American Merchant, which has invested $20 million in a modern, technology-enabled manufacturing facility in Virginia, made its debut at New York Home Fashions Market last month as it prepares to begin production. Equipment began arriving in the fourth quarter of 2018 and dying equipment in early March. The first full shift of production is scheduled to begin in the third quarter of this year, with plans to expand to three full shifts by early 2020. "We're making a lot of progress," said Robert Burton, chairman of the US operation. Production launches with 24 looms, and the operation will add another 24 looms as business ramps up. "We'll go as fast as the market allows us to," he said. American Merchant is focused on producing better/best 100% cotton bath towels in solid colors for the upper end of the market. All cotton is American-grown and spun, and the range of better fibers include Supima and organic cotton. "We're not looking to take on the [towel manufacturing] behemoths. The big-volume/ low-margin business doesn't work with our model," said Burton. The sweet spot is the $14.99 business, with the floor for 16-lb. at $11.99 up to 21-lb. at $19.99 or above. Although US manufacturing wages are higher, Burton argues those are offset by other considerations. Since American Merchant has purchased the latest machinery available, it has advantages in efficiency and speed, he said. Transportation costs are lower within the US, and there's no duty. "You have to look at the entire supply chain," he added. "You have not only the shipping cost but also the carbon footprint."
展开▼
