All eyes on new Fortunoff entry
Home & Textiles Today Staff -- Home Textiles Today, September 22, 2003
For upmarket textiles makers and entrepreneurial specialists, the opening of Fortunoff's sixth store here last week ushers in a welcome addition to what has become a retail rarity: a fashion- and merchandising-minded selling opportunity that won't crush the life out of margins.
The more disturbing news for the retailer's suppliers and wannabes is that Fortunoff is not particularly happy with the direction it sees the home textiles industry heading. Indeed, it is already anticipating a future in which it has to do more, if not most, of the product development itself.
"The whole industry is saying, 'We cannot sell up,'" principal Elliot Mayrock told HTT. "We dare not bend to trading down. Our average ticket has consistently risen."
Bed, bath and window combined constitute a $50 million business, roughly 15 percent of the company's total volume of over $400 million. The new White Plains store, which pinions the retail revitalization of that community's downtown district, will add $100 million in total sales, Mayrock said.
At 185,000 square feet, the store joins a troika of mega-Fortunoff locations and devotes some 35,000 square feet of its vast footprint to bed and bath alone. It also houses Fortunoff's largest assortment of table linens, a 75-window display of panels and draperies, and a collection of 250 area rug patterns — which in Fortunoff terms is considered a "limited" array.
"Is [rugs] the biggest business we're going to have? No. But it's an accessory, and people who come here want a one-stop shop," Mayrock said.
Better than B'way
He pointed to the new Yves Delorme shop — Fortunoff's first — as an example of the company's merchandising direction. "Every six months they just take out the old, bring in the new. That's theatre."
Lending another theatrical touch to the store is the country's only Hunter Douglas Gallery, which allows shoppers to customize room designs using a touch-screen monitor.
Equally showy is the adjacent ready-made curtain and drapery department, where private label now accounts for 30 percent to 40 percent of the mix, and 25 percent of the assortment changes quarterly.
"Everybody seems to think nobody wants a curtain for more than $30. It's just like tablecloths. Everybody thinks you can't sell a tablecloth for more than $9.99. So we went out and did it ourselves," Mayrock said.
"We believe we can sell $500,000 in ready-mades," he added. "We hope to raise the standard. This is ready-to-wear."
The dec pillow department is similarly trend-driven, and Fortunoff rotates in a new assortment every three months.
"Textures and styles — that's what fashion is about," Mayrock noted. "Bedding should be that way, too. And that's where we're probably going [in bedding]. If I have to make the investment to do it myself, then I will."
That frustration also extends to the de-specing of the solid color towel business, and Mayrock said Fortunoff is waiting to see what will become of the Royal Velvet and Charisma brands once the sell-off of bankrupt Pillowtex's assets has been completed.
"If they go down-market, we'll replace them, probably with our own towels. We sell a lot of proprietary towels — and we'll sell even more if the industry doesn't straighten itself up."
Embellished towels, however, "are fashion — and that's where we shine."
Fortunoff has more than 30 developers working on unique products just in textiles. In addition to seeking out proprietary merchandise, they create accent pieces to layer into branded ensembles such as bedding collections.
Fortunoff also remains on the lookout for upstart start-up suppliers, Mayrock said.
"We like entrepreneurs. The smaller entrepreneur is willing to do shorter runs. The entrepreneur will do something unique," he said.
Mayrock acknowledged that, as a privately held company, Fortunoff occupies a unique position strategically. There are only nine shareholders to please — and they're all related. The company has the luxury of operating under a policy of patience. The White Plains store, for example, was 25 years in the planning — not because Fortunoff didn't want to get into the market but because it would not settle for a secondary location.
The company has the organizational structure to pursue further expansion, he added, and is currently considering additional locations in eastern Long Island, New Jersey and the King of Prussia area of Pennsylvania. When Fortunoff will enter specific local markets, however, remains an open question.
"If it were easy," Mayrock said, "everybody would be trading up."
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