“I don’t think [we’ve seen] the total impact of all of the housing starts and housing transactions and interest rates—[even] as interest rates start pushing a little higher now,” says Zabel. “I think there is a lot of work inside the homes that people haven’t done yet because they’ve been busy buying them. New home activity accounts for about a fifth of window covering activity. There, the purchase needs is immediate. But with regard to all of the existing home sales, I think it takes a long time for all of the changes and choices people want to make to funnel through.”
D&WC: In your opinion, what is the state of the window coverings industry?
Zabel: The state of the industry is good. But more importantly, our research suggests that there remains a pretty significant potential for growth.
There are all the obvious factors that are interrelated—from interest rates and refinancing to new home starts and record existing home sales to larger homes with more windows and the influence that home decorating shows are having on consumers. But we actually think that there is a somewhat pent-up demand. The reason for that is because the industry really isn’t doing much from a new product standpoint. We believe we can tap into that pent-up demand through product innovation, through improved quality and through style and fashion change. This is a challenge for all of us because of the cost of going to market with all of these various product categories, I’m not sure we stay as fashion-forward as we should.
Lastly, we believe that keeping service promises to consumers is really an important point. Our research would suggest that’s been substantially compromised. The best opportunity for a new sale will, most likely, come from consumers who are currently purchasing. We think about a third of households are actively involved in this category. Two-thirds are pretty ambivalent. So, it’s really important to satisfy consumers when they are in the market. Most likely they’re the ones who are going to be back, and if you’ve done a good job they’re going to remember that.
Consumers have their preferred channel of purchase. The implication of this is that all channels need to be developed to their fullest potential. Among the first things a consumer does in the purchase process is they decide what level of assistance and what level of style they’re seeking. This really determines their channel choice—whether they go to a large national chain, or whether they go to a specialty retailer or dealer—that’s
all pretty much determined very early in their process and, contrary to what a lot of people believe, less than 10 percent of consumers switch channels once this decision is made.
D&WC: How does Springs Window Fashions fit into this picture?
Zabel: Our tradition of providing quality window products goes back to 1939, so we’re 64 years old. At that time we were known as the Graber Co. Today, Springs Window Fashions is just one of several divisions that make up Springs Industries. But what is unique about Springs Industries is that it’s really the only complete home décor corporation that can provide decorating solutions for an entire room with bedding, bath, floor coverings, drapery hardware and hard and soft window products. We believe there is a tremendous future potential through offering what we call integrated room solutions with all of these products.
Based on the current industry environment, we gain a significant competitive advantage by continuously improving our product quality and setting a high customer service standard in the industry. We are very, very focused on serving our customers be they a consumer, a dealer, a designer/decorator, or a traditional large retail outlet. We’re very committed to keeping our promises.
D&WC: Are there advantages or disadvantages to being a part of a larger corporation?
Zabel: I think there are a lot more advantages than disadvantages because we are all focused on providing solutions for the same home interior décor. In a lot of corporations we would be a division that may or may not be directly related [to the others]. There is a lot of synergy between us that really hasn’t been leveraged as well as it could be.
The other thing that is really nice is that while we have all of those positives, we also are given the opportunity to operate this business very independently as a stand-alone business. We’re responsible to the corporation for our results, obviously; but we’re responsible to provide our own capital and we generate our own cash flow. So we don’t operate like most divisions operate, we really operate as a freestanding entity.
It gives us the latitude to be flexible. It gives us a chance to respond quickly to customers’ requests.
D&WC: Will this pent-up demand you mentioned be the factor that drives the industry in the near future, or are there other factors?
Zabel: What is driving the industry is a combination of economic trends and fashion trends. Product news is what will get at the pent-up demand. Frankly, I can’t judge that on the part of our competitors—and I don’t mean that in a bad way, I just don’t know where they intend to go. We certainly intend to be much more focused on new products and are much more focused on new products.
When you look at the factors driving the industry, there is one negative factor and that's price. Price is one of the tough issues the industry must face. Some in the industry are really losing sight of the value they represent to the ultimate consumer. There is substantial documented research that suggests that price is not the most important element of the purchase decision. Yet, day after day I see examples in the supply chain of just continuing to lower the price of product.
There isn't any real value add or differentiation to that kind of strategy. The supply chain really provides more value adds to consumers than that. Springs Window Fashions is very much about selling value-added products. If the industry continues to sell down, eventually consumers will not perceive any real value in these products. It's important that everyone in the industry realize that we're building custom products to satisfy specific consumer needs. Consumers expect it-they expect to pay and they will pay for the service.
I would even go a step further and say successful designers sell themselves first to clients. They deliver a great outcome because of their expertise, which nine times out of 10 delights their clients. Seldom do they only focus on price or products. Successful designers and decorators really focus on the solution that the product provides. Consumers really want solutions, or they wouldn't need the help.
I've been in the industry four years, but to me that's the part that has been a big disconnect. There's just constant pressure on reducing price, which I don't think is necessary.
As for other factors that are driving the industry, I think quality of service has really elevated us in this industry. We want to provide the influencer-be it a designer, a decorator or retail salesperson-with every tool they need to become more efficient and profitable with every customer or client they come in contact with. Consumers have specific style orientations and various degrees of assistance they are looking for, and we want to anticipate those wants and needs and then deliver solutions for our customer base that will delight consumers.
We have a philosophy here at Springs Window Fashions that we call "Best Experience." This strategy permeates everything we do at every level-with our customers, with our consumers and, most importantly of all, with our associates. We empower our associates with a do-what-it-takes attitude to deliver this promise to everyone they come in contact with, be it internally as we work together to run our business every day or externally with our customers. By focusing on this goal, we have become more of an industry leader and our associates say that this is a great place to work.
"Best Experience" goes even deeper. It's about making promises that matter and keeping those promises. Consumers are interested in you doing what you say you are going to do. Whether it's quality products or meeting shipping dates, we take our promises very seriously and we are happy with our progress. But I would say in the next breath that we're realistic and realize we have a lot more of the journey ahead of us.
D&WC: Are there aspect of this industry that surprise you?
Zabel: One of the things that has surprised me most about this industry is its complexity. It's very complex in its product capabilities, the precise nature of its componentries, all the different conditions in which these products have to operate.
In addition to that, it's how dynamic the industry is from a distribution channel standpoint. There are so many different places or channels that sell this product category.
D&WC: Is there a particular market that is most important to Springs?
Zabel: There clearly is a different consumer segmentation that is designed around each of our brands. Nanik is very, very high-end, Graber is comparable to any of the top names in the custom window coverings market and Bali is a product that is made extremely well but that we have tried to position for the more price-sensitive customer.
All of those brands are growing, and where we're challenged is in finding the marketing resources to make sure that our brands remain fresh and are as well represented in each of their respective markets as they need to be. That's absolutely a necessary investment we need to make every year in our business, and we do.
We focus on all of the channels where these brands are sold because we want our brands to be available where consumers shop. As I have said, consumers, in their purchase process, make that choice pretty early on and they tend not to bounce back and forth. So it's pretty important that we be present where consumers will shop.
I believe we clearly have potential with all of our brands in all channels. We are really committed to being more important than we are today in the specialty store, designer/decorator community. We want a greater presence there than what we have today and we get there through our distributor/fabricator network.
D&WC: What are your personal goals for the next five years?
Zabel: I would like to help Springs Window Fashions become a company that thoroughly delights its consumers, satisfies its customers and, most importantly of all, provides security for the thousands of associates that we have. I think as a business leader, my greatest responsibility-sure, I have a responsibility to the shareholders to build this business-is really about assuring the future of our associates. If there is a burden that comes with the job, that's it. It's a big responsibility, but that's why I do this every day.
COMPLETE HOME DÉCOR
Founded in 1887 with headquarters in Ft. Mill, SC, Springs Industries supplies leading retailers with a complete line of coordinated home furnishings designed to simplify home decorating for every consumer.
Since its founding, the company has grown from a single mill to a company with approximately 40 manufacturing facilities in 12 U.S. states, Canada and Mexico. It employs about 17,000 people, led by Chairman and CEO Crandall Bowles, fifth generation of the Springs family to lead the company.
Springs Industries' major brands are Wamsutta®, Springmaid®, Graber®, Bali®, Nanik®, Dundee®, Wabasso® and Texmade®. Major licensed brands are Burlington House®, Harry Potter®, Liz At Home®, and NASCAR.
For years, Springs Window Fashions has been a fixture in the window decorating industry, but it actually started as two separate and competing companies-Carey & Co. and the Graber Co.
Carey began operations near the end of the Civil War, manufacturing lamps for horse-drawn carriages. It entered the window treatment business in 1906, making curtains and curtain rollers for automobiles. The company became Carey-McFall after acquiring McFall Mfg. Co. In the late 1930s, Carey-McFall was producing blinds for railroad cars and businesses, including wooden Venetian blinds.
Graber started in 1939 when founder John Graber invented the Badger Crane, a bracket designed to hold drapery panels over Venetian blinds. At first other companies handled the manufacturing and packaging, but in-house production began in 1942.
In the 1960s Carey-McFall introduced the Bali Custom Mini Blind. In the 1970s, the company changed its focus to Venetian blinds and moved manufacturing to Montgomery, PA.
At Graber, the 1960s and 1970s were years of growth and acquisitions, which helped the company expand its product offerings to window shades, verticals blinds and woven woods, along with hundreds of drapery hardware items.
In 1979 Springs Industries purchased the Graber Co. Ten years later, Springs purchased Carey-McFall. The two were merged into Springs Window Fashions shortly after. Since then, Springs Window Fashions expanded its operation by adding Nanik-a high-end handcrafted custom wood blind manufacturer.
Today, Springs Window Fashions and its 3,000 employees manufacture and market high-quality fabric, vinyl and wood window fashions and drapery hardware. Its products can be found at many retailers including The Home Depot, Lowes, Sears, JCPenneys and Menards. They are also sold by many independent dealers and decorators.