Monday, February 13, 2012
THE BUSINESS AND FASHION NEWSPAPER OF THE HOME TEXTILES INDUSTRY
Maison Inspires BY ROBBIE SUMBERG AND JOAN LIEBERMAN PARIS — This year, three clear trends emerged at Maison et Objet from the enormous diversity of products offered. We once again saw a strong
Bedding from Manuel Canovas at Maison et Objet.
presence of top-name fashion brands, which share their sophisticated styling with the world of household linens through licensing. In terms of style, we saw the vintage look and graphic tonality becoming increasingly important in the new collections presented. Lastly, we saw the desire for all things natural and eco-friendly becoming expressed more clearly and more tangibly. Many home textiles exhibitors were clearly inspired by the graphic prints and vintage chic of the 1950s. The colors are bold and vital and the patterns geometric — psychedelic, even – to say nothing of the folk spirit evoked by patchwork. Exhibitors also showed sensitivity to the natural world.
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hometextilestoday.com
| Vol. 33, No. 5 | $8.00
Penney by the Numbers
BY JENNIFER MARKS NEW YORK — JCPenney’s leadership team took to the stage here in late January to lay out a bold vision to transform the 110-year-old department store into a leading edge retail emporium filled with branded specialty shops encirling an interactive “town square” offering as-yetunrevealed services. Even more eye-opening were some of the numbers ceo Ron Johnson shared about how the company has been operating in recent years: The Penney shopper visits the store four times a year.
SEE MAISON PAGE 12
SEE PENNEY PAGE 22
H&M Fast Forwarding Into Home BY WARREN SHOULBERG FRANKFURT, GERMANY — If you think H&M shook up the apparel retailing world, you should see what they are trying to do in home furnishings. H&M — more formally Hennes & Mauritz AB, the
Swedish-based ret ailer best known for helping to create the “fast retailing” merchandising style of fast turnarounds of fashion at a price — began selling home textiles and accessories online in Europe in 2009 but has now begun to open H&M Home stores as well.
Inside This Issue Gut Check .......................................................................... page 4 The Tracks of My Tiers ..................................................... page 4 Shoppers Turned to Fashion Kitchen, Table Linens in 2011 ............................ page 8 120% Lino Basks in the Warm Climate .......................... page 10
While the company says it will begin selling its products online in the United States this fall, it has not announced any plans to open American stores. But a visit to an H&M Home store here in the downtown shopping district of this financial center of Germany reveals a merchandising concept totally unique and apart from anything else being done in the home furnishings arena. Combining the display techniques of a wholesale showroom with the fulfillment process of a cataSEE H&M PAGE14
The H&M Home store is located inside a regular H&M clothing store on Frankfurt’s main shopping pedestrian mall.
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2/10/2012 5:33:58 PM
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Home Textiles Today
February 13, 2012
News
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Downlite to Present a Variety of PrimaLoft products During Market ALBANY, N.Y. — Downlite will introduce several utility bedding products featuring PrimaLoft down alternative fill during the New York Home Fashions Market, which takes place March 58 in Manhattan. A premium comforter collection features PrimaLoft Thermo, a proprietary formula of ultra fine fibers that mimic the loft, softness and warmth of down. The collection offers a selection of products providing varying warmth levels: white for light weight warmth, light grey for year round warmth, and medium/dark gray for extra warmth. The shell consists of 350-count cotton with a new signature pattern called Boutique Stripe as well as satin
Retail Briefs
piping. Downlite is also introducing a PrimaLoft Thermo blanket. The Ultra Lite Zero Gravity PrimaLoft comforter is designed to provide warmth without weight and features a Germanmilled, micro-modal shell. A new collection of premium pillows employ PrimaLoft Support, a proprietary formula of ultra fine fibers. This collection features custom woven gussets and a 300-count cotton sateen cover. The PrimaLoft Core Support Pillow uses a supported PrimaLoft Memory inner core surrounded by PrimaLoft Support marrying support and softness. The cover is 300-count cotton sateen. HTT
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Charlie Schlang, 69 SCARSDALE , N.Y. — Longtime spin-off Atrivm, which owned entrepreneur and industry ex- the home textiles license and manufactured home ecutive Charlie Schlang products for the popdied unexpectedly in his ular men’s clothing sleep in the early morndesigner Joseph Abing hours of Feb 9. He boud. In that assowas 69. ciation he was affiliMost recently, he ated with Davidson was ceo of Renaissance Cotton, which subAmerica and a partner CHARLIE licensed the bath liin Portico Home, which SCHLANG cense for Abboud. he established in 2007 He is survived by with long-time business partner and Fayette Home ceo his wife Matti, daughters Lisa Siglag and Julie Seifer, and four Gregg Haft. “It’s a huge personal loss,” grandchildren. Anyone interested in maksaid Haft. “Charlie and I were ing a charitable donation in more than just partners.” Earlier, Schlang was pres- his name should donate to the ident of Induter USA and its American Cancer Society. HTT
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Hong Kong Textiles and Furnishings Fair Set for April HONG KONG — HKTDC Hong Kong International – the only home textiles and furnishings expo in the region – will hold its third annual show April 20-23 at the Hong Kong Convention and Exhibition Centre. The event will feature approximately 200 exhibitors from 11 countries and regions, including China, Bangladesh, Belgium, India, Iran and Vietnam. Product categories will in-
clude bedding, bath and kitchen textiles, infant textiles, floor coverings, window fabrics, readymade curtains and upholstery products as well as design and trade services. The Hall of Glamour will feature an array of trend-right products, including bedding, towels, curtains and carpets. For more information, visit www.hktdc.com/hkhometextilesfair. HTT
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LIMA International Licensing Excellence Awards Seek Nominations NEW YORK — International Licensing Industry Merchandisers’ Association (LIMA) has opened the nominating process for its annual International Licensing Excellence Awards, which recognize outstanding achievement in licensing. LIMA is accepting nominations in the following categories: • Art • Character/Toy • Corporate Brand • Film, Television, Celebrity or Entertainment • Licensed Promotion • Retailer of the Year • Sports/Sports-Themed Enter-
tainment In addition, the Awards Committee will select nominees for the License of the Year award, which recognizes the property that has the biggest impact on the licensing community at retail and in the general marketplace. Submission deadline is Friday, March 9, 2012. Winners are chosen by the LIMA membership and will announced at the LIMA Opening Night Awards Ceremony on June 12 during Licensing International Expo in Las Vegas. For more information, visit www.licensing.org. HTT
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Home Textiles Today
February 13, 2012
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OPINIONTodaY Gut Check
A
F T ER JCPENNE Y E X ECU T I V ES laid out their vision for transforming the store and before they held a special session for the financial community the following day, the company invited analysts to submit questions in advance. The most asked question: How far will sales volume have to fall before you scrap the streamlined pricing and go back to promotions and coupons? There was a reason analysts posed the question. They’d seen this movie before. Ironically, the last major retailer to announce a simpler EDITOR-IN-CHIEF pricing structure and a pivot away from couponing and heavy promotions was Macy’s, which is now suing Martha Stewart Living Omnimedia for forging a deal with JCP. Macy’s was never able to shake the door-busters, oneday sales, and all the rest. But it must be noted it never went all the way through with the attempt. The prices were streamlined, yes. The promotions were never completely eradicated. Penney, on the other hand, announced a three-tiered pricing strategy on Jan. 25. And on Feb. 1 it was a reality. My highly non-scientific conversations with female family and friends since suggests Penney has a whole lotta ’splainin’ to do before this new approach sinks in. Granted, the ladies I queried are, variously, Macy’s, Kohl’s or specialty store shoppers. They have all seen the commercials. They didn’t get what was going on. And by the way, they all hated the “scream” ad that preceded the new pricing launch. JCPenney ceo Ron Johnson, the force behind the development of Apple retail stores, emphasized during the vision presentation that Apple was not always as sexy, profitable and seemingly invitable as it is today. And he trotted out the financials to prove the case. He also explained repeatedly that Penney is building for the long term. Which is why, no doubt, it immediately ceased releasing monthly sales figures and announced that it will provide earnings guidance on an annual basis only. So the outside world will have to gauge the impact of these changes one quarter at a time. But Penney insiders will know they day-to-day results of the new policy. Can they stay the course? By the way, Johnson’s answer to the question about at what point JCP will renege on the new sales strategy was: “We won’t.” HTT
Jennifer Marks
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The Tracks of My Tiers
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HER E WA S T HIS tractor trailer you used to be able to see in a parking lot that the train passed every morning. On the side of the trailer was the name of the store – long gone even back then and below it the sloWarren –gan, “America’s FavorShoulberg ite Junior Department Store.” PUBLISHER/ I always wondered EDITORIAL DIRECTOR what most of the riders on that commuter train used to make of that slogan. A hundred out of a hundred of them most certainly had no idea what in the world a junior department store actually was. It was one of those categorizations that those in the retailing business understood, but pretty much nobody else had a clue. Call it business myopia, but it was probably part of the reason that trailer was sitting abandoned in that desolate parking lot for all those years. I’m reminded of that moment by all the recent commotion caused by The Martha Wars. Ms. Stewart’s pending migration to JCPenney and her possible eviction from the hallowed halls of Herald Square and environs certainly makes for great theater, and you know lots of lawyers are going to make lots of money on this — including the ones who screwed up in the first place and wrote contracts with seemingly Houdini-like escape clauses. One of the key issues here will be channel of distribution exclusivity and how
much overlap and competition there is between Macy’s and Penney. To which I say: You people are all insane, there are no channels of distribution anymore. The consumer shops wherever she wants and she doesn’t make a damn bit of distinction between channels anymore. Think about it: You can buy Karl Lagerfeld at Chanel or H&M. Missoni is at Target and Neiman’s. A shopper can look for Sony electronics everywhere from the local Duane Reade drug store to the most high-end home theater boutique. And I won’t even talk about Calvin Klein or Ralph Lauren. Even the lovely Miss Martha is everywhere from Home Depot to Michaels to Macy’s. If you look hard enough you’ll probably still find some inventory in the back room at Kmart. I get store exclusivity. It’s one of the reasons Macy’s has done so well recently as it has developed not just captive and private label programs, but captive and private label programs people actually want. If you’re the only place in town to get that brand — and it’s a brand worth getting — it’s a great merchandising card to play these days. That’s not what we’re talking about here, however. A brand like Martha is all over the place. And the consumer knows that. But does she understand channel of distribution exclusivity? Absolutely not. Does she care? Even more absolutely not. She’s just as likely to buy something at Amazon as she is at Nordstrom as she is at Dollar General. And it’s all good to her. She may even shop at a junior department store … whatever that is. HTT
2/10/2012 2:54:47 PM
News
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Retail Briefs
Surya Realigns Sales Staff C ALHOUN , G A . — Looking to
more closely cater to its increasingly diverse and specialized customer segments, area rug and home accessories house Surya has realigned and expanded its sales staff. Seth King, vp, sales and marketing, told HTT the company has split its sales team into two groups and brought on new staff for added support in selling Surya’s catalog-based wares – which span 2,000 rugs as well as 400 decorative pillows, throws and wall art pieces. The first group handles in-
dependent furniture stores and other retail customers, including assortment gift and home furnishings retailers. Eric Nyman has been promoted to national sales manager from his former post as senior sales coordinator to head the team, which consists of Surya’s existing 30 reps. The second group – the design services team – handles interior decorators, designers, architects and other similar clients as well as the hospitality sector. Surya hired 30 new reps across the country to be part of
this team, and appointed Steve Fahey as its national sales manager. Fahey comes to Surya from Selamat, where he served as sales manager. Both Nyman and Fahey report to King. “This new strategy will give us better coverage of and exposure to these accounts, and allow us to offer them better one-on-one service,” King said. While the accounts collectively pull from Surya’s catalog program, the company is expanding its offerings and developing new lines for specific segments. HTT
Rizzy Home, Furniture First Partner to Expand Business Opportunities C ALHOUN , G A . — Rizzy Rugs is expanding its retail reach through a new alliance with Furniture First. The two-year partnership allows Rizzy, a supplier of rugs, top of bed, throws, and decorative pillows, to tap members of Furniture First, a 17-year-old national buying group serving the
retail home furnishings and mattress industry. With a reported $1.2 billion in sales, Furniture First has 186 company members representing 398 store fronts. Shauna Snyder, director of accents and accessories at Furniture First, described Rizzy Home as “a great source to bring
to our members.” Added Tim Donahue, Rizzy’s director of business development: “We feel our product mix, manufacturing capabilities and local distribution will be a benefit for Furniture First members as they look to create programs that will capitalize on our vertically integrated facilities.” HTT
Pantone Announces Fall’s Top Fashion Colors C ARLSTADT, N.J. — Global color authority Pan-
tone has released its color report for fall 2012 and announced the 10 top colors for women’s and men’s fashions. “By playing to consumers’ practical side with versatile neutrals, and boosting their confidence with bold, spirited hues, this skillfully balanced palette has something for everyone,” said Leatrice Eiseman, executive director of the Pantone Color Institute. The top colors for women’s fashion for fall 2012 are: • PANTONE 19-4056 Olympian Blue • PANTONE 17-1463 Tangerine Tango • PANTONE 18-5338 Ultramarine Green • PANTONE 17-4014 Titanium • PANTONE 15-1142 Honey Gold
• PANTONE 18-2133 Pink Flambé • PANTONE 16-3817 Rhapsody • PANTONE 14-1506 Rose Smoke • PANTONE 19-1012 French Roast • PANTONE 14-0445 Bright Chartreuse The top colors for men’s fashion for fall 2012 are: • PANTONE 19-1012 French Roast • PANTONE 19-4056 Olympian Blue • PANTONE 15-1142 Honey Gold • PANTONE 17-1463 Tangerine Tango • PANTONE 18-5338 Ultramarine Green • PANTONE 17-4014 Titanium • PANTONE 19-1652 Rhubarb • PANTONE 14-0445 Bright Chartreuse • PANTONE 16-3304 Sea Fog • PANTONE 12-0304 Whitecap Gray HTT
Bon-Ton board Elects Bergren Chairman YORK , PA . — The board of directors of regional department store chain The Bon-Ton Stores Inc. has elected Bud Bergren as its chairman, effective Feb. 7 the day after he retired from his
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eight years as president and ceo of the company. The board has also accepted Tim Grumbacher’s resignation as executive chairman. Grumbacher remains a di-
rector of the company and was named strategic initiatives officer. Additionally, Brendan Hoffman, recently appointed president and ceo effective Feb. 7, was elected a director of the company. HTT
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Home Textiles Today
February 13, 2012
American Living Line to End at JCP
R
alph Lauren’s president said last week the company and JCPenney have decided to drop the exclusive American Living line of home, apparel and accessories goods - which, when it launched at JCP in 2008 marked the retailer’s single largest brand introduction in history. The arrangement’s five-year term is drawing to an end, Roger Farah said during Ralph Lauren’s quarterly conference call. “We’ve left the door open for future dialogue and relationships.” In addition, “...with Chaps being the No. 1 brand at Kohl’s, we think we have that channel well covered.”
Walmart to Provide Gen Merch Data to NPD Group
W
almart U.S. stores has signed an agreement with consumer research firm NPD Group to provide data for its general merchandise categories. The move comes seven months after Walmart signed a similar cooperation deal with Nielsen for packaged goods. NPD will analyze sales data from Walmart’s U.S. stores as well as walmart.com. Categories covered in the agreement include home, apparel, hardlines, toys and entertainment.
Pioneer Linens Turns 100
V
enerable luxury linens emporium Pioneer Linens in Palm Beach, Fla., celebrated its 100th anniversary on Feb. 7. The company was founded by Max Greenburg, an immigrant who moved to the frontier town of Lake Worth, Fla. To open a store called Pioneer Hardware. The store’s assortment included dynamite to blow up tree stumps as well as wash tubs, door knobs, hammers and nails, chicken wire, guns and fish hooks, according to the company history. Current president and owner Penny Murphy is the third generation member of the founding family to run the business.
Dillard’s Takes Stake in Ecommerce Company
D
epartment store company Dillard’s has invested $4.0 million in Acumen Brands, an ecommerce company that operates 12 niche online retailer sites, including fulfillment. Acumen, based in Fayetteville, Ark., provides branded storefronts for professions and lifestyles including medical uniforms (www.scrubshopper.com), work wear (www. toughweld.com), and western wear (www.countryoutfitter.com). . To help expand its online business, Dillard’s will open a new internet fulfillment center this spring in Maumelle, Ark.
Macy’s Home Labels Hit ShopNBC
S
hopNBC last week debuted a curated selection of Macy’s house brands in home textiles and housewares - marking the first time the labels will be offered on television. Hotel Collection textiles , Charter Club bedding and bath and housewares carrying The Cellar and Tools of the Trade each received their own show. The products were also available online at (www.shopnbc.com/macys).
2/9/2012 5:38:08 PM
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Home Textiles Today
February 13, 2012
News
GLM to Create Artisan Sourcing Show-in-Show NEW YORK — New York Interna-
tional Gift Fair organizer GLM will launch an artisan production sourcing event for U.S.based importers, direct import retailers and Called Artisan Resource, the event will run from Aug. 20-22 during the NYIGF. However, buyers will be separately credentialed. Buyers qualifying to attend Artisan Resource will be required to handle FOB (freight on board) pricing. Buyers will include large and volume retail stores, national retail chains, mail order catalogues, wholesaler companies and manufacturers, designers and sourcing agents. The event will include educational programming for buyers on importing basics, FOB pricing, customs, warehousing and distribution. For the artisans, two days of exhibitor education prior to the show will include U.S. market-readiness training, including from product designers, and New York market familiarization, includ-
ing visits to New York retailers. Exhibitors will be selected for experience in meeting export demands, as well as design innovation, cultural preservation, social enterprise and sustainability. Participating exhibitors will come from countries such as Afghanistan, Colombia, Guatemala, Haiti, India, Mexico, Nepal, Peru, Philippines, South Africa and West Africa. Some 50-75 companies are expected to participate in the first show, which will be located in Hall 1E (Baby and Child will move from 1E to 1D, and Handmade Global Design to the newly renovated Galleria for the summer show. In January 2013, Artisan Resource will move to the Piers to accommodate the ongoing Javits Center renovations.) Artisan Resource will be managed by GLM and organized with the help of ByHand Consulting, which offers product design, marketing and training help to artisan enterprises looking to reach new export
markets, and helps U.S. buyers source artisan products. Its clients include export promotion agencies of foreign governments, international economic development institutions, and private enterprises in the U.S. and abroad. ByHand co-founder Colvin English formerly served as GLM’s director of craft marketing, while co-founder Karen Gibbs previously worked with Aid to Artisans and Hand/ Eye Fund as well as serving as an independent consulting to international development organizations. GLM promoted Allison Rober to sales manager for Artisan Resource. She reports t o C h r i s t i a n Fa l k e n b e r g , NYIGF show manager. Rober, an eight-year GLM veteran, has served as sales representative for two GLM events, The Gourmet Housewares Show at NYIGF and NYIGF’s Tabletop & Housewares division, and as show coordinator for NYIGF’s General Gift division. HTT
Feroze 1888 Mills, Feroze Textiles Industries Form Single Entity K ARACHI, PAKISTAN — Now that
it has completed its acquisition of management of Nakshbandi Industries Limited and changed the name to Feroze 1888 Mills Ltd., Feroze Textiles Industries and Feroze1888 Mills are now merging the two companies. This comes upon the approval of the High Court, which is expected shortly, the company added. Combined, the new entity is expected to position Feroze1888 as the largest terry mill in Pakistan. “The new platform will help ensure compliance with best practices in all areas of opera-
tions and management which will improve entrepreneurship skills bringing prosperity and sustainability to the merged entity,” said Khaleeq Rehman, ceo, Feroze. Established in 1971 and 1972, respectively, Feroze Textiles and Feroze1888 Mills (formally Nakshbandi Industries) both started as small terry operations and eventually grew to become among the country’s largest. The acquisition of management of Nakshbandi Industries Limited occurred between 2008 and 2009, followed by the company’s name change to Feroze1888 Mills Limited in 2010.
The now-merger of the companies will allow Feroze1888 Mills to streamline production, lower operating overheads, and position itself as the premier towel facility in Pakistan. “This merger shall benefit all the stake holders associated with the company and will provide more focused attention to customer needs. Our quality of talent is proven in the past and after the merger it will be further reinforced that they have the capability to handle any challenge and to meet the expectations of all customers,” said Rehan Rahman, ceo, Feroze1888. HTT
Gul Ahmed Plans N.Y. Market KARACHI, PAKISTAN — Multi-category home textiles manufacturer Gul Ahmed will make its first appearance at the New York Home Fashions Market next month. The company will show at 7 W (7 West 24th St.) in Suite 822. Gul Ahmed has taken 3,600 square feet of space and will display 10 to 12 beds as well as curtains and table linens. HTT
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Ellery Expanding Showroom, Vue Line NEW YORK — Ellery Homestyles is adding 1,000 square feet to its 17,000-square-foot showroom ahead of the New York Home Fashions Home in March to accommodate its expanded product offerings. Among those is the introduction of the Vue Signature Curtain collection, keying off the earlier launch of Vue Signature bedding for the contemporary master bedroom. “The curtain line contains a rich collection of fabrics, and the styling and influences of the collection range from traditional to familiar evoking a designer, luxury look,” according to the company. Ellery Homestyles is also expanding its Eclipse brand to include home theater curtains marketed under the Absolute Zero brand. The line provides
100% “blackout” in fashion styles. In addition, Ellery Homestyles will present new designs for the LinenHouse Australia brand that it introduced in 2011 under an exclusive licensing agreement. The luxury collection includes bedding, throws and accessories inspired by nature, architecture and individuality. “Each ensemble has a unique story behind the artist’s inspiration for its design,” said Susan Lazor, director of brand management at Ellery Homestyles. The manufacturer will also show its SoundAsleep Room Darkening Curtain line, which addresses the health and sleep segment of the market and has been named the Official Curt ain of The National Sleep Foundation. HTT
Feizy Renews Lease at Vegas World Market Center DALLAS — Area rug house Feizy Rugs has signed a two-year renewal lease contract with the World Market Center in Las Vegas for its showroom at the Design Center. The manufacturer of handknotted, hand tufted and power loomed rugs has opted to remain at its showroom in Building C in suite C-399, which measures more than 14,300 square feet. “Las Vegas has been and
continues to be an exciting market for Feizy Rugs that draws the crème de la crème of buyers,” said John Feizy, president and ceo, Feizy Rugs. “The exhibitor-focused support from the World Market Center, the educational seminars, and other events geared toward market attendees as well as our growing customer base in the western U.S. have all contributed to our decision to remain at the World Market Center.” HTT
Momeni Doubles Size of Vegas Showroom C ARLSTADT, N.J. — Contemporary area rug house Momeni has relocated into a new and larger showroom at the World Market Center in Las Vegas. Located in suite B-425, the new space measures 7,000 square feet - double the size of the company’s former showroom on site. The new space “will enable
[us] to show more of [our] growing, one-of-a-kind rug offerings from around the world. This also enables us to show more promotional products as well as our broadloom, area rugs, concept program and roll runner displays plus our popular current program collections,” explained Reza Momeni, a principal of Momeni. HTT
2/8/2012 4:57:14 PM
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February 13, 2012
Shoppers Turned to Fashion Kitchen, Table Linens in 2011
TABLE AND KITCHEN LINENS
7.1
%
BY CECILE B. CORRAL
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I
2.7%
AND
BA D ATA K
2011 Home Textiles 2010 Home Textiles Universe Universe
Up
said good night to ivory, white, black, navy, and beige. After a long, recessioninduced period of buying safe and predictable palettes, they spent last year on the lookout for lively colors and patterns – for everyday use, not just the seasons. “When the times are tough, to get excitement into their stores retailers turn to fashion to [stir] impulse purchases. And we definitely saw increases [last year]
B
LE
SE E
NEW YORK — In 2011, shoppers
% of the Home Textiles Universe
$25.72B $25.05B
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in fashion and prints for kitchen and table,” said Bryan Siegel, chairman and ceo, New Yorkbased Elrene Home Fashions. “[Fashion and prints] definitely
TABLE LINENS Distribution channels
Merchandise Mix, 2011
2011 total retail sales: $1,022 million up 1.2% from $1,010 million in 2010 2011
Discount department stores $371 Home textiles specialty chains $221 Mid-price chains $217 Off-price chains $81 Direct-to-consumer $38 Department stores $37 Variety/closeout $21 Single unit specialty stores $18 Warehouse clubs $9 Other* $8 Total $1,022
2010
$364 $217 $218 $80 $37 $37 $21 $18 $9 $8 $1,010
% CHANGE
2.0% 1.7% -0.6% 1.8% 1.2% -0.2% 1.2% 1.2% -2.2% 1.2% 1.2%
Napkins
21.7%
Runners
7.3%
Tablecloths
25.2%
Napkin rings Placemats
2.8%
43.0%
*Other includes home improvement centers, military exchanges and gift/home accent stores. Figures have been rounded. 2010 figures have been revised.
KITCHEN LINENS Source for all tables and charts: Home Textiles Today market research
Distribution channels
Merchandise Mix, 2011
2011 total retail sales: $808 million up 2.9% from $785 million in 2010 Discount department stores Mid-price chains Home textiles specialty chains Off-price chains Variety/closeout Warehouse clubs Department stores Direct-to-consumer Other* Single unit specialty stores Total
2011
2010
$495 $127 $88 $30 $24 $16 $8 $7 $6 $6 $808
$480 $126 $86 $29 $23 $16 $8 $7 $6 $5 $785
% CHANGE
3.3% 1.0% 3.2% 3.5% 3.6% 2.9% 0.9% 2.9% 2.9% 2.9% 2.9%
*Other includes home improvement centers, military exchanges and gift/home accent stores. Figures have been rounded. 2010 figures have been revised.
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Dishcloths
18.2%
Chair pads
6.7%
Potholders/ mitts
22.0%
Aprons
1.0% Kitchen towels
52.1%
crept up a few percentage points, taking away from the solid portion of this business.” It was clear from the start that some of the eye-catching options for kitchen textiles, table linens and, increasingly, aprons came at a somewhat higher cost. But ripe for change, shoppers were not deterred. “A direction we have been seeing is that people would rather spend a little more money on something that they really love versus a basic,” noted Abe Haddad, president and owner of New York-based Homewear Linens. “They are looking for more fashion, quality and value and are willing to spend a little more for it, but they expect a little more back.” He explained that the trend, which emerged last year, still holds for both kitchen and table linen products across the board. Furthermore, added Anchor Home Products president and owner Frank Petronzio, “people were moiré willing to spend on full coordinate programs.” By that, he means shoppers bought more matching components for a more complete decor story in their kitchens and dining rooms – “from window [tiers and curtains] to chair pads to place mats to even decorative pillows. People were looking for full fashion coordinates for their homes.” Aprons were also strong last year — and on an upswing in early 2012. “We see the aprons category as expanding. The stores are giving it more attention, displaying more products earlier in the season and enlarging their selections,” Haddad said. “The direction they are going is toward more fashion forward, embellished novelty styles and presenting them as gift-able offerings.” HTT HTT’s new Database series replaces the long-running Facts series of category sales reports. The next Database report will appear on April 2 and will cover the bath category.
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Home Textiles Today
February 13, 2012
> hometextilestoday.com
First Monday: Specialty Retailing
120% Lino Basks in the Warm Climate BY CECILE B. CORRAL C ORAL GABLES , FLA . — Crisp. Clean. Light. Lest we forget one more: Luxury. These are words to live by when living and lounging in Miami — and when shopping for high-end bedding and bath linens from Magic City newcomer 120% Lino. The 25-year-old upscale Italian purveyor of luxury linen apparel and — more recently, home textiles — has made its first retail move into the U.S. market with a shop located in the posh Villages of Merrick Park shopping venue in the city’s affluent Coral Gables neighbor-
hood. It makes sense to pick this sun-drenched, pan-Latin locale as a launching point. Miami’s residents — permanents and pied-à-tere types — as well as the city’s heavily Hispanic tourist base have reacted well to 120% Lino’s super-soft, solid white, 100% linen goods, noted Jolanda Marini, vp and the force behind the company’s entry into the United States. Located on the first floor of the center, 120% Lino’s American home is steps from the mall’s manicured gardens and in the milieu of Neiman Marcus, Tiffany & Co., Façonnable, Carolina Herrera, and Gucci, to name a few.
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“We love Merrick Park — it’s been our best decision,” Marini told HTT. “It’s a sophisticated environment with an abundance of Latin American clients who love linen. [Our products] are very well appreciated by them.” Marini said the timing of the store’s opening this past October was also right. “Two years ago it might have been a disaster. But the upscale customer is doing better now, and Merrick Park is specifically geared to that highend Latin customer, whether they live around here or they come to Miami and bring spending money or they have an apartment here they need to furnish.” Miami is not new to Marini. For the past 16 years, she has been based in the city’s upscale urban Brickell area. 120% Lino, which is based in Milan and Capri, Italy, was founded by company president Alberto Peretto 25 years ago as a fine linen and fabric fashion house. It was not until about 10 years ago that home linens were added to the offering through an alliance with Italian furniture designer Lanzi to complement his sofas and beds, explained Marini. “From that initiative, we created a whole new division for bedding, bath and table linens,” she continued. While 120% Lino has sold wholesale to specialty retailers in the United States, the Miami store represents the company’s first retail concept that it corporately owns here. For now, the home line is strictly available in white. “It’s always the chicest color in this kind of climate,” Marini said. “But because we garment dye all of our products, we can do any color in the world,” she continued. “So if this concept takes off, we can add pink, light blue, gray, anything the customer wants.” In bedding, an Italian linen queen duvet cover is priced at $619, a set of two Euro shams is
120% Lino displays bedding at the center of the store amid its colorful fashion apparel collections.
$339, and two pillow cases retail at $$230. The bath department comprises robes and towels. The linen kimono robe is priced at $216, the terrycloth linen robe with hood is $290, and the terrycloth linen robe sans hood is $239. The towels, all of which feature a linen border, include a bath size for $150 and a handand-face (wash) towel two-piece set for $110. The table linens assortment includes a square tablecloth with six napkins for $485, a rectangular tablecloth is eight napkins for $628, four napkins for $97, two placemats with matching napkins for $163, and a runner for $154. Customer response to the store over the past four months has been “extremely positive.
But we still are known mainly as a fashion [apparel] company. So the customer is still discovering that we also carry home goods,” Marini noted. Nevertheless, business has been healthy enough to encourage 120% Lino to seek out more potential venues to open additional stores — both in the Miami-Dade area and in other warm U.S. climates. North Miami, specifically the high-end Aventura area, is where 120% Lino will open a soon-tocome second storefront. California is also under consideration, Marini said. “And we want to continue with our lifestyle store concept.” Also soon to come for U.S.based 120% Lino: The launch of a new website, set for late February or early spring. HTT
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> hometextilestoday.com
News
February 13, 2012
Home Textiles Today
11
At left: For the time being, all bedding is white, reflecting the taste of the store’s affluent Hispanic clientele, according to founder Jolanda Marini. At right: Table linens are the only home textiles in the store to feature an element of color.
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Home Textiles Today
Maison Trends MAISON FROM PAGE 1
From the choice of raw materials to manufacturing techniques, the textiles sector is at the cutting edge of sustainable development. Manufacturers are also adopting materials like linen, bamboo, natural silk and hemp, as well as recycling techniques. This taste for recycling objects, celebrating the references created by reclaiming natural materials and embracing sustainable development bring with them new perspective on the world as part of the same quest for authenticity and simplicity. Ethnic chic was the sector to visit for those seeking new am-
February 13, 2012
News
> hometextilestoday.com
bience from near and far. The rich mosaic of opportunities to mix industrial with ethnic and materials with techniques in response to the need of contemporary interiors for eclecticism and personal identity. It offered an enormous wealth of inspiration for decorative looks that take us well off the beaten track to places where style borders no longer exist. HTT Joan Lieberman and Robbie Sumberg and are the principals of Showoffs, a designed resource founded in 1991 and based in Westport, Conn. Showoffs clients include Target, Macy’s, Martha Stewart, Ralph Lauren, Tommy Bahama, The Limited, The Gap and Williams-Sonoma, among others.
Kaszer’s geometric design reflected a trend of using medallions in all shapes and sizes.
Paris Au Mois offered tie-dye splotch prints on demin.
Long-haired yarns and furs lent a Rasta look to textiles, as at Ada.
Ferm Living’s pillow provides an example of some of the fantasy and fairytale prints on display.
Eme Objet’s pillow is emblematic of the pattern mixing seen at the show.
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Home Textiles Today
February 13, 2012
Euro Stores
> hometextilestoday.com
The H&M Home store in Frankfurt features a showroom-like display with products shown on free-standing islands as well as on walls.
Designs mix brights with neutrals and this season showed a liberal use of words and phrases on towels, dec pillows and accessories.
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H&M Fast Forwarding Into Home H&M FROM PAGE 1
log operation, it is as distinctive a shopping experience as exists anywhere in the industry. The relatively small store — less than 1,000 square feet — is housed inside a regular, multistory H&M clothing store here with its own signage and display at the street level. Once inside the department, shoppers are greeted with a series of wall-mounted and free-standing displays showcasing individual products. The assortment skews heavily toward decorative pillows, towels and bath accessories as well as bedding primarily focused on the top-of-the-bed classification. Designs are clearly geared toward the existing H&M demographic, a younger customer with contemporary tastes and a ramen-noodle-for-lunch budget. The color story this winter is a mix of brights and neutrals accented by a liberal use of words and phrases, some in English and some in French, but as far as the casual shopper could see nothing in Swedish. Prices are geared to the same target customer. Decorative pillow covers start at about $5.25,
while bath towels range from $9.25 to $33. Bedding, due to different European sizes, is a little more difficult to compare, but the smallest duvet set, approximately equivalent to an American twin, retails for about $33. The prices are not as low as at American discounters, but compared to prices in traditional European department and specialty stores, they are quite low. While the products are shown as if this was a to-the-trade showroom with single items, sometimes repeated around the store, there was little if any inventory on the selling floor. The purchasing process is where H&M seems to be trying to reinvent the wheel. Every item is replicated in miniature on a small magnet affixed to a magnetic panel. The small, 1by-2-inch magnet contains an image of the product, some details about construction and/ or size and the price. Shoppers take the magnet and stick it on a home-shaped board, collecting all of their intended purchases. This is then brought to the front desk where a clerk takes it and retreats to the stock room to gather all the items.
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> hometextilestoday.com
Euro Stores
Home Textiles Today
February 13, 2012
15
Zara Home: Same Customer, Different Approach
XXX XXX FROM PAGE 15
FRANKFURT, GERMANY — If H&M has
Shoppers take a miniature magnet with a picture of the item and product details when they want to make a selection. This panel displays products for the badezimmer, or bathroom.
Individual magnets are affixed to a home-shaped metal board and taken to the front desk where stock is pulled to match the shopper selections.
Finances are presented and the transaction is completed. It is a purchasing process that can only be compared to that which once existed at the catalog showrooms of the 1980s but one that survives in some form
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today in high-end specialty stores. Curiously it is also how one buys most home textiles products at Crate & Barrel. Staying true to its fast-fashion roots, H&M says it updates its home assortment four times a week, according to a recent article in the European magazine ISBN cited by the Apartment Therapy website. While the company does not own manufacturing, its strategy depends on a fast-to-market plan with multiple inventory turns and constant waves of new merchandise, some of which carries designers such as Karl Lagerfeld. H&M currently operates about 2,500 stores in 43 countries, including more than 230 units in nearly 30 states in the United States. American annual sales were about $1.4 billion last year. HTT
taken a radical approach to merchandising its new home collection, fellow fast retailer Zara is going a more conventional route; at least that appears to be the strategy from visiting a store here down the street from H&M. The Zara Home unit, one of many in several European countries for the Spanish-based retailer that has also targeted the United States as a major expansion market, is a free-standing unit, unlike H&M Home. Spreading over two floors, each about 1,000 square feet, the store uses a more traditional merchandising approach toward home with display beds and inventory in fixtures on the selling floor. Designs steer heavily toward neutrals in an assortment that would not be out of place in a Pottery Barn or West Elm store. Soft home dominates both floors, but there is a greater use of decorative accessories like candles and tabletop products than one finds at H&M. Prices are similar with decorative pillow covers starting in the $5 range and towels generally in the $15 to $30 range. There are no Zara Home stores in the United States and the company has not announced plans to open any in the American market. It currently operates 47 apparel stores in the United States. HTT
The store’s inventory is housed in fixtures on the selling floor, unlike H&M where shoppers pick up their purchases at a central checkout counter.
The two-story Zara Home store in Frankfurt takes a more conventional approach to the category.
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Home Textiles Today
February 13, 2012
> hometextilestoday.com
PEOPLETodaY Triangle Home Fashions Adds to Executive Team NEW YORK — Jenny Zhu, president and ceo of Triangle Home Fashions, has announced three new executive appointments to the multi-category, retail-direct home textiles manufacturer based in China. Jared Cohen has been named chief operating officer, a new position. According to Zhu, “Jared’s legal and business training and experience will be invaluable as we continue to position the Company to support the incredible growth that we have experienced. One of his first tasks will be managing the implementation of a new software system which will enhance our ability to forecast inventory needs
and improve our already strong record of timely fulfillment. “ Allen Darwin has been appointed vp of marketing and brand development. Darwin has spent over 30 years in the home furnishings industry. Previous positions include ceo of Cardinal Inc., a gift, tabletop and decorative accessories firm, and senior vp roles at Hampton Forge and Lifestyle Home. Said Zhu: “Formalizing the brands we have established in the past few years is one of our top priorities moving forward. Allen brings a keen understanding of the consumer market to our company, and we are looking forward to building greater awareness in future marketing campaigns that
tell the Triangle story.” Jeffrey Swartz has been promoted to the position of vp of sales. In his prior role as key accounts manager, he did “an incredible job of growing the relationships with our current customers as well as opening several new strategic accounts for our company,” said Zhu. “Along with the years of industry experience that he brings to this position, Jeff does a great job of translating our customers’ needs into extremely successful programs.” All three report directly to Zhu. Triangle Home Fashions product categories include bedding, window curtains, decorative pillows, shower curtains and table linens. HTT
Laura Ashley Inc. Taps Synergy Licensing as Agent to Expand into New Categories FORT MILL, S.C. — English lifestyle brand Laura Ashley Inc. has partnered with Synergy Licensing LLC as its newest licensing agency. A New York-based firm specializing in licensing, Synergy will be leveraging on the brand’s existing success into related product categories. Laura Ashley already boasts over 30 active licensees, but is looking to expand with Synergy’s help into other areas. The initial focus will include the juvenile, toys, collectibles, publishing and consumable categories. “The 56-year heritage of the
Laura Ashley lifestyle brand combined with Synergy’s expertise in brand management, make for a natural fit,” according to Laura Ashley Inc. “Our loyal Laura Ashley consumers look to us to provide a breadth of merchandise consistent with the distinctive look and quality that has made our brand so steadfast and successful” said Penne Cairoli, president, Laura Ashley. “Synergy Licensing understands our heritage and has the experience to bring us qualified licensees in categories that will enhance and grow the licensing program.”
Added Synergy principal Randi Goodman: “We will continue to leverage Laura Ashley’s global presence and tap into its strong English roots by identifying appropriate partners that will take the program to the next level.” The Laura Ashley brand said it has an 88% awareness level and is available at 450 stores worldwide, with presence throughout the UK, Europe, Asia, Australasia, Middle East, Russia and South America. Laura Ashley product can be found in over 25,000 ret ail doors in the United States and Canada. HTT
Walsh New vp of Business Development for Dallas Market Center DALLAS — Dallas Market Center has named Eva Walsh vp of business development, a new position. Walsh will head the company’s retail sales force for specialty and major stores, as well as create new business opportunities for the Market Center. “Eva possesses an inspiring tenacity and passion for our industry,” said Robbin Wells, executive vice president of leasing, Dallas Market Center. HTT
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Bon-Ton Taps Hoffman to Replace Bergren as President, ceo YO R K , P A . — The Bon-Ton Stores Inc. has named Brendan Hoffman the company’s president and ceo, effective Feb. 7, replacing Bud Bergren. Hoffman will also be elected to Bon-Ton’s board of directors. Bergren, who is a current member of the board, will transition to the role of chairman. At that point, Tim Grumbacher, who currently serves as executive chairman of the board, will remain a director of the company. Hoffman has been ceo and president of Lord & Taylor LLC since October 2008. Prior to that, he spent six years a president and ceo of Neiman Marcus Direct, a subsidiary of The
Neiman Marcus Group Inc., where he oversaw the growth of www.neimanmarcus.com and the launch and growth of www. bergdorfgoodman.com. He also served as vp of Last Call clearance division at Neiman Marcus from August 2000 to December 2002 and as a divisional merchandise manager of Bergdorf Goodman Inc. from October 1998 to August 2000. Grumbacher said Hoffman “comes with a wealth of knowledge and experience in the retail industry, which we believe will be very beneficial in driving profitable growth from the strategic initiatives we began piloting in the fall of fiscal 2011.” HTT
Scheps Joins Sinomax-USA as svp Decorite Inc. Scheps described Sinomaxappointed longtime industry vetUSA as “perhaps the eran Lonnie Scheps as fastest moving player its new senior vp. in the category now.” Frank Chen, presThe company proident and ceo, said he duces specialty foams and his team expect in pillows, toppers and Scheps’ “extensive mattresses in North experience in foam, America and Europe. home textile and furniture industries will help LONNIE SCHEPS It is also the licensee of our business growth tre- Sinomax-USA The Sharper Image, for which it offers several mendously.” branded bedding and Scheps was previkitchen accessories products. ously with Hudson Industries, “With direct ties and comwhere he spent the past 12 years plete verticality, I am excited of his career — most recently as in what we can do and how fast the company’s senior vp, leading we do it — conceiving comthe consumer division. Earlier, Scheps served as vp pelling products that are true of The Carpenter Company, game-changers offering unprecwhere he launched its consumer edented quality and packaging division. And prior to that, he satisfying the retail demands at was vp for the former decorative every level,” Scheps continued. fashion accessory manufacturer HTT H OUSTON — Sinomax-USA has
2/8/2012 4:54:27 PM
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Home Textiles Today
> hometextilestoday.com
February 13, 2012
BUSINESS TodaY Off-prices, Costco Strong in January BY CECILE B. CORRAL N EW YORK — The off-pricers
continued to rack up comp gains at a good pace last month, when both TJX Cos. and Ross Stores proved January’s strongest performers. Costco led the 11-retailer pack tracked monthly by HTT. The club took home an 8% comp gain. But, TJX and Ross Stores were close behind. TJX reported an above-plan 7% gain and Ross was well ahead of expectations with a 5% comp increase. By division, TJX’s comp results for the month, as relayed by svp of global communications Sherry Lang, included: a 7% gain for Marmaxx, which “significantly exceeded plans;” a 10% increase for Home Goods; and a 4% gain for the Winners and Home Sense Canadian divisions. “We are pleased to see the
10.0%
Target posted the fourth best comp increases in January — up 4.3% — as well as a strong 5.3% sales gain, which came in “near the high end of our expected low to mid single-digit range, reflecting strong performance in both discretionary and non-discretionary categories,” said Gregg Stein-
WINNERS AND LOSERS Same-store sales % change
WINNERS Costco Wholesale Corp. TJX Companies Ross Stores Target Corp. Macy’s Inc. Kohl’s Corp.
8.0% 7.0% 5.0% 4.3% 2.4% 0.6%
LOSERS Stein Mart The Bon-Ton Stores Duckwall-ALCO Fred’s Inc.
(3.9) (3.5) (1.1) (0.8)
4.8%
8.5%
Five weeks ended January 28, 2012 (dollar amounts in millions) a 2012 SALES
The Bon-Ton Stores Inc. Costco Wholesale Corp. b Dillard’s Inc. Duckwall-ALCO Stores Inc. Fred’s Inc. Kohl’s Corp. Macy’s Inc. Ross Stores Inc. Stein Mart Inc. Target Corp. The TJX Companies Inc.
$174.4 $7,000.0 $363.5 $28.7 $132.4 $844.0 $1,336.0 $483.0 $60.1 $4,608.0 $1,400.0
5.5% 4.0%
2011 SALES
TOTAL % CHG.
SAME-STORE % CHG.
$180.1 $6,300.0 $366.4 $28.5 $129.1 $825.0 $1,310.0 $441.0 $62.8 $4,383.0 $1,300.0
(3.2) 11.0 (1.0) 0.7 3.0 2.4 2.0 10.0 (4.3) 5.1 5.0
(3.5) 8.0 0.0 (1.1) (0.8) 0.6 2.4 5.0 (3.9) 4.3 7.0
TOTAL % CHG.
SAME-STORE % CHG.
52 WEEKS The Bon-Ton Stores Inc. Costco Wholesale Corp. c, d Dillard’s Inc. Duckwall-ALCO Stores Inc. Fred’s Inc. Kohl’s Corp. Macy’s Inc. Ross Stores Inc. Stein Mart Inc. Target Corp. The TJX Companies Inc.
2012 SALES
2011 SALES
$2,884.7 $40,180.0 $6,199.0 $482.8 $1,879.0 $18,804.0 $26,404.0 $8,608.0 $1,160.4 $68,466.0 $23,200.0
$2,980.5 $36,080.0 $6,020.3 $426.6 $1,842.0 $18,391.0 $25,003.0 $7,866.0 $1,181.5 $65,786.0 $21,900.0
a. Reporting periods vary among key retailers. b. Costco’s December comp results are for the U.S. division and do not include the positive impacts of inflation in gasoline prices or the negative impact from foreign currencies. Including those impacts, comps for the month were up 9.0% in the U.S. division, 6.0% in the international division, and 8.0% for the total company. c. Because it is on a different fiscal calendar than the other key
2012 year-over-year
7.0%
JANUARY SALES FOR KEY RETAILERS
-3.2 11.0 3.0 4.4 2.0 2.2 5.6 9.0 (1.8) 4.1 6.0
(2.8) 6.0 4.0 3.0 0.5 0.5 5.3 5.0 (1.1) 3.0 4.0
retailers on this list, Costco’s year-to-date sales and comp results reflect the past 22-week period. d. Costco’s year-to-date comp results are for the U.S. division and do not include the positive impacts of inflation in gasoline prices or the negative impact from foreign currencies. Including those impacts, comps for the month were up 9.0% in the U.S. division, 9.0% in the international division, and 9.0% for the total company.
2.5% 1.0% -0.5% -2.0%
January Same-Store Sales Johnson Redbook Index
-3.5% -5.0% JAN FEB MAR APR MAY JUN JUL AUG SEPT OCT NOV DEC JAN Source: Johnson Redbook Retail Sales Average, a unit of Instinet, a Reuters company.
momentum come back into our Canada businesses,” said Lang. Ross Stores’ vice chairman and ceo, Michael Balmuth, said juniors, shoes and children’s were the strongest merchandise categories during the month, while Florida and the Mid-Atlantic were the top performing regions. “We are extremely pleased with both our sales and earnings growth in 2011, especially considering that they were achieved on top of exceptional increases over the past three years,” he continued.
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hafel, chairman, president and ceo. “Sales trends were healthy throughout the month and across the country.” Home category comps increased in the low single digits, with the strongest performance reported in housewares and the softest results generated by domestics. Macy’s 2.4% comp and its 2.0% sales increase made January the department store’s “smallestvolume month of the year,” and the results were “weaker than anticipated,” said Terry Lundgren,
chairman, president and ceo. “Nonetheless, January was the 26th consecutive month of yearover-year same-store sales growth for our company,” he continued. “The fourth quarter was our strongest in many years, and demonstrated the continued progress in improving the fundamentals in our business at Macy’s and Bloomingdale’s.” Online sales for macys.com and bloomingdales.com combined were up 38.7% in January, 40.0% in the fourth quarter and 39.6% for fiscal 2011. Ecommerce sales positively affected the company’s same-store sales by 1.7 percentage points in the fourth quarter and 1.5 percentage points in fiscal 2011 as a whole. Online sales are included in the same-store sales calculation for Macy’s. Kohl’s modest 0.6% comp and
a 2.4% sales increase in January were in line with expectations, according to chairman, president and ceo Kevin Mansell. Better news came from its online business, he continued, as Kohl’s achieved its goal of $1 billion in e-commerce revenues in fiscal 2011. “The e-commerce business was a key contributor to our fiscal 2011 sales performance, and we plan to build on its momentum in 2012,” Mansell added. “Additionally, strong expense management during the quarter contributed to better-than-expected profitability.” Kohl’s home category, along with men’s, outperformed the company average for the month. The only retailer reporting flat comps in January was Dillard’s, where sales in shoes, home and furniture were significantly above
trend during the month. The biggest comp losers in January were Stein-Mart and BonTon, reporting comp decreases of 3.9% and 3.5%, respectively. Tony Buccina, vice chairman, president - merchandising, explained that Bon-Ton’s sales were below expectations “due to the continuation of the milder weather in our markets, which had an adverse impact on sales of cold-weather merchandise and comprised the majority of our sales shortfall.” Bon-Ton’s best performing business was home, which included furniture, “due to the customers’ favorable response to our semi-annual home sale.” The regional department store’s e-commerce sales “increased significantly over the prior year period,” Buccina added. HTT
2/8/2012 12:18:08 PM
THE BIG PARTY IS BACK
Join us for the
MARKET KICK-OFF PARTY The HTT Market Kick-off Party’s new location got rave reviews. Don’t miss it: Bar Basque at the Eventi Hotel, 2 minutes from 5th Avenue Showrooms.
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2/7/12 12:01 PM
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Home Textiles Today
February 13, 2012
Business
> hometextilestoday.com
Big Lots Sees Comps, Sales Kohl’s, Macy’s, Ross and TJX Update Jump Above Plan in Q4 C OLU M BUS , O HIO — Big Lots
Inc. beat its fourth quarter comp sales expectations, nearly doubling plan. Comparable store sales in the four-week period ended Jan. 28 for stores open at least two years at the beginning of the fiscal year were up 3.4%. Big Lots had expected and increase of 1% to 2%. Retail sales in the quarter grew 7.0% to $1.6 billion. Fourth quarter sales for the Canadian operations it acquired last year as well as wholesale operations will be announced in
March along with full fourth quarter financial results. For the 52-week fiscal 2011, retail sales from U.S. operations totaled $5.1 billion, up 3.9%. Comps were tepid, up just 0.1%. By merchandise category, during the fourth quarter the seasonal and furniture segments each comped up by low double digits and consumables comped up mid single digits. Based on the U.S. sales results and lower-than-expected losses in its Canadian business,
Big Lots is raising its consolidated fourth quarter earnings guidance to $1.71 to $1.74 per share. That represents a 17% to 19% improvement over fourth quarter 2010 earnings of $1.46 per diluted share. Previously, the retailer expected fourth quarter EPS of $1.59 to $1.66. Additionally, Big Lots also said it now expect earnings of $2.94 to $2.97 per share from continuing operations for fiscal 2011, a 4% to 5% improvement over fiscal 2010 earnings of $2.83 per diluted share. HTT
Hudson’s Bay Company Completes Acquisition of Lord & Taylor BY MICHAEL J. KNELL TORONTO — The Hudson’s Bay
Company has completed the acquisition of its affiliate, U.S. department store chain Lord & Taylor Holdings, and named Bonnie Brooks, who has served as president and ceo of The Bay since August 2008, to oversee the newly expanded retail operation as president of the Hudson’s Bay Company. Prior to this announcement, Hudson’s Bay and Lord & Taylor were side-by-side affi liates. Both were owned Hudson’s Bay Trading Company, a holding company owned by NRDC Equity Partners, a retail estate and investment firm owned by Richard Baker. B o t h w e r e a c qu i r e d b y NRDC in 2008. Baker then became governor and ceo of Hudson’s Bay Company. Baker will remain in those posts as will Donald Watros, the company’s chief operating officer. “We are fortunate to have both Don Watros and Bonnie Brooks round out the leadership team of the Hudson’s Bay Company,” Baker said in a statement. “Don’s operational and financial expertise has been instrumental in contributing to both The Bay and Lord & Taylor’s year-over-year profitability despite the poor economic en-
htt120201_Business 20
vironment around the globe. “Bonnie’s extraordinary leadership at The Bay and previous global retailing expertise from Lane Crawford are a natural fit to lead this new integrated organization as we move to our next phase of growth and evolution,” he said, adding, “The turnaround and speed of growth at The Bay under Bonnie’s leadership is unprecedented in modern times.” Lord & Taylor and The Bay will maint ain their distinct identities and nameplates while leveraging the merchandising strengths of the organizations to improve and accelerate their continued growth, officials said. Analysts have praised Brooks for her performance at The Bay. Insiders have reported that after a decade of declining sales, same-stores sales growth for The Bay’s 91 units was 6.5% in 2011, building on almost similar growth in 2010. Having said that, Lord & Taylor is also enjoying something of an uptick. Sources have reported same store sales for its 46-unit chain were up 8% last year and 12% the year before. As part of a strategy to reduce HBC’s debt, Taylor sold the rights to 186 leases held by Zellers for $1.8 billion. Target, the U.S. based rival to Wal-
Mart, acquired those leases and is expected to begin converting the units to its format beginning early in 2013. As part of the restructuring, Hudson’s Bay Company invested some $427 million in Lord & Taylor, all of which was used to reduce the latter’s debt. Both The Bay and Lord & Taylor have a strong big ticket home goods business - although, unlike The Bay, Lord & Taylor doesn’t sell mattresses or major appliances. Both have active furniture businesses. In addition to its 42 stores across nine states, Lord & Taylor also operates two Lord & Taylor Home stores. Two new L&T stores are planned for 2012. In addition to The Bay and its 91 units, Hudson’s Bay Company operates another 500 stores under three other banners including Zellers, Home Outfitters and Fields. “We look forward to an even stronger 2012 with this new leadership structure in place and the strength of two dynamic teams coming together and leading the HBC into the future,” Baker said. Brendan Hoffman, who has served as president and CEO of Lord &Taylor for the past three years, will be leaving the company to pursue another opportunity. HTT
Guidance
N EW YORK — Encouraged by
healthy results at the close of the fourth quarter, four key retailers updated their earnings expectations recently. Kohl’s Corp. now projects fourth quarter earnings per share of $1.79 and $1.80. It had previously set a target of $1.70 to $1.73 per hare. For the full fiscal year it has raised guidance from $4.20-$4.23 per share to $4.29-$4.30 per diluted share. Macy’s Inc. also hiked its earnings guidance for both the quarter and full year. Fourth quarter earnings are expected to be $1.63 to $1.65 per share. Earlier, it expected 4Q EPS of $1.55 to $1.60. For the full year, Macy’s now believes it will gen-
erate EPS of $2.81 to $2.83, improving its earlier guidance of $2.73 to $2.78. The projections exclude extraordinary items. Ross Stores boosted its 4Q EPS guidance to 84 to 85 cents, which would represent a 22% to 23% jump compared to last year’s 4Q earnings per share. Fiscal year earnings per share are estimated to grow 23% to 24% to $2.85 to $2.86. All share and per share figures reflect the Ross’s recent two-for-one stock split. TJX Cos. said it now expects fourth quarter fiscal 2012 earnings per share to be at or slightly above the high end of its previously estimated range of $1.19 to $1.23.HTT
Same-store sales
Redbook Index up in February’s First Week NEW YORK — The Johnson Redbook Retail Sales Index was up 2.5% in the first week of February. Month-to-date, February was up 2.5% compared to February of last year, relative to a target of a 2.8% gain. Month-overmonth showed a 1.2% gain compared to January, relative to a target of a 1.5% gain. February is a four-week month on the retail calendar, ending on Feb. 25. Most stores were tracking on or slightly below their monthly targets as the period ended. Like January, February is generally regarded as a transitional month, combining final clearance of winter merchandise with early introduction of spring goods. “Some retailers continue to clear pockets of winter goods at marked down prices, although this represented a less significant portion of their business,” noted Catlin Levis, Redbook analyst. “In addition, Super Bowl Sunday drew sales of big screen televisions, snack food, beverages, team apparel and other related merchandise leading up to the event.” HTT
Johnson Redbook Index First week of February, year-over-year % change WEEK ENDED
2/4
Department stores* Discounters Redbook Index
1.3 3.2 2.5
2/11
2/18
2/25
MONTH
1.3 3.2 2.5
TARGET
2.1 3.2 2.8
*Including chain stores and traditional department stores Source: Johnson Redbook Index
2/8/2012 2:17:27 PM
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Home Textiles Today
February 13, 2012
News
Home Prepares for a Makeover NEW YORK – JCPenney will begin rolling out two shop-in-shop concepts per month starting in August. Apparel will be first up, but branded home departments won’t be far behind. The plan is to ensure that all home brands – house and national – are meaningful, according to John Tighe, senior vp/gmm for home. Although ceo Ron Johnson pointed to over-reliance on private brands as one of the problems with modern de-
partmet stores, there’s no plan to put a cap on them, Tighe told HTT. “He doesn’t want private brands to be ‘this big’ or ‘this small.’” Tighe pointed to Royal Velvet, which begins rolling out in late spring as a JCPenney exclusive in bed and bath. “We’re gong to use it to target traditional in a beautiful way.” The window department – long a business in which Penney has dominated – is scheduled to begin evolving
sooner rather than later, with the first changes emerging in May. “We have lots of ideas about how to make window better, how to make it more inviting, how to open up the floor,” said Tighe. In the past 90 days, merchants have been sent around the world to scout new ideas for product and merchandising. “It’s a great time to be a merchant at JCPenney,” said Tighe. “It’s all about product.” HTT
360 Park Avenue South, New York, N.Y. 10010 Tel: (646) 805-0227; Fax: (646) 365-2307 www.hometextilestoday.com www.facebook.com/httmag EDITOR-IN-CHIEF Jennifer Marks 10 Ocean Blvd #8B Atlantic Highlands, N.J. 07716 (732) 204-2012 | jnegley@hometextilestoday.com PUBLISHER/EDITORIAL DIRECTOR Warren Shoulberg (646) 805-0226 | wshoulberg@hometextilestoday.com SENIOR EDITOR Cecile B. Corral 428 Bianca Ave. Coral Gables, FL 33146 (305) 661-7493 | cbcorral@aol.com MANAGING EDITOR Julie Murphy (646) 805-0224 | jmurphy@hometextilestoday.com CONTRIBUTING GRAPHIC ARTIST Desiree Nunez (646) 805-0233 | dnunez@giftsanddec.com DIRECTOR OF MARKET RESEARCH Dana French (336) 605-1091 | dfrench@sandowmedia.com
JCP Charges a Lot More Customers Spend a Little More To buttress the argument for lowering JCPenney’s pricing across the board and ditching a blizzard of promotional activities executives noted that while it has escalated its prices over the past decade, what the customer actually pays for a product once events like one-day sales, coupons and discounting are taken into effect has changed very little. An item JCP bought at a cost of $10 in 2002 went out at retail at $28 – but actually sold on average at $15.80. As of last year, that $10 item carried a $40 price tag, but ultimately sold at $15.95. So while the price tag jumped 43%, the customer wound up paying only 1% more than she did in 2002.
2002
2011
50
$40
40
10
$10
0
$10
Cost
CLASSIFIED AD SALES Spencer Whittle (336) 605-1027 swhittle@sandowmedia.com Karen Hancock (336) 605-1047 khancock@sandowmedia.com
MANAGER, INDIA Kaushal Shah Cell: 91-9821715431; Tel: 91-22-6663 4597 / 24988658 Fax: 91-22-66634596 | Kaushal@kaushals.com
$15.80 $15.95
20
ACCOUNT MANAGER NORTHEAST/MIDWEST/ WEST COAST/CANADA Mary McLoughlin (646) 805-0227 | mmcloughlin@hometextilestoday.com
MANAGER, EUROPE Mirek Kraczkowski Tel: 48 22 401 70 01; Fax: 48 22 401 70 16 | kraczko@aol.com
$28
30
ASSOCIATE PUBLISHER, ACCOUNT MANAGER CHINA Jeff Reeves (336) 605-1009 | jreeves@hometextilestoday.com
43% change
1% change
Retail tag
Sell-thru retail
SOURCE: JCPENNEY
The customer, said ceo Ron Johnson, “doesn’t even start paying attention to pricing offers until they hit 40% off.”
ONLINE SALES MANAGER Penny Schneck (336) 605-1084 | pschneck@sandowmedia.com PRODUCTION MANAGER Rich Lamb Tel: (336) 605-1074; Fax: (336) 605-1143 | rlamb@ sandowmedia.com DIRECTOR, WEB OPERATIONS Chris Schultz | (336) 605-1076 | cschultz@sandowmedia.com MANAGER, CLIENT SERVICES, WEB ADVERTISING Dan Sage | (336) 605-1080 | dsage@sandowmedia.com E-MEDIA PROJECT MANAGER Missy Axe | (336) 605-1005 | maxe@sandowmedia.com DIRECTOR OF AUDIENCE MARKETING Allison Ternes (704) 573-9007 | aternes@sandowmedia.com PRESIDENT, FURNITURE TODAY GROUP Kevin Castellani (336) 605-1034 | kcastellani@sandowmedia.com
Where the Cuts Will Come From JCPenney plans to “self-fund” the cost of remaking its more than 1,100 stores by cutting $900 million in costs. Here’s where it plans to find savings.
$400M $300M $200M
Stores SOURCE: JCPENNEY
htt120201_001_014_015.indd 22
Advertising
Home office
JCP By the Numbers JCP FROM PAGE 1
• 72% of Penney’s sales are generated on items priced at 50% off or more. • Penney buyers have been spending 50% of their time working on pricing. • Pe n n e y r a n 590 promotions last year at an average marketing spend of $2 million per promotion. • The Sephora shops inside Penney produce $600 per square foot in sales. The rest of the store averages sales per square foot of $200. Before introducing those figures as among the justifications for Penney’s new non-promotional pricing strategy, Johnson vowed that the company will “leave bad habits far behind.”
The new pricing grid the retailer launched on Feb. 1 is being billed as “fair and square” and consists of three tiers: • Lower everyday prices more reflective of the sweet spot at which goods actually move; • Month-long specials; • Best prices, which will be offered on the first and third Friday of each month and are designed to clear out merchandise — although Johnson insisted that “clearance” is over. By way of example, Johnson pointed to a core Penney towel that now retails at $10, but actually moves out the door, once all the discounts are taken into consideration, at $3.30. Its new everyday price is $4 and its “best” price will be $2. HTT
FOUNDING EDITOR-IN-CHIEF Carole Sloan 1979-2011
SANDOW MEDIA PRESIDENT AND CEO Adam I. Sandow CFO/COO Christopher Fabian VP CREATIVE AND EDITORIAL Yolanda E. Yoh EVP, GROUP PUBLISHER James N. Dimonekas SUBSCRIPTIONS: U.S.A. (866) 456-0405 All other countries: (515) 247-2984 HTTcustserv@cdsfulfillment.com FAX SUBSCRIPTIONS: 1-866-310-7181 THE BUSINESS AND FASHION NEWSPAPER OF THE HOME TEXTILES INDUSTRY® 360 Park Avenue South, New York, NY 10010 Telephone: (646) 805-0227 Fax: (646) 365-2307 USPS 497-490 HOME TEXTILES TODAY (USPS 497-490) (ISSN 0195-3184) is published 29 times a year except for the weeks of 1/16, 2/6, 2/20, 3/12, 3/26, 4/9, 4/23, 5/7, 5/21, 6/4, 6/18, 7/2, 7/16, 7/30, 8/13, 8/27, 9/17, 10/1, 10/15, 10/29, 11/12, 11/26, 12/10, 12/24 by Furniture/Today Media Group, 360 Park Avenue South, 17th fl., New York, NY, 10010 a subsidiary of Sandow Media LLC, 3731 NW 8th Ave, Boca Raton, FL 33431. Periodicals postage paid at New York, NY, and additional mailing offices. HOME TEXTILES TODAY copyright ©2012 by Sandow Media LLC. Annual subscription rates: U.S. and Canada $169.97; 1 year, other countries $325.99 for surface mail . All payments must be made in U.S. currency. Subscription inquiries: HOME TEXTILES TODAY, PO Box 5879, Harlan, IA 51593-1379. Phone: (866) 456-0405. HOME TEXTILES TODAY and THE BUSINESS AND FASHION NEWSPAPER OF THE HOME TEXTILES INDUSTRY are registered trademarks of Sandow Media LLC, used under license. Sandow Media LLC does not assume and hereby disclaims liability to any person for any loss or damage caused by errors or omissions in the material contained herein, regardless of whether such errors result from negligence, accident or any other cause whatsoever. (Posted under Canadian International Publication Agreement No.40624074. Sandow Media/CDS (Mint Hill) POSTMASTER: Send address changes to HOME TEXTILES TODAY, P.O. Box 5879, Harlan, IA, 51593-1379 Email: HTTcustserv@cdsfulfillment.com. Return undeliverable Canadian addresses to: RCS International; APC; PO Box 503, RPO West Beaver Creek, Rich Hill, ON L4B 4R6
2/10/2012 3:43:12 PM
News
> hometextilestoday.com
The View on Vendors pause. That would be a goal over the long run, said Johnson. Chief operating officer Mike Kramer jumped in to clarify, saying he is not opposed to vendor contributions but does object “when it becomes a drug.” In fact, throughout the financial session as execs described their plan to reduce costs by $900 million to “self-fund” the transformation of 1,100-plus stores, vendor participation was cited frequently – once in the form of making a “capital investment” in creating the shop-inshop formats. Executives also said that as Penney converts the floor from its current format into 100 branded shop-in-shops, vendors will be invited to offer their ideas and vie for the real estate. HTT
>72% of Revenue at 50% off or More 0.2%
Regular price
1.1%
20%
Discount rate
NEW YORK — During JCPenney’s “fresh air” presentations here in late January, ceo Ron Johnson criticized the current set-up of retail/vendor relations, calling it “one of the most broken things in the retail industry.” The vendor’s job, he added, is to design, source and deliver on time. The retailer’s job is to market and sell. Vendors and retailers shouldn’t be co-mingling their profits and “playing games.” JCP held a summit specifically for vendors during its visit to New York to outline the new plan. Johnson said vendors came away thinking it’s all “too good to be true.” During a later summit for the financial community, an analyst asked if that means Penney will no longer demand markdown money. There was a distinct
23
Home Textiles Today
February 13, 2012
7.7%
30%
18.3%
40%
31.8%
50%
26.9%
60%
9.5%
70%
4.4%
80%
SOURCE: JCP INTERNAL DATA.
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Established California home textile co. seeks Director of Sales & Marketing for new division of English luxury bed linens (www.peterreed.com) being introduced to U.S. retail markets. Requirements include: - Exp. selling home furnishings to hi-end department stores and/or boutiques - Self-starter to lead the development of this brand in the U.S. - Understanding of e-commerce retail channels for luxury goods Applicants to submit resume, salary history to hr@standardfiber.com
2/10/2012 5:02:54 PM
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