Welcome to Episode 42 of Sit & Sew Radio, a Quilt Addicts Anonymous podcast.
This week we are taking a look at the closing of Free Spirit. On Monday the quilt industry was rocked by news that North American Crafts has decided to close its Lifestyle Fabrics business, which includes fabrics produced by Free Spirit and Westminister Fabrics/Fibers. The news was made public when the Craft Industry Alliance shared a copy of the email sent to fabric designers informing them of the imminent closure.
The reasoning given was that, “Despite our best efforts, we have continued to struggle with an inherent weakness in the business model and have not be able to demonstrate a profit.”
There was no warning that this was coming. Designers were actively working on new collections and promoting ones to be released in June and later after the company will cease its operations. My fabric rep was hundreds of miles from home, meeting with shops and taking orders. The Free Spirit Marketing team sent an email to shop owners promoting a social media marketing webinar scheduled for later in the week.
The internet quilting community came out in force to speculate why and how such a prominent name in the quilting industry and home to some of the top designers in the world could close. There also was an outpouring of support for the employees who will be losing their jobs and designers such as Tula Pink, Kaffe Fassett, Amy Butler and more encouraging them to keep creating.
Then on Tuesday more information started to come out. A similar email was sent to shop owners, using the same inherent weakness line to explain the reasons for closing. I was on this list and have shared the content of the email I received below.
Free Spirit is not sharing much information. Even designers I have spoke to off the record were still waiting as late as yesterday for phone calls from Westminister and Free Spirit before deciding what to do next. Many have taken to social media to thank their fans for supporting them, assuring them that they will keep designing, just with a new company and expressing a positive attitude that this change will ultimately be a good thing for them creatively.
I have learned from my Free Spirit fabric rep that collections slated to be shipped through May 2018 will come out. That includes Tula Pink All Stars, which is already in the Westminister’s US-based warehouse and is being prepped for shipment. However, decisions are still being made to determine whether the much promoted Kaffe Mystery Block of the Month will be fulfilled or if Tula Pink’s De La Luna fabric line, originally slated for June, will be printed.
But as a business woman in the quilting industry, what had me most concerned was the line North American Crafts kept using in its carefully crafted communications, that there was an inherent weakness in the business model. So I invited two presidents of fabric companies to come on this week and talk about the closing of Free Spirit and what it means for the industry.
In our conversations we talk about:
• The state of the quilting industry
• What is necessary for a fabric company to run well and profitably
• How the size of fabric lines and release frequency can impact cash flow – the life line of a business
• How new technology is changing the industry
• The inherent differences of running an independently owned fabric company, versus being a division of a larger corporation as Westminister Fibers and Free Spirit was
• What business expenses are covered when you buy a yard of fabric
• And how disruption is everywhere in every industry, so challenges like internet fabric sales just means there needs to be some creative problem solving and innovation to meet the needs of today’s consumer
Ken Gamache, President of QT Fabrics
First up we have the president of QT Fabrics Ken Gamache. Ken started at QT Fabrics in 1978 as a print machine set up man. It was his job to clean the ink from the copper rollers and he worked the midnight shift.
Throughout his 40 year career with the company, he has worked his way up from production, to supply chain management, distribution, sales, general manager and now president. Since he has worked in just about every aspect of the business, he has first-hand knowledge of what it takes to keep the company running efficiently and profitably.
We talk about the state of the quilting industry, how the size of a fabric line can impact profitability and inventory management, how digital printing can lead to future profitability and the four areas of a company that need to run smoothly, in Ken’s opinion, for a fabric manufacturer to succeed.
You can learn more about QT Fabrics at their website by clicking here.
Ted Hoffman, President of Clothworks
Next up with have the President of Clothworks, Ted Hoffman. Ted and his wife Candice purchased Clothworks when Ted wanted to go in a different direction after working in corporate high tech life in Seattle. After about a year and a half of searching for the right company, Clothworks came up which held interests for Ted, the business guy and Candice, the company’s Creative Director.
The numbers looked good and they bought the company, saw it through the Great Recession and the many challenges that came with it.
We also talk about the state of the quilting industry, the cyclical nature of business, Clothworks’ model of selecting designers based on their distinct artistic styles as a way to diversify the business, what is covered (and it is a lot) when a consumer purchases one yard of fabric, and how disruption is everywhere, in every industry and it just provides a creative challenge for businesses to meet the needs of today’s consumer.
You can learn more about Clothworks by visiting their website by clicking here.
A big thank you to Ken Gamache from QT Fabrics and Ted Hoffman from Clothworks for taking some time out of their busy schedules to talk with me and react to the big news of Free Spirit closing its doors.
Click here to read the Craft Industry Alliance article that broke the news of the closing to the quilting industry and scroll down to see the full text of the email I received as a shop owner explaining the closing.
You can also click here to read a blog I wrote that details what lines Quilt Addicts Anonymous will be receiving before Free Spirit closes. We have already had a few customers who have started buying up our current Free Spirit lines, knowing that they may not be reprinted when the designers find a new home. We have fabrics from Tula Pink, Kaffe Fassett, Amy Butler, Shell Rummel, Anna Maria Horner and Free Spirit Solids at shop.quiltaddictsanonymous.com.
Here is the full text of the email sent to quilt shop owners:
As you may have heard, we will be exiting our fabrics business, which includes our Westminster Fabrics/ Fibers, FreeSpirit brand, and designers.
We have worked diligently for the past few years to make this a successful part of the Coats and Clark, Inc. craft business here in North America. I am sorry to say that, despite our best efforts, we have continued to struggle with an inherent weakness in the business model.
We will work with you and have ongoing communication regarding availability of fabric selection and current programs within the next several weeks.
It also means, at a future date, we will be moving invoicing and customer service functions supporting the fabric, thread, and yarn businesses from Greer, South Carolina to our Albany, Georgia, and Charlotte, North Carolina offices. For now, your current contacts will remain the same.
It is our intent to support you and our talented and dedicated artists during this transition. These decisions have been difficult and we thank our employees, our designers, and you for your enthusiasm for FreeSpirit and your continued support.