Creative Leisure News
306 Parker Circle
Lawrence, KS 66049
September 18, 2000
Vol. IV, No. 18
TABLE OF CONTENTS
Just a note to let you know, next month we'll be moving Creative
Leisure News to its own new website. Fax subscribers will
receive their issues as usual, but everyone else will receive an
email telling them a new issue is online. At the site, they will
find the latest issue, archives of old issues, and a variety of
surprises. The site will go "live" in early October, but
we'll deliver the October issues the usual way until we're sure all
the bugs have been worked out.
HOLIDAY SEASON PREDICTIONS, PT. I
While the strong economy continues to grow, many consumers'
disposable income will be less than a year ago. Heating oil and
gasoline prices are substantially higher this year. Interest rates
are higher, too, for new homeowners and for consumers with
Other factors include the absence of Y2K fears (remember those?) to
boost spending, and heavier debt loads for consumers who have spent
more than they have saved in the past year. People aren't making as
much money in the stock market this year, either.
The lackluster back-to-school season may be evidence that a slowdown
in consumer spending has already started. If so, look for this
holiday season to have more retail promotions, which will hurt
A.G. Edwards analyst Robert Buchanan to forecast flat or lower
earnings for 9 of the 14 retailers he follows, Business Week
HOLIDAY SEASON PREDICTIONS, PT. II
How will all these general economic trends affect our industry? It
may not necessarily portend a tough season. A long-held, if
unproven, theory says consumers who feel a need to reduce spending
may make more holiday presents instead of buying readymades.
Perhaps it's the unseasonably hot weather under which much of the
country has been suffering lately -- or just the typical summer
doldrums. Let's hope so.
On the other hand, we're hearing reports from vendors in various
categories that business is flat. A major exception to the gloomy
talk is scrapbooking, which continues to grow in terms of overall
dollars, number of stores, and number of vendors.
Still, it's hard to generalize from complaints by U.S. vendors that
more consumers aren't in a buying-and-making mood. Here's why:
1. At least one major chain apparently is continuing to
suffer from bugs in its new computer system. Empty peghooks mean
lost sales opportunities. Maybe the consumer isn't interested, but
if the shelf is empty, we'll never know.
2. Another chain seems to be increasing its use of
private-label, imported items rather than buying U.S. products. So
the chain might be doing well, but U.S. vendors will never know.
3. We're hearing a growing number of complaints about buyers
being far less interested in considering new products. Maybe
consumers would love some of these new products that aren't being
given enough buyer consideration, but we'll never know.
THE IDEAFOREST/JO-ANN SITE, TV
IdeaForest has launched the re-designed joann.com for Jo-Ann Stores.
If you surf to IdeaForest.com, you'll find the message, "IdeaForest
has partnered with Jo-Ann Stores, the nation's leading fabric and
crafts retailer, to inspire and serve your creativity, in the
comfort of your own home or in the Jo?Ann store near you," and
a link to joann.com.
The joann.com site features include a "Project Finder,"
which allows customers to locate projects based on skill level,
time, and budget; access to IdeaForest's panel of craft experts; and
Street Fair, where consumers can sell their projects.
And, of course, e-commerce. The major shopping categories are Book
Store, Decorative Painting, Floral, General Crafts, Holidays, Home
Accents, Kids, Mind & Body, Quilting, Rubber Stamping,
Scrapbooking, Sewing, and Yarn & Stitch. A full fabric line will
be available soon.
Some examples of the pricing: Ceramcoat and Folk Art
are each $1.09. Red Heart Super Saver Yarn is $2.79/skein.
IdeaForest merchandisers will make all decisions regarding product
assortment on the joann.com site. Vendors should contact Bob Kendig
or Lesley Siegel. 310-62-4472.
The site also includes "Partner Stores" which sell art and
framing; art materials, hobbies, woodcrafting, fresh flowers,
decorative painting, quilting, and "unique" art and gifts.
IdeaForest also announced joann.com's Creative World, a
series of 52 hour-long programs that will air on ValueVision, a home
shopping network, over the next 14 months. The network is beamed
into approximately 36 million homes. The series, which premiered
last Thursday, will center on themes such as Christmas tree
decorating, knitting projects, etc. IdeaForest's panel of experts
(Dee Grunig, Priscilla Hauser, Kathy Lamancusa, etc.) will be guests
on the series.
The next shows will be September 28 and October 12 at 1 pm EST, and
every Thursday beginning in November.
IdeaForest officials plan to support the joann.com site with the tv
series, "heavy" on-air promotions including a new tv
commercial, new print ads in consumer media, a direct mail campaign
to Jo-Ann Stores' customers, and in-store promotional displays in
the 1,000-plus Jo-Ann and Jo-Ann etc stores.
"We want joann.com to be known as the earth's largest
creativity store," said IdeaForest's President/CEO Rich
Bergsund. "Our partnerships with Jo-Ann Stores and ValueVision
television help us serve consumers whenever and wherever they like
SIERRA PACIFIC CRAFTS EXPANDS AGAIN
Sierra Pacific Crafts (SPC) has added two new members to its
exclusive, worldwide network of independent craft retailers:
Hannah's Home Accents, of Chicago, and BFS, Inc., of Hawaii.
"We are very fortunate to have these two tremendous companies
on our team," says Emma Gebo, SPC board president and
Pocatello, Idaho, member store owner. "Both Hannah's Home
Accents and BFS are on the cutting edge of retail crafting and will
provide a wealth of knowledge to our network."
The additions boost SPC's membership to nearly 60 retailers in 11
U.S. states and Japan.
Hannah's Home Accents is greater Chicago's largest craft/home
accents store, covering more than 30,000 sq. ft. Owners Don and Jane
Marski bring more than 50 years of retailing experience to SPC.
"This is an incredible opportunity for us to be part of such an
elite group," says Don Marski. "As independents, it is
important to find a group of people in the industry that understand
our business. We found that in SPC."
BFS, Inc. is a Hawaii-based retail company operating 18
craft/hardware stores throughout the Hawaiian Islands. The Kamitaki
family, BFS owners, opened its first Ben Franklin Craft store in
1951 on the island of Maui.
Based in Woodburn, Oregon, SPC began in the late 1970s as a small
Northwest co-op and has since invited select members from around the
globe to join its network. SPC strives to maximize the success of
its member stores and vendor partners through cooperative strategies
in marketing, purchasing, education, operations, networking, and
fellowship. Hannah's Home Accents and BFS are the first new members
since August, 1999 when four Ben Franklin stores in California and
Nevada joined the group.
JO-ANN'S SUPPORTS INDUSTRY PROMO
We're into the most active promotional month in the industry's
history, thanks to special events sponsored by the Society of
Decorative Painters (SDP), the Hobby Industry Association(HIA), the
Home Sewing Association (HSA), and the Craft Yarn Council of America
Jo-Ann's is taking advantage of most of those efforts by declaring
September as Creating a Difference Month. (CYCA's Knit-in
takes place in New York.)
* Sew for the Cure (September 9-30): Every customer who
donates $1 to breast cancer research receives 12-page Sewing Idea
booklet filled with ideas for making everything from evening bags to
ribbon pillows. Sew for the Cure is an HSA initiative to
raise money for breast cancer research. Last year, Jo-Ann's donated
$100,000 to the cause and hopes to increase that amount this year.
* Create a Difference Celebration (September 15-17): A
portion of the weekend's proceeds will be donated to breast cancer
research. In addition, on September 15 from 5-10 p.m., all customers
will receive 10% off all transactions, as a special thank you from
* Learn to Paint Day (September 16): Customers can see
finished projects and receive project sheets about painting
techniques. Some stores will also host a make-it/take-it class on
painting a paper mache heart-shaped box, taught by SDP members, from
10-12 am and 1-3 pm.
* A Family Craft-In (September 23) will include in-store
demos from 11 am - 3 pm. Children, parents, and grandparents can
learn together to make an autumn leaf picture frame, a photo
transfer pillow, a flower pot wreath, valances and swags, and a
decorated haunted house cake. They can also create a bookmark as
part of the HIA-sponsored promo.
Comment: trade groups spend a lot of money, and volunteers
spend a lot of time, to create nation-wide promotional efforts like
this. It's a waste of that time and money if retailers don't take
advantage of these promotions by creating local, in-store events.
SELLING TO INDEPENDENTS
A leading manufacturer/importer with a nationwide sales organization
and a very solid financial standing is looking for opportunities to
purchase and/or sell items/lines to its established base of
independent businesses. Have a great product but need a sales force
and a method of distribution?
This could be a viable solution to an increasingly common dilemma
facing many manufacturers these days. They want to lessen their
dependence on a handful of large accounts, but don't have the sales
force to adequately reach the independent base. The vendor could
sell his/her product to this company, which would then re-sell to
its independent customer list, or, have this company act as its
sales force to independents.
For more info, contact Mike Hartnett, in complete confidence, at
309-925-5593 or email email@example.com.
FOOD FOR THOUGHT
Is your biggest customer your biggest profit source? Not
necessarily, says The Selling Advantage, a bi-weekly
newsletter for sales professionals. "Recently the correlation
between size and profitability has become much less clear,"
wrote Neil Rackham and John DeVincentis. "The experience of a
major U.S.-based component manufacturer provides a typical example.
Not long ago it analyzed the profit contribution of its 10 largest
accounts. In 1987, these accounts had represented 72% of overall
profit. Ten years later, in 1997, this contribution had shrunk to
less than 40%. Every one of the top ten accounts was highly
profitable in 1987. By 1997, two of these accounts were creating a
loss for the company and two others were barely breaking even."
WANG'S. Responding to rumors circulating through the
industry, Suzy Wang said the rumors began when Wang's experienced a
system-wide failure during a computer conversion last April. The
problem halted deliveries, including most Christmas items, until
July. It affected the business "like an earthquake," she
told CNA editor Karen Ancona. The system is working now and the
company is shipping. She said she thanks the customers who have
stood by the company and looks forward to doing business with them
in the future. She added that the company intends to stay in the
craft industry -- with a re-focused line -- and plans to exhibit at
HIA in January.
SEWING. Consumers are beginning to complain on sewing-related
Internet sites about Wal-Mart testing the idea of pre-cut fabric
replacing bolts. There is even talk of gathering petitions to
protest. One woman complained on sewingworld.com that the nearest
place she can buy bolt fabric (other than Wal-Mart) is 40 miles
away. No official word on how the test is doing.
MEDIA. Watch for an upcoming issue of Time. A reporter
interviewed Jim Hedgepath of Pegasus Originals, including a 3-hour
photo shoot, about the Internet copyright problem.
PEOPLE. Industry veteran Karen Kilbourne has joined Krause
Publications as Account Executive. She'll be working with CNA, Craft
Supply Magazine, Arts & Crafts, and Great American Crafts ...
Artisan Network, the umbrella for MisterArt.com, StudioSource.com,
etc., hired Paula J. Charles as Chief Financial Officer. She had
served as Sr. VP, Finance and MIS, for US Franchise Systems.
JOB. Major soft craft manufacturer is looking for a Regional
Sales Manager for the Southeast, operating out of Atlanta.
Compensation in the high 60's. For more, call Mike Hartnett in
complete confidence, at 309-925-5593, or email firstname.lastname@example.org.
SITES. Duncan has revamped the craft portion of its
duncancrafts.com site which offers a wide variety of free painting
and craft projects.
STOCK. Wedbush Morgan initiated coverage of Michaels with a
Buy recommendation. Michaels repurchased 694,000 shares of common
stock for $26.6 million from the end of the second quarter through
Sept. 8. In July 1999, the board had approved the repurchase of up
to 5 million shares. As of Sept. 8, Michaels had about 36.3 shares
of common stock outstanding ... Merrill Lynch reiterated its
coverage of Wal-Mart at Near-Term Buy/Long-Term Buy and Banc of
America Sec initiated coverage of Wal-Mart at Buy.
PERSONNEL. The excellent newsletter published by The Creative
Network, the only personnel search firm specializing in our
industry, is now available by email. And it's free! If you'd like to
receive it, go to www.creativenetworkinc.com or e-mail email@example.com.
DIVIDEND. The Hancock board of directors declared a cash
dividend of 2.5 cents/share on the outstanding common shares,
payable October 15 to shareholders of record October 1.
RATINGS. Standard & Poor's raised its corporate credit,
senior unsecured debt, and bank loan ratings on Michaels to double-B
from double-B-minus. S&P said, "The ratings on Michaels
Stores reflect the challenges of managing rapid store growth and
improving execution at the store level, particularly in inventory
management and service," Dow Jones News reported. S&P
thought the risks were minimized "by the company's position as
the only retailer in the arts and crafts industry with a national
scope, and continued improvement in profitability."
LEATHER. In November, The Leather Factory will open two
company-owned warehouse sales centers in the Dallas (Mesquite) and
Houston (Missouri City) areas.
VOTING. Clerks will hand out federal voter registration forms
outside Wal-Mart stores and SAM'S Clubs, September. 21-22. Customers
complete the forms, add postage, and mail them. The company also
will register employees at its distribution centers. Officials
estimate up to 10 million potential voters will pass through 2,300
Wal-Mart stores and SAM'S Clubs during those two days.
STORES. Ames will open 8 stores in the Chicago area and two
in Columbus, Ohio area this Thursday. Two additional stores are
scheduled for Chicago this year.
NEW. Toys R Us says it will build the world's largest toy
store in Times Square in New York, opening in the summer of 2001.
RANDOM THOUGHTS, RANDOM QUOTES
1. The expansion of Sierra Pacific Crafts is an additional
reminder that vendors are foolish to operate on the assumption that
there are only a half dozen viable retailers in the industry.
Collectively, the SPC members operate about 100 stores; some of them
are among the largest-grossing stores in the industry.
2. Why are these SPC stores so good? A few years ago, I had a
friendly disagreement with an SPC member who operates 10 stores. I
said if you have 10 stores, you're a chain. He disagreed vehemently,
claiming he was still an independent. Hmmm. Maybe these stores are
so good because of that kind of attitude.
3. One thumb up to Wal-Mart and Kmart for requiring customers
to prove they are over 17 before buying mature-rated video games.
("Mature" is a euphemism for very violent.). It would be
two thumbs up if they didn't sell such games at all.
4. In the Everything Comes Around Again Department: Mark Lee
at AMACO reports a resurgence of Friendly Plastic, which is being
used with stamping.
5. I talked to Larry Shook recently. As we reported earlier,
Larry closed his distributorship, Craft & Hobby Supplies.
"I didn't lose placement; I lost customers," Larry said,
referring to the likes of Piece Goods and Old America. He still has
Tolin' Station's excellent metal line for sale -- earlier he sold
the transfer paper line to Loew Cornell. Interested in buyiing the
entire line? Call Larry at 336-370-0670.
ACQUISITION. CraftClick.com acquired CraftPlanet.com, a
community site with an idea library, message boards, columnists,
etc. CraftClick will add e-commerce features to the site soon.
CraftPlanet was owned by Deborah Sweigart, former webmistress and tv
personality for Aleene's Creative Living.
WOMEN. In a recent study by Media Metrix and Jupiter
Communications, women now outnumber men, 50.4% to 49.6%, on the
Internet, Reuters reported. While the total number of Internet users
grew by 22.4% during the past year, the number of female users grew
STARTUPS. The Seattle Times published a fascinating history
of ArtPassion.com, a site selling art prints and posters. It
chronicles the company's steps -- and mistakes -- in such detail
that it becomes words of wisdom for anyone thinking about starting
an e-commerce site in our industry. Surf to http://seattletimes.nwsource.com/news/business/html98/art10_20000910.html.
RESEARCH. Kathy Lamancusa's recent TUESDAY'S TREND TALK TO
TRANSFORM TOMORROW reported on the Shopping Index VIII by Greenfield
Online. Why consumers are shopping online: Save time, 60% ... Avoid
crowds, 47% ... Find the lowest price, 46% ... Buy hard-to-find
items, 35% ... Better selection, 29% ... More product information,
22%, ... Easier to ship, 15% ... Good gift ideas, 14%. Why consumers
do not shop online: Shipping charges, 51% ... Can't see/touch items,
44% ... Can't return items easily, 32% ... Worried about credit card
safety, 24% ... Can't ask questions, 23% ...Takes too long to load
screen, 16% ... Worried about delivery time, 15% ... Enjoy shopping
offline, 10%. To subscribe to Kathy's free newsletter or to learn
about her seminars and consulting services, email firstname.lastname@example.org.
WHY CAN'T WE BE MORE LIKE HOME
The following letter is from Lisa Shepard, the Creative Director for
As an insider in the sewing/craft industry, I visit our stores to
buy supplies for my projects and survey our industry from the
consumer's point of view. I make mental notes about assortment,
layout, lighting, displays, sale items, etc. I also pay attention to
the staff's level of product knowledge, helpfulness, and
friendliness, plus conversations with other shoppers.
During a recent trip to my local sewing/craft store, I overheard an
exchange between the sales associate and a customer at the fabric
The customer had selected a gorgeous black-and-ivory shantung dress
print and described her plans to make dresses for herself and her
daughter. Then she asked for interfacing for the fabric. The sales
associate replied, "Oh, what kind do you want? I don't know
anything about that stuff. I don't use it."
The customer said, "I don't know either, but I want the iron-on
stuff; you know, the fast, easy way. Just give me the CHEAPEST
The clerk admitted her ignorance of interfacing again, while
claiming she sews regularly. She pulled out two fusibles, one
non-woven (craft backing!), and one woven. Naturally, the non-woven
was cheaper ($2.55 vs. $3.49), but I could tell it wasn't right for
So I volunteered, "I think that might be too heavy. Maybe
there's a better one." I returned from the nearby interfacing
area with a much more compatible (and by coincidence, less
expensive) alternative, a non-woven priced at $2/yard. The customer
Then I asked the clerk, "So how DO you sew without
interfacing?" (You can only take polar fleece so far, I
The clerk admitted she sticks to styles that don't need it, stating
again that she didn't understand the need for it. Worse, she didn't
seem to care to learn.
When the clerk announced her plans to make a button-down shirt for
her boyfriend, both the customer and I tried to explain the need for
support in the collar, cuffs, and placket.
I left the store with a sinking feeling about how many times this
scenario plays out in fabric stores, not only regarding
interfacings, but sewing in general.
Consumers don't expect the store staff to be experts in every phase
of sewing or crafts, but dealing with employees who have some grasp
of the basics (like interfacings) shouldn't be too much to ask in a
specialized retail environment like a fabric store.
When I visit Home Depot, I don't expect every employee to be able to
build a house from the frame up. But when I have a question, I
receive a useful answer because the employees have at least a basic
working knowledge of what they're selling and why.
This is obviously a big part of Home Depot's success. Can the same
be said for most of our industry retailers?
Unfortunately, many of our customers complain about encountering
sales associates who either don't know or don't care about what
they're selling. It's up to the storeowners and managers to promote
the Home Depot approach as much as possible, and to make educational
resources available to their staff on a regular basis. It's a
crucial for retaining current customers and attracting new ones.
Comment: HTC offers a free, 6-page brochure of interfacing products,
with selection and fusing tips, preshrinking hints, etc. It's
available to retailers, educators, consumers and sewing guilds by
written request. Please email email@example.com, write to HTC, Inc,
103 Eisenhower Parkway, Roseland, NJ 07068, or visit www.htc-inc.net
for more information.
THE CREATIVE NETWORK: JOB OPENINGS
The only personnel recruitment firm specializing in our industry has
the following job openings. Call 360-834-0802; fax 360-834-0702;
email firstname.lastname@example.org; or check
CENTRAL: Design Department Manager (crafts) ... Marketing
Coordinator (floral, wedding) ... Product Manager (floral, wedding).
CENTRAL/WESTERN: Product Designer (seasonal).
MID ATLANTIC: Director of Sales & Marketing (gift,
novelty) ... VP Sales Account Executive (ribbon, trims) ... VP
Marketing (trims, fabrics) ... VP Marketing (soft crafts, trims).
NEW ENGLAND: Assistant Art Director (fine art) ... Director
NORTH CENTRAL: Branding Manager (high tech) ... Director of
Sculptural Team (3D product design) ... Director of Sports
Collectibles ... General Manager (sales & operations) ...
Editor/Manager (web/book content) ... Oracle Developer/Web Master
... Product Development/Designers ... Programs Manager (high tech)
... Group Product Manager (direct marketing experience) ... Product
Development VP (gifts/collectibles).
PACIFIC: Ad Copy Production Manager (overseas experience) ...
Director of Product Management (crafts) ... Senior Product
Development Manager (crafts).
SOUTH: Product Manager (school, office supplies) ... Senior
Art Director (marketing communications).
CREATIVE NETWORK: JOBS OF THE
Position: Product Manager (floral, wedding) ... Salary:
$55-70K, plus benefits and relocation ... Location:
Mid-Central ... Description: Aggressive, fast paced
manufacturer ... Responsibilities: Complete management of
assigned wedding and floral lines and new product development;
provide and maintain the annual strategic plan; create and manage
timelines for new product or projects; work with directors to
implement merchandising ideas (press releases, displays,
plan-o-grams, packaging, etc.) ... Qualifications: 5-10 years
experience; and excellent communication, organization, and
analytical skills. Some travel (about 25%) required.
Position: Senior Product Manager ... Location:
California ... Description: Develop, manage, and execute key
product lines; contribute to the product development effort from the
concept (sourcing, costing, sampling, and packaging) through the
final launch (attaining margin goals and timely manner of delivery
of goods); manage projects with multiple items within a line (and
often within a package, such as a kit); update and manage a weekly
status report; identify new product opportunities and/or line
extensions; and work cooperatively with other departments and
vendors ... Qualifications: scrapbook/stationery industry
experience preferred; strong marketing, communication, organization,
and analytical skills; 3-5 years of product management experience;
computer literacy; Far East development experience a must;
bachelor's degree; an interest in crafts or hobbies a plus.
For more about these positions, contact The Creative Network at
THE CLN RETAIL INDEX
A. C. Moore (ACMR). Last*: 7 7/8 ... Change**: -1 7/32
Ames (AMES). Last*: 5 11/32 ... Change**: +5/32
Hancock Fabrics (HKF). Last*: 5 ... Change**: -1/8
Jo-Ann Stores (JAS.A) [a]. Last*: 6 1/4 ... Change**: -7/16
Michaels (MIKE). Last*: 40 9/16 ... Change**: +4 3/16
Rag Shops (RAGS). Last*: 2 13/32 ... Change**: -3/32
Wal-Mart (WMT). Last*: 51 7/8 ... Change**: +3 1/16
CLN Retail Index. Last*: 119.313 ... Change**: +4.9%
Dow Jones Index. Last*: 10,927.00 ... Change**: -2.8%
*September 15 ** from September 1 [a] voting share Note: Prices are
exclusive of dividends
CONSUMERS WRITE ...
The consumer is always right, right? Yes, in theory at least, but
sometimes when the consumer writes .... you have to wonder. The
following is a letter an industry manufacturer received and shared
"I heard that you can wallpaper with fabric. You would use a
staple gun and put it up that way and then use trim to cover over
the staples. It sounds interesting. Could you tell me how to do
this? Also how do you cover over the seams? Also the person said to
use a king size sheet. We can not paint because we have a parrot.
Thank You. Arlene"
The parrot reminds us of years ago when a Central Illinois retailer
told us this story: A woman walked into the store and asked the
clerk to special order a frame that was much deeper than a normal
frame. The woman's parakeet, Bob, had died and her brother was going
to stuff it for her. Hence the need for the frame.
The clerk ordered the frame. The next day the brother came in,
wanting to cancel the frame order because his cat ate poor Bob. He
said if he had to pay for the frame, he'd get another parakeet that
looked like Bob, kill it, stuff it, and fool his sister.
The clerk said no, the brother wouldn't have to pay for the frame.
Years later, the store still had the frame in stock.
Do you have a funny, unusual, or touching letter or story about a
consumer? Send it to us and we'll share it with CLN readers. We'll
protect everyone's privacy and share some smiles.
Note: Creative Leisure News is published on the
first and third Mondays of each month. Your next issue will be
Monday, October 2nd.
Need any rumors checked? Company news or comments on industry
issues? Call Mike Hartnett, in confidence, at 309-925-5593; fax
309-925-9068; or Email to email@example.com.