H&M Bans PFC Use

Sweden-based retailer H&M Hennes & Mauritz AB (H&M Group) has banned the use of
perfluorinated compounds (PFCs) in all products it sells. All products ordered on or after Jan. 1,
2013, must be PFC-free.

PFCs — used to provide water, oil, grease, heat and stain repellency to a range of textile
and other products — have been found to be persistent in the environment and are associated with
adverse affects on humans and wildlife. H&M will replace PFCs in its products with
BIONIC-FINISH®ECO, a fluorocarbon-free water-repellent finish produced by Rudolf GmbH, Germany,
using a blend of branched comb polymers and dendrimers.

Last year, H&M and other fashion and sport brands initiated Joint Roadmap: Toward Zero
Discharge of Hazardous Chemicals, with the goal of eliminating hazardous materials discharge in
apparel and footwear supply chains by 2020. H&M also is on the steering committee of the
Apparel and Footwear Industry Restricted Substance List Management group, which strives to reduce
the usage and impact of harmful substances in the apparel and footwear chain.

September/October 2012

Congress OKs Fixes To CAFTA-DR, Renews AGOA Fabric Proviso

President Barack Obama recently signed legislation to amend the Central America-Dominican Republic
Free Trade Agreement (CAFTA-DR) and renew the third-country fabric provision in the African Growth
and Opportunity Act (AGOA), among other trade-related items.

The CAFTA-DR amendments include, among other items, a redefinition of sewing thread that
adds single multifilament synthetic yarn used as sewing thread. In the original agreement, an
out-of-date definition failed to consider this thread type, which is commonly used in apparel
production, resulting in a loophole that allowed use of such yarn from non-signatory countries in
place of thread originating in the CAFTA-DR region, and leading to a loss of jobs for U.S. thread
manufacturers.

AGOA’s third-country fabric provision, which allows lesser-developed sub-Saharan countries
to produce duty-free and quota-free apparel using fabric and yarn produced anywhere in the world,
now will continue in effect until Sept. 30, 2015. Congressional delays in renewing the provision
had led to moves by U.S. apparel companies doing business in the region to seek other production
sources, thereby threatening to cause job losses and plant closures in sub-Saharan Africa and a
negative impact on cotton and textile inputs.

September/October 2012

Desperately Seeking Stability

After a year of up-and-down business conditions — a period that followed one of the most sustained
up cycles in recent memory — the yarn market seems to have stabilized, at least for the short term.

Spinners and brokers report a steady stream of orders, with pipelines beginning to fill and
delivery dates beginning to move out. The reasons for the year-long uncertainty in the business
were multiple, according to many industry insiders and observers, who now hope for a sustained
period of stability.

“Coming off such a crazy period, the market was in complete disarray,” said one observer.
“Many customers, fearing product shortages, overbought. Through a combination of factors, cotton
was in short supply and the price increased to record levels. Then, we all quickly came crashing
back to earth.”

Cotton prices began to drop precipitously, and many spinners were left with inventories of
high-cost raw materials that were suddenly worth a lot less in the marketplace. Orders stopped
coming as customers became concerned about the volatility of pricing. Retailers were left with a
glut of product that, in still-difficult economic times, was not moving off the shelves as quickly
as they would have liked. “In the end,” said one spinner, “we moved from feast to famine almost
overnight.”

Hopes are high in the industry that all of these issues have finally resolved themselves.
“There was a necessary inventory correction,” said one industry insider. “A lot of customers
purchased more than they needed when yarn was in short supply. We expected a correction to last a
few months and, instead, it lasted the better part of a year. Also, there remained a tremendous
amount of uncertainty about prices. Both spinners and customers were caught out in the last cycle,
and there was a lot of hesitancy to go down that road again.”

Over the past few months, the price of cotton has stabilized at levels close to where they
were before the boom cycle. Whatever inventory correction occurred seems to have run its course. “I
was in a major retailer’s store the other day, and there is not a whole lot of selection on the
shelves right now,” said one observer. “This tells me that retailers are only stocking that
inventory they absolutely have to have.”


Prices Of Imported Yarns Going Up


Along with the domestic market factors, another reason for the recent increase in U.S. orders
is the pricing and availability of imported yarns. Commented one yarn broker: “Prices for imported
yarns are increasing and delivery times are moving out. It is going to take you eight weeks to get
it, if you can even get it then. It may be 10 weeks. I just brought in two containers. The one that
hit the dock last week was two weeks late. The one that hit the dock this week was three weeks
late.”

Added a spinner: “A lot of customers are starting to return programs to the U.S. The prices
are higher, but there is not as much difference as there was just a short time ago. And delivery
can be a lot faster.”

A yarn broker said: “When customers take delivery of imported yarn, they think they can
reorder at the same price, but they can’t. Prices are going up, and when companies in Asia can’t
get the prices they are asking, they stop selling. India and Pakistan have stopped shipping
recently because they can’t get the prices they want.”

He continued: “Retailers are talking about bringing programs back to the U.S. Of course,
they’ve been saying that for the past eight years. But some of the programs I’ve recently quoted on
are the first times somebody has seriously inquired on 200,000 or 300,000 pounds in a long time.
And, there are people I’ve tried to call on for the past year, who haven’t returned my calls. They
are calling me now.”

Ultimately, spinners are hoping current market conditions will loosen pricing pressures and
allow them to begin selling at a reasonable margin. “It sounds like a broken record,” said one
spinner, “but there is still a lot of pressure on pricing. Customers don’t want to pay the
prevailing price, and mills can’t sell at the price customers want to pay. At some point, this
cycle is going to have to break. And, I think it’s one of those things that, when the first big
customer realizes that they are going to have to buy at the market price, a lot of others will
follow. It is then, I think, that we can say the market has truly stabilized.”

September/October 2012

From The Editor: Thank You Douglas C. Billian

By Jim Borneman, Editor In Chief

There is a very special In Memoriam in this issue of Textile World for Douglas C. Billian, founder and chairman of Billian Publishing Inc. — publisher of Textile World,Textiles Panamericanos and Textile World Asia.

Mr. Billian had a great passion for publishing and founded Billian Publishing after retiring from McGraw-Hill Publishing Co. Ironically, while at McGraw-Hill, he was responsible for moving
then-McGraw-Hill publication Textile World from New York City to Atlanta. Mr. Billian, with his own firm, published America’s Textiles International (ATI) magazine and went head-to-head with TW in serving the textile industry. Later, he closed the circle, purchasing TW and continuing its publication to this day.

Mr. Billian always spoke about the importance of a quality business press and nurturing the connection between readers and content that readers would find valuable.

In his view, for an industry to flourish, it needs a quality business magazine to function as a platform for ideas, to highlight innovations, to feature new technology, and shine a light on industry leaders and the industry’s leading companies. He also believed all publications could be improved.

Mr. Billian was a strong believer in marketing and branding. He built countless programs for businesses in publications like Purchasing Week, Business Week and Golf World (which he owned and later sold). To him, it was crystal clear that an investment in branding paid dividends in sales. He used to say, “Advertising’s sole purpose is to reduce the cost of sales.” His presentation was classic and was built around the six steps to selling: contact; raise awareness; establish preference; propose; close; and repeat. In his view, a branding campaign with advertising achieved making contact with a broad audience of potential customers, raised awareness of the brand and its products, and helped build a preferred brand image in the industry. That being done, all salespeople needed to do were to make a sales proposal, close the sale and repeat the process.

Mr. Billian was much more than an advertising advocate: He enjoyed the textile industry and the people associated with the industry, and he always spoke fondly of ITMA and ATME-I. In good years and bad, often investing significant sums of capital, he would always make sure the industry had a quality business magazine.

Billian Publishing grew through the years to publish various titles, and today is a leading source of data on the U.S. healthcare system. With its origins in the Pocket Guide to Southern Hospitals and later Billian’s Hospital Blue Book, Billian’s HealthDATA has become the nation’s leading healthcare data portal.

As an Eagle Scout who earned three Palms by the age of 15, Mr. Billian was a lifelong supporter of the Boy Scouts and often referred to the Scout Law. He also made great contributions
of time and shared his financial skills philanthropically with organizations in Atlanta.

Mr. Billian created opportunities for many individuals to succeed. His leadership, incredible work ethic, generosity, drive, and dedication to the textile industry will be missed.

September/October 2012

ITMF Annual Conference In Vietnam

The ITMF 2012 Annual Conference will take place November 4-6 in Hanoi, Vietnam. It is co-organized
by the Switzerland-based International Textile Manufacturers Federation (ITMF) and VINATEX, the
Vietnam National Textile and Garment Group. The theme of the conference is “Challenges for the
Textile Industry — Present and Future.”

“Volatile raw material markets, sovereign debt crises, currency disputes, political
instability in some regions, a blocked Doha-Trade-Round, looming protectionism … these are just a
few of the short- and long-term risks that the world economy is confronted with and which have far
reaching implications for the global textile value chain.” With those words, ITMF is introducing
the conference.

As ITMF states on its website, the conference delegates “will benefit from a wide range of
presentations, meetings and workshops in order to

  • learn more about the ongoing changes affecting the global textile industry,
  • exchange views and experiences regarding the challenges and opportunities of today and tomorrow
    and
  • meet colleagues from the textile and affiliated industries from around the world.”


Textile World
 spoke to ITMF Director General Christian Schindler, Ph.D., about the reasons why Vietnam was
chosen to be the host of this year’s conference.

ITMFSchindler

ITMF Director General Christian Schindler, Ph.D., says: “Welcome to Hanoi. We are looking
forward to many attendees at the annual ITMF conference.”


TW: Why is this year’s annual ITMF conference taking place in Vietnam?

Schindler: Vietnam has been opening up in the past two decades and has gradually
integrated its economy into the global economy. Its proximity to many rapidly developing and
emerging economies in Asia and the regional integration of its economy helped to spur investments
and economic growth. Along with Vietnam’s economy as a whole, also its textile and apparel industry
grew rapidly. Between 2000 and 2010, Vietnam’s textile and apparel exports surged from US$2.1
billion to US$13.5 billion — an average annual increase of 54.3 percent. While apparel exports
still represent approximately 80 percent of the industry’s exports, textile exports have increased
significantly. According to ITMF’s International Textile Machinery Shipments Statistics,
investments in Vietnam’s primary textile industry picked up strongly. The segment of spinning
machinery especially saw a strong increase. Since the year 2000, the Vietnamese textile industry
has on average invested in approximately 210,000 new short-staple spindles every year. In 2011
alone, the industry installed 330,000 new short-staple spindles.


TW
: What are the benefits for the Vietnamese textile industry in organizing this
conference?

Schindler: Bringing the ITMF Annual Conference to Vietnam is an opportunity to
showcase the Vietnamese textile and apparel industry, to promote investments in the industry, to
build ties and networks with textile representatives from around the world and to discuss topics of
mutual interest. In other words, hosting an ITMF Annual Conference provides the possibility to
promote the Vietnamese textile and apparel industry.


TW: What do you expect from this conference for the Vietnamese textile
industry?

Schindler: As the co-organizer of the ITMF Annual Conference, we hope that the
participants will discuss the challenges and opportunities of the industry in the various general
sessions as well as during the social activities outside the conference room. The ITMF Annual
Conference with a truly international platform enables all participants to better understand the
developments and ongoing changes in the global textile value chain — from fibers to retail — that
the industry needs to understand to overcome the challenges and to prosper in the future. Of
course, we hope that the links between the Vietnamese and the international textile industry can be
intensified and strengthened.


TW: What are your hopes for the ITMF attendees for the conference?

Schindler: I hope that the participants will listen to informative presentations,
will be able to participate in interesting discussions, will meet old and new colleagues and
friends, will learn more about the Vietnamese textile industry, and will better understand the
short- and long-term challenges and opportunities of the global textile industry.


TW: What should not be missed while visiting Vietnam and the conference?

Schindler: Attending the ITMF Annual Conference in Hanoi enables every participant
to experience first-hand this fascinating country with a vibrant and dynamic society and economy.
If time allows, one should also consider participating in the ITMF post-conference tour to central
Vietnam. The cultural and natural treasures of Vietnam are numerous and definitely worth visiting
and seeing. We are looking forward to welcoming a lot of guests to Hanoi in November.

VINATEX

VINATEX is owned by mother company Vietnam Textile and Garment Group; research and training
centers; and nearly 120 sub-companies, which include joint stock companies doing business in
various fields, such as textile apparel manufacturing and commercial services. The organization’s
chairman is Vu Duc Giang.

ITMFVinatex

Vu Duc Giang, chairman of the VINATEX Members’ Council, and other heads of VINATEX visit
with Nhabe Garment Corp. at a New Year’s 2012 opening ceremony.

VINATEX’s strategy for developing the Vietnamese textile apparel industry until 2015, and its
orientation toward 2020, includes a focus on specialization and modernization to offer added value
in textile apparel products. The organization’s approach comprises two initiatives:

  • to achieve sustainable, stable and long-term development of the country’s textile apparel
    industry by implement three decisive programs – cotton planting, high-quality spinning and human
    resources training; and
  • to complete capitalization of all state-owned textile apparel enterprises and VINATEX.

September/October 2012

Vietnam: A Small Tiger Is Growing Up

From humble beginnings since the reunification of its northern and southern regions, Vietnam has
become a strong player in the global textile market. The textile and apparel industry plays a major
role in increasing the country’s prosperity. The Vietnamese textile industry, with more than 3,800
companies, is the leading export sector.

State-owned enterprises make up just 0.5 percent of Vietnam’s businesses; however, 75
percent are joint stock or limited companies. The country ranks fifth worldwide in textile and
apparel exports and has a labor force in that sector of more than 2 million people, of whom 1.3
million are working directly in the industry.

Vietnammap


VINATEX


The Vietnam National Textile and Garment Group (VINATEX) is one of Asia’s leading textile
and apparel groups, and has a relationship with more than 400 organizations from 65 countries. It
was established in 1995 as a result of merging textile and apparel state-owned enterprises. Of its
120 members, 95 percent already have been equitized. VINATEX member companies account for 9 percent
of the Vietnamese textile and apparel industry’s total labor force and 18 percent of total exports.


Economy


Vietnam’s gross domestic product (GDP) grew by 5.9 percent in 2011, down from 6.8 percent in
2010. However, 2011 GDP growth was relatively high considering the country’s efforts to control
inflation.

Vietnam’s textile and apparel exports in 2011 totaled US$15.8 billion, up 24.4 percent
compared to 2010. Its main export markets were the United States, which accounted for $6.9 billion
of those exports; the European Union, $2.5 billion; and Japan, $1.7 billion. Of the total textile
and apparel exports, yarn exports accounted for $1.79 billion — up 27.8 percent from the previous
year. China accounted for 30.5 percent of yarn exports; Korea, 16.1 percent; and Turkey, 15.4
percent. Vietnam’s fabric exports totaled $831.7 million.

Vietnamese textile and apparel exports continued to record growth in the first six months of
2012, growing by $7.7 billion — an 8.2-percent increase over the same period in 2011.

In 2011, textile imports, not including accessories, netted $9.3 billion — a 28.8-percent
increase over 2010 imports worth $7.2 billion. Cotton imports totaled 332,600 metric tons (mt)
valued at $1.05 billion. Imports of other fibers and yarns totaled 614,100 mt and were worth $1.53
billion. Fabric imports totaled approximately $6.7 billion.


Structure


There are 70 spinning companies in Vietnam, 31 of which are located in northern Vietnam, six
in the middle region and 33 in the south.


At the end of 2011, the textile sector employed some 840,000 people — 11.2-percent more than in
2010. The average hourly wage for textile workers that year was 60 cents in U.S. currency terms.


Important Retail Business


The cornerstone of the Vietnamese textile industry is basically the retail business. The
country has 71 textile/apparel supermarkets, with locations in 25 cities and provinces. Plans call
for increasing that number to 200 supermarket and trade centers nationwide by 2015, and to
establish textile and apparel material and accessories centers in northern and southern Vietnam.
Plans are also in place to promote and enhance fashion brands to increase competitive strengths,
and to create an online textile/apparel trade website.

The Vietnamese textile and apparel industry’s customers include the top labels worldwide. To
name a few from the top three markets, U.S. brands and retailers include, among others, JCPenney,
Nike Inc., Gap Inc., PVH Corp., Liz Claiborne, Target Brands Inc. and Perry Ellis; European brands
and retailers include Marks & Spencer, C&A, The Otto Group, Camel, Seidensticker, Pierre
Cardin and Jacques Britt; and Japanese brands and retailers include Itochu Corp., Sojitz Corp.,
Marubeni Corp., Mitsui & Co. Ltd., Seikyo, Mitsukoshi Ltd. and Katakura Industries.


Capacities


Vietnam consumes some 400,000 mt of cotton annually — with 35 percent of that total imported
from the United States, 32 percent from India and 19 percent from South Africa.

In 2010, 3,656,756 ring spindles and 104,348 rotors were installed in Vietnam. Total yarn
production capacity was 514,000 mt per year, primarily for 100-percent cotton yarn. Domestic
consumption accounted for 34.7 percent of the yarn produced. Woven fabric capacity in 2010 was 680
million square meters (m2). The available production capacities and imports of these and other
textile products are shown in Table 2.


Investment Opportunities


Investment projects, along with government incentives for foreign investment, are deemed to
be central to the improvement of the Vietnamese textile and apparel industry as Vietnam seeks to
strengthen its competitive position in global apparel markets. Other contributing factors include
low labor costs and a stable political environment.

The Vietnamese textile industry today comprises mainly apparel cut-and-sew enterprises.
VINATEX has the following investments in the works to build manufacturing capacity for upstream
textile production:

  • viscose fiber plant (phase one): 30,000 mt/year capacity;
  • compact spinning mill with 60,000 spindles: 4,500 mt/year capacity;
  • greige fabrics plant: 30 million running meters/year capacity; and
  • dyeing plant: 30 million running meters/year capacity.


Human Resources


VINATEX is focusing on R&D and training to foster competitiveness. There are plans for
the long-term development of vocational schools and colleges. In this context, 20,000 workers
should receive training to reach intermediate, college, or higher skill levels. There also is a
plan to add some 60,000 educated and skilled workers every year. And, finally, the textile industry
wants to cooperate with international partners to provide high-quality training.


Future Plans


The Vietnamese textile and apparel industry has an ambitious target plan, with investment
capital estimated to total approximately $25 billion in 2020 (See Table 3). A complete
infrastructure is planned for the industrial areas, including traffic systems, power and water
supply, drainage and wastewater treatment centers.

The current textile and garment industrial total area of 510 hectares (ha) is based in two
regions: in the north, in Pho Noi B comprising 121 ha and Bao Minh comprising 165 ha; and in the
south, in Binh An comprising 76 ha and VINATEX Tan Tao comprising 148 ha. There is an ambitious
plan to further extend the industrial area for textiles and garment production by 1,080 ha.


Bright Future


The future of the Vietnamese textile industry looks bright because of continuous efforts
made by textile companies to upgrade their equipment to enhance their competitiveness. Over the
last three years, there has been a fundamental change in the industry’s structure, especially in
the spinning subsector.

Vietnamese Textile Industry Self Evaluation

In collaboration with VINATEX, the Vietnamese textile industry evaluated its own strengths
and weaknesses in a SWOT analysis. A SWOT analysis is a strategic planning method to evaluate the
strengths, weaknesses/limitations, opportunities and threats involved in a business or project.
Here is the outcome of the analysis:


Strengths

  • Dominant exporting capability and highly potential domestic market;
  • Low costs, skillful labor force;
  •  Renovated and modernized equipment;
  • Stable political environment; and
  • Incentive policies.


Weaknesses

  • Most enterprises are medium and small size;
  • 50 percent of raw materials are imported;
  • Production management is still weak and inefficient; and
  • Marketing strategy is not paid serious attention.


Opportunities

  • Shifting trend from China to Association of Southeast Asian Nations (ASEAN) countries,
    including Vietnam;
  • Attracting investors from potential markets such as Russia and Korea;
  • Expanding market share in United States, European Union and Japan market; and
  • Large population: 86 million people.


Threats

  • Strong competition from rivals including China, India and Indonesia; and
  •  Bargains of technology, hygiene, social responsibilities.


Competitive Advantages

However, VINATEX has defined some important competitive advantages over its neighboring
states, such as:

  • Abundant source of skillful, fast-learning and wage-competitive labor;
  • Modern facilities backed with high-quality water treatment systems;
  • Cost-competitive locations for manufacturing and exporting;
  • Good and strong relationships with big international buyers/importers;
  • Recognition of credibility for high-quality products; and
  • Support from free trade agreements with major exporting markets.

Source: VINATEX

September/October 2012

Affordable Luxury Brand RAOUL Selects FashionManager ERP Solution

LYNDHURST, N.J. — October 10, 2012 — RLM Apparel Software Systems Inc. announces that women’s
luxury apparel and accessories brand RAOUL has selected the FashionManager™ software solution to
manage its business operations in the U.S. market. The company has begun the planning phase of
implementation for the Enterprise Resource Planning (ERP) solution in its New York headquarters.
Key among the initial business improvements the company expects to achieve through the new system
is streamlining the global supply chain and distribution processes.  

According to President of Sales Karen Katzman, “As a globally expanding business, we
recognized the need to update our systems to take advantage of the latest advancements in fashion
technology.  We chose RLM not only because their systems give us the tools we need to solve
today’s challenges, but also offer the full range of  fashion capabilities we need as we grow
into the future. We look forward to achieving measurable benefits with their systems.”

To meet the fast-growing supply chain and distribution needs of RAOUL, the FashionManager ERP
solution will leverage an existing integration point with apparel fulfillment specialist Bergen
Logistics to improve visibility and control over third-party logistics (3PL) processes such as
warehousing and order fulfillment. This integration enables FashionManager to fully automate the
finished goods receiving process by replacing manual entry and interaction with automatic
processing of electronic Advance Shipping Notices (ASN) to Bergen. By transmitting order pick
tickets and shipping information, the system can automatically create shipping cartons and generate
invoicing. Sharing of customer returns information will also streamline credit processing and make
returned goods available for quicker resale.

“We are pleased with the opportunity to provide solutions for such a fast growing global
brand”, noted RLM Vice President Andy Lynn. “As a Bergen Logistics client, RAOUL will be able to
leverage our pre-configured integration to achieve fast and significant results in streamlining
operations and improving accuracy. Because this and many of our other system capabilities align
well with their specific needs, we expect RAOUL to meet and exceed their expectations with
FashionManager.”

Posted on October 12, 2012

Source: RLM Apparel Software Systems

Copper Sole, Socks For Heroes Partner To Help Soldiers In Afghanistan

MOUNT AIRY, N.C. — October 3, 2012 — Of all the basics that U.S. troops on the battlefield need the
most, clean socks are high on the list, says a leading military support group.

“Clean socks are as important as food and ammunition to an infantryman,” said Jim Hogan, who
with his wife Carla started the Socks for Heroes program in 2011 to help provide a much-needed item
to Marines stationed in Afghanistan. Through donations from such companies as Renfro Corporation,
they have shipped 128,000 pairs of socks to Marines and Soldiers in Afghanistan.

To help the Hogans serve more soldiers with new socks, Renfro Corporation, a global leader in
the legwear industry, is launching a pre-holiday offer to benefit the military. For every pair of
Copper Sole socks that is purchased through its website www.CopperSole.com between now and November
18, 2012, Renfro will donate a pair of Copper Sole socks to the Socks for Heroes program.

The Copper Sole brand was chosen because it provides many benefits that an infantryman
appreciates.  Copper ions are woven into the fabric of the sock, helping to eliminate
odor-causing bacteria.  The socks have a reinforced cushioned sole and smooth toe seam that
provide exceptional comfort against tough boots. They wick moisture away from the skin to keep the
feet drier. Copper is a mineral found naturally in the body. The copper ions help the body feel
energized and can repair damaged skin.

Because infantry soldiers spend an average of 10 hours a day on their feet doing multiple
patrols and are stationed in places where laundry facilities (and often water) are in short supply,
a clean pair of socks can make all the difference to their well being, said Hogan.

“Many soldiers who don’t have access to laundry facilities say that a fresh change of socks
will often give them a temporary feeling of cleanliness until they reach a place where hot showers
and clean clothes are available,” said Hogan. “For the Infantryman, socks are the perfect gift or
item to include in gift boxes sent to soldiers on a regular basis.”

“It has been Renfro’s privilege to help Socks for Heroes provide socks to our dedicated U.S.
Marines and Soldiers who serve so faithfully in Afghanistan. We look forward to helping Socks for
Heroes send thousands more socks to the troops to provide the comfort that Copper Sole gives to
tired feet,” said Andrew L. (Bud) Kilby, CEO and President of Renfro.

Posted on October 12, 2012

Source: Renfro Corp.

The Rupp Report: Home Textiles – Still Going Strong

It’s getting close to the end of the year, and therefore, it’s getting close to the summit of the
global home textiles industry: Heimtextil. The gathering will take place at the Messe Frankfurt
fairground in Frankfurt Jan. 9-12, 2013.

Increased Turnover In 2011

At a recent press conference, show organizer, Messe Frankfurt GmbH, revealed some interesting
facts: The German textile industry recorded a turnover of 11.7 billion euros in 2011 — a plus of
7.7 percent compared to 2010. The sector enjoys a good atmosphere generated by increased exports
and a recuperation of jobs. Furthermore, the home textiles producers are profiting from positive
developments in the construction sector.

On the European side, the turnover rose 5 percent to 88.8 billion euros compared to 2010.
However, imports from non-European Union countries jumped by 13.9 percent to 25.4 billion euros.
Exports to these non-EU countries totaled 20.3 billion euros — 8.23-percent more compared to 2010.
For 2012, Messe Frankfurt is rather convinced that there will be a further increase of 3 percent,
compared to 2011.

Since its beginnings, Heimtextil has been the first event of the new year and season for the
home textiles industry, as producers, the processing industry and the trade. The event has reported
impressive figures: At the 2012 show, there were more than 2,600 exhibitors and approximately
70,000 visitors from 132 countries.

Heimtextil 2013

For next year, the organizers report there will be many new as well as returning exhibitors.
A trend to notice is a revival of mattresses. It seems that many mattress-producing exhibitors from
IMM Cologne — another home and contract furnishings trade show that takes place in Cologne,
Germany, later in January — are coming back to Frankfurt instead of exhibiting in Cologne.

Further trends include a comeback for wallpaper and a strong increase of exhibitors that are
producing furniture and decorative fabrics.

A key factor of the success of Heimtextil is always the number of lectures and presentations
that are given during the exhibition. Main topics will be luxury living, future hotels and
sustainability.

From one side, it is quite significant that this sector of the textile industry is also
fostering sustainability. According to a Messe Frankfurt survey, 78 percent of all German consumers
are interested in buying sustainable fabrics and products. In this context, another issue is
gaining importance: upcycling, referring to new, higher-value products made with recycled material.

Trends 2013-14

From the beginning, the trends from Messe Frankfurt have played an important role for the
home furnishings sector. The show organizers ask the manufacturers to send samples to be presented
in a wonderful array of fabrics. However, some visitors note that the producers do not show every
new design, which is quite understandable. The trend presentation serves as a teaser for the
visitors — first, to give some information on new design and color trends; and secondly, to lead
the visitors to the exhibitors’ booths for further discussions.

For 2013, Messe Frankfurt hired a complete new team of international designers to define the
trends for 2013-14. Rarely, in the last 20 years or so, has better and more precise trend
information been presented than at this year’s press conference. The pictures and colors are
superb. Here are the four basic trends, as abstracted from the descriptions by Messe Frankfurt’s
designer team:

The Historian

This personality sets great store by enduring values and discovers new ways of bringing the
past into the present. He gains inspiration from the late 16th and the 17th century. Expressive
ornaments, luxuriant decorations and wonderful details radiate an aristocratic dynamism. The
historian likes luxury with a sense for quality. Thus, textiles with a layer look are part of this,
as are net fabrics and artistic embroidery. The home is brightened by shimmering gold, bronze and
copper, as well as sophisticated reflections from material surfaces. The colors in rooms tend to be
subdued and dominated by mysterious shadings.

The Eccentric

His passion is for extravagant discoveries combining timeless qualities with decorative
character. The eccentric searches for unique items, curiosities and original articles distinguished
by exotic or ethnic influences. At all events, what he finds must be traditional and authentic. The
modern Dandy and Bohemian loves elegantly made textiles, such as hand-colored silk, extremely
lustrous artificial snakeskin, upholstery fabrics inspired by suit fabrics or oriental jacquards.
In his home, we find patterns with ethnic blossoms. The wall coverings take their inspiration from
textiles. The dominant colors have an Asian touch and interact in an extraordinary way.

The Inventor

To develop things that make life exciting — that’s the inventor’s challenge. He works on
concepts that combine function and fun, as well as wellness and pleasures. Fabrics are literally
brought to life: they sway, flutter and grow as flowery ornaments — extremely sensuous and tactile.
The inventor experiments with extraordinary upholstery fabrics, openwork weaves and meshwork.
Foamed textiles create an airy depth and give rooms and furniture a new look. Technical veils,
iridescent films and latex are also used. Feather-light constructions play with light and
reflections. Lively colors ensure extraordinary contrasts and awaken curiosity.

The Geologist

The nature lover appreciates and protects the earth and all its treasures. He knows the
quality and origins of a product. He is fascinated by the irregularities of geological surfaces. In
his environment, natural structures are upgraded by colorful marl aspects and winding, viral
patterns, as well as rough graininess, bark-like textures and rustic leather, skin or natural cork.
Blotch effects bring otherwise sober surfaces to life. Broken, mysterious brightness flashes from
the materials. The color series reflects the enigmatic dark side of nature. Intensive colors are
rounded off by shades of virulent intensity and metallic luster.

Contract Creations And Coupons

Two other offerings that are very important for the textile furnishings industry are Contract
Creations and the Coupon Business Finder. Through Contract Creations, the target group of
architects, hotel managers, interior designers and such may also attend lectures and podium
discussions during the event.

Also important for the trade is the possibility to buy in small quantities. More and more, it
is becoming very difficult to find manufacturers that are able — and, even more, willing — to sell
small quantities, for example, one piece of a design or color. Visitors will have the possibility
with the Coupon Business Finder to find such exhibitors.

More information is available at www.heimtextil.messefrankfurt.com.

October 9, 2012

Tandus Acquired By Tarkett Group

Dalton, Ga.-based floor covering designer and manufacturer Tandus Flooring Inc. has been acquired
by France-based Tarkett Group, a global manufacturer of sustainable flooring and sports surfaces,
for an undisclosed price.

Tandus, with roots going back to 1803, when the company began to import woven carpet to North
America, in 1969 became the first carpet manufacturer in North America to produce modular carpet.
In 1994, it became the first company in the industry to provide a closed-loop recycling program. In
addition to being recognized for its technologically innovative product lines and its environmental
and sustainability initiatives, it has earned numerous design awards. With annual revenues totaling
$340 million, the company currently has some 1,400 employees, five manufacturing sites in the
United States and Canada and one in China, and serves commercial markets in North America and Asia.

Tandus is now a stand-alone entity within Tarkett’s North American division and continues its
current manufacturing and business operations as well as distribution channels. Tandus President
Glen Hussmann remains in charge of the business and foresees expansion opportunities for the carpet
manufacturer.

“Tarkett is a true global company with sizeable exposure in high growth developing
countries,” Hussmann said. “This can provide Tandus a solid base for international expansion.”

Tarkett reported 2011 revenues totaling 2.1 billion euros and approximately 9,200 workers in
100 countries, including in 32 manufacturing sites. The company is co-owned by the Deconinck family
and private equity funds affiliated with KKR. The acquisition of Tandus enables Tarkett’s expansion
into North American and Asia Pacific commercial carpet markets.

“Together, Tarkett and Tandus will reach $1 billion of total sales in North America,” said
Jeff Buttitta, president, Tarkett North America. “We will now offer a broad commercial portfolio of
soft and hard surfaces, have a deep and experienced field organization and hold strong positions in
the education, corporate and healthcare segments. In the future, we will leverage our combined
resources for accelerated product innovation, integrated design activities and joint sustainability
initiatives that will provide our customers with greater choice in products and services with
worldwide capabilities.”



October 9, 2012

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