Sullivan Back in the Saddle Again at American Silk
November 19, 2009
GREENWICH, Connecticut - American Silk Mills expects to survive doing less business than before but still expects to grow 10 to 12 percent over the next five years, according to John Sullivan, the 'new' CEO.
Sullivan is the seventh generation family owner of American Silk founded in 1896. He sold the mill to his employees in 2006 in an ESOP. At that point, he became chairman and a consultant operating at arm's length for several years but now has come back to run it on a day to day basis as CEO and active Chairman. Robin Slough continues as president.
Interviewed at his Greenwich, Conn. farm, Sullivan said he spends his time commuting between the mill in Plains, PA and the new office in Philadelphia at 2300 Chestnut Street, an hour closer to the mill than the original New York office. That office was closed in a money-saving move and only a small showroom remains in New York at 41 Madison Avenue. Slough lives in Philadelphia. Design operates in the Philly office under the direction of Cynthia Clark Douthit based in High Point, N.C.
Sullivan plans to invest more personal money into the business because he sees a future in it.
Sullivan is the grandson of Paolino Gerli, the owner of Gerli & Co. which owned American Silk since 1948 before it was sold to the employees in 2006. In addition to American Silk, Gerli & Co. also owned Cheney Bros., at one time, the oldest mill in America,l founded in 1838. Cheney made silk parachute cloth during WWII, velvet as well as decorative fabrics. Gerli was a well-known silk trader in his day, a heritage which Sullivan does not take lightly.
The silk tradition is very much in 'Sully's' blood but American Silk now buys half of its total line from other suppliers, including Sensuede® from Asahi in Japan, a 30 year relationship that now brings 100 percent recycled polyester product to market. Jobbers like Designtex and Robert Allen buy Sensuede from American Silk. The Cheney line known as ''Brussels Velvet'' is now made for American Silk by one of its domestic competitors. There is also an embryonic deal with a northern Chinese mill in the breeze, Sullivan said. Sullivan doesn't make deals lightly unless he thinks the prospective partner will keep their word on the exclusivity of product he demands as a distributor.
Sullivan sees a future for the American Silk business as a specialized, European-style mill. Although business is flat to slightly ahead, it has stabilized in the last few months and 2007/2008 was a record year; but after that, business slowed for the mill and its jobber customers, he said.
"We've cut every bit of fat we could find in the business to make us right sized for today,'' said Sullivan. ''We know who we are. We're a jacquard mill and we split that business with our converting business 50/50. This industry has changed. There used to be specialists—dyers, warpers, weavers and now the biggest U.S. mills are all vertical. The survivors in this business in Belgium, Italy, Japan and France are specialized operations building off of their core competence and customer base. We could cut our volume 25 percent and still survive. Big mills can't do that."
American Silk produces high sley, fine denier goods in high pic ranges over 80 pics and as high as 120 pics per inch. "This allows our designers to work in high definition from fine drawings supplied by our customers or developed from our own archives," he said.
Sullivan and Slough said the hottest portion of the line is drapery fabric today, especially contract and hospitality drapery sold only through the jobber.
American Silk has a special knack for weaving silk warps with silk and linen filling and up the roll stripes for silk and linen is one of its hallmark products as well as poly warps with cotton filling yarn and imported all-silk fabrics for $20. The line sells for $15 to $40. "What we can make in China for $28 would cost us $40 to make it in the States." American Silk also does a China-to-China business.
Sullivan is the seventh generation family owner of American Silk founded in 1896. He sold the mill to his employees in 2006 in an ESOP. At that point, he became chairman and a consultant operating at arm's length for several years but now has come back to run it on a day to day basis as CEO and active Chairman. Robin Slough continues as president.
Interviewed at his Greenwich, Conn. farm, Sullivan said he spends his time commuting between the mill in Plains, PA and the new office in Philadelphia at 2300 Chestnut Street, an hour closer to the mill than the original New York office. That office was closed in a money-saving move and only a small showroom remains in New York at 41 Madison Avenue. Slough lives in Philadelphia. Design operates in the Philly office under the direction of Cynthia Clark Douthit based in High Point, N.C.
Sullivan plans to invest more personal money into the business because he sees a future in it.
Sullivan is the grandson of Paolino Gerli, the owner of Gerli & Co. which owned American Silk since 1948 before it was sold to the employees in 2006. In addition to American Silk, Gerli & Co. also owned Cheney Bros., at one time, the oldest mill in America,l founded in 1838. Cheney made silk parachute cloth during WWII, velvet as well as decorative fabrics. Gerli was a well-known silk trader in his day, a heritage which Sullivan does not take lightly.
The silk tradition is very much in 'Sully's' blood but American Silk now buys half of its total line from other suppliers, including Sensuede® from Asahi in Japan, a 30 year relationship that now brings 100 percent recycled polyester product to market. Jobbers like Designtex and Robert Allen buy Sensuede from American Silk. The Cheney line known as ''Brussels Velvet'' is now made for American Silk by one of its domestic competitors. There is also an embryonic deal with a northern Chinese mill in the breeze, Sullivan said. Sullivan doesn't make deals lightly unless he thinks the prospective partner will keep their word on the exclusivity of product he demands as a distributor.
Sullivan sees a future for the American Silk business as a specialized, European-style mill. Although business is flat to slightly ahead, it has stabilized in the last few months and 2007/2008 was a record year; but after that, business slowed for the mill and its jobber customers, he said.
"We've cut every bit of fat we could find in the business to make us right sized for today,'' said Sullivan. ''We know who we are. We're a jacquard mill and we split that business with our converting business 50/50. This industry has changed. There used to be specialists—dyers, warpers, weavers and now the biggest U.S. mills are all vertical. The survivors in this business in Belgium, Italy, Japan and France are specialized operations building off of their core competence and customer base. We could cut our volume 25 percent and still survive. Big mills can't do that."
American Silk produces high sley, fine denier goods in high pic ranges over 80 pics and as high as 120 pics per inch. "This allows our designers to work in high definition from fine drawings supplied by our customers or developed from our own archives," he said.
Sullivan and Slough said the hottest portion of the line is drapery fabric today, especially contract and hospitality drapery sold only through the jobber.
American Silk has a special knack for weaving silk warps with silk and linen filling and up the roll stripes for silk and linen is one of its hallmark products as well as poly warps with cotton filling yarn and imported all-silk fabrics for $20. The line sells for $15 to $40. "What we can make in China for $28 would cost us $40 to make it in the States." American Silk also does a China-to-China business.
