Real optimism in bloom during New York market
Lissa Wyman -- Furniture Today, November 25, 2010
Lissa Wyman Rug editor
New York's Market Week earlier this month created a broad sales environment for rugs at every price point. We saw one new rug (made in Afghanistan) with a retail price of $500,000. We also saw bath rugs that retail for $12 (made in the USA) and printed room-size rugs (made in Egypt) to retail at $49.
Market Week events catered to various retail channels - big-box home textiles retailers and major furniture chains, traditional Oriental rug specialty stores, architects, designers and specialty stores.
Retailers and vendors had a survivor mentality that manifested itself in a kind of giddy joy that ran counter to the realities of the recession. They were glad to still be alive and kicking.
I have always had a love-hate relationship with Market Week. It's exciting but it's a challenge to cover. I had to get into a car and travel to showrooms spread hither and yon in the wilds of New Jersey. At a party in the Meadowlands of Secaucus, I took pictures of Oriental rug retailers with unpronounceable (and unspellable) names having an uproariously happy time.
Back in Manhattan, I lingered a bit too long at 7 W NY, where I was seduced by the exotic provenances and price tags of the world's finest rugs. Then I had to hotfoot it to see importers in New York's Oriental Rug District. I also roamed the big home textiles showroom buildings along Fifth Avenue, where I was often politely shooed away as the secretive buyers from big-box stores conducted business behind tightly closed doors.
At week's end I was exhausted but exhilarated. I can see some real optimism building behind the fake optimism so many rug people have valiantly maintained over the past year. No one thinks the recession is over, but at least there is some traffic in the stores, and inventories are low enough to place orders.
The most sobering impression from New York is the rapid growth of rugs in the mass market channel. It's not just the so-called big-box and discount stores. The huge furniture store chains are beginning to grab market share in "value-oriented" merchandise.
When room-size rugs retail for $150 to $199, I wonder where the profit margins are. How can an ordinary independent store stay in business? They can't compete with the inexpensive rugs that consumers can buy at their local discount store. And very few retailers know how to sell the $50,000 Iranian contemporary rug or the $500,000 Afghani rug I saw.
What's going to happen? The rich will always be with us, so the high end will survive and even thrive. For the most part, however, big mass market chains will eventually take the lion's share of the rug business.
In the middle price points, the established, reputable independent specialty stores will be able to prosper by providing fair prices, good assortments of unique products, and service, service, service.
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