 |
                |
Creative Leisure News
2677 Ashley Ct.
Tremont, IL 61568
Phone: 309-925-5593
Fax: 309-925-9068
Email: mike@clnonline.com
|
|
|
|
|
Date:
June 3, 2002 TABLE OF CONTENTSCOMMENTARY: THANKS, CNAThere will be something different in the July issue of CNA magazine -- I'm not in it. Creative Leisure News has grown so much that I can foresee eventually not having the time necessary to make my column and other pieces as good as I think they should be. I'll miss working with Karen Ancona, CNA's editor, and writers Beth Mauro and Jan Evans. They're a great group of professional journalists.Now that I'll have more time, I have plans to make CLN more interesting and helpful to you. Any suggestions you have for changes or additions, please let me know -- 309-925-5593 or mike@clnonline.com.
[ top ]
MICHAELS: EARNINGS UP 184%Net income for the quarter ended May 4 rose 184% to $20.7 million ($0.29/diluted share) on a 15% sales increase to $603.2 million; same-store sales rose 5%. Wall Street had predicted 20 cents/share.During a conference call with investors, Rouleau attributed the strong earnings to conservative budgeting, improvements in the infrastructure and process, good buyers, and strong sales in basic and kids crafts, needlework, books, art materials, ribbon, and apparel crafts. Rouleau refers to systems investments developed since he arrived at Michaels. These were highlighted in a recent profile in Retail Merchandiser: POS systems in all stores; centralized controls such as plan-o-grams, accounts payable, and payroll; and a new store prototype. (Note: web-based EDI, new distribution centers, and a growing perpetual inventory system could also be added to the list.) Hear the conference call for yourself: visit www.michaels.com or call 973-341-3080 and use PIN #3121432.. The call will be available until June 7. May sales results will be released this Thursday. (Officials anticipate about a 6% increase in May same-store sales.) The conference call will begin at 7:30 am CDT. To participate, call 973-633-6740; or visit the website 15 minutes early to register and download any necessary audio software. A replay will be available shortly after the call and archived until Thursday, June 13. Again, visit the website or call 973-341-3080, PIN #3121341. During the quarter Michaels opened 19 new stores, moved eight, closed one, and opened three Aaron Brothers stores. There are plans for 45 additional stores this year. The current store count is 718 Michaels stores, 143 Aaron Brothers stores, and 1 wholesale operation. Note: All the major news services immediately reported Michaels' earnings. It wasn't that long ago that the national media didn't care how craft retailers performed. Michaels' stock closed on June 1, 2001 at $39.55/share. It later split, and last Friday that share was worth $86.90.
[ top ]
IDD IN LIQUIDATIONIndependent Direct Distributors, once the industry's leading magazine and book distributor, is in liquidation. According to officials, IDD lost key business from Michaels and Jo-Ann's and could not replace the business quickly enough.The magazine distribution business has undergone tremendous consolidation in recent years, at the same time IDD was increasing its niche in the growing craft market. The result of the consolidation was a handful of huge, powerful distributors who began to notice the craft market. One of those, Ingram, took key business from IDD. Select Media of Chicago has taken over many of IDD's remaining accounts. For more information about Select Media, call Mike Carter at 678-380-9880, ext. 207, or email elondon@selectmediaservices.com.
[ top
]
JO-ANN'S TURNAROUND CONTINUESFor the quarter ended May 4, the net profit was $8.7 million ($0.43/diluted share), versus a net loss of $6.4 million ($0.35) a year ago. Net sales rose 13.2% to $372.4 million and same-store sales rose 13.5%. Operating profits were $20.4 million, compared with an operating loss of $2.1 million last year.Strong sales, improved margins, less promotional merchandising activity, and lower inventory shrinkage were the reasons for the improved bottom line, officials said. Chair/CEO Alan Rosskamm said, "... we are effectively executing our turnaround plan. We are establishing a new baseline for operating and financial performance founded on the improvements we have reaped from our past investments, particularly in information systems and logistics, and from our more recent turnaround initiatives. In fiscal 2003, we remain committed to our previously stated goal of further reducing debt." When evaluating Jo-Ann's performance for the remainder of the year, remember the company's "SKU Reduction Initiative" last year. That program resulted in the sales of tens of millions of dollars of close-out merchandise, virtually at cost. That caused same-store sales to increase a strong 8.2%, but the profit margins weren't there. Now that the Initiative is behind them, officials expect lower same-store sales growth (3%-4%), but much higher profit margins for the remainder of the year. Jo-Ann's expects to reduce its debt by $40-$50 million, and interest expense by $28-$30 million, officials say. They expect earnings/share to be $1.40-$1.50 for the full year. The company closed eight traditional stores in the first quarter and will close another 30-40 this year, all of which were reserved for in last year's store closing charge. Wall Street has certainly noticed the turnaround. On June 1, 2001, Jo-Ann's stock sold for $4.80/share. Last Friday it closed at $23.11.
[ top ]
HANCOCK EARNINGS ON A ROLLNet earnings for the quarter ended May 5 improved 48% to $3.7 million ($0.20/diluted share) and sales rose 6.6% to $104.0 million. Same-store sales were up 7.4%. Gross margins improved, inventories were down 2%, and again Hancock was debt free during the quarter.CEO Larry Kirk stated, "The company's results are benefitting from the repositioning of our store base and the remerchandising of our product mix. We are attracting a broader base of customers without compromising our traditional sewing business. "In the first quarter, the store-within-a-store concept in home decorating was installed in 19 existing stores and five new openings and will be added to more than 30 existing stores and all new openings in the second quarter. "At the same time," Kirk added, "new initiatives in the home accents, quilting, and special occasion groups are also under way. We are pleased with the performance of the store model that is being developed and rolled out, and we are actively looking to expand it, both organically and in acquisitions of multiple retail spaces." During the quarter Hancock opened five stores and closed seven, bringing the store count to 437 stores in 42 states. The websites are www.hancockfabrics.com and www.homedecoratingaccents.com. Like Jo-Ann's, Michaels , A.C. Moore, and Rag Shops, Hancock's stock has risen substantially in the past year. On June 1, 2001, the stock closed at $9.11/share. This past Friday it was at $18.58.
[ top ]
NEW PROGRAM, SEMINARS HIGHLIGHT SDPWhat might art supply sales be like if 100,000 newcomers were turned on to the pleasures of painting? DecoArt hopes to find out through its new program, Decorative Painting for Everyone.Unveiled to more than 350 members of DecoArt's Helping Artists program at last month's Society of Decorative Painters' convention, the new Painting program is an effort to help the industry teach consumers to try, and succeed at, decorative painting. The program consists of classes taught by the 3,500 authorized Helping Artists in the retail stores and in their home studios. The subject of the six-session class will be a starter kit containing all the necessary paints, mediums, brushes, paper, and a 20-page guide book. Teachers merely choose the surface -- wood, paper mache, etc. Teachers receive a training video and lesson plan, and retailers receive camera-ready art for local ads. DecoArt plans a big advertising and publicity campaign for the program. In an interview with Creative Leisure News, DecoArt President Stan Clifford said costs are being kept to a minimum. "We're not trying to make money on the kit," Stan explained, "we're trying to build the market." For more information, call Customer Service at 800-367-3047. Other Show News. Another highlight was Michelle Temares' seminar, "How To Design Your Own Painting Projects," particularly her section on analyzing trends ... There was much talk and concern about the aging of the decorative painter ... Many exhibitors sold at prices below the suggested retail price -- often WAY below. "Prices were so low, attendees would be crazy not to buy supplies at the show," one teacher told CLN. "We even had distributors selling loss leaders. Distributors!" ... Attendees seemed especially hungry for new designs and new uses for existing products.
[ top ]
ACCI SPONSORS RETAIL PANELOur industry has been doing well these past nine months ... now what? To help you answer that question, ACCI has assembled some of the top retailers to discuss, "Challenges Facing The Industry Today" -- and you're invited. The panel will be Saturday, July 20, from 6:30 to 8:00 pm in the Grand Ballroom at the Hyatt. A show badge is all that's necessary for admission.The event is part of the annual ACCI show July 19-21, with education beginning July 18, in Rosemont (Chicago), IL. Jim Scatena, 1st Vice Chair of the ACCI Board and President of Floracraft, will be the moderator. The panelists: Dave Bolin, executive vp/merchandising & marketing for Jo-Ann's ... Jim Bremer, owner of The Tall Mouse retail stores and wholesale operation ... Emma Gebo, owner of Crafts & Frames ... Brenda Lugannani, vp/merchandise manager for Michaels. The panelists have decades of experience. Bremer and Gebo are both former presidents of the Sierra Pacific Crafts group, and each are on trade groups' boards of directors, Bremer on HIA and Gebo on ACCI. Bolin is one of the driving forces behind the Jo-Ann etc stores. Lugannani has probably purchased more art products than anyone on the planet. To attend or exhibit, call 888-360-2224 or visit www.accicrafts.org.
[ top ]
QUILT MARKET REPORT(Note: The following was contributed by Ellie Joos of Ellis Joos and Associates.)The Quilt Market in Kansas City was, in a word, great! The show floor was busy from the beginning of the show to the end; most vendors I spoke with were delighted with orders and the booths were a feast for the eyes as always. The folks at Michael Miller have a great time illustrating their new lines. This time the look was 50's Home Ec, complete with the kitchen sink and barbeque, and aprons worn by all. The America from the Heart exhibit of quilts made in response to Sept. 11th was on display -- its first stop in its tour around the country. Sales from the companion book will go to one of the Sept. 11th funds. Another book, Sew with the Stars, was published by P&B Textiles and features 12 patterns by celebrity quilters. Proceeds go to Sew for the Cure. The Americana trend continues, but it's not red, white, and blue; instead it's warm, rich, traditional colors in shades of brown, red, beige, and blue. There were also many nostalgic-looking prints, floral motifs, and influences from Asia. Red work continues, as does toile. Bright colors were also visible. Flannel, wool, and felt surfaces were more prevalent in folk-art styling. Embellishments, such as beads from Gutterman, are popular, and the Favorite Findings button line from Blumenthal received a very good response. A new pattern line from Mount Redount Designs incorporates beautiful beadwork. There were more soft sculpture patterns for dolls, angels, animals, etc. Especially charming and whimsical were those from a new exhibitor, A Clever Endeavor. Among the numerous new products at the show: Click-n-Craft from Indygo Junction features CD-ROMs in seven themes of beautiful vintage images to print on paper and fabric. They are terrific with Quick Fuse from June Tailor -- fusible, washable, inkjet fabric sheets, in packs of three or available in bulk put-ups for the retailer. Also from June Tailor: Message Memory, a small, battery-operated device to record a 10-second message that can be replayed 500 times and placed in a small pocket on the back of pillow, quilt, etc. Big Board from Big Board Enterprises is a 22" x 60" sturdy work surface that fits securely on top of an ironing board. Great idea! Disney motifs are now in EZ Quilting's Sliding Stencil, the durable stencil line that eliminates piecing together border designs. Disney motifs are also available in blanket bindings. Design Mirrors and Angle Gauge from Collins allows the quilter to easily view quilt blocks before piecing them together. Sylvia Design's Quilter's Work Station has an optional extension which adds extra work surface when needed, then folds down to save space when not used. Country Living Sewing Patterns by Amy Butler are gorgeous patterns for bags, totes, photo memorabilia, etc. using "vintage" fabrics. Amy is a new exhibitor and a contributing editor to Country Living magazine. Her sense of color and design is exquisite. Fold and Finish is a line of five patterns from Quilt Yard. It's a unique, easy method for quilting which creates a reversible quilt. (Note: Ellie can be contacted at Ellie Joos and Associates, 1220 Hope Bridgeville Rd., Blairstown, NJ 07825. Call/fax 908-459-9269; email eleapple@hotmail.com.)
[ top ]
SEW AMERICA! DEBUTSSew America! is a new, non-profit consortium of companies, educators, and community organizations dedicated to enriching American culture through sewing. The initial funding is from tax-deductible contributions by the sewing industry, individual donors, and foundations which sponsor programs that encourage intergenerational dialog.Sew America!'s executive director is Joan Campbell, the executive director of the Home Sewing Association. "Sewing skills remain extraordinarily important to the country," Joan said, "as the centerpiece of the fashion industry and the heart of one of the country's best-loved activities. However, many people no longer see these skills as an important part of their lives. Sew America! aims to re-establish sewing as a valued component of American culture." Sew America! will begin by sponsoring a pilot program, Sew Many Memories, designed to bring children and senior citizens together in sewing activities to promote intergenerational contact and learning. Seniors will share their life experiences with the kids, and a sewn item reminiscent of those memories will be the result. Other pilot programs will use sewing in an after-school environment and as a therapeutic approach to health management. For more info or to make a donation, call Joan at 212-714-1633 or email jcampbell@sewing.org. The address is 1350 Broadway, Ste. 1601, New York, NY 10018.
[ top ]
ACCI NEW PRODUCTSACCU-CUT (Booth #4416). Offers five new alphabet die sets: Sassy Serif (puffy oval dots accentuate an informal, relaxed style; upper and lower case); Funhouse (heavy, rounded tops and a playful style, upper and lower case); Yikes(a look of edgy stylishness, upper case only); Fairy Tale (letters with a whimsical flair, upper case only); Hodgepodge (fun, slightly puffy letters in a mixture of upper and lower case). All are available in 1.25-inch, 1.5-inch, and 2-inch sizes, with numbers and punctuation. Dies can be ordered with one letter per die, or multiple letters on the same die. The alphabets are available in formats to fit any of Accu-Cut's roller die cutting systems. 800-288-1670; www.accucut.com.HDA (#1015). Wall Art's unique trace-and-paint application makes creating professional-looking murals as easy as paint by number. The kit includes everything except the paint: tracing paper, colored pencil, alignment tape, outliner pen, slant-edge paintbrush, paint-by-number color guide, and instructions. A color guide is given for each design so consumers can color-customize their wall murals; 75+ children designs are available in three sizes -- 5' x 3', 9' x 5', 11.5' x 6.5' -- and elements can be repeated on fabric and furniture. Retailers ordering 36 kits receive free coded brochures featuring all Wall Art designs. Rebates are paid to retailers when consumers order from the brochures. Call 877-WALL-MURAL, email wallart@hdainc.com, or visit www.hdaebiz.com. MIDWEST PRODUCTS (#1008). The Easy Cutter Pro is designed to cut a variety of materials, including balsa, hardwoods, dowels, and most plastics up to a half-inch thick. It also includes three adapters for cutting cordage, hose, and rubber. Four-color packaging is designed for pegboard display. Retails for $23.99. 219-942-1134; www.midwestproducts.com. TSUKINEKO (#3010). StazOn is a solvent-based ink pad designed for decorating non-porous surfaces, and doesn't require re-inking between applications. The transparent ink gives a "stained glass" appearance and clean up is easy. It's acid-free, archival, and works on glass, mailboxes, metal, plates, picture frames, planters, shrink plastic, acrylic blocks, etc. Available in six colors. Shipping now. Call Bernadette Shintaffer at 800-769-6633; sales@tsukineko.com; www.tsukineko.com. YALEY ENTERPRISES (#804). Soy Wax for pillar candles -- a special blend of quality soy beans and pure botanical oils. It's an excellent alternative to paraffin and is environmentally safe. Available in 1- and 3-lb packages ... Crystallizing Wax for containers. This one-pour wax brings out the light and dark tones of a color and creates a subtle, cracked-ice effect. Also available in 1- and 3-lb packages ... Two Metal Candle Molds: both of the new shapes, the Column and the Scallop Column, are available in two sizes. 800-959-2539; www.yaley.com. Note: Creative Leisure News will continue to highlight new products being unveiled at the summer trade shows. Exhibitors are more than welcome to send appropriate information to me or mail to 2677 Ashley Ct., Tremont, IL 61568. Photos aren't necessary, but please include the name of the show, booth number, and website, if you have one. If the product or line is available for immediate shipping, please say so.
[ top ]
RANDOM NOTES, RANDOM THOUGHTS1. Dollar stores are the most successful sector in retail, other than craft stores, and some craft vendors are finding success selling to them. The major players (and their stock symbols) are Family Dollar (FDO), Dollar General (DG), and 99 Cents Only (NDN) on the New York Stock Exchange, and Dollar Tree (DLTR) on NASDAQ.2. More than 90 ACCI exhibitors have already taken advantage of a really unique feature. They have gone to the website, www.accicrafts.com, clicked on "Site Map" and then "exhibitor show special edit form". Then by using the invoice number for their booth, they wrote their own "show special" and put it online themselves -- and they can edit it any time they want. Meanwhile, attendees can visit the site, click on "Site Map" and "2002 exhibitor show specials", and see the specials for themselves -- an excellent pre-show planning tool. 3. HDA (Home Design Alternatives) has an interesting strategy for its large (225 SKU's) Wall Art line (see "ACCI Products" above). Retailers probably will not carry the entire line, so what does HDA do? Many vendors have a similar problem. HDA's solution is to "display" the entire line in a brochure that's coded for each retailer. The retailer stocks and displays a partial line -- and the brochures. When HDA receives an order from a brochure, it gives a rebate to the retailer. So the store can offer the entire line without sacrificing so much space.
[ top ]
MISCELLANEOUS NEWSDATA. HIA's first quarter update on its 2001 HIA Nationwide Craft & Hobby Consumer Usage and Purchases Study now pegs the size of the industry at $26.2 billion. The new results show discount stores increasing their market share of certain categories such as paints and florals, and craft chains' share of basic crafts slipping a bit. HIA members can read the complete update on the member level of HIA's website at www.hobby.org. The report and subscriptions to the quarterly updates are for sale to non-members. Call 201-794-1133.BANKRUPTCY, I. Ames now says it won't offer a reorganization plan to emerge from bankruptcy until after the 2002 holiday season. It asked the court for an extension of its plan from last Thursday until Feb. 28. Officials said sales were 3.8% below plan for the year, but cash flow has been sufficient to remain in compliance with all loan covenants. BANKRUPTCY, II. Kmart completes the closure of 283 stores this month. About 22,000 employees will lose their jobs; the hourly employees will not receive any severance. Meanwhile, the SEC and the FBI continue to investigate the company, which lost $2.42 billion in 2001. The Associated Press reported the company lost $1.02 billion in April and same-store sales dropped 16.4%. Kmart also restated its earlier losses after changing its accounting practices for vendor discounts. Now the company counts rebates and other vendor give-backs only if it has a formal agreement with the vendor. As a result, Kmart now says its losses in February were $269 million, not $174 million, and were $175 million, not $135 million, in March. STATIONERY. The N.Y. Stationery Show offered lots of handmade papers and cards, and the embellishments we're seeing in scrapbooks was evident in stationery, too -- ceramic, wire, and metal objects that make a card a collectible gift in itself. INDEPENDENTS. Look for a new Vendor Spotlight program to be unveiled by the Sierra Pacific Crafts group. We'll have complete details when they are available, probably by the ACCI show in July. PEOPLE. Ron Sprafkin is the new sales vp for American Traditional Stencils. Ron had been sr. vp at Offray. PAMIDA. For the first quarter ended May 4, sales at the 224-store Pamida division of ShopKo dropped 7.2% and same-store sales fell 6.0%. SOFTWARE. Michaels is implementing Oracle's Human Resources Management System which will enable the 30,000 employees to update their personnel info and select benefits using a web browser. That means less time for the HR staff. Visit www.oracle.com. DUCKWALL-ALCO. Sales for the 13 weeks ended May 5 rose 4.8% to $96.8 million; same-store sales rose 3.1%. Net earnings increased to $531,000 ($0.12/diluted share), compared with $23,000, ($0.01) a year ago. Gross margins improved to 33.3% of sales, from 32.3%. MEMORIES EXPOS. Exhibitors at the Denver Expo Sept. 6-7 who purchase their booth for $895 can have a second booth for make-it/take-its for $250 ... 2003 Expo schedule: March 7-8, Las Vegas; April 4-5, Chicago; May 2-3, Somerset, NJ; Sept. 5-6, Denver; and Oct. 31-Nov.1, Orlando. Call 888-878-8728, ext 3110, or visit www.memoriesexpo.com. REPS NEEDED. Midwest Design Imports is looking for reps in the Midwest and Northeast. Call Hal Mangelsen at 402-691-8009. GLASS. Visit the updated website of the Art Glass Suppliers Assn. at www.agsa.org. CREATING FOR LIFE. Will no longer hold an auction at the ACCI show, but is still soliciting funds for AIDS research, education, and services by Chicago's Howard Brown Health Center and The NAMES Project AIDS Memorial Quilt. CFL has raised $250,000+, and every penny went to people and agencies in need. Send donations (credit cards accepted) to Creating For Life, c/o Craftrends, 741 Corporate Circle, Suite A, Golden, CO 80401. Donations requested by Aug. 1. Meanwhile, ACCI, which had donated space and publicity efforts for CFL, is considering other charitable functions for future shows. SHOWS. The International Needleart Retailers Guild's Charlotte show is July 26-28, with classes beginning July 24. Call 706-628-5684; or visit www.stitching.org. CONDOLENCES. Our sympathies to the family of Ben Franklin retailer Ernie Henderson, who died recently of a heart attack.
[ top ]
THE CREATIVE NETWORK: JOB OPENINGSTo see a sampling of the current job openings and to contact The Creative Network, click on the "Jobs" button in the left hand column.
[ top ]
THE CLN RETAIL INDEXA. C. Moore (ACMR). Last*: 42.67 ... Change**: -1.08Ames (AMES). Last*: 0.14 ... Change**: UNC Hancock Fabrics (HKF). Last*: 18.58 ... Change**: -1.41 Jo-Ann Stores (JAS.A) [a]. Last*: 23.11 ... Change**: +0.11 Michaels (MIK). Last*: 43.45 ... Change**: +2.75 Rag Shops (RAGS). Last*: 5.95 ... Change**: +0.76 Wal-Mart (WMT). Last*: 54.10 ... Change**: -4.78 CLN Retail Index. Last*: 188.00 ... Change**: -1.9% Dow Jones Index. Last*: 9,925.25 ... Change**: -4.1% *May 31 ** from May 17 [a] voting share Prices are exclusive of dividends
[ top ]
A PERSONAL ADCLN doesn't publish personal ads, but we thought this one, emailed from a friend, was worth it:"SBF Seeks male companionship, ethnicity unimportant. I'm a svelte, good looking girl who LOVES to play. I love long walks in the woods, riding in your pickup truck, hunting, camping, fishing trips, and cozy winter nights spent lying by the fire. Candlelight dinners will have me eating out of your hand. Rub me the right way and watch me respond. I'll be at the front door when you get home from work, wearing only what nature gave me. Kiss me and I'm yours. Call 555-XXXX and ask for Daisy." (The phone number was the local Humane Society and Daisy was an eight-week-old black Labrador Retriever.)
[ top ]
REMINDERS1. Paid subscribers are invited to have their website evaluated by Lynn Carlisle of Carlisle Communications. She'll check the site and provide a confidential assessment and suggestions for improvement. Just email mike@clnonline.com or ljc@carlislecommunications.com.2. If you want a hard-copy of this issue, click on "Printer Friendly version". 3. If your company is a paid subscriber, everyone in the main office is welcome to register, free. 4. If you want to recommend CLN to a friend, use the "Tell Your Friends" box on the home page. 5. Creative Leisure News is published on the first and third Mondays of each month. Your next issue will be Monday, June 17.
[ top ]
xxx |
|
|
|
|
|
|
Printer
Version
|
|
