Textiles Have Stake In Legislation


A
s the 109th Congress winds down between now and November, the US textile industry and
importers have a vital stake in some of the issues that may or may not be dealt with in an
atmosphere charged with politics as the congressional election campaign unfolds. For the most part,
textile issues are in the area of international trade, where decisions made now will have a major
impact on the future shape of the industry. In some cases, congressional action is expected this
year, while others likely will have to wait for the new Congress in 2007.

Berry Amendment — The Berry Amendment, which directs the Department of Defense
(DoD) to buy its textiles and apparel from domestic courses whenever possible, will be acted upon,
but there is an effort by Rep. Robin Hayes, R- N.C., to expand the requirement to the Department of
Homeland Security. Past efforts by DoD procurement officials to weaken the Berry Amendment have for
the most part failed, but those officials are likely to try again. Extension of Buy American to
homeland security remains doubtful at best.

Chinese Currency — US textile industry officials and others contend currency
manipulation by the Chinese government amounts to as much as a 40-percent subsidy for its exports
to the US market. A number of bills have been introduced in Congress to address the issue. One
sponsored by Sens. Charles Schumer, D-N.Y., and Lindsey Graham, R-S.C., would impose a 27.5-percent
tariff on Chinese goods imported to the United States unless the president certifies China no
longer is manipulating its currency in order to gain an unfair international trade advantage. A
companion measure in the House of Representatives is sponsored by Reps. Sue Myrick, R-N.C., and
John Spratt, D-S.C. Those bills are not likely to become law in view of President George W. Bush’s
opposition, but they have been useful as a club to force voluntary action by the Chinese
government. A second approach to the problem, sponsored by Reps. Tim Ryan, D-Ohio, and Duncan
Hunter, R-Calif., would declare exchange rate manipulation by China actionable under US
countervailing duty and product safeguard statutes. That bill has the backing of a broadly based
farm, industry and labor currency manipulation coalition including textiles; and has a better
chance of enactment than the Schumer-Graham bill.



Trade Preference For Least-Developed Countries
— The Tariff Relief Assistance for
Developing Economies (TRADE) Act would permit 15 least-developed countries to ship their textile
apparel products to the United States duty-free regardless of the country of origin of yarn, fabric
or other components. US textile manufacturers are opposed to this legislation, contending it would
undercut the benefits of the North America Free Trade Agreement and the Central America-Dominican
Republic Free Trade Agreement. This legislation enjoys considerable support and could be enacted,
but not without a fight from the textile industry’s supporters in Congress.

Countervailing Duties For State Economies — A major problem for US textile
manufacturers is a ruling by the government that countervailing duties cannot be imposed on
state-run economies such as China and Vietnam. The House in July 2005 passed legislation designed
to reverse that ruling. In addition, it would establish a monitoring and reporting system to
measure China’s compliance with its trade obligations under the World Trade Organization (WTO).
Senate action is pending.



Free Trade Agreements
— Congressional action is pending on free trade agreements
(FTAs) that the US textile industry opposes. The Haiti Economic Recovery Opportunity (HERO) Act
would grant duty-free entry into the United States for apparel assembled in Haiti regardless of the
fabric’s country of origin. The HERO bill caps the amount of duty-free articles that can enter the
United States, and while the numbers appear small, they would amount to $2 billion in apparel
exports taken from other Caribbean and Central American countries. The Bush administration also has
entered into FTA negotiations with South Korea. While that pact has not been finalized and sent to
Congress, the US textile industry is strongly opposed to it, and it hopes to get congressional
input that will modify it before it is submitted for ratification.

Vietnam Agreement — Legislation that would grant permanent normal trade relations
to Vietnam has been introduced in Congress. The legislation is a necessary step toward Vietnam’s
accession to the WTO. It is strongly opposed by US textile manufacturers, but importers are
supporting it.



Textile And Apparel Research Funding
— Legislation pending in Congress would
continue the federal government’s long-standing support for textile and apparel research at the
Spring House, Pa.-based National Textile Center (NTC) and the Cary, N.C.-based Textile Clothing
Technology Corp. [(TC)2] at the current levels of $13 million for NTC and $2.5 million for (TC)2.
The federal government’s support for these two organizations is intended to improve the industry’s
competitiveness. With Congress tightening its purse strings in some areas, the outlook is uncertain
at this time.


Textile Trade Future Cloudy In View Of WTO Problems


The uncertain future of the WTO’s Doha Round of trade liberalization negotiations raises more
questions than answers with respect to the future of international trade in textiles and apparel.
While trade officials in the United States and abroad hope the round can be revived, there is a
chance it will die a slow death over the next few months.

The demise of the negotiations would be one of those good news/bad news situations for
textile manufacturers and importers. If the talks collapse, the US industry would not have to worry
about reductions or elimination of US textile and apparel tariffs. On the other hand, they feel the
round can be a vehicle to get a permanent safeguard mechanism that would prevent China, and perhaps
one or two more nations, from completely dominating the US apparel import market. Importers, on the
other hand, who do not like the idea of a safeguard mechanism, would lose the tariff reductions
they believe are so important in their future overseas sourcing.

As the talks reached a critical juncture in early July, the House weighed in on behalf of the
US textile industry when it passed legislation stating the US negotiators must adhere to the
objectives of the Trade Act of 2002. That act states: “The principal negotiating objectives of the
United States with respect to trade in textile and apparel articles are to obtain competitive
opportunities for the [US] exports of textiles and apparel in foreign markets substantially
equivalent to the competitive opportunities afforded [to] foreign exports in the [US] markets and
to achieve fairer and more open conditions of trade in textiles and apparel.”

While that language is somewhat vague and can be read in different ways by different people,
it does underscore the congressional interest in promoting fair trade in textiles.


Military Procurement Of Textiles, Apparel Faces Crisis


While the US textile and apparel industries have a long history of successfully meeting the
peacetime and wartime needs of the armed forces, demands of the war on terrorism and military
procurement practices are resulting in what many industry officials believe is a crisis. They
contend the defense industrial base is eroding to the point where it is increasingly difficult for
them to meet the needs of the armed forces.

The problem has resulted from inconsistent buying patterns. New orders are few and far
between, incoming orders under existing contracts are sporadic and unpredictable, and frequent
start/stop orders are being issued. In past wartime buildups, the military relied on more of a
centralized procurement system, but today procurement is spread across several agencies with
differing requirements and procedures. Industry officials say the Iraq War and lack of
communication and organization have caused “tremendous confusion in the industry, stretched limited
resources to the breaking point and have made fact-based production planning nearly impossible.”

The National Textile Association, Boston; the American Apparel and Footwear Association,
Fairfax, Va.; and the Parachute Industry Association, Skokie, Ill. — which represent most of the
500 companies of the defense industrial base — have launched a series of meetings with defense
officials in an effort to fix the problem.

Members of the defense industrial base provide the armed forces with their most basic needs:
socks, undergarments, combat and other uniforms, hats, gloves, boots, wet-weather gear,
cold-weather gear, chemical-protective gear, body armor, utility bags, sleeping systems, parachutes
and tents.

July/August 2006

TenCate Selects Benninger Bleaching Machine

The Netherlands-based TenCate
Advanced Textiles has brought online an automated process-controlled, continuous open-width
bleaching machine with a fully integrated operating system. The company worked with
Switzerland-based Benninger Textile Systems Co. Ltd. to design the machine according to TenCate’s
specifications.

The new pretreatment line performs separate singeing, scouring and bleaching operations in
one process sequence. Features include microprocessors for automated measurement and adjustment of
variables including water, chemicals, speed and pressure; and 25 automatic dosing positions for
chemicals.

The line represents a 6 million-euro investment including building alterations, and
foundation and platform construction.


July/August 2006

Automatic Weft Detection


F
ashion trends are production challenges faced every day by a textile finisher. The goal
is to produce first-quality goods only. This is especially difficult when weft distortion has been
introduced to the fabric during various process stages.

Uneven tension distribution across the weft is the main cause for distortion. There are many
causes for this defect, including tension variations, equipment lineup, improper roller adjustments
and direct contact of machinery with the material.


Dealing With Weft Distortion

Mechanical forces are commonly employed to correct the geometry of a weft that has been
distorted during the finishing phase. Both mechanical weft straighteners and differential drive
tenters are commonly applied technologies.

By adjusting the speeds of differential tenter chains, or by applying linear tension and
passing material across rollers that can be pivoted around the center point of the fabric width,
the weft lines can be moved and realigned.

Mechanical weft correction devices have always been used to correct weft distortion,
primarily on materials where distortion is more visible and becomes an issue for the end-user.
However, as tolerances grow tighter, production speeds increase, and the fabrics become more
complex, automatic weft straightening is a must in today’s modern textile finishing operations.

 

p28
Using photoelectronic detection in oscillation removes possible mechanical difficulties.


Straightening Principles

The history of automatic weft straightening goes back more than 40 years. Generally, there
are two common automatic weft-straightening principles used today: automatic straightening by means
of mechanics; and automatic straightening by means of electromechanics.

Automatic straightening by means of mechanical force is based on the parallelogram effect.
When the distortion of the fabric is along a diagonal axis, the warp and weft geometry, initially
orthogonal, assumes a parallelogram configuration. When the two selvages are pulled out to stretch
the cloth to its full width, the weft is tightened, generating complex forces in a parallelogram
configuration to establish a square structure. This straightening force can be exploited for
restoring proper weave geometry if the selvages, in spite of their lateral tensions, are
sufficiently free to move in the direction of the warp.

Automatic straightening by means of electromechanics is the most common method employed
today. Weft geometry is automatically detected using a mechanical or electrical sensor. That
information is then transformed into a signal that displaces rollers, making the correction as
necessary. The weft-straightening effect here is the result of the difference in distance traveled
by one selvage in relation to the other over the rollers in the weft-straightening system.

p26


Sensing Technology

In order to have an effective automatic weft-straightening system, it is important for the
sensing device to detect all the possible fabric styles, designs, colors and structures. With
today’s complex textile products, that is not always an easy task. The ideal detection system is
capable of sensing denim, sheeting, jacquard, apparel and automotive fabrics; fiberglass, carpet,
lace, terry towels and a large variety of technical textiles, among other products.

In the early 1960s, two major detection systems on the market were used for detecting weft
distortion in fabric. One system involved the use of mechanical principles, and the other utilized
photoelectronic sensors.

 

Mechanical Detection Principle

The mechanical principle is based on the use of two wheels mounted on a freely moving
mounting pin. Under normal conditions, both wheels are turned by the passing fabric, resulting in a
homogenous signal. When a distortion is sensed, the tension created by the skewed weft causes the
freely mounted wheels to turn left or right depending on the distortion. A non-proportional signal
is generated by a differential amplifier, sending correction signals to a correction device. As
long as the wheels in continuous contact with the material remain in the same good working
condition, the measurement results remain satisfactory. Any uneven fabric surface challenges the
mechanical principle and generates asymmetrical distortion. This system has not been further
developed in its design and has been discontinued because of limited detection abilities and
hardware reliability.


Photoelectronic Detection Principle

The photoelectronic sensor is based on a signal modulation created by the passing web
structure. One of the first photoelectronic sensors was based on several photo elements located on
one side of the web and a light source on the opposite side of the web. When the weft line was
parallel and straight in front of the sensor, a somewhat equally strong signal was generated in
both channels.

If the weft line was not parallel to the sensor, one pair of photo elements generated more
signal than the other, and this determined the distortion. That type of sensor could only
differentiate between left or right distortion and was not able to quantify the amount or angle of
distortion. Therefore, a proportional correction based on the physical distortion was not possible.

The next generations of optical sensors utilized only one photo element by letting it freely
oscillate between known limits. That improved the linearity, resolution and accuracy of each
sensor, enabling it to detect more complex fabric structures.

With microcomputers entering the industrial arena, it was not long until the first
microcontroller-based detection system was introduced. Stepper motor technology for linear movement
replaced the free-oscillation detection lens and improved lighting principles such as infrared
light-emitting diodes and reflex light sources, bringing the system more up-to-date.

The photoelectronic detection technology is utilized in various executions such as
oscillation, rotation or shifted dual-rotating mode. By rotating the lens 360º instead of always
oscillating on the same position, one could avoid possible mechanical difficulties. However, there
is some valuable time lost by scanning areas of the fabric that are unrelated to the weft line. The
shifted dual-rotating mode reduces such time delays in collecting valuable weft distortion
information with a two-lens system.

camera
The latest CCD matrix camera from Erhardt + Leimer GmbH employs high-resolution auto-focus
and auto-zoom technologies.


Weft Detection Using Cameras

The rapid reductions in the prices of computer systems and digital cameras combined with
advanced image-processing techniques have led to the introduction of several vision systems to the
textile manufacturer. There are two types of camera systems that can be used to create an image:
line scan camera technology; or charged-couple device (CCD) matrix camera technology.

The line scan camera in combination with an encoder creates an image while the web passes
by. After capturing the image, the evaluation software uses special algorithms to process the
digital information.

The line scan camera technology typically is used to detect the full width of the web,
detecting and evaluating patterns rather than the weft line. That can be realized with either one
or two cameras, depending on the area of interest. However, if there is no pattern in the web, the
line scan technology is not able to detect any distortion in a web.

A matrix camera takes images similar to any conventional digital camera on the market. The
web is imaged several times per second, whether running or not, on a 2-D area. The camera looks at
multiple weft lines simultaneously, providing a high data rate of the passing weft structure. With
sophisticated software tools and mathematic calculation, a 3-D image is processed, detecting not
only the weft, but also the warp of a web.

The matrix camera technology is used for a closer look at the individual weft and utilizes
the weft structure in its calculation of the residual web distortion. Whether with several cameras
evenly distributed over the full width of the web, or just one scanning camera taking images
across, a large cross-direction and machine-direction profile of the passing web is captured. A
reflecting circumference infrared illumination guarantees the best uniform imaging results.

The latest camera introduced from Germany-based Erhardt + Leimer GmbH employs
high-resolution auto-focus and auto-zoom technologies that allow the camera to view an optimum
evaluation area and the largest 2-D area possible. The camera is mounted 250 millimeters away from
the web, moving it away from sometimes harsh existing environmental conditions. The image is then
processed within a 3-D space and filtered through a fast Fourier transformation (FFT), resulting in
spectral data. Separating the noise from the actual high-level spectral data leaves the positioning
information of the weft and the warp.

A major breakthrough of the 2-D image detection system using CCD matrix camera technology
makes detection on many difficult webs such as carpet, jacquard and thicker wefts a problem of the
past. Whereas conventional photoelectronic systems detect one weft at a time, the CCD matrix camera
has the ability to evaluate a large number of weft lines simultaneously, even if the web is not
moving. And whereas conventional photoelectronic sensors are required to have a minimum speed for
detection, the speed of the process has no influence on the final result or the quality of the
evaluated detection area when using the CCD matrix camera.

In addition to increasing the number of weft lines being detected, the system with its wide
field of view also has increased drastically the evaluation area in the cross direction of the
weft. That makes it more accurate and reliable because it sees far more than conventional detection
systems see.

Many disadvantages associated with conventional detection systems can be overcome by using
image-processing techniques to monitor webs of all kinds. New camera measurement systems have
improved the range of use from unstructured, homogenous webs to complex, patterned fabrics.

Higher-quality products and more satisfied customers result from more accurate and reliable
technologies.


Editor’s Note: Udo Skarke is manager of Germany-based Erhardt + Leimer GmbH’s Textile Division
in Duncan, S.C.


July/August 2006

Taking Advantage Of Technology


A
shopper at a retail flooring store selects a Mohawk carpet thats a cut order from a
regional warehouse. The salesperson takes the order, and it is entered electronically into Mohaw’s
communications system, almost ensuring that it will be delivered within 72 hours. The next day, the
customer decides she wants to increase her order to include another room. Is it too late for a
change? It isn’t with Mohawk’s state-of-the-art communications network. In this case, the system
could signal the warehouse almost up until the time the order is actually cut and make the change,
keeping the customer happy and the order profitable.

Mohawk Industries is an avid user of technology, particularly as it provides new abilities to
enhance efficiency, improve customer service and adapt to changing customer demands. And one of the
shining stars is the intricate, redundant voice and data network that keeps Mohawk factories,
distribution and dealers in constant communication. This year, prompted by business growth, a
growing bandwidth demand of systems functionality and the need to create a cost-effective platform
to grow on, Mohawk has made a major upgrade to its data network. The upgrade has created a
multi-protocol label switching network that is recognized for its efficiency and effectiveness.
Taking advantage of lower cost/higher-bandwidth technology, Mohawk has worked with AT&T to
build a highly available data storage, retrieval and management system that updates almost
constantly, giving Mohawk employees critical information that lets them do their jobs as
effectively as possible.

That may mean on-time delivery of an order despite a last-minute change. Or it may mean making
an adjustment in production that saves thousands of dollars.

mohawktech

Mohawk’s website,
www.mohawk-flooring.com, provides consumers with
information about its products.


B2B Strategy

The system is not necessarily a pure business-to-business (B2B) network, but it flows from the
dealer all the way back to production and raw material supply. Tied in with custom applications and
systems developed around distribution including local fleet management, over-the-road fleet
management, warehouse management, plant automation, planning, scheduling and Web-based support
tools, Mohawk’s network is designed to provide accurate representation of delivery dates while
providing manufacturing with the information needed to optimize plant operation, allocation of
orders and production efficiency.


Leveraging The Internet

Through a dedicated website,
www.mohawknet.com, dealers can place orders electronically.
With Mohawk’s Real Time Visibility software, the dealer can know within minutes when an order will
reach his store, plus get e-mail and fax notifications of deliveries. The customer can view the
steps in the order process up to the point the truck makes the delivery.


New Technology Adoption

The key to improved customer service is responsiveness. Mohawk has been very aggressive in the
use of radio frequency technologies in its facilities, along with bar coding to optimize inventory.
As dealers get more access to the Internet and become more accustomed to using it, the system gains
efficiency. Internet tools provide dealers with easier and more personalized access to order and
account information, making it easier for them to manage their day-to-day needs.

For larger
customers, Mohawk also has implemented radio frequency identification (RFID) systems that mesh with
how major retailers manage their flow of goods. And while Mohawk constantly explores making plant
innovations to improve production efficiency and processes, many of which are proprietary the test
of new ideas is how they integrate into the overall system to enhance its effectiveness. Shop floor
systems, sales and operation planning processes, distribution and delivery are all interconnected,
saving Mohawk millions of dollars each year and making it possible for dealers to work small
miracles like a last-minute change in a customer order.

July/August 2006

Cotton Incorporated Installs Menzel Machinery

Cotton Incorporated, Cary, N.C., has
purchased and installed a brushing machine and a two-burner singer from Spartanburg-based Menzel
Inc. According to Menzel, the singer is available for customer trials at Cotton Incorporated’s new
facility.

The updated brushing machine’s polycarbonate sliding doors allow a full view of the brushing
action. The updated singer’s new, easy-to-adjust air/gas mixing system, used in conjunction with
the Menzel gas analyzer, enables setting of an optimal flame, according to the company.


July/August 2006

July/August 2006

The Controlling Electrostatic Hazards
DVD/DVD-ROM training package from

Newson Gale Inc.
, Lakewood, N.J., trains staff on managing electrostatic discharge when handling
flammable materials. The package also includes additional training and informational resources.

New York City-based

Cooper-Hewitt National Design Museum
has added two wallcoverings from New York City-based KnollTextiles — Pause, designed by
2×4; and Merge, designed by Abbott Miller of Pentagram — to its permanent collection.

England-based

International Newsletters Ltd.
has published the second edition of “Medical and Hygiene Textiles: Initiatives for
Growth,” by Geoff Fisher. The report profiles 50 major companies in the medical and disposable
hygiene industries.


Jakob Müller AG, Frick,
Switzerland, is publishing a textbook series for the narrow fabrics industry. The first
two volumes, “Preparation – Finishing – Make-up” and “Needle Weaving Technology in Narrow Fabrics,”a
re now available in German and English. Also, the company’s website, www.mueller-frick.com, soon
will feature an input mask where customers may report defects and request technical assistance.

The 4th Annual

Industrial Fabrics Foundation (IFF)
Silent Auction, benefitting Roseville, Minn.-based IFF, will begin Sept. 18, 2006,
on-line at iffauction.cmarket.com.

The

Edward Lowe Foundation
and nonprofit organizations, has named Midland, Mich.-based

Aegis Environments
one of the “Michigan 50 Companies to Watch.”

Through its new Seal of Approval for Deep Cleaning Systems program, the Dalton, Ga-based

Carpet and Rug Institute
examines the solutions, equipment and overall effectiveness of carpet-cleaning processes.
The first gold seal winners are systems from Mohawk FloorCare Essentials; Sears Carpet &
Upholstery Care; Steamin Demon; ZeroRez; and Harris Research Inc., which also won silver ratings
for two of its systems.

West Conshohocken, Pa.-based

ASTM International
offers an Online Directory of Testing Laboratories that is searchable by keyword, testing
type and products tested at www.astm.org/LABS. Users also may search the directory from the ASTM
Standards Database.


GorillaCareers.com
, Aiken, S.C., a website for employers and job seekers, has added the textile industry to
the list of sectors it serves.


Sauquoit Industries LLC
, Scranton, Pa., has released its Advanced Textile Materials/Unique Processing
Capabilities brochure presenting the company’s full line of electrically conductive fabrics and
yarns.

Ithaca, New York-based

Emerson Power Transmission
’s revised Belt Drives and Bearings Reference Guide offers product design, installation,
maintenance and troubleshooting details for its belt, sheave and bearing products.

Fredericksburg, Va.-based

Kaeser Compressors Inc.
has expanded its Sigma Frequency Control compressor line to range from 15 to 335
horsepower and provide flows from 17 to 1,568 cubic feet per minute in pressures from 80 to 217
pounds per square inch gauge. The company’s new Cost Savings with Compressed Air System Maintenance
guide details maintenance activites for each system component.

Full color, 24-bit designs for digital textile printing are available for purchase for
between $100 and $1,500 at

www.fabric24.com
, Italy. More than 90 percent of the designs are available in PostScript format, and
users may search for designs by keywords or by categories.


Yaskawa Electric America Inc.
, New Berlin, Wis., has launched its DriveWizard™ 6.1 software, which features file
conversion tools and enhanced Ethernet support.

The new Sheerweave® 4550 and 4650 styles for interior shading from Tuscaloosa, Ala.-based

Phifer Inc.
offer two faces because of their broken twill weave. The fabrics, which feature a white,
outward facing side that reduces solar heat and an inward-facing color side, may be used for small
diameter shades.


Banner Engineering Corp.
, Minneapolis, has updated its 2006 Sensor Products catalog for sensing
applications.


July/August 2006

ATI Offers TEXTEST PORTAIR Tester

Greer, S.C.-based Advanced Testing
Instruments Corp. (ATI), exclusive North American agent for Switzerland-based TEXTEST AG, now
offers Textest’s FX 3360 PORTAIR air permeability tester, a compact, battery-powered, hand-held
tester for measuring the air permeability and thickness of stationary or moving webs.

The Portair allows measurement of air permeability at a selected test pressure or of the
pressure drop at a selected air velocity, producing results that are both accurate and
reproducible, according to Textest. When not in use, the tester may be stored or transported in a
docking station, which also automatically recharges the batteries.

The tester displays graphic and numerical test results. Data may be transferred to a
personal computer (PC) for storage. Both the Portair and the PC software, which comes with the
tester, give the results in English, French, German, Italian and Spanish.


July/August 2006

Avoid Missteps By Dispelling Marketing Myths



M
arketing is more than making the sale. It’s a continuous process of creating and
maintaining relationships, and measuring results.

As a marketing professional, you should be implementing a cohesive marketing strategy that
helps you gain both market and customer share. Measuring marketing results can be trying, but it
sometimes can be as easy as asking questions such as, “Are the majority of our customers repeat
buyers or one-shot deals?”

Periodically — at least annually — review your marketing strategy to determine whether to
adopt a new one or perfect the one you have. Once you determine which strategy to implement, you
can better decide what tools you’ll use to reach your target audience and improve your
sales.


Market Share Strategy

The market share strategy is a straightforward plan to get a bigger piece of the pie than your
competitors. To grow market share, you have to change how you penetrate the market. For you to win
a sale, the customer has to perceive that your offering is of greater value than the competition’s.

To implement this strategy, first determine: What’s the target market? In what portion of
those target markets do you have a presence? How do these customers perceive the value of your
product versus your competition’s?

Armed with this information, you can develop new value propositions to meet customer needs,
develop access to customer segments you’re not reaching and improve communication with existing
customers.


Market Expansion

The market expansion strategy, as the name suggests, seeks to expand the size of your market.
For example, if you presently sell in a four-state area, you might consider expanding to five. To
implement this strategy, you need to make certain the new market includes your target audience and
that a new competitor won’t undercut your price or make entering the market difficult.


Market Segmentation

The market segmentation strategy concentrates on a subgroup of customers with a special product
or service need. Segmentation and specialization can be a good way to create more value for your
company. For example, if your competition has product strength but lacks in the areas of service or
repair, you may want to concentrate on the market segment that has an ongoing need for maintenance,
repair or spare parts.


Positioning Strategy

A positioning strategy is psychological. It’s designed to create and maintain a specific image
in the customer’s mind. This strategy is about how customers think and feel. It uses words and
images to create strong feelings and beliefs about the company and product or service, and it
requires a lot of brand building through advertising and marketing communications.

Developing a positioning strategy depends a great deal on how your competitors position
themselves. Do you want a “me too” strategy that positions you close to your competitors so
consumers can make a direct comparison when they purchase, or do you want to position yourself away
from the competition?


Product Life Cycle

The product life cycle strategy is driven by innovation and can apply to a brand or to a product
category. Its duration may be only a few months for a fad item, or a century or more for categories
like the gasoline-powered automobile.

Product life cycle stages include introduction, growth, maturity and decline. When the
product is introduced, advertising costs typically are high and sales are low until customers
become aware of the product and its benefits.

The growth stage is a period of rapid revenue growth. Sales increase as customers’ awareness
of the product and its benefits grows, and additional market segments are targeted.

The maturity stage is the most profitable. While sales continue to increase in this stage,
they do so at a slower rate. Because brand awareness is stronger, advertising expenditures are
reduced. But competition may result in decreased market share or prices, with similar products
limiting your ability to differentiate.

Eventually, sales begin to decline as the market becomes saturated, the product becomes
technologically obsolete, or customer tastes change. If the product has developed brand loyalty,
profitability may be maintained longer.

Critics of this strategy argue the product life cycle may become a self-fulfilling prophecy.
If sales peak and then decline, managers may conclude the product is in the decline phase and
therefore cut the advertising budget, thus precipitating a further decline.


Quality Strategy

To implement the quality strategy, you must be better than the competition in your customers’
eyes. You can deliver on the quality quotient in several ways — such as having a better design or a
more durable product, or offering more reliable service or faster delivery. Select one or two areas
where you know you are superior to the competition and implement a marketing strategy that
identifies these specific attributes.


Reminder Strategy

The reminder strategy is simple and communications-oriented. It targets regular, loyal customers
to remind them to make an additional or replacement purchase.

In light of the fact that the cost of selling to a new customer is five times greater than
for selling to an existing one, this strategy is fairly easy and inexpensive to implement. It can
be as simple as a letter or postcard reminder that it’s time for an upgrade or replacement. You
might also consider an incentive or reward for your best customers who refer business your
way. 


Simplicity Strategy

The simplicity strategy emphasizes customer convenience. Businesses and consumers these days
often are overwhelmed with the complexity and choices of goods and services available to them, with
products full of functions and features that only a small number of users will ever use.




July/August 2006




NCSU Hosts Italian Technical Textiles Conference


T
he realization that technical textiles will continue to grow as a significant sector of
the US textile industry was at the center of a conference held recently at the North Carolina State
University (NCSU) College of Textiles on the Raleigh, N.C., Centennial campus. The Italian Trade
Commission Seminar, presented by the Italian Trade Commission (ICE) and The Association of Italian
Textile Machinery Manufacturers (ACIMIT) in cooperation with NCSU’s College of Textiles and the
Nonwovens Cooperative Research Center (NCRC), brought a delegation of Italian machinery
manufacturers face-to-face with members of the technical textiles industry from throughout the
United States.The two-day event featured presentations including the state of the US industry, the
potential for innovation, tours of the college, an overview of the Italian textile machinery
industry by ACIMIT, and presentations of equipment and technology by Italian machinery companies.

The conference, facilitated by John Hagewood, associate director of the College of Textiles,
opened with welcoming remarks by Blanton Godfrey, dean of the College of Textiles, and Giovanni
Bifulco, trade commissioner in ICE’s Atlanta office.

”The American market for textile machinery has undergone some difficult years, but the
numbers show how American manufacturers have been capable of reacting to the crisis that has
overcome the entire textile industry in industrialized nations,” said ACIMIT President Paolo Banfi,
who also serves as CEO of Italy-based Comez S.p.A. “ American companies have set up restructuring
and concentration programs which have [streamlined] the sector, rendering it also more efficient in
facing international competition. One of the main factors for the recovery of America’s textile
industry has certainly been the greater degree of attention paid to market niches with a high
potential for growth — that is, technical textiles and nonwovens,” Banfi said.

Mauro Badanelli, ACIMIT economics manager, presented an overview of the Italian textile
machinery industry, which includes approximately 300 companies and more than 23,000 workers. In
2005, Italian textile machinery exports totaled 2 billion euros — 80 percent of the year’s total
production of 2.5 billion euros. US companies bought Italian textile equipment worth approximately
82 million euros in 2005. Badanelli said ACIMIT estimates more than 100 of its member companies
have involvement in technical textiles and nonwovens and a steadily growing turnover, currently 5
to 10 percent of the total turnover.

behnambanfi
Behnam Pourdeyhimi, Ph.D., NCSU College of Textiles associate dean for industry research
and extension, William A. Klopman Distinguished Professor and director, NCRC (left); with ACIMIT
Chairman Paolo Banfi. Banfi also is CEO of Italy-based Comez S.p.A.

Machinery Companies Featured

Comez, a manufacturer of needlelooms, crochet knitting machines and double-needlebed
warp-knitting machines, presented solutions for technical narrow fabrics. Comez technology assists
in making a wide variety of webbings and nettings as well as 3-D designs that have been used in
markets such as automotive, sports equipment, agriculture and medical applications.

Cormatex S.r.l. has a history of making carding machinery for the woolen and worsted
industries. Coming under new management in 1978, the company diversified to include a full range of
nonwovens technology from bale breakers, openers, feeders, cards and crosslappers to slitters,
winders and proprietary software.

Nuova ROJ Electrotex S.r.l., a well-known supplier of weft feeders for knitting and weaving
applications, is focused on opportunities in technical weaving. Glass, carbon, Kevlar®, polyester,
polypropylene and nylon yarns all place special demands on the equipment, and ROJ has developed
feeders for these technical materials.

OMMI S.p.A. designs and produces opening and blending plants. With almost 1,000 plants
worldwide and more than 40 years of experience, OMMI makes both batch and continuous systems.

PLM Impianti S.r.l. offers measuring, inspection, winding and packing technologies. The
company also supplies transportation and automation systems for the inspection and shipping areas
of the plant.

Well-known weaving machine manufacturer Smit S.p.A. presented the common platform strategy
for its rapier machine for flat fabrics, air-jet for flat fabrics, rapier for terry fabrics and
rapier for technical fabrics. The GS900 rapier weaving machines for technical fabrics and air-bag
production were reviewed.

godfrey

 Blanton Godfrey, dean of NCSU’s College of Textiles


Room For Growth And Innovation

Edward Gregor of Charlotte-based Edward C. Gregor & Associates LLC touched on emerging
innovations in technical textiles, as well as providing some sense of scope of the current market.
Pointing to data from David Rigby and Associates, Gregor noted the global industrial textiles
market in 2005 was estimated at $72 billion. The Americas are estimated as a $21 billion market;
Europe, $19 billion; and Asia, $27 billion; with the rest of the world accounting for $5 billion.
Gregor also pointed to gross profit margins of successful industrial textile companies in the 25-
to 30-percent range. Regarding nonwoven market sizes in North America, Gregor cited Association of
the Nonwovens Fabric Industry data for 2005 that concluded the largest market in dollar terms was
filtration, at $713 million. Hygiene, at $703 million; medical/surgical, $570 million; and wipes,
$503 million, rounded out the top tier. The furnishings, automotive and flooring/carpet markets
were each estimated at approximately $200 million.

Behnam Pourdeyhimi, Ph.D., NCSU College of Textiles associate dean for industry research and
extension, William A. Klopman Distinguished Professor and director, NCRC, provided a nonwovens
overview. Pourdeyhimi noted the US nonwovens industry is estimated to include more than 550 firms
that employ more than 160,000 people. He characterized the typical firm as fairly small with median
employment of 75 people and annual sales of $7.5 million. Pourdeyhimi showed a wide variety of
products being produced and also discussed the projected life cycles of various nonwoven
manufacturing methods.

 

mussazuiches
Alex Mussa, assistant trade commissioner, ICE (left); with James Zuiches, NCSU vice
chancellor for extension, engagement and economic development


NCSU Shines

The College of Textiles was open for laboratory tours conducted by university professors. NCSU
continues to grow and invest in textile research as well as in the education of graduate and
post-graduate students.

NCRC was established in 1991 as a partnership between NCSU and nonwovens and allied
industries suppliers. Funding was provided by the National Science Foundation and the State of
North Carolina. The facility’s value is estimated to exceed $15 million.


July/August 2006

 

 

Redefining Floor Covering


T
he Mohawk Industries Inc. story reads like a classic business case: a success story based
on leadership that supports growth both organic and through mergers and acquisitions as well as a
redefinition of product and services to fit the demands of consumers, and migration from
traditional manufacturing to becoming a fully vertical floor covering supply chain that includes
aggressive marketing and retail support.

The Calhoun, Ga.-based Mohawk Industries known today has its origins in a strategic merger that,
at the time, made the company the only US mill to produce the four available styles of woven
carpet. In 1878, four Shuttleworth brothers came from England and established a mill with 14
secondhand looms in Amsterdam, N.Y. In 1886, a mill known as McCleary, Walin and Crouse was
established in the same city. In 1920, the two companies merged to establish Mohawk Carpet Mills,
taking the name from the Mohawk River running through Amsterdam.

Growth came quickly to Mohawk, which reported $18 million in sales and earnings in excess of $1
million in 1937. By 1941, sales exceeded $30 million; and by 1948, sales reached almost $62
million.

In 1954, Mohawk merged with Alexander Smith and Sons to establish Mohasco Industries. Combined
sales reached $110.7 million.

Product and technology continued to be a significant part of Mohawk’s success. One example is a
1953 investment in tufting that payed off just 10 years later. By 1963, more than half the carpet
produced in the United States was made using tufting technology. That early investment positioned
Mohasco for rapid growth.

mohawkfloor

Established in 1878 as a carpet manufacturer, Mohawk Industries has focused on a strategy
of growth, which includes adding laminate flooring, ceramic tile, stone, hardwood flooring and
resilient to its products portfolio.


From $270 Million To $7 Billion

In 1980, Mohasco hired David Kolb as CEO. In 1984, John Swift joined the company as CFO. In
retrospect, Swift’s pairing with Kolb was a tipping point for Mohawk as this team led rapid change,
and rapid growth unfolded.

Jeffrey Lorberbaum, current chairman and CEO, summed it up best when Swift and Kolb retired in
late 2004: John has been an integral part of the Mohawk organization as we grew from a $270 million
carpet manufacturer to a leading floor covering manufacturer with 2003 sales in excess of $5
billion and an annual earnings per share growth rate of 26 percent since 1997. When John started
with Mohawk in 1984, Mohawk was an unprofitable division of Mohasco. Under his financial
leadership, Mohawk was spun off as an independent company in 1988 and became publicly traded in
1992. During his tenure, Mohawk completed 17 successful acquisitions, growing to number 349 on the
Fortune 500 list with a total enterprise value in excess of $6 billion.

With similar respectful remarks for Kolb, Lorberbaum said: Dave has truly changed the company
and the industry with his vision, strategy and hard work. Under Dave’s leadership, Mohawk was spun
off from its parent company in an LBO transaction and turned in a strong performance for three
years as a private company. In 1992, he took the company public in an [initial public offering] and
began to lead the consolidation of the floor covering industry with 12 acquisitions over the course
of eight years. After Dave retired as CEO to continue serving as chairman in December 2000, the
company continued its strong growth both through acquisitions and organically with strategic
emphasis.

Today, Mohawk continues in Kolb’s and Swift’s strategic footsteps and has gained key leaders
like Lorberbaum through mergers and acquisitions, blending talents and corporate cultures along the
way. By late 2006, sales are projected to close in on $7 billion, continuing the company’s growth
history.

Established in 1878 as a carpet manufacturer, Mohawk Industries has focused on a strategy of
growth, which includes adding laminate flooring, ceramic tile, stone, hardwood flooring and
resilient to its products portfolio.


1992 To Present

Acquisitions at Mohawk have not only increased sales, but also opened markets and added talent
to the company. From associates to executives, Mohawk has benefited from the knowledge and talent
brought to the company through aggressive merger and acquisition activities. To get a sense of the
companies that form the core of Mohawk’s transformation, a year-by-year list of some of the key
acquisition investments put in action by Kolb and Swift follows: 1992 Horizon Industries; 1993
American Rug Craftsmen and Karastan-Bigelow; 1994 Aladdin Mills; 1995 Galaxy Carpet Mills; 1997
Diamond Carpet Mills (certain assets); 1998 Newmark Rug Co., American Weavers and World
Carpets/WundaWeve; 1999 Durkan Patterned Carpets and Image Industries; 2000 Alliance Pad; 2002
Dal-Tile and American Olean; 2003 Lees Carpets; and 2005 Unilin.

At first glance, the list above looks like the act of a consolidator amassing industry
participants to maximize economies of scale and buy market share. A deeper look reveals that
strategically, each company has brought additional advantages in product, distribution or
ever-important supply chain control. In addition, Mohawk’s migration from carpet manufacturer to
floor covering resource is clear. In 2001, 5 percent of total company sales was in hard-surface
products. With the addition of Dal-Tile and Unilin known for Quick-Step® laminates the company
rebalanced its revenue mix to include a 35-percent share dedicated to hard surface. Dal-Tile, which
focuses on ceramic and stone, is estimated to be growing at 15 percent per year. Consumers hunger
for laminates continues to grow similarly.

In true Mohawk form, the migration from carpet manufacturer to full floor covering resource has
multiple repercussions. In terms of distribution, a complete floor covering line is available from
Mohawk. In terms of marketing and retail support, Mohawk can offer retailers full support and
increase penetration with Mohawk brands. The retailer, from one source, can benefit from a variety
of in-store marketing support across Mohawk design and product lines as well as direct consumer
marketing in the form of brand-building consumer and trade advertising.


A Focus On Growth

The strategies of Kolb and Swift, which continue today under Lorberbaum’s charge, appear as
savvy financial investments in a growing industry. That may be true, but the ability to actively
manage the strengths of Mohawk, adding to them when necessary to lead rather than accommodate
industry changes from fiber through retail and commercial to consumer is as big if not a bigger
part of Mohawk’s success.

It would have been easy for Mohawk to get stuck in its identity as a world-class carpet and rug
manufacturer. The risks were understood. But the active vision to change to deal with the change
presented by the retail and distribution environment, whether it be the advent of Home Depot and
Lowes supercenters, or the family-run floor covering store is the quantum leap. Mohawk didn’t
abandon its history to pursue its future. Rather, with significant vision and an understanding of
the consumer, it redefined floor covering and, in doing so, charted a path for growth.



Jeff Lorberbaum: Transition To The Future

In 1994, Mohawk merged with highly profitable and privately held Aladdin Mills Inc. through a
$430 million pooling of interests. Mohawk paid a premium price for Aladdin but felt justified by
Aladdin’s comparatively high profitability. Aladdin’s compound sales growth had averaged 20 percent
from 1988 to 1993, and after the merger Aladdin contributed 40 percent to Mohawk’s sales and 50
percent to its net income. In 1995, Jeffrey Lorberbaum, son of Aladdin founder Alan Lorberbaum, was
appointed Mohawk president and COO, while David Kolb continued on as chairman and CEO. Lorberbaum,
no newcomer to the industry, joined Aladdin in 1976 as vice president of operations and later
became its president and CEO.

Focusing on profitability, Lorberbaum structured the corporation’s manufacturing capacity along
product lines, adjusting capacity over the ensuing years and consolidating operations at the most
efficient plants. He also expected to expand Aladdin’s existing warehousing and distribution system
to service all of Mohawk’s operations. A more dynamic marketing program emphasized the strength of
the company’s core brands.

Under Lorberbaum’s guidance, Mohawk continued acquisitions through the rest of the 90s and into
the new century, including Image Carpet Mills, Galaxy Carpet Mills, Diamond Carpet and Rug, World
Carpets and Durkan Patterned Carpets. One of the biggest acquisitions came in 2002 with the
purchase of Dal-Tile, which made Mohawk Industries the largest supplier of ceramic tile in the
United States. The acquisition of Unilin in 2005 catapulted Mohawk into the same strategic position
in the fast-growing laminate market.

Kolb and CFO John Swift retired in 2004, but their legacy and strategic vision are still present
in Lorberbaum’s leadership. 



David Kolb And John Swift: Key Architects Of Mohawk’s Financial
Strategy

In 1980, Mohasco, then owners of Mohawk, hired David Kolb, an attorney who had served as
comptroller and director of the nylon carpet fibers division at Allied Fibers. As Mohawk’s CEO,
Kolb was charged with turning the then-unprofitable company around. The new CEO undertook a
five-year program that encompassed plant and system’s modernization, cost reductions and
development of new managers. He even moved the company’s headquarters from Amsterdam, N.Y., to
Atlanta.In 1984, John Swift joined the company as vice president of finance and CFO after 18 years
with General Electric Co.

kolbswift

David Kolb (left) and John Swift

Under the guidance of Kolb and Swift, Mohawk switched to higher-margin products and increased
direct distribution to retailers, streamlining the supply chain. Having achieved his profit goals,
Kolb took the carpet division private with a $120 million leveraged buyout (LBO) in 1988. Kolb
became chairman of the Board of Directors and CEO of the company, and Swift became secretary and
treasurer.

Mergers and acquisitions reduced the number of carpet producers from more than 300 in 1980 to
100 by the mid-1990s, with vertically integrated and, in Mohawk’s case, well-diversified mega-mills
emerging at the top of the heap.

Using the $38 million proceeds of Mohawk’s 1992 public stock offering to reduce the company’s
LBO debt, Kolb and Swift engineered a series of key acquisitions that catapulted Mohawk from 11th
in the industry to second, increased its sales from less than $300 million to nearly $1.5 billion,
and multiplied its market share from less than 4 percent to 17 percent. In addition, Mohawk’s
growth rate ranked it second among the Fortune 500s fastest-growing companies in 1993.

The first purchase, Horizon Industries, came in October 1992. Although larger than Mohawk,
Horizon was vulnerable because of back-to-back losses in the early 1990s. Less than eight months
later, Mohawk acquired American Rug Craftsmen (ARC), a 10-year-old manufacturer of area rugs. ARC
made Mohawk the nation’s leading producer of mass-market rugs and now is part of Mohawk Home.The
August 1993 purchase of Karastan-Bigelow from Fieldcrest Cannon added two of the industry’s
best-known and most valuable brands. In fact, Bigelow was named for Erastus B. Bigelow, the
19th-century Father of the Modern Carpet Industry, so-named for his invention of the power loom.
The addition of Karastan-Bigelow pushed Mohawk past competitor Beaulieu of America to become the
United States’ second-largest carpet company. The leadership and philosophies established by Kolb
and Swift transformed an unprofitable Mohasco division into a performance-oriented publicly traded
firm that has realized close to $7 billion in annual sales. Following the 2004 retirement of Kolb
and Swift, Mohawk Industries continues to focus on growth and meeting consumers demands.

July/August 2006

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