Update03: A materially different way to approach the bath biz
November 18, 2003,
New York — Retailers are pressing for more design exclusivity, at the same time exploiting licensed programs in a bid to pump new life into bath accessories, suppliers say.
Part of their effort centers on better quality and more novel constructions with combinations of materials — from metals, woods and glass — to achieve more varied and value-added looks.
But collectively, all of these retailer-specific strategies are directed at returning some semblance of price point integrity to the category and thereby further protecting margins.
"We're doing more and more retailer-specific programs, and it's important," said Dianne Weidman vp, design sales, Cincinnati, OH-based Saturday Knight Ltd. "Instead of creating a price war, retailers differentiate their assortments, making it about the product and design and not the price."
The question, Can we getan exclusive? is "the first thing retailers always ask us," said Carl Legreca, vp, merchandising and marketing, bath products and decorative accessories, New York-based Croscill Home Fashions.
"The category is becoming more proprietary and as a result we are working with our customers all year round — not just during markets — because they constantly want to see newness," Legreca said. "It's just hard to bring newness constantly with accessories because they aren't pattern-driven, as is the case with towels and shower curtains."
One way is to experiment with new materials and constructions. Resin, one of the most adaptable and prolific materials used to make bath accessories, "has somewhat peaked," said Barry Leonard, president, New York-based Ex-Cell Home Fashions.
This factor, combined with the recent demand for more value-oriented product, has opened the door for multi-construction products that employ various materials, like wood, glass and metal.
"The price points aren't going up, but the value of the products is," Leonard continued. "Mass merchants and mid-tier department stores are offering customers a lot more fashion and value, which is pushing the specialty and department stores to offer higher value at equal or slightly higher prices."
Suppliers, while happy to gain placements for their collections, have valid worries related to offering proprietary product to retail partners.
For one, they need to be sure their overseas manufacturing partners can maintain efficient inventory levels to be able to service retailers, and secondly they need to be able to balance that with the minimums required.
Mark Grimes, product manager, Somerset, KY-based The Cecil Saydah Co. noted that while everyone is looking for an edge, such as a licensed or designer collection "to increase their chances of placement at retail," retailers are fueling this competition with requests for exclusive runs of licensed and some non-licensed product, creating a taxing situation for suppliers.
"This can become a burden on the vendor, when we are asked to produce bath coordinates for retailers who are too small to use up the minimum production run in a reasonable amount of time," he said. "Overall, however, this is just part of the evolution of the category, and something we are all learning to work with."
Grimes also noted that many retailers not only want exclusivity on certain collections — they also expect the supplier to provide packaging — which he described as an ongoing trend for several years at the mass merchant level, but one now just reaching its peak with smaller retailers.
"This becomes an issue for the vendors when each of several retailers using a particular pattern needs their own packaging, making inventory management difficult," Grimes said. "There is also an added expense factor involved in developing packaging art/photography and buying the special packaging materials to meet each retailer's requirements. Of course, no retailer wants to pay a premium for these extra services."
Even after conceding to all these requirements and demands, suppliers still stand to take major risks, Weidman said.
"If a retailer decided to drop your line, you're stuck with it," she said. "You can always close it out, but that's where you lose."
Another challenge facing bath accessories suppliers is retailers' growing attempts to import product directly from overseas manufacturers, particularly those based in China and India.
"Until the retailer has that first hiccup, they will try to do as much direct importing as they can," said Rick Lipton, national sales manager, Central Islip, NY-based Creative Bath Products. "To the advantage of people like us, they still don't have the fashion and design sense, which is resulting in the rise of more branded product."
The name game
Creative Bath's licensed brands include The Hautman Brothers for catalogs and Echo and Joseph Abboud for specialty and department stores, Lipton said.
"Sometimes, a designer name can get placement more easily because it's an exclusive," Legreca said. Croscill's licensed brands include Cheri Blum, Portmeirion and Jona-than Adler.
If it's not a designer label, a house design that has already proven to be popular with customers in a different product category can extend well into bath accessories, as has been the case for category newcomer Blonder Home Accents with the "Pinecone Lodge" design it originally introduced for its wall border line.
Cleveland, OH-based Blonder has already had repeat orders for this line.
"These reorders came in three weeks after the initial ones," said Brian Murphy, vp, sales and marketing.
Pinecone Lodge is a licensed design by artist Stephen Lyman. Most of the company's bath accessories collections feature licensed designs.
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