Area Rug Makers Meet the Challenge
May 5, 2008,
New York — With retailers being more cautious in their orders as home furnishings sales continue to dip across many categories, suppliers are compelled to be more creative in the way they market their wares.
HTT asked executives at major rug companies how they are responding to the challenging times, and their answers spanned the topics of product innovation, in-store presentation, marketing and testing new channels of distribution.
828 International Trading Co.
John Shepherd, president
"828 International is strengthening its existing channels of distribution by putting more 'feet on the street.' We're increasing our sales team to further our efforts with furniture stores and to add to the services we provide to specialty stores and multi-level retailers.
"Another way we are battling the challenging times is by partnering with other wholesalers to reach new channels of distribution. Their sales team sells some of our products — and vice versa — to audiences we wouldn't normally service. This joint effort furthers our individual strengths to the benefit of our bottom line."
Mark Ford, director of product development
"Balta has a clear focus of what the game plan is. Number one is to strengthen relationships with existing customers. Balta considers itself fortunate to have financially healthy customers. And because Balta is relatively new to the U.S., there is plenty of room with the current customers to grow the business.
"Number two is to broaden our base with new customers. Balta will target customers that are looking for true partnerships in the business. We think long and hard about who we want to approach.
"Number three is to focus even more on servicing the customer. Learning from previous challenges, Balta will not stop striving for perfection in program execution and overall reliability.
"Number four is to be ahead and think with the customer on new projects and ways of displaying the rugs. Balta's strategy is to not simply show rugs to customers [but offer] solutions to product assortment and new ways of thinking about displays and even packaging.
"And fifth is to smile a lot. Just kidding."
Pat Moyer, president
"It's not so much that we're trying to go after new distribution channels, but rather we're trying to go after more business with our existing retail customers. We've broadened our line to try to maximize our opportunities with our current customer base.
"For years, we were primarily a printed accent rug house. But in the last year we've added a comprehensive line of tufted polypropylene and tufted nylon dyed accent and area rugs to our line. We even have some tufted polyester. Tufted rugs is not a new category for us, but we're bringing it back in a strong way. We bought several new tufting machines in the last year and a half to get back into the category in a more meaningful way.
"We've also started to focus again on our kitchen accent rug offerings. We've identified it as an opportunity for growth and we're developing more product.
"And also, we've re-entered the bath rug business with textured tonal looks."
Allen Robertson, vp sales
"We are aggressively pursuing new distribution with patio shops and nurseries that sell outdoor furniture, to expand our rapidly growing sales of our unique products featuring Sunbrella fabric finishes. We are also analyzing opportunities with mass merchants with proprietary product."
Larry Mahurter, director of advertising and sales promotion
"Over the past year, Couristan has successfully expanded its retail distribution in the outdoor/indoor area rug category by targeting new types of dealers, like patio and garden centers, with packaged offers that include our space-effective Outdoor Living Merchandising Display Box. We expect to see continued expansion with this category, particularly through the spring and summer seasons."
Kami Navid, evp
"Protecting our customers against the internet competition coupled with our Showtime Marketing System have given us the opportunity to get our foot in the door with quite a few accounts in different areas in retail such as floor covering, home furnishing, gift and accessories, and other stores. Our Showtime Marketing System is a no-brainer concept where any account could get into the area rug business in less than 5.5 square feet and with a minimal amount of investment where it would be rebated back to them, which makes the whole thing a risk-free venture."
Bill Storey, svp, general manager
"We continue to work with our current retail partners to drive business to their stores through local promotional and advertising support. In addition, Karastan continually invests in its brand with exciting national advertising campaigns."
Wendy Reiss, key account manager
"I think there are a number of things we are focusing on in order to ride the economic wave.
"First, it is really important that we continue to provide the best service and solutions we can to our existing customer base and work with them to update their assortments with the best new product we offer. New accounts are very important, but keeping our existing customers happy, satisfied, and growing [is] even more so. Even in difficult times, it is so important for a retailer to be the best in the business with an eye-catching assortment and new products to offer.
"Second, this year is a great opportunity for us to expand ourselves further into the West Coast. As we work to get ready for the July Las Vegas show in our new permanent showroom, we are excited about the potential out there and the new business and relationships it will create."
Jim Quist, vp, sales
"We've really focused on furniture and regional rug dealers through our Mohawk Select [division]. That became a new focus for us in early 2007, and we are seeing good growth in that segment of our business."
Natco Products Co.
Jim Thompson, vp sales and marketing
"Something really successful for us in Natco has been our new program of sets — three-piece and four-piece sets — which allow customers to get a lot of value for their dollars. We'll take for example a 5-by-8 and put it in a set with a matching 2-by-6 runner and a 2-by-3 accent rugs.
"We make these for our mass merchant customers, and it's been a very good business for us."
Alex Peykar, founder and principal
"We're always pursuing untapped distribution channels. For example, we've just released several exciting new broadloom collections that will increase our commercial and hospitality business exponentially over the next three years. However, we've built our business by truly supporting our customers. So we deal with challenging times by doing our very best to help all of our retail partners do the very best they can. That means moving product faster for quick turn on the floor. We do this in part with an aggressive national advertising campaign, and by providing stores with outstanding assortments. We've also just launched a unique program that increases the available choices at participating stores by nearly 100 additional designs in just a few square feet of space."
Jim Curtin, vp sales
"We are focusing on what we do best and the channels that have always brought us the best return. If we deviated from that, we would move attention from our best customers. They deserve more than that. It seems to be working."
Mike Riley, president
"It's important in times like this to offer new products and value added services. Beyond continuing to introduce fresh looks at each market, we are launching a patterned broadloom line as well as area rug underlay in a variety of price points and sizes. Also, we are offering services such as a 10-year stain and soil warranty on our polypropylene products. Our mission is to be a complete resource for our retailers and to partner with them in growing their business."
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