irreverent, thought-provoking analysis of the industry.
2003 IN REVIEW
As usual, lots of ups and downs.
by Mike Hartnett (December, 2003)
The top stories of the year:
1. ACCI and HIA agreed to merge. While the deal is not
yet done (due diligence continues), the end result should be the
best of both worlds: two annual shows, one membership, redundancy
eliminated, and the industry speaking in one voice.
2. INRG and TNNA agreed to a joint show in Columbus in
2004. This should greatly benefit retailers who now need only attend
one show to find the latest in cross stitch, yarn, and needlepoint.
In related news, the Crochet Guild of America and its events
will be held in conjunction with the Knitting Guild of America.
3. Michaels opened its first two ReCollections (all
scrapbooking) stores and Village Crafts stores (craft stores
in smaller population areas).
4. Jo-Ann's caused a huge stir when it invited vendors to a
60th anniversary party and asked for money for
anniversary promotions. Many vendors were outraged, but the
complaints stopped after vendors heard the presentation of the
company's history and future plans.
5. Mergers weren't the only changes for the trade
associations. HIA, HSA, and NAMTA hired new executive
directors, and Offinger Management agreed to manage INRG and
the Crochet Guild of America.
6. Crafts magazine, once the largest circulation
consumer craft magazine, announces it's changing to Paper Crafts,
setting off a huge debate on specialization.
7. The industry started to pay attention to Hispanics, now
the largest minority group in the U.S. HIA released a study on the
Hispanic market, publishers published books in Spanish, and more
vendors included Spanish on their packaging.
8. The SARS epidemic stopped travel to the Orient during the
crucial spring period, but it taught some retailers and importers
that they don't HAVE to travel overseas as much as they had assumed.
9. Congress held hearings and continued to wrestle with
legislation to curb online copyright infringement. The effort is led
by the music industry, but the final result should help our
10. Retailers in other industries continue to pick off
"our" products, whether it's stickers in drug stores,
Christmas decorations at Lowes, framed art and frames every where
you shop, etc.
11. Martha! Not a good year for the "doyenne of
crafts." She was indicted on criminal insider-trading charges,
saw her tv ratings and magazine circulation decline, and watched as
her retail partner, Kmart, continued to struggle.
2003 was not a particularly great year for most. Overall, sales
probably outpaced most other industries, but profits were only
slightly better than last year, if at all ... Chains continued their
pressure on vendors to lower prices ... Importing grew as vendors
and retailers look for lower prices ... Some scrapbook retailers are
thinking twice about their business as some regions become
over-retailed ... Scrapbooking is evolving into two industries;
large vendors sell to chains, small vendors to independents, and a
lucky few to both ... It is difficult to
get chains to take a chance on new lines, so some vendors are
looking to expand their business by acquiring companies that already
have shelf space in the chains.
Scrapbooking remained king and spawned increased interest in
stamping, cardmaking, and other paper crafts ... Jewelrymaking and
yarn continued to grow – both the high-end and the lower-cost
lines ... Quilting continues to roll on ... Newcomer of the Year:
pursemaking ... Embellishments were strong not only in scrapbooking,
but in quilting as well ... Decorative painting needs to attract a
younger audience ... Altered books appeared and expanded into
altered art, which one veteran designer said, "Isn't that just
a fancy name for mixed media?" ... Toys suffered from price
wars ... Collectibles declined drastically ... Seasonal suffered
from so many "non-craft" retailers dividing the pie.
Generally attendance equaled or surpassed last year's events,
when people were still leery of traveling after 9/11. There were
complaints at some shows about how they were becoming
"scrapbook" shows. Those complaints came from
vendors/retailers not involved in scrapbooking. Shows like TNNA, Memories
Expo, MemoryTrends, and Great American Scrapbooking continued
to break records. Shows in most industries declined.
Once again our industry has lost some good ones this year,
including Justin "Freddy" Zimmerman, one of the founders
of Jo-Ann's ... Dick Thompson, one of the industry's most
well lked manufacturers' reps ... Author/designer Betty Auth ...
Painter/author Debbie Toews ... Sales rep Ted Nelson ... Randy
Schafer, former owner and creator of Omnigrid ... Pei Ling
Chong, a former buyer for the Ben Franklin stores in
Singapore, died of SARS ... Marilyn Schwankoff of Walter Foster
and AMACO ... Cara Nabity, daughter of Accu-Cut’s
Steve and Lynette Nabity ... Industry veteran Marty Gelfand,
formerly of Darice and Westrim ... Don Pendray,
husband of Shay Pendray ... Painter Marty Bell ... And our friend,
Lisa Julson Cahoon, formerly of CraftShop.com, co-president
FAO Schwartz (Chapt. 11, for the second time) ... MJDesigns
(Chap. 7) ... The Art Stores (Chap. 11) ... Wellington
Leisure Products, whose Maxwell-Wellington division was
the dominant macrame vendor when macrame was king ... Kmart
emerged from bankruptcy amidst a flurry of lawsuits, but, well, it's
still Kmart ....Ames died long ago, but lawyers are still
hounding creditors to return millions in payments.
Hygloss Products acquired Color Fantasy, manufacturers
of Color Your Own T-Shirts and Color Your Own Posters
... Greenleaf Steel Rule Die re-acquired its former dollhouse
line, Greenleaf Products ... Caron acquired
substantially all assets of CC Product Co./Bond America ... Berwick,
a division of CSS Industries, acquired substantially all of the
assets of C.M. Offray ... Jean Charles and ImageHill
merged ... Janlynn signed an exclusive partnership deal with Kooler
Design Studio, a leading needlework design firm ... Malinda and
Jim Johnston sold Lake City Craft to Sandy Watson ... Duncan
Ent. acquired all of PSX ... Creative Beginnings
acquired and revived Stampa Rosa and reestablished the
product line. The Buffalo Batt division of Leggett &
Platt acquired the consumer (Mountain Mist) division from
Stearns Technical Textiles.
The United Brotherhood of Carpenters Pension Trust filed a class
action suit against Michaels and some top execs, charging the
company with violations of federal securities law. Michaels denied
the charges ... A California judge was deciding whether to make a
sex discrimination suit by current and former Wal-Mart
employees a class action suit. If he decides yes, it will be the
largest case in history ... Wal-Mart is also the subject of numerous
lawsuits claiming the company forced employees to work unpaid
overtime, engaged in anti-union activities, and used illegal workers
... Wal-Mart led a class action suit which won big settlements with
Visa and MasterCard that should lower retailers' costs of accepting
(Note: To comment on this column or other industry issues,
email Mike Hartnett at firstname.lastname@example.org.
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