January 7, 2010,
By Andrea Lillo
The four brothers named the company Noury and Sons to give it an established, veteran feel. Decades later, the company now called Nourison has become exactly that in the area rug business.
Celebrating its 30th year in business in 2010, Nourison has built itself on filling holes in the market, said Alex Peykar, co-founder and principal. In everything the company does, "the name of the game is, how do we create something that is different?" he said.
"The importer was not doing everything the retailer needed, so we entered the wholesale arena," said Alex Peykar. But it was a difficult start, being that it was the end of the '70s, where there were 20 percent interest rates and the economy was slow.
They also began working with a region not many were going to back then--China. Initially Nourison was importing hand-knotted area rugs mostly out of India and a bit out of Pakistan, but come the mid 1980s it grew its Chinese business more. "We were getting better results in China with a consistency we could count on," he said.
Now the company owns three factories there -- in Qingdao, Yangxin and Nantong -- and 90 percent of its products are made there, but in the beginning there was a lot of trial and error. "We found comfort levels in the areas where we are now," he said. "But we've had our share of mistakes." But its best product "still comes from China," Peykar added.
China has also taken on another role for Nourison: as a retail opportunity. Though they kept away from selling rugs to the Chinese market for many years, the need to keep production flowing during the economic slowdown resulted in a change in strategy. Now about two percent of Nourison's business, the domestic Chinese market could grow to 10 percent this year, Peykar said. "That channel has helped us a lot," he said. "China is in much better shape than the U.S."
And company has also grown its machine-made business, which is now 40 percent of its line overall. At this month's Atlanta International Area Rug Market, the company will expand its lower price point offerings with several collections of machine mades. While a year ago the cheapest rug from Nourison may have been $299, now it will be $199. "With the changes in the economy, the price points are more feasible," Peykar said.
The company has also seen success with its rug displays, which it uses to get into furniture stores that don't sell rugs or stores that don't have the space for full-size rugs. With such displays as Fifty to Infinity and Rug Boutique already at retail, the company is completing development for one for its Calvin Klein line. That line is "doing okay," Peykar said, adding that having names in area rugs is harder than other categories. "If you can put the name before the manufacturer in the store, it works better," he said. Fans of Calvin Klein or Ralph Lauren can go to those shops in department stores for a complete collection, but those licensed rugs are located in the rug section, he explained, and then it becomes an issue of color and design, he said: "It doesn't matter whose it is."
The Calvin Klein line performs better online, he said, because of the ability to show the name first. And Nourison hopes to achieve that same effect in stores, with the new display. "That will be an incredible door opener for us," he said.
And while many other area rug manufacturers have added product categories to their lineup, Nourison's focus is on flooring, Peykar said, save a few decorative pillows. One newer area for the company is the scatter rug category, which it has aggressively entered in kitchen and Christmas rugs. "That's an excellent division for us," Peykar said. "Christmas is bigger."
Today Alex, Steven and Paul remain principals of the company (Edmund is no longer a working partner) while the next generation--Paul's son Andrew, who runs the IT department, and Alex's son Jonny, who assists in running the broadloom division--have joined the business as well.
As for the new year, Peykar has strong expectations, saying he would be "disappointed" if his company's sales were less than 20 percent for 2010, and for the industry overall, 10 percent. "It's not hope--it's foundations and infrastructure," he said.
And the company continues to look for those niches to fill. "We had a tough start [when the company was founded], but of course we weathered that storm by doing things that haven't been done before," Peykar said. "There are always voids--even this year."
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