WPS to face Owen challenge
Playthings Staff -- Gifts & Dec, January 26, 2004
New York — After building the wall high to protect its Vellux franchise, and its virtual monopoly in the U.S. market, WestPoint Stevens is facing competition for the first time in almost a decade. The new challenge takes the comes in the form of Charles D. Owen Mfg., acquired last year by Springs Industries.
WestPoint shipped its first Vellux-branded flocked blanket in 1967 after working for three years to develop a unique manufacturing process. And over the years it's built Vellux into a business topping $130 million in sales in 2003.
It's also created something unique in a home-fashions business hit by price deflation — a high-margin, profitable product that cuts across distribution channels. And it's had a lock on the market, scaring off potential competitors with its patented technology, ever since rival Fieldcrest Mills exited the business a decade ago. Even when Fieldcrest was making its own flocked product, it ended up paying royalties to WestPoint on each blanket it sold, settling a patent squabble.
"But now they've got some competition again," said Bob Fleischer, Owen's manager of product development and institutional sales. "We're in it now, and we're providing a new product. We're giving the retailer an advantage: some competition in the marketplace and another choice. We've just reset the marketplace, taking it back eight or 10 years, to when Fieldcrest was in it and WestPoint had some competition."
While Owen is offering competitive product, it's a different product, using an entirely different manufacturing process, the company insists.
Harry Jenkins, who came to America from Wales to work with Owen as general manager of flocked manufacturing and develop the line of flocked blankets, said, "It's the difference between night and day. Their process uses AC (alternating current) as part of the flocking process, while our system uses DC (direct current). Because of differences in the way the current works to create the flocking, the system we use tends to produce an even flock, with the fibers standing straight up, making it soft to the touch."
Like WestPoint, Owen will target all channels of distribution, including the big hospitality trade, where Vellux has carved out a significant niche because of its durability and its easy-care and flame-retardant characteristics.
Owen launched its flocked product under the SofTouch name, which shows up under Springs' Wamsutta and Springmaid brands. The product comes in a broad palette of 11 colors, and is self-bound land reversible. And the pricing? "Competitive," said Fleischer.
It's not just the product that's different, said Fleischer, but also the presentation. "It's a very touchy-feely product, so we've developed packaging that allows the consumer to reach in and touch the product, feel how soft it is, without having to open the package."
With only five flocking ranges operational in the United States — WestPoint operates four and Owen the other — that gives Owen a potential 20 percent share of a market worth $130 million last year, and a chance to layer on $26 million in sales, if current pricing levels hold. A big if.
But WestPoint makes it plain that it won't make it easy for Owen to take away share.
"We've decided not to let them get a foot in the door, and we're blocking them wherever we can," said Art Birkins, chief of WestPoint's basic bedding business. "And even if they've got a product, we've still got the brand name. And it's a brand name that's sold a billion blankets since it was launched more than 35 years ago."
Sounding like he's ready for a fight, Birkins said, "We've been through this before with Fieldcrest, and we're not going to let them do it."
In what looked at first like a pre-emptive strike, WestPoint launched a major revamp of its Vellux line-up during the fall market, creating a new Royal Vellux nameplate, taking aim at better retailers with somewhat higher prices.
Royal Vellux will sell at retail for $5 to $10 more than the core, classic Vellux line. "That was the first major specification chance since 1965, when the product was invented here," said Birkins.
What the new manufacturing process yields is a flocked product "that's thicker, plusher, and definitely more drapable," said Birkins. "The core Vellux is a little bit stiff, but this feels very soft and plush and it and rolls beautifully."
But Birkins categorically denies that Royal Vellux is a response to the fresh competition.
"The reality is that this has been in development for three years, even before we heard they were coming into the business. We're dealing with extremely complex manufacturing processes that involve changing the chemistry of the product. It's not something that happens rapidly. But given that, the timing couldn't have been more perfect."
Making it abundantly plain that WestPoint won't give up an inch of share without a fight, Birkins suggested that Vellux pricing could become more flexible if it has to.
"We've closed down our Greenville manufacturing plant, putting all of our Vellux production into our Biddeford, Maine facility. That's generating a considerable savings. We have really lowered our cost of manufacturing. That gives us a lot of flexibility we didn't have before. Now we can beat them on quality, brand and price."
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