U.S. Wholesalers Reap the Benefits of Flourishing Economy
September 5, 1999
Sipco News Network -- The U.S. is a boom economy. Interest rates are low and so is inflation. American wholesalers couldn't be happier. A great economy at home has allowed them to thrive.
"We're living in a phenomenal time. I can't imagine any distributor not enjoying very good sales," said Jay Cassen, president of Westgate Fabrics. Although he would not reveal the percentage, Cassen confirmed that sales have risen in 1999. Other executives concurred. Mark Rickers, chief executive of Stout Brothers Co. Inc. said his company increased by double digits and Curt Pindler of Pindler & Pindler stated that as of the first half of 1999, sales have increased by 15 percent. Harvey Nudelman, president of Fabricut located in Tulsa, Oklahoma, expects sales to increase beyond 20 percent in 1999.
"Business is incredible. I have been in business for 30 years and I have never seen conditions as good as they are now," said Harvey Nudelman, president of Fabricut located in Tulsa, Oklahoma. "If you're a wholesaler in North America and you're not doing well at this time, there's something wrong with your company."
The U.S. economy is not the only reason for increased business in the wholesale market. A combination of factors is thought to be the cause, including the increase in new housing starts. According to the U.S. Census Bureau, the number of privately owned housing starts in May was six percent above the April figure of 1,576,000 and nine percent above the May 1998 total. Not only are new housing starts on the rise, but improvements to existing homes are also on the rise. In 1998, an estimated $119.5 billion, according to data released by the U.S.
Commerce department's Bureau of the Census, was used for improvements and repairs, of which 67 percent was for improvements.
According to Cassen, housing starts and interest rates combined to create a dynamic economy that has afforded not only American wholesalers conditions for great business, but also the opportunity for American consumers to take advantage of it.
"More and more people are hiring interior decorators and baby boomers have more spendable income to use on their homes," said Rickers. According to the U.S. Census Bureau, the median household income was $37,005 in 1997, up from $34,303 a few years back. If there are more houses and more improvements, then there is more fabric needed to decorate and vice versa, stated Arnold Chasen, principal of Dorell Fabrics in Los Angeles.
What may be the most important factor is the fact that the U.S. economy is booming, while abroad things have stalled. For some the international textile scene has been on a downturn. At Intohome, many UK businesses worried about domestic business were focusing more on exports. And at the May edition of Surtex in New York, visitors confirmed that the U.S. was their largest market at this time. Ã’I think many European sellers of fabric, either because of moderate growth in their own markets or due to expansion, have become more aggressive in selling to the U.S. market," said Cassen. Rickers agreed, saying that many have taken on agents in the U.S. and have begun forming good reputations with vendors. Rickers feels that essentially the reason is because the U.S. economy is doing better than that of Europe. "The economy in general- the American economy- is doing well, while foreign business is off, and as a result the converters are keying in on their American customers," he said.
In April of this year, exports increased from $77.1 billion to $78 billion, while imports, increased $96 billion to $97 billion, according to the U.S. Census Bureau.
"Fabricut has been an active importer since we started business 50 years ago. Imported fabrics have gotten an increase in the share of our open to buy because our product lines have expanded greatly in the past five years. As our offering and skus have grown so rapidly, a lot of that growth has been through imported fabric," said Nudelman.
Although the number of lines from foreign sources is increasing, they still do not surpass those of the U.S. and this fact has hungry overseas suppliers offering top quality and exclusivity to U.S. wholesalers. For Westgate this means deals that involve exclusivity with companies such as Yeomans and Warwick in the UK. The company's oversea suppliers are from the UK, Spain and Germany. Italy is a major source for fabric because of the attractiveness of wovens and the fact that the goods add variety to the company's lines, said Cassen.
From May 1998 to May 1999 sales of furniture and home furnishings in the U.S. increased by 3 percent. Good business has allowed companies like Stout Brothers to open new showrooms and has given them the ability and resources to focus on customer service, new products and innovation and increase imports, according to CEO Rickers. But not all those in the textile industry agree.
"Although the economy has been bright for some time now, home furnishings sales have not been keeping pace with the other national industries. This is only my opinion though," said Pindler. "Pindler & Pindler has enjoyed constant growth for two reasons. The product mix is superior, focusing on the exclusive upholstery product in our line, as well as never losing sight of providing excellent customer service."
"We're enjoying a wonderful year as we continue to focus on delivering great product, great service for our customer base," said Ron Kass, president of the Robert Allen Group. "Business is very good." F&FI
"We're living in a phenomenal time. I can't imagine any distributor not enjoying very good sales," said Jay Cassen, president of Westgate Fabrics. Although he would not reveal the percentage, Cassen confirmed that sales have risen in 1999. Other executives concurred. Mark Rickers, chief executive of Stout Brothers Co. Inc. said his company increased by double digits and Curt Pindler of Pindler & Pindler stated that as of the first half of 1999, sales have increased by 15 percent. Harvey Nudelman, president of Fabricut located in Tulsa, Oklahoma, expects sales to increase beyond 20 percent in 1999.
"Business is incredible. I have been in business for 30 years and I have never seen conditions as good as they are now," said Harvey Nudelman, president of Fabricut located in Tulsa, Oklahoma. "If you're a wholesaler in North America and you're not doing well at this time, there's something wrong with your company."
The U.S. economy is not the only reason for increased business in the wholesale market. A combination of factors is thought to be the cause, including the increase in new housing starts. According to the U.S. Census Bureau, the number of privately owned housing starts in May was six percent above the April figure of 1,576,000 and nine percent above the May 1998 total. Not only are new housing starts on the rise, but improvements to existing homes are also on the rise. In 1998, an estimated $119.5 billion, according to data released by the U.S.
Commerce department's Bureau of the Census, was used for improvements and repairs, of which 67 percent was for improvements.
According to Cassen, housing starts and interest rates combined to create a dynamic economy that has afforded not only American wholesalers conditions for great business, but also the opportunity for American consumers to take advantage of it.
"More and more people are hiring interior decorators and baby boomers have more spendable income to use on their homes," said Rickers. According to the U.S. Census Bureau, the median household income was $37,005 in 1997, up from $34,303 a few years back. If there are more houses and more improvements, then there is more fabric needed to decorate and vice versa, stated Arnold Chasen, principal of Dorell Fabrics in Los Angeles.
What may be the most important factor is the fact that the U.S. economy is booming, while abroad things have stalled. For some the international textile scene has been on a downturn. At Intohome, many UK businesses worried about domestic business were focusing more on exports. And at the May edition of Surtex in New York, visitors confirmed that the U.S. was their largest market at this time. Ã’I think many European sellers of fabric, either because of moderate growth in their own markets or due to expansion, have become more aggressive in selling to the U.S. market," said Cassen. Rickers agreed, saying that many have taken on agents in the U.S. and have begun forming good reputations with vendors. Rickers feels that essentially the reason is because the U.S. economy is doing better than that of Europe. "The economy in general- the American economy- is doing well, while foreign business is off, and as a result the converters are keying in on their American customers," he said.
In April of this year, exports increased from $77.1 billion to $78 billion, while imports, increased $96 billion to $97 billion, according to the U.S. Census Bureau.
"Fabricut has been an active importer since we started business 50 years ago. Imported fabrics have gotten an increase in the share of our open to buy because our product lines have expanded greatly in the past five years. As our offering and skus have grown so rapidly, a lot of that growth has been through imported fabric," said Nudelman.
Although the number of lines from foreign sources is increasing, they still do not surpass those of the U.S. and this fact has hungry overseas suppliers offering top quality and exclusivity to U.S. wholesalers. For Westgate this means deals that involve exclusivity with companies such as Yeomans and Warwick in the UK. The company's oversea suppliers are from the UK, Spain and Germany. Italy is a major source for fabric because of the attractiveness of wovens and the fact that the goods add variety to the company's lines, said Cassen.
From May 1998 to May 1999 sales of furniture and home furnishings in the U.S. increased by 3 percent. Good business has allowed companies like Stout Brothers to open new showrooms and has given them the ability and resources to focus on customer service, new products and innovation and increase imports, according to CEO Rickers. But not all those in the textile industry agree.
"Although the economy has been bright for some time now, home furnishings sales have not been keeping pace with the other national industries. This is only my opinion though," said Pindler. "Pindler & Pindler has enjoyed constant growth for two reasons. The product mix is superior, focusing on the exclusive upholstery product in our line, as well as never losing sight of providing excellent customer service."
"We're enjoying a wonderful year as we continue to focus on delivering great product, great service for our customer base," said Ron Kass, president of the Robert Allen Group. "Business is very good." F&FI
