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HIGH POINT — After 18 months of lackluster performance, the rug industry is recovering its shine.
To demonstrate their newly recovered confidence, vendors are coming here with both expanded product lines and larger showroom facilities. Inventories of tired old product have been whittled down, and bright new color palettes are coming into the pipelines.
Major licensing programs with furniture tie-ins are increasingly becoming the domain of large suppliers such as Shaw and Nourison.
Shaw is keeping its Martha Stewart rugs under wraps this spring, but there will be a big splash later in the year, promised Jeff Meadows, vice president of the Shaw Rugs division.
Later this spring, Shaw will be making presentations of the total Martha Stewart floor covering package to 1,500 retailers across the country. "After the preview, we will begin the product rollout," he said.
Handmade rugs at value-driven price points will be making big news. Many introductions are aimed at the $249 to $799 "sweet spot" in the retail price spectrum. Hand-tufted and Tibetan knot constructions are now the hottest items on the market.
Nourison will be introducing India House, a collection traditional and transitional hand-tufted wool rugs that will retail for $249 in 6 by 9 feet. "These rugs offer the consumer incredible values," said Alex Peykar, a principal of the large importing company. "Good taste shouldn't be only for the wealthy. People with smaller budgets should have access to the same looks that are normally only available at the high end."
In the past, most rug vendors concentrated on either the low, medium or high economic niche. Now they are covering the entire price spectrum. In addition to the $240 tufteds, for example, Nourison is introducing its ultra high-end Calvin Klein collections here.
Looking good
No matter what the price point, quality levels are going up, according to Ron Couri, chief executive officer of Couristan. "I just returned from a trip around the world looking for both handmade and machine-made rugs. The biggest challenge is trying to choose from hundreds of superb products," he said. "We are conscientiously trying to upgrade all our lines, yet the price points are becoming even more affordable."
After a period of moribund sales in 2001, the rug business is picking up.
"It's no secret that the rug business was soft last year," said Paul D'huyvetter, senior vice president and general manager of Oriental Weavers USA. "But now it's back on track, and retailers are ready for new colors and new looks. Vendors have gotten rid of their closeouts and seconds, and inventories are lower than they 've been in years."
"Business has been remarkably good in the first quarter," said John Graham, president of the Sphinx division of Oriental Weavers. "We are well ahead of last year. It looks like 2002 will be a year of exceptional growth."
As the price gap between handmade and machine-made rugs continues to narrow, vendors are increasingly carrying both.
Sphinx introduced its first collections of Oasis handmade rugs in January. "Initial bookings have been excellent, but our machine-made lines are also well ahead of last year. This confirms our belief that the two types of rugs can co-exist. The Oasis line gives our retailers more choice. It doesn't compete with existing lines," said Graham.
John Shepherd, chairman of 828 International Trading, agreed. The company began importing hand-tufted and hand-knotted Tibetan weave rugs in late 2001. "We've had extraordinary success with our first handmade products, but there are also many technological advances on the machine-made side," he said.
"We are beginning to show some machine-made products using soft-touch fibers and yarns. It's a major trend in the carpet industry, and we want to be the first with these looks in the machine-made rug business."
The color palette is also going through a major change, with clear colors replacing muted antique tones. Reds, greys, blacks and sunny naturals are moving in, while antique finishes are moving on.
"More than ever, we have to be aware of regional taste differences. This translates into offering more assortment," said Graham. "The brighter colors seem to be selling better in the sun belt areas, while antique tones remain important in the Northeast and Midwest."
The furniture connection
With a move to a new 5,500-square-foot showroom in Market Square, Shaw's High Point strategy is becoming even more strongly linked to furniture.
"Our Tommy Bahama and Kathy Ireland collections are oriented to the furniture and accessory market," said Shaw's Meadows. "The Martha Stewart rugs will also be very much a part of the furniture orientation. We think the Market Square environment is in keeping with the total home fashion approach."
While vendors are showing broader product lines, they are also zeroing in on distribution channels. "Our product presentation is completely different at each of the major markets," commented Steve Mazarakis, president of Hellenic Imports. "Home furnishings retailers have totally different needs compared to home textiles and floor covering stores."
In a furniture store, rugs are primarily accessory items, and they can often be an add-on or impulse sale, he pointed out. "It's not logical to show a $1,500 rug with a $700 sofa. So our focus is on rugs that not only coordinate with furniture styles, but which realistically tie in with furniture price points."
At United Weavers, general manager Samir Abuhadba said that business began to pick up significantly early this year. "March was a record, and I believe April will be even better," he said.
United Weavers has teamed up with Schweiger Furniture to develop several rugs that are coordinated with the furniture maker's upholstery fabrics, Abuhadba noted. "They will be sold exclusively through Schweiger's sales organization.
"This type of partnership is a new venture for us. Not only does it give us a new opportunity to place our product, it is helping us to better understand furniture design trends."
In the popular price points from $150 to $200, jazzy contemporary styles in bright brash colorations are also in abundance. Shaw, Oriental Weavers USA, United Weavers, General Industries and others are introducing affordable rugs that speak to young adult lifestyles.
"We call them adult Fun Rugs," said Itzak Shabtai, president of General Inds. "They're inexpensive, they're light-hearted. They offer a lot more design interest than an ordinary throw rug. They make you smile."
Even as major vendors increasingly offer goods at every price point, there is still room for the high-end niche vendor, observed Bob Kirby, president of Jaipur Rugs. Jaipur is adding to its dense hand-knotted collections retailing in the $2,000-plus range.
"The events of Sept. 11 certainly affected all price levels, even at the high end," said Kirby. "But in the last three months, it seems that the affluent consumer is getting back to business. She's out there shopping again."
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