Atlanta Market Business Report RUG EXECS SHARE 2018 GOALS, BIG MOVE TO CHANNEL EXCLUSIVITY
ATLANTA — With the winter show circuit getting 2018 off to a running start, members of the rug industry are already looking forward to strong sales for the year. During the Atlanta International Area Rug Market, executives shared their goals and aspirations for the coming year.
“Our goal? To sell a whole bunch of rugs!” jokes Blake Dennard, senior vice president of Kaleen. “The rug business was the most challenging of our businesses last year,” Dennard admits, adding that in contrast, the company’s broadloom business doubled last year.
|“Furniture stores will be a big part of growth for us.” — Blake Dennard, Kaleen|
“So we’re refocusing our sales force to rugs. One plan is to create a more durable product for furniture retailers, one that will shed less and stay looking new even in heavily trafficked vignettes on a sales floor. “We feel that furniture stores will be a big part of growth for us,” Dennard adds. “So we need to give them a product that will hold up to that traffic.” In particular, the company’s successful Rachael Ray line will add these new constructions.
|“We make products in the U.S. 100 percent every chance we get.” — Jonathan Witt, Oriental Weavers|
“As far as 2018 is concerned, we’re committed to the same initiative that our country is focused on now,” says Jonathan Witt, president of Oriental Weavers, referencing the strong desire among American consumers for domestically made goods. “We make products in the U.S. 100 percent every chance we get. Last year we added an enormous, high speed, space-dyed yarn line, so our yarn capacity has grown tremendously to keep up with the growth we’ve had. Between 2015 and 2017, we’ve grown our capacity 40 percent in the U.S.”
For 2018, Oriental Weavers has further committed capital investment towards expanding domestic production and growing American jobs. “We’re going to be adding two new looms, and two new twisting lines to help with some of the more complicated yarns. Made in the USA is still a major focus for us and it’s also one of the distinct advantages Oriental Weavers has over a lot of people in the industry.” Witt says.
Prioritizing Interior Designers
|“We want to be a design leader- that’s one of our top goals.” –Satya Tiwari, Surya|
“We want to be more design centric,” says Surya president, Satya Tiwari. “If you’re an interior designer, a design service, or even a design lover, Surya should be the first thing you think about. That’s one of our top goals. Design is evolving very quickly, and while we have always been a leader in design, we want to continue to push. It’s not a new goal, but we want to stay ahead on trends. Designers want variety and depth, fresh looks and uniqueness,” he explains.
As Surya’s product line grows, the company is simultaneously focusing on what Tiwari calls “discovery” — making the product easier to search. “Even though our products are best appreciated when you touch them, a lot of our designers are making decisions online on our website.” To that point, Surya will continue to push the envelope with high-end imagery, better copy, more romance and making its products searchable in any format.
Channel Exclusivity on the Rise
A strong recurring theme throughout AmericasMart showrooms was the goal of establishing exclusive lines for brick and mortar and dot-com customers, with many adding special lines into the mix, including one of a kinds and higher-end goods for interior designers.
|“We’re not in the business to kill one channel for another.” –Santhi Yarlagadda, KAS Rugs|
At KAS, Santhi Yarlagadda, vice president of business development, said the corporate team has spent the past two years setting up for a stellar future. “We’ve changed the way we do business, and because of this, we’re expecting a robust two years,” she said. The company has arranged its business into three core customer divisions: brick and mortar, e-commerce, and interior design, and plans to offer certain collections exclusive to each channel.
“We are going into 2018 with the idea that we should grow each of these channels separately,” she explains. “We’re not in the business to kill one channel for the other.” Of the three, Yarlagadda said KAS is particularly looking to grow its roster of interior design customers, building upon the recent launch of its Libby Langdon line.
|“You have to protect your channels.”– Ron Couri, Couristan|
Similarly, Couristan plans to work on differentiating its offerings between various retail channels this year as well. The company is creating a separate division, Couri Studio, which will be comprised of higher-end rugs, and will create a division of offerings for e-commerce customers as well.
“You have to protect your channels,” says Ron Couri, president and CEO. With 17 new collections of area rugs introduced at Atlanta and Las Vegas markets, and a plan to introduce 58 new collections of residential broadloom rugs at the upcoming Surfaces show, Couristan appears poised to open new retail doors in 2018 across many channels.
|“We’re doing more and more furniture and more dot-coms.” — Don Newton, Orian|
Don Newton, senior vice president of sales and marketing at Orian, said the company’s goals include expanding distribution to more furniture stores and more dot-com retailers, as well as growing the brand’s Canadian business — a top priority.
Orian’s strategy is to offer exclusives to each of the channels it serves. “We’re doing more furniture and more and more dot-coms, which are in constant conflict with one another. You have to have exclusive product for those channels. If you don’t do it, you’d better hire somebody to answer the phones because you’re going to hear from them [upset customers].
“We differentiate with colors, patterns, and sometimes weaves — a heavier weight or lighter weight version of a design, for instance,” says Newton. “It’s all about direct cross over in rugs. It could be the same quality or the same creel, but as long as it’s not the same exact pattern, you’re fine.”
|“We want to be the best in everything we do.” — Austin Craley, Loloi|
“Loloi’s goal for 2018 is to be the best in everything we do,” says Austin Craley, the company’s vice president of sales. “We want to provide the ultimate customer experience for our retailers. We want to give them the best value we can at every price point, from our entry level price points to our high-end hand-knotteds.
“We want to make sure that we have rugs that turn quickly for the customer and retail very quickly so that they are profitable with our rugs,” Craley explains, pointing to market hit machine-made collections Porcia and Patina that give retailers an edge in design exclusivity. “They offer higher-end mosaic looks associated with higher-end product, but we’re able to hit lower retails — it’s $369 MSRP. The response has been fantastic,” says Craley.
|“We plan to broaden our reach in licensed programs.” — Steve Roan, Rizzy Home|
Launching a hospitality division is a goal for Rizzy Home, according to Steve Roan, Managing Director of the Americas. It will include rugs, pillows, and bedding. The company also has plans to “broaden the product reach of our licensed programs,” Roan adds.
Rizzy’s popular Simply Southern line, which started with pillows, is expanding into rugs and top of bed, and its collection designed by industry veteran Connie Post will launch in April. The Donny Osmond collection will also expand into rugs, and Rizzy will build on its Andy & Kim Hilfiger line.
|“Retailers selling a multitude of products are driving traffic to their stores.” — Steven Peykar, Nourison|
Steven Peykar, co-owner of Nourison, is expecting a turnaround in the industry that will significantly improve sales. “It’s the first year our customers have firmly indicated they had sales growth in a previous year,” he says.
So at Nourison, the company plans to follow multiple design trends to ensure that all bases are covered, and to make sure to cater to furniture stores and other retailers that offer a variety of product categories. “The stores that are selling a multitude of products — they are the ones driving more traffic into their stores, and we feel they have a potential for growth,” he notes.
|“We are building e-commerce, which is growing like crazy.” — Joe Barkley, Amer Rugs|
Expanding its focus in 2017 to include machine-made area rugs boosted business at Amer Rugs — and the company will continue to aggressively grow the depth and breadth of its product assortment in 2018, says Amer’s Joe Barkley, VP of sales and marketing. “Amer is going to further expand our entry into machine-mades and also try to produce even more unique tufted products in 2018 building on our January Atlanta launch and well into 2019.”
In fact the company has staffed up to help it meet its targets. “We are building e-commerce, which is growing like crazy, so much so that we now have two directors of e-commerce sales, with our newest hire focusing on key accounts.Amer is also paying more attention to the designer business, and just before Atlanta, we announced a new hire to work specifically with interior designers,” Barkley adds.
|“We’re moving from paper to a more app-based business.” — Ned Baker, Tamarian|
Technology is on the mind of the executive team at Tamarian. “Our goal is to move away from paper to do more app-based business,” says Ned Baker, key account manager.
“We are using a lot of new technologies for inventory and ordering. Among them is software that will allow salespeople to track a custom or handmade rug through the production system, right down to who is weaving the rug or where it is in transit.”
|“We will continue to expand our interior design base.” — Greg Jordt, Harounian Rugs International|
At Harounian Rugs International (HRI), Greg Jordt, executive vice president, sales and marketing, says the company has big plans in store for the year. On one hand, the company will continue to expand its interior design base by working with to-the-trade showrooms and higher-end rug stores.
Also this year, the company will finesse its private-label program of machine-made rugs. Geared towards department stores and big-box retailers, the focus will be on mid- to better-quality area rugs with sophisticated looks.