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When a 3,000-year-old industry goes industrial

Lissa Wyman, Rug editor -- Furniture Today, January 19, 2003

They used to talk about the "Oriental rug mystique." But in less than 10 years, hand-made rugs have become middle-class impulse items. Instead of costing thousands of dollars in small Oriental rug shops, hand-made rugs can be tossed into the shopping cart along with socket wrenches and dish towels.

Most significantly, the rug industry has gone from a one-of-a-kind to a mass-production business.

Today, even traditional rug importers are getting on the mass-market bandwagon. A review of introductions at the just-concluded Atlanta rug market indicates that average retail price points for hand-made rugs are now under $800 for a 6 by 9. A decade ago, the average hand-made was over $2,000.

Like many other consumer products, rug prices have been pushed down by a variety of factors, including competition, advances in technology and the economies of scale associated with an increasingly mass-market category.

The big technological changes in hand-made rugs are the development of good quality hand-tufted products and the widespread use of the larger, faster Tibetan knotting technique. Coming up: more pattern variety for hand-loomed rugs, which will retail at less than $300 in a 6 by 9.

The rug business was a cottage industry for about 3,000 years. In 10 years, it's became industrialized. Yet surprisingly in the face of industrialization, rugs have retained their individual integrity.

With over 300 vendors in the field, there has been very little consolidation. It's a business of a handful of giants and many, many proud, family-owned businesses.

Because rug sales are based on pattern and color, every single vendor strives to differentiate its products from the others.

In fact, as the industry has matured, there are more rug designs available than ever before. A certain "look" or color palette may go in and out of vogue but, with very few exceptions, each company strives to interpret that look in a unique way.

Most of the action in the hand-made rug business is taking place in the midpriced range of hand-tufted, Tibetan-knot and hand-loomed constructions. Fine hand-knotted rugs, with their intricate patterns, have resisted modernization. They cannot be rushed.

As a result, I see the industry splitting in two. Aging baby boomers and Generation X-ers happily will shop for great-looking rugs at stores like Home Depot or Home Goods. Meanwhile, designers and devoted students of fine hand-made rugs will patronize the small, independent Oriental rug specialty shops where business really hasn't changed much in the past decade.

Those beautiful, value-driven, hand-tufted, Tibetan-knot and hand-loomed rugs will reach Everyman. The ornate, densely knotted hand-made rug will quietly return to cult status.

The mystique remains.

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