Fashion expected to spark sluggish dinnerware sales

Discount Store News, April 14, 1986

Fashion Expected to Spark Sluggish Dinnerware Sales

New, higher-priced stoneware fashions are bringing hopes of better margins and stronger sales in the sluggish dinnerware market, according to discounters and catalogers testing the new lines.

Vendors like Pfaltzgraff, Newcor and Anchor Hocking are trying to design stoneware with the graceful florals and pastels of fine china at prices affordable to the discount shopper. Discounters hope to attract shoppers by offering an alternative to the thick look of traditional, banded stoneware plates, which frequently form the backbone of discount store dinnerware sections.

"People buy dinnerware based on home furnishing fashions, and about 62% of U.S. households are decorating in early American and traditional styles,' said Bill Borland, national sales manager for mass merchandisers at Pfaltzgraff. Borland believes it is this trend that is stimulating sales of the new stoneware look at K mart, Gemco, Jamesway and Best Products.

K mart buyer Don Edel said the new stoneware fashions have a "subtle look' with a soft, floral design often trailing down one side of the plate rather than a single bold flower arrangement in the center.

Testing Fashion Sets

If he can make space in the 20-ft. dinnerware section, Edel said he will test a 20-piece Newcor set in 100 stores where the demographics suggest shoppers are willing to pay for the new styles. The stores involved in the test would be given the choice of taking out a domestic ironstone or Melamine set currently carried to make space for the Newcor.

About two years ago, K mart tested two higher-priced brands, Noritake and Mikasa, but after four months of poor sales took them out.

Edel said one of the problems back then was the added expense of working through a middle man. Mikasa and Noritake wanted to protect their brand names in department stores and wouldn't deal directly with K mart; Newcor will.

The most expensive set K mart currently offers is a 45-piece set imported from China, with a $68.88 everyday ticket. Most of the dinnerware mix--including several sku's of Corning, Melamine, 20-piece imported stoneware and domestic ironware--is considerably lower priced.

Despite the chain's intention to test the Newcor set, the bulk of K mart's assortment will remain at the lower price points.

"We don't want to forsake our customer on the low end.'

Gemco has doubled the number of stoneware sets with "department store styling' from 12 last year to the current 24, according to Ken Kaufman, dinnerware buyer. The better sets make up 75% of the 32 sets Gemco carries.

The majority of dinnerware sales at Gemco remain under the $30 price point, but Kaufman sees an increasing number of shoppers willing to spend an additional $10 to $20 to get the new stoneware look.

"Basically, if it costs the consumer 33%-40% less than the perceived value, I'll think about adding it,' Kaufman said, adding there are limits.

"I still don't have a customer that will pay $100 for any 20-piece set,' he said.

But one problem in finding sets with a low cost and sophisticated styling is the highly identifiable motifs of some of these patterns.

"It's much more difficult to make an opportunistic buy with the department store patterns. With a blind item, there's a larger number of sources and they're not as identifiable,' Kaufman said.

The high perceived value of these newly styled stoneware lines has prompted at least one cataloger to beef up its middle price point. Best Products has sold a genuine department store line, Lenox, but will be eliminating it from the 1986/87 catalog, said Darlene Swed, housewares buyer.

Transitional Stoneware

In its place, Best will add to the number of newly styled stoneware sets--what she calls "transitional' lines. She said the transitional stoneware set offers a middle-of-the-road option.

"These sets can be used for formal, as well as everyday use and, minus the metal trim, they're microwavable,' said Swed.

Like Kaufman, Swed said these lines are doing well in her mix because the styling gives the dinnerware a higher perceived value.

"There's definitely more potential to increase margins,' said Swed, as long as manufacturers keep the new fashions coming.

"The life span of these looks is shorter; it's about two years compared to the basic stoneware brands that, because they aren't as identifiable, can sell well for about eight years.'

Swed added that she thinks fine china will regain popularity in another five years after the population ages and tastes change again.

In the meantime, however, it is clear that these "transitional' lines will provide new volume at better price points for many discounters. The buyer at one large Midwestern discount chain said that a 20-piece set by Newcor selling at $34.99 is already his best seller. The set is the most expensive the chain carries.

Photo: Best Products will devote more inventory dollars to fashion stoneware in its upcoming catalog, according to buyer Darlene Swed, to attract new and different customers.