Vendors rate Atlanta rug market the best in years
By Lissa Wyman -- Furniture Today, January 22, 2006
Atlanta — Vendors called last week's International Rug Market here the best in years, and they expressed cautious optimism that 2006's first half would show healthy gains over last year's fairly lackluster results.
In 2005, the rug business unfolded in fits and starts, due mainly to jittery, war-weary consumers. For many vendors, the bottom line showed sales gains of about 3% to 5%. For several majors, however, expansion into new product categories or new channels of distribution resulted in gains of up to 40%.
Vendors said retailers came to market here with good open-to-buy and an eye for fresh-looking new rugs.
"We experienced modest growth last year, but business seems to be picking up now," said Reza Momeni, president of Momeni Inc. "We had our biggest new product introduction in history, adding new items at every price level. "
In addition to value-oriented tufted and machine-made products for first-time rug buyers, Momeni said the company had success here with better hand-knotted rugs.
"In the past five years, consumers have become educated. Now they love rugs and they want to trade up to better quality," said Momeni.
John Feizy, president of Feizy Rug, said he is optimistic about 2006. "We experienced good growth in 2005 and we expect this year to be even better as we increase our efforts to stay ahead of the design curve," he said.
2005 was a record-breaker and 2006 is also expected to be a major growth year for Couristan, which makes and imports rugs and broadloom carpeting.
"We have created a new division devoted to midpriced broadloom. Several of the collections include coordinated rugs and runners," said Couristan CEO Ron Couri. "We are best known for high-end residential and hospitality carpeting that retails for over $80 per yard. Now we are getting into the $18 to $40 price range."
Couristan also will shift manufacturing to China in 2006, said Couri. "We are moving 40 Axminster looms to China," he said. "It's a big transition and we expect out Chinese production to double over the next two years."
Meanwhile, Couristan is expanding its Georgia distribution center by 225,000 square feet. "We are approaching 2006 aggressively; we're very bullish," said Couri.
Safavieh also is expanding and diversifying its product line. "We continue to make inroads into the furniture business, but we are also expanding our presence in the rug business," said company principal Arash Yaraghi.
The company introduced its first licensed rug collections in partnership with Thomas
O'Brien here, and added innovative machine-made and hand-knotted products. "I defy any expert to tell the difference between authentic antiques and our new hand-knotted rugs," said Yaraghi.
Kas Rugs celebrated its 25th anniversary during the Atlanta market. President Rao Yarlagadda said, "We are increasing our commitment to Internet retailers and big boxes. Those channels didn't even exist when we started the business. Our biggest challenge is to keep adding a steady stream of products. You can't sit back; you'll be left behind."
The Domotex market in Hanover, Germany, traditionally has kicked off the winter round of rug markets, but American importers increasingly are skipping that event.
"The import business has changed drastically since the days when we shopped for new lines at Domotex," said Steve Mazarakas, president of Hellenic Rug Imports. "Now we go directly to the overseas manufacturers with our own copyrighted designs and they make the rugs to our specifications."
Mazarakas noted the Atlanta rug market really begins a week earlier with the opening of the Atlanta Gift & Home Furnishings Market. "We do a lot with the gift and home accents buyers," he said.
"We were absolutely slammed with appointments, beginning the day before the market opened," said Mark Ferullo, vice president of 828 International Trading, adding 828 is poised for growth after a year of restructuring. "We zeroed in on the best-selling lines," he said.
Like many other vendors, Ferullo said rug companies must adjust to the see-saw changes in the marketplace.
Kim Barta, brand manager for Shaw Living, described the January Atlanta show as the main event for the rug industry, adding, "We're expecting an excellent year. 2005 ended on a high note; we were well over our projections for the year."
Shaw added to its Kathy Ireland and Tommy Bahama collections here, and debuted a variety of lines that include indoor-outdoor qualities and soft-hand polypropylene yarn systems.
Satya Tiwari, president of Surya Rugs, said the company unveiled new constructions covering a broader range of price points. "Although we are best known for hand-tufted rugs from India, we introduced machine-made rugs from Egypt," Tiwari said. "Our customers have asked for it, and we want to be a full-service supplier."
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Vendors rate Atlanta rug market the best in years
Jan 26, 2006
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