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Business

Rug Executives, Prepped for High Point, Are Bullish on Strong Q4, After Rug Sales Rebound

Area rug players surveyed by RugNews.com expect 2020 rug sales to continue to climb and end on a high note as they head to High Point Market.

Lisa Vincenti
10/13/2020
A brown toned medallion style rug in living room
Area rug manufacturers are offering plenty of newness for buyers heading to fall High Point Market. Shown, Kaleen Soumela-10

SPECIAL REPORT -- While winter and spring grinded much of the area rug industry to an unexpected halt, consumers, as a result of the nationwide shutdowns, hunkered down at home and began a pandemic version of cocooning. The result has been a renewed interest in renovating, upgrading and re-inventing their spaces and area rugs makers have been key recipients of those endeavors as consumers turn to the category to finish or refresh their interiors.

So despite many in-persons market cancellations in the first half of the year, and summer attendance down dramatically, area rug executives report a rebounding third quarter and expect a solid Q4 as e-commerce accounts, more traditional retailers and designers as well -- hungry for new and fresh product -- stock up.

RugNews.com in this special report, surveys a broad swath of area rug executives who share their expectations for High Point, their latest debuts and what categories are driving business in 2020.

AMER RUGS
Virtual only



Amer Rugs' latest hand-made rug are in-demand with buyers. Shown, hand-knot Legacy in brick red

Amer Rugs, which will not open its High Point showroom during market, kicking off on Oct. 13, still anticipates a strong finish to the year. The rug manufacturer is currently producing a series of videos and conducting showroom walk-throughs by appointment via Zoom instead.

"We expected low attendance at High Point market, hence our decision not to open our showroom," Anupriya Choudhary, Amer director, told RugNews.com.

"Designer business and production at the high-end (hand-made goods) has continued with limited interruption, and slightly longer lead times. Our retailers -- some of our larger accounts -- have empty shelves and racks and are desperate for goods, and we are well positioned to serve them. In stock position is critical and our vertically integrated operations have helped us maintain a good stock position with minimal impact on our handmade product lines."

Among the most in-demand products Amer buyers and clients have been seeking are its hand-knotted and hand-loomed rugs, especially in larger sizes. The company rolled out a range of constructions for 2020 featuring trending palettes and styles.


"For the fourth quarter, our e-commerce and private label businesses will increase significantly over last year. While our retail and designer segment is expected to increase modestly. We exited some high-volume, low-margin businesses, which will impact top-line revenues compared to Q4 2019," she said.


Blue color combinations and handmade constructions are trending at Amer. Shown, hand-tufted Abstract-5

FEIZY RUGS
Market Square, 1-143


Feizy Rugs' business is booming and it introduces High Point shoppers to its newest hand-knotted designs. Shown, Karina 909-6793F

Feizy Rugs will opens its showroom doors at High Point Market, and is complementing that with digital content for buyers not attending in-person markets.

"Product videos are much more beneficial than showroom tours because of the unique challenges found in remote rug shopping. Clients need to see the pile and get a sense of the rug virtually to feel comfortable investing in it from afar," Justin Yeck, VP of omni-channel sales, marketing, product development, explained. "We are expecting a bullish High Point Market -- 80 percent of our clients have not seen new product now in over a year. Their showrooms and offerings are tired and they are looking to refresh. We do know that traffic will be down but like Las Vegas Market the people who intend to come will be motivated buyers. The rug category continues to be a volume driver especially for retailers who cannot get other goods. It’s a great way to refresh the look of their store while they wait for new case goods and upholstery.

"People need product that is in stock. Luckily, because we own our own factory in Turkey and have a long history of working with our vendors in India, we are in an outstanding stock position. We consistently buck industry trends in inventory levels and this shows in our client base that is hungry to get their hands on new items."

For High Point Market, Feizy is showing 33 rug collection, including more than 150-plus new designs. "This includes our hottest new collections Aura and Azure, which feature our industry leading use of metallicized polypropylene.

"Our new machine-made collections continue to exceed expectations while our long history of designer partnership has driven our fine and custom programs," Yeck said.


"We’ve had an amazing year and we expect Q4 to be the cherry on the cake," he continued. "Our sales in all of our channels continue to grow. Due to our strong inventory position, we continue to gain market share and we have launched innovative new programs like our 5X8 reverse roll program that has been a HUGE hit with our retail partners."


Feizy debuts the hand-knot, geometric designs of Palomar, PAL-6591F shown, at High Point Market.

HAROUNIAN RUGS INTERNATIONAL
Market Square Tower, 100A



With performance rugs driving sales, HRI continues to add to its Sunbrella program, introducing the more accessibly priced Sunbrella 1000. Shown, S10-17B

Also open for business during High Point Market, Harounian Rugs International (HRI) will only be displaying its newest introductions at one of its two showrooms there: Market Square Tower, 100A. Like other rug manufacturers, the company will supplement its in-person meetings with a virtual component for non-attending buyers.

"We expect that this market will be similar to the Las Vegas Market that was down 80 percent," Greg Jordt, HRI EVP sales and marketing, said. "It appears that those attending will be mostly from a drivable radius.

"Our inventory is positioned very well to take care of the projected needs of our designers. While the retailer has to replenish and refresh floor stock and inventory -- they need help and we are very aggressive in offering just that with a menu of financial incentives," he said.

While the New York-based company will introduce High Point shoppers to five hand-knotted collections, it expects its debuting Sunbrella 1000 collection to be the market highlight. These machine-made rugs from Turkey expand the Sunbrella program, launched last fall at High Point Market, adding a popular price point to the series crafted of Sunbrella fiber yarns.

"Performance rugs that are in contemporary and transitional looks continue to drive our sales," Jordt continued. "The demand for performance fabrics has also become a very important factor in area rugs and we are uniquely positioned with our new launches of Sunbrella rugs collections at every market.

"We have no reason to expect that the fourth quarter will be anything less than a continuation of the strong sales trend we have experience throughout the entire year."



In addition to rolling out five hand-knotted collections, HRI continues to showcase its latest rugs made of easy-care Sunbrella yarn. Shown, S7-03

KALEEN RUGS
Showplace, 2345



Kaleen's outdoor and indoor machine-made rugs have doubled sales during 2020 and the company adds new collections, such as Soumela, in those constructions. Shown, SOU-06

"Our summer performance overall was pretty good, given all of the hurdles that everyone has been facing," Monty Rathi, COO, Kaleen, told RugNews.com. "Summer is typically great for us due to the outdoor rug season, but this summer we had record-breaking unit sales. Our outdoor and machine-made indoor rugs more than doubled in sales so far this year because they are lightweight and perfect for e-commerce."

As Kaleen heads to High Point, it continues to add to its performance indoor-outdoor area rugs and indoor machine-mades, introducing several new collections and growing some of its most popular lines. In addition, the company is also offering several hand-crafted collections for buyers seeking step-up area rugs.

"The entire industry has been experiencing the same thing -- brick and mortar business is down as stores and shops were closed," Rathi continued. "But, we are already seeing a rise in sales and expect to see this business come back very strong in the fourth quarter."



Kaleen rolls out the plush and super soft Estoria collection of fringed designs. Shown, EST-05

LR RESOURCES
Showplace, 3435



LR Resources sees mid- to upper-middle price points drive sales, and debuts the hand-loomed Calypso collection (81693, shown).

LR Resources relocates and debuts a new showroom at High Point Market, located at Showplace 3435.

"We will be live at High Point and plan to shoot video while there to send out to customers who can’t attend," Mike Thompson, LR Resources VP sales direct division/GM. "Since there was no spring High Point Market, we hope that folks will come and see everybody’s newest products live! Most retailers are busy and will greatly benefit by attending for a day or two.

"Special orders are way up, and those who inventory benefit by stocking some proven winners. We have at least three new collections and additions to existing collections for both October and expect even more for January," he explained, adding that the company's pillow and accessory lines are growing to a much larger share of the company's business.

On the rug side, mid- to upper-middle price points in machine-made and hand-made constructions are driving business for LR Resources. "$299 to $499 in 5x8 retail are hot! Our benches, poufs, pillows, and accessory furniture items are moving well too." Among the company's best-performing area rug collections is Michelle, a cotton weft, polyester machine-made collection, with a retail price of $299 in 5x8. In addition the latest Naturals collection designs ($349, 5x8 retail) have also been a success.

"Business has been good, but it’s because we’ve been seeing customers face to face -- if late summer is any indication, we should have a great Q4! People are spending more on their homes right now," Thompson said.



LR Resources' perennial favorite Naturals collection adds new looks for fall. Shown, 03388

MOMENI RUGS
IHFC, H345


 
Momeni introduces its new Momeni Basics range of higher-quality foundational pieces. Shown, the hand-loomed Beckton 1

While Momeni's High Point showroom will be open for business during market, the company continues to produce digital options for rug shoppers. Among the several key debuts for market is the new Momeni Basics series of higher-quality foundational area rugs.

"There is a huge demand right now from every vertical we sell through -- all categories are performing well ... There isn’t a single one that hasn’t had incredible sales," Reza Momeni said. "Consumers have begun to place higher value on the items they bring into their home. This movement was underway well before COVID and the quarantine, but those two compounded the drive."

While Momeni expects light showroom traffic, it anticipates "great orders and selling. Pre-market attendance showed that the demand is there. Retailers, and consumers, want fresh product," he explained.

"We anticipate a better than usual Q4, and the NRF recently announced that they also expect a strong holiday season."



Momeni sees demand across all categories and rolls out new collections in a range of constructions. Shown, hand-woven Bristol-05

NOURISON
IHFC, IH101



Nourison expects healthy sales growth, focuses on higher-end roll outs including the new Tibetan rug-inspired, hand-knotted Plateau collection.

Nourison opens it High Point doors during market and is also hosting a special virtual market on Oct. 22 to showcases its newest designs (read more).

"We are expecting about 20 percent of regular market attendance due to travel restrictions and health concerns," Giovanni Marra, director of marketing and digital strategies, said. "However, retailers and designers are looking for inventory that is available now and ready to ship.

"Our product introductions are centered around high-end collections, such as new designs added to our best-selling Prismatic collection and the new hand-knotted Plateau collection. Our clients are looking for designs in neutral palettes, and in terms of color, blue has been in demand and performing well.

"So even though we expect less attendance than normal at market, we expect successful meetings with our customers, and continued growth with best sellers and interest in new introductions," Marra said. "We expect a healthy increase in sales, as our clients’ customers continue to focus on improvements in their home."



Nourison showcases its successful cut-pile power-loomed Rustic Textures assortment. Shown, RUS-12

ORIENTAL WEAVERS
Virtual only



Oriental Weavers records best Q3 in history, rolls out latest designs virtually for fall shoppers. Shown, new power-loomed Caravan collection

Oriental Weavers, while not opening its showroom during High Point Market, has introduced a series of videos and flipbooks showcasing its six newest collections, which includes a follow-up collection of its successful Andorra range.

"While March and April were obviously difficult due to the pandemic; some channels such as online, home centers and mass blew all forecasting reports away," Jonathan Witt, president, told RugNews.com. "Between online business and working with retailers that remained open throughout those early months, we were only down 7 percent from the prior year.

"Our outdoor rugs continue to drive sales – while they performed really well last year, this year has been unbelievable with sales 2.5 times higher the usual rate. People are spending time outside, redoing porches and patios and many outdoor rugs feature opening price points, so it’s not a big investment," Witt explained.

"As customers began to open back up and catch up on inventory needs, Q3 actually ended up being our best overall quarter in company history. While customers have ramped up business with inventory in place, indications are that our fourth quarter will be solid."



Outdoor business is booming at OW, which introduces the new Torrey collection of indoor-outdoor designs. Shown, 5561h

S&H RUGS
Virtual only



S&H Rugs recasts classic Oushak motifs in contemporary palettes, as in this all wool design, SH55276, made in Afghanistan.

Hand-knot rug manufacturer S&H Rugs has seen its business pick up since the spring, however due to ongoing safety concerns of the coronavirus, decided it will not participate in-person at fall High Point Market. Despite not attending various markets, the New Jersey-based showroom has experienced a continuous rise in sales.

"Our hand-knotted rugs and natural fibers rugs are more in demand and sales have been constantly on the rise since the nation shut down back in April and May," Ori Wilbush, president told RugNews.com. "While the situation seemed very grim and that only our colleagues in the machine-made rug category and lower-end price points selling online were doing fantastic, when the shops reopened last June, sales have taken off.

"After so much time spent mainly at home it became a much more important place than before and many households looked to new and fresh decor."

Among the top-selling styles at S&H are monochromatic tonal designs, rugs featuring trending pink colorways and updated classic area rug motifs (read full story).



S&H Rugs' chevron design is hand-knotted of textured wool and pure silk. Shown, SH59363

SURYA RUGS
Showplace, 4100


Surya debuts 75 new area rug collections, and expands its space-dyed yarn, machine-woven Avant-Garde with fresh colorations.

Surya's Showplace doors are open for business during High Point Market and the company will showcase 600 new area rug designs for buyers attending in-person, but it is also planning one-on-one Zoom meetings with those who are not at market.

"Every quarter of 2020 has outperformed last year," Satya Tiwari, told RugNews.com. "This is our first High Point in a year, and High Point has always been our main market, and for this market, I have a good feeling." Satya Tiwari, president, told RugNews.com.

While he cautions that many of the larger corporate accounts are not attending, Surya has appointments with semi-national regional buyers and mom and pop stores. "We are getting a high level of regional players -- they need the market. Our big accounts, will do more Zoom meetings and showroom tours.


"Retailers want to be stocked for Q4 and fit as much product as they can into their stores," Tiwari said, who noted that Surya will be following all safety guidelines and as such will not serving meals to market attendees. "It will be a decent market but I don't expect markets to ever be 'normal' again. People have been complaining about markets for years and with COVID, market trends have accelerated. This will be the first real digital market we have had as an industry."

Surya has experienced growth across all area rug categories from hand-knotted to machine-mades. "Our business is getting more segregated: most e-commerce business is moving toward disposable value rugs, and our high-end hand-knotted business has also grown significantly.

"For High Point, we are introducing two or three hand-knotted collections, two hand-tufted collections and machine-mades. We are trying to bring good, better and best within the high-end, machine-made and hand-loomed categories. In addition, we are launching our one of a kinds in a big way at this market. There is plenty of newness and every one responds to newness."


Surya rugs debuts the hand-knotted traditional motifs of the Reign collection (shown, 2309), which features updated scale and framed with delicate fringe.
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