Copland's Larry Hulighan Weighs in on the Hospitality Sector
July 25, 2002
Textiles Veteran Discusses State of Industry, Diversification Challenges
Burlington, N.C. (USA) - Since Copland Industries began producing contract textiles three years ago, it has become a solid supplier for the sector.
Copland Industries consists of three businesses: 1) A vertical operation where it prepares yarn, weaves and finishes fabrics, which it sells directly to its customers in various markets; 2) a commission-finishing operation that finishes fabrics owned by other companies; 3) a converting operation that prepares and sells poly cotton and cotton fabrics from qualified suppliers.
Below, VP of marketing Larry Hulighan discusses the challenges of diversification and the state of industry.
How is Copland dealing with the recession?
''Jim Copland's tenacious attitude has positioned us to survive,'' Hulighan said. ''Also, we've cut costs. We've been forced to, especially with foreign governments giving companies in their countries so much support. No government or bank is giving us money. We've invested in our future, in our facilities, and in equipment and people to keep ourselves competitive. We've also benefited from a loyal workforce.''
When did Copland begin producing goods for the hospitality sector?
''In 1999, Jim Copland invited me to join Copland to help diversify its mix and we agreed to enter the hospitality marketplace. I had previously helped the Klopman division of Burlington to diversify into five different businesses between 1987 and 1999. The largest was wovens for hospitality.
''It's no secret, looking at the the textile industry, that the companies that will remain are those that can diversify, while keeping costs to a minimum and at the same time offering innovative looks. It puts a tremendous amount of stress on all parts of the operation, but you don't havea choice.''
After a company decides to diversify, what important decisions must it make?
''It's important to choose the right supply partners. If you're modernizing, you have to make sure you're not operating in a vacuum. It does no good if you spend millions on looms if you can't find yarns that are high enough quality to run on them. ''We've looked more deeply at our sourcing issue.''
What challenges await a company who begins serving a new market?
''It's one thing to say you're going to create products for a market that's new to you, but I've found that they're not waiting for you to arrive. On the contrary, they're probably satisfied and probably think that their needs are being met. One objective is to convince them that you're serious and have staying power. You have to take the approach of showing them that they have needs that they weren't aware of. Or you try to show them a new model - economic, quality of service - that they thought was impossible to achieve, or products they never thought of that are perfect for their environment. I've tried to show that Copland can do for them equal to or better than what other suppliers do for them.
''You have to demonstrate staying power. There are many companies in the hospitality market that have nothing to do with hospitality. They just milk it and leave. If you want to be a long-term player, you have to innovate by knowing the technical aspects of the products and being capable of creating an aesthetic.
''The hospitality business is multi-layered, and therefore you have to keep yourself involved in each discussion along the chain. You can't service the supply line if you don't know the end-user's needs. ''So you can say you're going to commit to the industry, but when business slows, do you choose to sustain your participation in the model? You need financial stability to sustain your presence through these difficult times.
''We think we have achieved a level of credibility from which we can demonstrate to our customers that they can count on us for the future. What we're looking to do over the next couple of years is to market that credibility.''
How would you sum up the current predicament of the industry?
''I think the anticipated growth of hospitality may have been too much. And 9/11 changed everything. The consolidation within the industry is a testimony to this situation. Consolidation has occurred at every level.
''You see this consolidation every day. It backs right up to the production line - to the converters and mills.''
What effect did the events of September 11 have on the marketplace?
''After 9/11, you could see projects cancelled and put on hold. My sources predicted we wouldn't hit bottom right away. They were right.
''I saw the velocity start to return at the beginning of March. Discussions and levels of business have accelerated and continue to move forward. That is the first step in the recovery.
''Post-9/11, most of our customers committed to an inventory reduction. We now see a prudent reversal of that trend. We're trying to support them with additional inventory above their immediate needs...it's been a challenge to keep pace.
''It's a real state of limbo where you can feel it's going to get better but you can't tell when and you can't put a finger on with what products.
''My fear is that we won't be able to take advantage of the resurgence because it will re-ignite so fast. Budgets are going to come through. Projects are going to be released. People aren't going to want to wait eight more weeks for product.''
As business picks up again, how can you prepare?
''I completely understand that my customers are having trouble keeping pace with their customers. Therefore, we have a supply line strategy. It begins with yarn: keeping up a daily dialogue with our yarn suppliers - it moves to looms - common-warp strategy and loom availability - and moves through finishing. Most importantly, it is all dependent upon high quality, daily communications with our customers. ''Many of our customers committed themselves to carrying less inventory and now need product.'' F&FI
Burlington, N.C. (USA) - Since Copland Industries began producing contract textiles three years ago, it has become a solid supplier for the sector.
Copland Industries consists of three businesses: 1) A vertical operation where it prepares yarn, weaves and finishes fabrics, which it sells directly to its customers in various markets; 2) a commission-finishing operation that finishes fabrics owned by other companies; 3) a converting operation that prepares and sells poly cotton and cotton fabrics from qualified suppliers.
Below, VP of marketing Larry Hulighan discusses the challenges of diversification and the state of industry.
How is Copland dealing with the recession?
''Jim Copland's tenacious attitude has positioned us to survive,'' Hulighan said. ''Also, we've cut costs. We've been forced to, especially with foreign governments giving companies in their countries so much support. No government or bank is giving us money. We've invested in our future, in our facilities, and in equipment and people to keep ourselves competitive. We've also benefited from a loyal workforce.''
When did Copland begin producing goods for the hospitality sector?
''In 1999, Jim Copland invited me to join Copland to help diversify its mix and we agreed to enter the hospitality marketplace. I had previously helped the Klopman division of Burlington to diversify into five different businesses between 1987 and 1999. The largest was wovens for hospitality.
''It's no secret, looking at the the textile industry, that the companies that will remain are those that can diversify, while keeping costs to a minimum and at the same time offering innovative looks. It puts a tremendous amount of stress on all parts of the operation, but you don't havea choice.''
After a company decides to diversify, what important decisions must it make?
''It's important to choose the right supply partners. If you're modernizing, you have to make sure you're not operating in a vacuum. It does no good if you spend millions on looms if you can't find yarns that are high enough quality to run on them. ''We've looked more deeply at our sourcing issue.''
What challenges await a company who begins serving a new market?
''It's one thing to say you're going to create products for a market that's new to you, but I've found that they're not waiting for you to arrive. On the contrary, they're probably satisfied and probably think that their needs are being met. One objective is to convince them that you're serious and have staying power. You have to take the approach of showing them that they have needs that they weren't aware of. Or you try to show them a new model - economic, quality of service - that they thought was impossible to achieve, or products they never thought of that are perfect for their environment. I've tried to show that Copland can do for them equal to or better than what other suppliers do for them.
''You have to demonstrate staying power. There are many companies in the hospitality market that have nothing to do with hospitality. They just milk it and leave. If you want to be a long-term player, you have to innovate by knowing the technical aspects of the products and being capable of creating an aesthetic.
''The hospitality business is multi-layered, and therefore you have to keep yourself involved in each discussion along the chain. You can't service the supply line if you don't know the end-user's needs. ''So you can say you're going to commit to the industry, but when business slows, do you choose to sustain your participation in the model? You need financial stability to sustain your presence through these difficult times.
''We think we have achieved a level of credibility from which we can demonstrate to our customers that they can count on us for the future. What we're looking to do over the next couple of years is to market that credibility.''
How would you sum up the current predicament of the industry?
''I think the anticipated growth of hospitality may have been too much. And 9/11 changed everything. The consolidation within the industry is a testimony to this situation. Consolidation has occurred at every level.
''You see this consolidation every day. It backs right up to the production line - to the converters and mills.''
What effect did the events of September 11 have on the marketplace?
''After 9/11, you could see projects cancelled and put on hold. My sources predicted we wouldn't hit bottom right away. They were right.
''I saw the velocity start to return at the beginning of March. Discussions and levels of business have accelerated and continue to move forward. That is the first step in the recovery.
''Post-9/11, most of our customers committed to an inventory reduction. We now see a prudent reversal of that trend. We're trying to support them with additional inventory above their immediate needs...it's been a challenge to keep pace.
''It's a real state of limbo where you can feel it's going to get better but you can't tell when and you can't put a finger on with what products.
''My fear is that we won't be able to take advantage of the resurgence because it will re-ignite so fast. Budgets are going to come through. Projects are going to be released. People aren't going to want to wait eight more weeks for product.''
As business picks up again, how can you prepare?
''I completely understand that my customers are having trouble keeping pace with their customers. Therefore, we have a supply line strategy. It begins with yarn: keeping up a daily dialogue with our yarn suppliers - it moves to looms - common-warp strategy and loom availability - and moves through finishing. Most importantly, it is all dependent upon high quality, daily communications with our customers. ''Many of our customers committed themselves to carrying less inventory and now need product.'' F&FI