3 675.0
Home textiles specialty chains 13.00% 269.8 385.0
Direct-to-consumer 4.30% 89.2 93.0
Home improvement centers 1.98% 41.1 47.0
Single-unit specialty stores 0.90% 18.7 22.0
Department stores 0.90% 18.7 22.0
Off-price chains 0.99% 20.5 22.0
Variety/closeout 0.92% 19.1 21.0
Other 0.81% 16.8 19.0

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