Rugnews.com Editorial
SHAW'S EXIT FROM RUG BUSINESS
TAKES RUG WORLD BY SURPRISE
By Lissa Wyman
The announcement Jan.6 that Shaw Industries is closing its Shaw Living operation was seismic. No matter how optimistic retailers were who attended the January 8 to 11 Atlanta Market, the fact that our industry will soon lose one of its most important made-in-America vendors saddened everyone. Read the original story, click here)
Even the top executives at Shaw Living had only a few days notice before the announcement was made.. Much too short a time to digest such stunning news.
The announcement was brief and uncompromising: The Ringgold, Ga. rug manufacturing facility, which makes both room size rugs and scatter and bath rugs, is to be converted into a plant for the manufacture of luxury vinyl tile.
The company's showrooms will remain open during the current market cycle in order to sell off inventory and yarn. It's a great opportunity for customers to get a good buy on Shaw quality rugs.
After all, they aren't going out of business because of shoddy workmanship or lack of service. Shaw has always been known for its high quality and a mutually respected relationship with its customers.
So what happened? Vance Bell, chairman and ceo of Shaw Industries explained that corporate economics led to the decision. "The economics of the rug business today simply do not allow for future growth or encourage further investment," he said. Shaw Living rugs accounted for only 2% if the company's total consolidated revenue.
What happens next will be very interesting for our industry, The Shaw move could have a long-term effect on the rug business in several ways.
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People. Although Shaw said that the vast majority of the 400 associates employed by Shaw Living will have opportunities elsewhere in the corporate structure, you can bet your booties there will be a lot of musical chairs, particularly in the sales department.
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Equipment. Shaw Living has beautiful, modern rug making machinery In a world that already has too much rug production, it will be interesting to see how this will play out. Will this group of machinery form the base of a new American company? Will it be sold off piece-meal? Will it be shipped to another country? All sorts of things could happen that would ultimately affect the U.S. rug business.
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Inventory. Shaw Living is selling off its stock and yarn at deeply discounted prices. This could be a dream come true for a lot of retailers. And a nightmare for other vendors.
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Showrooms. Shaw currently has active leases on its showrooms in Atlanta, New York, Las Vegas and High Point. With a 12,000 sq. ft. showroom opened in January, 2007, Shaw is one of the anchor tenants on AmericasMart's Sixth floor and also has a 7,000 sq. ft. Third Floor showroom at New York's 295 Fifth Ave.
I have followed Shaw's adventures in the carpet and rug business since 1970. The company certainly was not the first domestic manufacturer to get into the rug category, but it was always one of the best in terms of quality manufacturing and sales staff.
Shaw was also a leader in the development of Licensing Partnerships including design personalities as Kathy Ireland, Jack Nicklaus, Tommy Bahama, Bob Timberlake, Martha Stewart, MaryKate and Ashley and Angela Adams.
I am personally sad to see Shaw Living go. The company has and everyone associated with it has always been a wonderful business partner for Rugnews.com. I am sure a lot of interesting things will happen as a result of this move. We'll be here to cover this story as it unfolds.
Remember When?
Here is a sampling of Important
Shaw Living Stories Appearing in
Rugnews.com in the Past Few Years:
July 8, 2013: Shaw Living Expands World Market
Import Program Click here
Jan. 27, 2013: New Marketing and Product Strategies Transform Shaw Living. Click here
Jan. 9, 2013: Shaw Living Realigns Sales Under Tuftex Rugs. Click here.
Jan 17, 2010: Shaw Living introduces In-Store Interactive Kiosk. Click here.
June 8, 2008 Shaw Living Execs Target Specific Retail Channels to Gain Market Share. Click here.
Nov. 30, 2007: All Shaw Living Nylon Rugs Recyclable. Click here.
MORE ATLANTA MARKET NEWS COMING TOMORROW!
01.21.14
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