Use of wood fuels hefty sales surge in organizers - home storage organizers

Discount Store News, August 21, 1989 by Mary Ellen Kelly

Use of Wood Fuels Hefty Sales Surge in Organizers

Home organizer manufacturers anticipate 20 percent to 30 percent sales gains by the end of the year due primarily to greater acceptance of higher-ticket wood lines and the burgeoning garage/home workshop organizer business.

Suppliers of home organization products have even stepped onto the toes of ready-to-assemble furniture manufacturers by adding wood organizers to their growing wire, corrugated and plastic closet organizer product lines.

Not to be outdone, many RTA furniture manufacturers, new to the organizer business, are expecting substantial gains this year, especially in the garage/home workshop product area.

Lee Rowan, maker of closet and storage items as well as bath furniture, had anticipated a 28 percent sales gain this year, but has already exceeded this goal, according to Connie Conrad, vice president, marketing services. The St. Louis-based company is among the companies currently shipping a garage organization product; additional garage components are already in the works.

Lee Rowan is also developing organizers that are made completely of wood, as well as those that offer wood trim.

"Our non-retail builder division is working on ventilated products made of wire with a wood trim. We are also looking at an all-wood line made of solid oak with the possibility of transferring it into retail," Conrad said. The company will be talking with key retail customers and consumer focus groups during the next two months to learn which customers would buy wood products, and at what price points.

Similarly, Clairson International said it continues to enjoy a 25 percent to 30 percent sales increase level, as it has has for several years, said Judith Miley, communications manager. Acceptance of the hardwood-fronted line of organizers shown last year and freestanding organizer systems are a primary factor in the Ocala, Fla.-based company's current growth. At the Hardware Show earlier this month, additional wood line pieces--including items with a grooved, solid oak front, and those that go beyond closet use--were introduced.

Whitney Productions, Fort Lee, N.J., is also looking at a 25 percent rise by the end of this year. The company has shifted its emphasis toward more fashion-oriented corrugated items, said Dennis Gerrard, president.

"We're seeing increases all across the board. The solid black and solid white ensembles introduced by the company are helping the firm go beyond the dollar box business toward a new fashion orientation. Last year's flat sales reflected an adjustment time we needed to move away from dollar boxes to jumbos, and specialty items like cubes and accessory items," Gerrard said.

Richard Klein, president of CSD, which owns Lynx, one of the first companies to offer coated wire storage products, said it vastly expanded its business through the mass merchandisers. Last year, sales through mass merchants doubled to 40 percent of its total, and this year it will hit 80 percent--"65 percent to the discount stores and 15 percent to the home centers and hardware stores," he said.

Aiding the sales growth is the continued climb in price points. Klein estimated that the overall range of prices acceptable to the organizer shopper has risen by about 20 percent in the past few years. Consumers will pay more not only because the products look good and work well, but also in response to marketing. "As an industry, we're getting better at `romancing' the category," Klein added.

Jerry Gould, vice president of sales at Corr-Pak, East Brunswick, N.J., said the 7 percent gain in sales expected by year-end is due largely to its 18-sku selection of licensed merchandise.

"Our total sku's are about 250, but the 18 licensed lines give us about 40 percent of our sales and we expect it to go up," Gould said. "The new Auntie Em ensemble [introduced last January] is doing exceptionally well," he noted. In 1990, Corr-Pak will be adding to its assortment the combination floral/geometric design offered by the Center for Homeware Designs, and the floral launch by Hallmark.

Among the RTA vendors, O'Sullivan and Gusdorf are among those that now offer home workshop organizer components.

According to Mike Gusdorf, marketing manager of Gusdorf, St. Louis, "the results of the wire and wood program have been fantastic. Over time we will be adding more components." When asked whether it may be too late to enter the organizer business, Gusdorf said the category is far from saturated.

"For every house there are at least three or four closets that have the potential to be organized ... a tremendous market still exists," Gusdorf said. "It hasn't reached the saturation point like VCRs or microwave ovens."

Conrad of Lee Rowan agreed with that assessment:

"Storage continues to be one of the hottest classifications out there ... We're a long way from saturation in the consumer market."

Conrad also said she had conducted an informal survey of retailers at the January housewares show. "The majority said storage sales were rising."'