Joan reorganizes divisions
By Carole Sloan -- Furniture Today, August 11, 2003
Tyngsboro, Mass. — Leaading fabric suppler Joan Fabrics has reorganized its various divisions into sales, manufacturing and marketing and design functions.
In what Elkin McCallum, Joan chairman, called "a repotting of the business," the company also is consolidating its manufacturing facilities, closing some, and shifting production to its Mexican facility and its two-year old 600,000-square-foot facility in Fall River, Mass.
McCallum said the company is repositioning itself "as a marketing company, not a manufacturing company.... The time has come for us to present to our customers a unified approach to the commercial side of our business. and at the same time protect our design integrity through our multiple labeling effort."
This means, he said, products for all divisions except Circa 1801/Doblin will now be able to be produced at any company facility, including Mexico. Circa 1801/Doblin has its own, dedicated factory.
The design signatures of the divisions — Mastercraft, Home Fabrics, Circa 1801/Doblin, Joan Fabrics and Main Street Textiles — will remain distinct, he added.
"We need an organized response to sales and we need lots of designers. Design is the key," McCallum said. "We want to maintain our design integrity but we need flexibility and a commonality of supply. We have an opportunity to cover the waterfront with product.
"But we also need to maintain our price integrity and look between the divisions. There's a $3 difference between Mastercraft and Home and a $2 difference between Main Street and Mastercraft."
He said the company's Mexican production is greatly expandable and "it's working well." Under the new approach. the Andrew Major plant in Spindale, N.C., has been converted from a weaving plant to a yarn-dyeing facility.
In April, Joan announced a joint venture with Hong Kong-based The Cha Textile Group to produce cut-and-sewn fabric in China, with Joan designing and finishing the product. Initial efforts will focus on Home Fabrics with fabrics by the division's exclusive Wesley Mancini Designs. As the project develops, McCallum said it would include the production of the venture's own woven greige goods in China.
The Chinese joint venture won't be involved in a broad product mix to start, he said.
McCallum isn't sure the company needs to participate in Showtime in High Point. "We're analyzing whether it makes sense," he said. "In June, before Showtime, 80% of our customers spent a day shopping us in our new design center, and Circa is only five miles away.... We will keep a presence in High Point, but it may be a scaled-back presence."
The company has closed the Home Fabrics showroom and office in High Point and moved it to Market Square Tower with Joan and Main Street.
McCallum said the company also plans to test a cut order fabric program with a limited number of furniture suppliers, as a reaction to some jobbers who are going direct to furniture manufacturers.
"I will compete with jobbers when they are selling my customers direct," even if they are customers of one or more of Joan's divisions, he said. "We can put together programs from opening price points to $30. I'm trying to protect territory we already own."
As for export, he said, "We are protecting our business in NAFTA markets, but we have to look at things differently, especially concerning warehousing in Europe. The market there is falling apart." The company's participation in this year's Decosit in Brussels, Belgium, Sept. 6–9, is only a "maybe."
As part of the reorganization, Penny Richards, formerly president of Main Street, has been named president and chief operating officer of all supply chain management, information services and general operational functions.
Kerry McCallum, formerly president of the internal supply group, is now president of fabric operations. Richards and McCallum are members of the office of the chairman.
