Fleece is no longer golden. Oversaturation, fierce competition and an onslaught of other hot fabrics, such as cotton and Lycra spandex, have stifled the fleece category’s growth.
While still the backbone of some firms, fleece is presently on the down side of the apparel spectrum, after an almost three-year run of record sales. During that time, fleece sportswear, activewear and functional wear, including sweatpants and sweatshirts, were best-selling items.
That was until last fall, when Lycra spandex and blends using that fabric began taking hold in the markets where fleece had reigned.
Major fleece manufacturers and suppliers, such as Bassett-Walker, Pannill Knitting Co. and Tultex, have each attributed their recent poor performances in the second quarter to a slowdown in fleece sales.
Earnings at fleece manufacturer Russell Corp., on the other hand, rose 18.2 percent in the second quarter and 17.3 percent in the six months ended July 3, a sign that fleece products have not totally fallen by the wayside.
Another user of fleece for its line of women’s and men’s athletic, recreational and leisure wear, Champion Products, Inc., has also posted a net gain. Earnings for the Rochester, N.Y., company increased 88.6 percent and sales rose 16.3 percent in the first quarter ended April 1.
Fleece, especially the heavyweight variety with a high cotton content, continues to perform in the misses and mature markets, some executives said, but in general it has leveled off in the juniors area.
This, they added, is because of the slouch, loose-fitting look fleece lends in covering up a multitude of bodily sins, as opposed to Lycra spandex, which is geared to better figures.
As an active, functional fabric, fleece is also being replaced by form-fitting spandex. However, fleece still shines as a comfortable fabric for lounging around or going to the gym.
New colors and updated styling are needed to breathe renewed life into the fleece market, said some executives. Others noted that the market was crammed with novelty fleece looks last fall, and sales were still off the mark.
“When you have something that is so popular, you can almost predict a slowdown,” said Robert Appelbaum, director of apparel/mill marketing for Cotton, Inc., here. “Everyone was in the fleece business, and those who weren’t normally into fleece, both suppliers and manufacturers, rode the trend when it was hot.”
He pointed out that fleece with a high percentage of cotton is still growing, even in an otherwise shrinking market. Appelbaum also indicated, however, that the “whole piece goods market, including fleece, is weak right now, as is the entire apparel segment.”
Premium heavyweight fleece with a 95 percent cotton content is doing well, Appelbaum said, followed by 80-20 and 70-30 blends of cotton with polyester or acrylic.
However, the 50-50 mix of acrylic with cotton and polyester is just doing “fair.” Appelbaum noted that all fleece has to have some synthetic fabric, namely polyester, to pass a flammability test.
The fate of fleece for fall will be determined to a large degree by sales during the back-to-school period. But whatever turn fleece takes, he believes it is a resilient fabric, being both comfortable and practical, and that it will always be a “major hitter in the apparel business.”
Sales of women’s (age 16 and over) activewear, which consists mainly of fleece sweat pants, sweatshorts, sweatshirts, hooded sweatshirts and warmup suits, totaled $1,800,000,000 last year, compared to $1,200,000,000 in men’s activewear, according to John H. Tugman, vice president and general manager of soft goods information service for MRCA Information Services, Stamford, Conn.
Total women’s activewear units sold last year totaled 154,200,000, and 99 million men’s activewear units were sold.
MRCA tracks purchases recorded monthly by a nationwide panel of 11,500 households representing more than 30,000 individual consumers.
In terms of units of activewear sold for the first five months of 1988, women’s outpaced men’s, 46,400,000 units to 24,400,000 units.
Growth of women’s activewear for the first five months of the year was up 14.2 percent in units and 9.2 percent in dollars, to $479,200,000 over the same period last year.
For the same period, sales of men’s activewear were up 17.2 percent in units and 17.2 percent in dollars to $277,900,000.
The death knell for fleece has definitely not been sounded, according to Philip W. Davis, vice president of the apparel division of Reebok International, Ltd.
“Fleece will always be there in a major way as a base fabrication.”
He explained that fleece lost a little bit of its sheen last year because of a market “oversaturated with the stuff.” A lot of companies were especially interested in lightweight fleece categories, he said. As a result, its perceived value diminished markedly.
“Two years ago everything was in fleece,” Davis said from the Canton, Mass., company’s New York showroom. That was until alternative fabrications such as blends including Lycra spandex with cotton and nylon began infiltrating the marketplace.
While fleece continues to be useful as an items business, Davis said that the graphics are not as bold and overpowering as in previous seasons. “We are showing novelty fleece items in updated body silhouettes with minimal graphics.”
To keep the fleece business bouyant, Reebok is showing fleece jersey tops with Lycra spandex bottoms.
While the pairing of these two fabrics seems logical, when worn separately each takes on a different function for distinct occasions, Davis said. “You wouldn’t hang around the house in Lycra, but you would in fleece.”
Although heavyweight fleece goods are still in demand, lower-end fleece is not being bought, Davis maintained. “The difference is that the customer owns this type of fleece already and will only buy it as a replacement, as opposed to expanding her existing wardrobe with it.
“Fleece has been around for a long time,” he added. “It’s not like it dropped out of the sky. It’s still an important fabric, but its emphasis has shifted. Will it come back like before? Maybe not, but it will be redefined to add additional dollars on. Newer and alternative ways to produce fleece are key to its acceptance.”
One of the country’s major producers of fleece athletic wear, Russell Corp., a publicly held company in Alexander City, Ala., does a “substantial percentage” of its $500 million volume in fleece, according to Sonny Seals, vice president of marketing.
“I see nothing that indicates fleece has slowed down,” he said. “There is still a growing demand.” He did acknowledge that the market has softened. “The softness depends on what happens this fall at the consumer level,” Seals continued. “I haven’t heard of any excessive inventories at retail. If a good season develops, the market will firm up quickly.”
He believes that, while basic fleece shows signs of slowing down, it is the value-added categories offashion and graphics that will help the business grow.
“We do see the element of fashion as being more important,” Seals said, adding that much of the basic merchandise it ships is “decorated” before it reaches the consumer.
While the company uses other fabrics for its line of athletic team wear, T-shirts, tank tops and shorts, fleece remains the nuts and bolts of Russell’s business, namely basic fleece sweats–pants and sweatshirts. “Our business is driven by basic crewnecks and sweats,” he said.
These and other fleece products are bought more often by women than men, with the end users fairly well split among both sexes, Seals pointed out.
“We have been very successful in including women in our advertising campaign and brand presentations at point of sale,” he said.
“And we have found that women are comfortable buying fleece in men’s departments.”
As Lycra spandex gains a foothold in athletic tops and bottoms as well as sportswear, Seals does not believe fleece is being usurped to any large degree by this man-made fiber.
“Fleece is almost a universal product, and it’s not skewed just toward the young,” he said. “Some of the fastest-growing segments are in the mature market. It is worn by everyone from kids who sleep in it, to school on up.”
Compared to a year ago, the fleece business at Nike, Inc., Beaverton, Ore., has been flat at best at the moderate-price level in basic silhouettes such as pants and sweatshirts in both the women’s and men’s divisions.
“Fleece is never going to go away, though,” said William E. Kennedy, the newly appointed vice president of Nike Sport. “What it needs is to be updated with the correct styling and new colors.”
Kennedy talked about the comfort factor of fleece and compared it to denim as a truly American innovation. Nonetheless, the firm’s business is showing the most spunk in blends of nylon and Lycra spandex, and cotton and Lycra, in both its running and cross-training categories.
Present strengths at the firm, which had sales of approximately $150 million in women’s and men’s apparel for the fiscal year ended May 31, are its functionally driven designs.
But Kennedy pointed out that this merchandise is not always worn for the sole purpose of the sport it was intended for. Activewear, he added, is shaping up as a future growth area.
To breathe new life into fleece, Nike has begun working with other types of the fabric, such as heavyweight jersey and French terry, which are comfortable yet fashionable.
Nike uses domestic suppliers for its fleece, which is used in both the functional and active segments of the Sport division, with 50 percent of the active business made up of fleece products.
Of the three fleece weights, Kennedy said the firm does best with heavyweight fleece, which he said is good for fall selling and cold weather wear. Midweights have become less important, while lightweight fleece has fared the least favorably. “It looks cheesy,” he said.
At Gitano, the New York apparel manufacturer, the four fleece groups that the firm has offered for fall have less depth than in previous seasons, said Jan A. Morgenstern, national sales manager for junior sportswear.
“Fleece is not dead as long as there are people who are active, and in fact, fleece is doing better in misses than it is in junior,” the executive said.
But because fleece has become less sought-after, Morgenstern said the firm’s sales plan is down for fall and holiday, with the lost dollars to be made up in knit categories.
Heavy jersey, some reverse ribbed fabrications and a major statement in wovens is being undertaken to make up for the lost units in fleece.
Gitano’s fleece top division, having also geared down for holiday, has similarly taken on other areas such as sweaters and novelty knit yarns.
Morgenstern said updating fleece styles may help revive the category, but he was quick to point out that “there was more novelty business in fleece on floors last year than ever.”
“I’d love to see fleece bounce back,” he added. “It’s one of our main fabrications for fall and holiday. But if you already own fleece and replace it once a year, when you look in the closet and discover you already have it, there isn’t the need to go out and buy it.”
He continued that “because of the uncertain economy, people have become more selective in their buying, especially if they already own fleece items.”
Jerome Wiggins, vice president of finance and chief financial officer for VF Corp., whose divisions include Bassett-Walker, Martinsville, Va., a major maker of fleece apparel for women, children and men, said in a statement when the company’s second-quarter results were released, “Bassett-Walker has been very soft in the second quarter. The conditions obviously reflect the fleece market, which is very soft.”
David G. Sweet, vice president of merchandising for Bassett-Walker, said the jury is still out on its performance this year, since it is a second-half business. “How well it does at retail remains to be seen,” he said.
But because fleece manufacturing capabilities expanded during the fabric’s prosperous period, Sweet said, fleece supplies have reached normal levels. Therefore, retailers have the luxury of placing their fleece orders later than usual without undue concern about delivery delays, he added.
“There is a lot of business still done in basic fleece,” Sweet said. “It’s not dead by any means. Crewnecks and a switch from raglan sleeves to set-in sleeves, as well as sweatpants, particularly those with pockets, are doing well.”
Since the styling of basic fleece has a unisex appeal, women have been buying fleece merchandise in increasing numbers, he said. “Women by far and away buy the most fleece, not only for themselves but for their boyfriends, husbands and children as well.”
Last year the women’s market for fleece took off, Sweet added, but this year he expects sales to be flat with 1987.
Among the advantages of fleece, Sweet said. are the comfort factor and its ability to easily slip on. “It’s easy to get out of work and slip into a sweatsuit which, because of better styling, can be worn outside the home in addition to exercise. It has become more acceptable for casual wear.”
The Tultex Corp., Martinsville, Va., one of the country’s leading producers of fleeced knit activewear, is feeling the pinch of a soft fleece market, judging from the most recent sales and earnings for its second quarter and six months ended May 28.
Second-quarter earnings were down to $51,297,000, compared with $60,178,000 in 1987, and earnings were $1,773,000, or 6 cents per share, compared with $3,121,000, or 12 cents per share, for the same quarter last year.
For the six months, sales were $103,949,000, compared with $124,659,000 a year ago, and earnings were $2,800,000, or 10 cents per share, compared with $7,429,000, or 27 cents per share.
In a statement, William F. Franck, Tultex chairman and chief executive officer, said that the quarterly and six-month results were in line with management expectations, which also include a strong fall and winter shipping season.
Tultex is a vertically integrated producer of fleeced knit activewear and leisure time apparel, operating yarn and apparel factories in Virginia and North Carolina.
“Excess customer inventories resulted in slower customer demand during our first half, compared with the same period last year,” he said.
“Shipping activities are now picking up, and we feel comfortable with earlier predictions that more than 70 percent of our volume will be shipped in the second half. We anticipate, however, that soft pricing and higher costs will cause profit margins to be down from last year’s record high.”