Upholstery sales buoy fabric suppliers' investments
January 2, 2017,
HIGH POINT — Fabric suppliers invested in their businesses in a big way in 2016, buoyed by upholstered furniture sales that continue to drive retail.
Valdese Weavers has invested more than $31 million in the company’s equipment, facilities and employees over the past four years.
“We are a private, family-owned firm,” said Sean Gibbons, CEO. “We almost went out of business in 2005-2006 because of Asian imports and particularly, the introduction and popularity of microfiber suedes from China. To survive, we invested in jacquard looms to make accent fabrics. … We hired signature designers like Glen Read, and we invested heavily in all the yarns necessary to make a broad offering of upholstery fabrics.”
The strategy paid off, Gibbons said, allowing STI to move up in price points and add new customers. The timing of the Revolution launch corresponded with consumer demand for performance fabrics, transforming “slow, steady growth after 2008 to exponential growth.”
In 2017, STI will continue its expansion with a $17 million investment that will add 150,000 square feet and 90 new positions. Gibbons said the project, to be completed next year, will include 36 additional weaving machines, additional yarn manufacturing equipment, a new finishing line and needle punch equipment to support it. The company is looking at property for continued expansion in 2018.
“Many domestic textile mills did not survive this time,” he noted. “My best guess is about $2 billion of upholstery fabric production moved to Asia with the closing of companies like Quaker and Mastercraft. This has created tremendous opportunity for us to expand as some production of upholstery shifts back to North America from Asia.”
BT, parent company of the Keystone Weaving, Se7en and Bentex divisions, added weaving looms in 2016 as well, increasing capacity by 20%, said Mike Durham, president. Home to 355 employees, the company also invested in its existing looms, increasing the speed and reliability of the production output.
In addition, Durham said that BT developed a new evaluation program that allows the company to grade its suppliers on their quality and delivery. The company also made system improvements on its MRP/ERP infrastructure and upgraded the management organization to support more effective operations within the 300,000-square-foot dye house.
Durham added that both the dyeing and weaving facilities are located in Burlington, N.C., enhancing BT’s speed-to-market capabilities from concept to finished product.
“We are vertical and own the largest yarn dye house in our industry; therefore, we can be on the forefront of new colors and control our deliveries and destiny,” Durham said. “During 2016, our on-time delivery for the year exceeded 95% for all our divisions and, in many weeks, was more than 98%.”
Investments in 2017 will include new looms, renovations throughout the manufacturing facilities, enhancements to the company’s dyeing process and an extension of the BT University training programs throughout the company.
“Researching and interpreting consumer and design trends remains at the forefront of our marketing and merchandising focus,” Durham said. “We spend a lot of time, effort and financial resources on this endeavor and consider this research very proprietary towards our mission of creating highly decorative fabrics.”
Culp Upholstery Fabrics is another company that has made strategic investments in technology, state-of-the-art finishing and innovation, according to Teresa Huffman, vice president.
Huffman notes that the company has invested heavily in design and development as “key drivers of our industry,” following the “forward-thinking approach” and vision of founders Robert G. (Bob) Culp and Robert G. (Rob) Culp III.
“The upholstery fabric segment of the business has focused on three critical areas: design and innovation, providing a diverse range of products and expanding our customer base to both new markets and broader global markets,” Huffman said. “Culp has maintained the financial strength to support growth strategies.”
Another company investing in facilities, Glen Raven broke ground on new headquarters for Sunbrella in 2016, renovating the company’s first manufacturing facility to now house sales, marketing, design and customer service.
Glen Raven also expanded its capacity and manufacturing capabilities in the U.S., France and China and currently has 2,000 employees globally, 1,350 of which are in the U.S. in the custom fabrics division that manufactures Sunbrella and Dickson fabrics worldwide.
“In 2017, we will initiate a plan that significantly increases weaving, spinning and finishing capacities over the next two years in our U.S. facilities,” said David Swers, president of the custom fabrics division. “As we continue to grow Sunbrella fabrics, we will also increase personnel in our sales, design and marketing operations areas.”
At Valdese Weavers, 2016 investments included facilities and people, according to company president Mike Shelton. The company purchased the building it had been leasing for the Circa 1801 division in 2016, allowing it to move the yarn manufacturing facility it purchased in the Dicey Fabrics acquisition from Shelby to Connelly Springs, N.C.
Additional expenditures included new equipment and improvements to existing equipment that allow Valdese to increase production efficiencies and capabilities, completing an optimization initiative that culminated in a $31 million investment over the past four years.
“We have a long and rich history as a domestic manufacturer with a very short supply chain, and we also have a great response rate to the industry with product and fulfillment,” Shelton said. “Now we have new products for customization that allow us to maintain consistent performance and quality as well as our reputation for service that we’ve had for a long time.”
Valdese Weavers’ collaboration with Crypton Home creates a performance category for the company that encompasses hundreds of fabrics. Shelton said that the Crypton Home line is “exploding” in the residential retail marketplace and fills a high consumer demand niche.
“The beauty of Crypton Home is that we have developed the capability to apply a performance story to almost the full spectrum of our product with a full range of color capabilities,” Shelton said. “It meets the core concept for performance and fashion statement, and we’re extending the reach of the product across all brands. We expect it to become a fundamental part of the home furnishings retail setting.”
In 2016, Crypton Home invested in inventory, additional finishing equipment and warehouse space to support growth and also expanded its retail outreach to increase brand recognition and communicate performance capabilities at the furniture retail level.
“Our investment in research continues to grow every year,” said Randy Rubin, Crypton co-founder. “Continued expansion of our talent pool in our scientific research group helps us continually improve the existing products and innovate new ones.”
Advantage Fabrics launched its performance line including Revive Eco and Revive Premium at Showtime. Revive Eco is produced using olefin, a synthetic textile that is resistant to sunlight, spills, fire and chemicals, according to Robert Gorman, vice president of merchandising for Advantage. Revive Premium is produced with C6 telomere, a chemical compound that meets new Environmental Protection Agency standards and created for long-term protection against water- and oil-based spills.
Gorman said that Advantage develops and sources product through Greatex Mills, a company in business since 1964 and with international partners in England, Germany, Italy, Eastern Europe, China and Canada. He noted that the Tupelo, Miss.-based Advantage Fabrics has offices and warehouses that service and supply textiles to a customer base that spans 46 countries.
“We definitely saw a huge void in the marketplace for our Revive product for our China-to-China customers,” said Gorman. “The other advantage was in offering both types of protection. … We have been sampling our Revive products to customers steadily since its introduction and have already started shipping production. We expect Revive to really rev up sales over the next several seasons, and we are continuing the development of several new and innovative types of products in this category.
“One of the biggest challenges to our business is that so many people are shopping for themselves,” Gorman said. “Many go overseas themselves and avoid suppliers and converters. … However, when you do not have the structure in place to guide you and monitor everything from testing to sampling to production, dyeing, finishing, logistics and quality control, it can be a daunting task.”
Culp’s LiveSmart performance line has been a very successful launch for the company, Huffman said. “We will continue to focus on performance fabrics that meet and exceed consumer lifestyle trends,” she said, “and we are committed to being the best supplier of innovative products with superior quality delivered in a timely manner.”
Originally introduced as the first performance awning fabric in 1961, Sunbrella transitioned over the decades into the marine topping market, the casual outdoor category and the automotive top market. Today, the company is continuing its focus on the indoor market, along with consumer education.
“There is a great deal of confusion in the marketplace on what is a performance fabric,” Swers said. “Our goal is to educate the industry and the consumer and let them know that they do not have to settle.
“The response to Sunbrella fabrics continues to grow at significant double digit numbers each year,” he added. “We add several hundred woven-to-order fabrics per year along with more than 400 patterns available through our distribution partner and sister company, Trivantage, all available in cut-yardage quantities.”
Glen Raven addressed the mix-and-match design aesthetic with the Sunbrella Shift collection. It also announced a new partnership with The Shade Store, the company’s first window treatment effort with a major retail presence.
“We have a mindset that embraces change,” Swers said. “Innovation is vital, knowing that we will have to adjust our sails depending on the market conditions while staying true to our core beliefs.”
STI introduced Revolution Plus at Showtime, a performance fabric that Gibbons describes as “multipurpose, stain resistant forever and looks and feels like cotton.” He called the response to Revolution Plus “phenomenal” and said the company will expand the line “dramatically” in 2017.
“The key challenge now is to expand production fast enough not to disappoint customers,” Gibbons said. “Because basically all of our equipment is built to order in Europe and constructing factories takes time, we have to plan things far in advance. We don’t want an empty building with no machinery, but we also can’t have machinery show up with no place to put it.”
Investing in people
STI’s introduction of Revolution stimulated an expansion of the employee roster along with the product line. Gibbons said that nearly 30 remain to be filled at the Kings Mountain location.
“Since launching Revolution in 2014, we’ve added 110 people,” said Sean Gibbons, CEO. “We currently employ 344 people and have 27 open positions that we are looking to fill. Most of these jobs are in manufacturing, but we also hired in accounting, design, sales, administration, social media and marketing, engineering, IT, customer service and human resources — virtually every area of our business.”
Crypton currently has 200 employees worldwide, and Crypton Home, the residential line, now “encompasses more than 60 furniture manufacturers,” Rubin noted. In 2017, the company plans to continue its growth initiatives by relying on some of the founding principles.
“To lead each market that we enter requires a diligence and attention to the needs of the designer and end user,” Rubin said. “More choices in colors, textures and styles are a priority. Time-starved consumers want everything fast, which is why our programs that are guaranteed in-stock do so well. Furniture manufacturers are happy with the velocity of our deliveries, so they can in turn provide fast delivery.”
BT has added employees in both the associate and management groups.
“BT hired additional weavers, loom technicians and floor support personnel,” Durham said. “Our weaving facility added trainers to our staff to supplement the knowledge of our new hires as well as to improve our proficiency of our new existing skilled workforce. Other support functions added include a new director of quality, a professional supply chain manager and new customer service personnel.”
At Valdese Weavers, the implementation of an employee stock ownership plan was at the top of the investment category last year. The company’s 977 employees now include a high percentage of workers from Dicey Fabrics that made the move along with the equipment after the 2015 acquisition.
“Our major investment in 2016 was in ourselves with our ESOP,” Shelton said. “This company’s legacy developed over a 100-year period, and all of the things we’ve done were undertaken with the perception that opportunities exist and that one of our biggest challenges is how we react.”
At Glen Raven, Swers said that the most important assets are “our people and customer base,” noting that the company encourages associates at all levels to bring forward ideas that will help the company and its customer base.
“We have to understand the social, technological, demographic and geopolitical trends that can or might have an effect on our markets,” Swers said. “Beyond our sales, design and business development staff, we have 12 people in our R&D department to constantly improve our products and develop new products for our customers’ needs.
“Technology has dramatically shaped our individual lives in ways that were unthinkable less than a generation ago,” continued Swers. “We are looking at smart fabric technology to see what is possible and meaningful to the consumer, manufacturing with the latest equipment and delivering in new ways. Technology is changing rapidly, and the ability to recognize and execute a strategy to take to market is critical.”
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