CHF Industries, Inc.

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CHF Industries, Inc.

8701 Red Oak Boulevard, Suite 400
Charlotte, North Carolina 28217
U.S.A.
Telephone: (704) 522-5000
Toll Free: (800) CHF-7090
Fax: (704) 522-4761
Web site: http://www.chfindustries.com

Private Company
Incorporated: 1982
Employees: 30
Sales: $250 million (2006 est.)
NAIC: 314120 Curtain and Linen Mills; 314121 Curtain and Drapery Mills; 314129 Other Household Textile Product Mills

CHF Industries, Inc., is a leading manufacturer and marketer of window treatments, bed and bath linens, and accessories. Originally created as an amalgamation of small manufacturing companies, in the late 1990s CHF changed direction to become customer-focused. Under new management, the group began producing bedding and soft window treatments under license for leading designer labels. A turnaround ensued, and the number of licensing deals grew.

CHICAGO ORIGINS

CHF Industries, Inc., began as a textiles conglomerate pieced together by Chicago financier Henry Crown and became a division of first Henry Crown and Co. and then the CC Industries holding company, which was formed in 1986. Called Crown Home Furnishings or Consolidated Furnishings for a time, CHF Industries is not to be confused with another company of the same name that emerged from Chicago Hardware and Foundry.

The first part of CHF was acquired in 1979: Aberdeen Manufacturing Corp., a maker of draperies and bedding that dated back to the 1920s. Cameo Interiors, a higher-end maker of bedroom curtains, was added three years later.

In 1987 CHF bought Joanna Western Mills, a supplier of alternative window treatments such as shades, blinds, and shutters that had once led the window coverings industry. Joanna had acquired a handful of plants throughout its history, including Ogdensburg, New York's Standard Shade Roller Company, which it bought in 1915. Standard had been formed in 1907 but closed after CHF sold Joanna division in 1995.

For several years, CHF's investment was credited with helping revitalize Joanna's design, manufacturing, and marketing. According to HFD, Joanna had annual revenues of about $100 million in the late 1980s, about 40 percent of CHF's total sales.

Jakson, a maker of bath products, was also acquired by CHF in 1987. It had been founded in 1924 by Joseph A. Kaplan, who is credited with shaking up the market for shower curtains, which were once typically just white canvas, by making them with a range of colorful fabrics.

ARRANGING SPACE IN 1989

CHF had a number of textile plants in the Carolinas and in 1989 consolidated its headquarters in Charlotte, while leasing showroom space at the art deco–styled One Park Avenue building in New York. The administration of the Joanna division was relocated there from Chicago as part of the consolidation. Joanna's domestic manufacturing operations followed a couple of years later; about one-fifth of its products were being sourced overseas at this point. CHF's total sales were reportedly more than $250 million by the late 1980s, when the group had roughly 3,500 employees.

The high-end Cameo unit was retooled to be more responsive and fashionable in 1991. This business was looking to expand on its strength in window treatments by extending into the bedding market. Cameo had sales of roughly $50 million a year.

An ensemble based on the booming quilt craze gave the Aberdeen unit its most successful product in its history, an executive told Discount Store News in 1992. In the same year, CHF bolstered the Aberdeen and Cameo Interiors through the acquisition of the Chace Curtain and Roomaker lines of United Merchants & Manufacturers Inc.

In 1993 CHF acquired Reflections Fine Bedding Attire, which had filed for bankruptcy. Reflections was known for its contemporary styles. Meanwhile, CHF's Jakson division was embracing ethnic and environmentally conscious trends with its polyester shower curtain designs.

OWNERSHIP CHANGES IN 1995

CHF got a new owner in 1995: New York investment group 21 Holdings Inc., which later became Trace International Holdings Inc. In February of that year Peter Cohen, a longtime 21 Holdings veteran, was named CHF CEO and Chuck Reifer became chairman. CHF then sold its Joanna division to the Newell Group in order to focus on soft window coverings rather than shades.

The company was soon streamlined from three divisions into two: a window treatment division, which accounted for 70 percent of sales, and one for bedding and bath products. The market segments of the company's brands were also clarified, focusing Cameo on the high end and Aberdeen on the lower end.

One of the objectives of the new owners was to speed up production processes to make CHF a low-cost producer, an executive told HFN. It was beginning to embrace just-in-time manufacturing. In another efficiency move, the company's New York showroom was trimmed from two floors to one. CHF was also sourcing improved, lower cost "faux finish" fabrics from its vendors for its Aberdeen line. At this point, the company was not making designer goods under license.

Revenues for the privately held company were estimated at about $150 million a year in the mid-1990s, when CHF employed about 1,600 people. Private label business accounted for about 90 percent of production. Its output included 12 million pairs of curtains a year, probably making it second only to Burlington Industries in that category. CHF was modernizing its manufacturing plants in Fall River, Massachusetts; Loris, South Carolina; and Kaufman, Texas; the New Bedford, Massachusetts, factory, however, was slated for closure.

NEW MANAGEMENT IN 1997

Frank Foley, formerly an executive with quilt manufacturer American Pacific, replaced Peter Cohen as president and CEO in March 1997. Soon after, the company hired away a top marketing executive, Joan Karron, from rival Springs Industries. Karron happened to be married to Foley. Under the new leadership, CHF was reorganized into a consumer-centered organization. In addition, more sophisticated offerings were added, incorporating more elaborate construction. So dramatic were the changes at CHF that the company was thinking about changing its name, Foley told the trade journal HFN.

Once overshadowed by the window coverings business, the bed and bath operations were boosted considerably. New product lines in the late 1990s included On My Own bedding for younger customers and In Good Faith window treatments and bedding for the spiritually minded.

COMPANY PERSPECTIVES

CHF Industries is a leading marketer and manufacturer of home fashion products that are sold mainly to key retail stores throughout the United States. The major categories of products are window curtains, fashion bedding and accessories, and decorative bathroom products.

In order to expand its range of upscale product offerings, CHF also became the U.S. manufacturer for a couple of international white goods lines: Gudrun Sjoden of Scandinavia and Australia's upscale Peri Homeworks Collection. Peri was launched in 1993 by Swiss designer Cecile Hollenstein and it had quickly expanded into 20 countries. The Scandinavian designer Sjoden was known for clean designs incorporating vivid color. Yet another licensing deal involved a technological innovation: a new hookless shower curtain that could be installed in 20 seconds without removing the rod.

"Tweens," or youth from late childhood to early teens, had begun to attract serious interest from bedding suppliers. Early on, CHF embraced this market with its own brands, including the new "My Room" in the late 1990s. The company later signed a number of licensing deals geared to tweens' tastes.

In 1999 CHF's owner, Trace International Holdings Inc., went bankrupt. However, CHF itself was faring much better. Under its new market-driven focus, CHF had restored profitability while greatly expanding the bed and bath side of the business.

DESIGNER LICENSES PROLIFERATE

In the next few years, CHF added a number of licenses to stay in touch with the evolving consumer market. CHF signed a deal with California's Ocean Pacific Apparel Corporation in 2002. This involved two lines, Op Home for the 12-to-24 market, and Ocean Pacific Home for adults, many of whom remembered Op as an early beach lifestyle brand.

British giftwares designer Nick Munro was also signed in 2002 to fashion contemporary accessories. In the same year, CHF also replaced contract manufacturer C. S. Brooks as the maker and distributor of the upscale Donna Karan line of home products. A series based on the work of wildlife artist Lynn Chase was unveiled in 2003.

In 2004 CHF introduced a line of upscale home textiles under license from the Canadian design firm Umbra. At the same time it rolled out floral print shower curtains and bath accessories under the Kim Parker label.

CHF extended the success of its Hello Kitty line to a broad age range, and in 2006 added the "by girls … for girls" brand Miss O & Friends. Meanwhile, the Hippie Chic line was proving very successful among Generation X.

Much of the company's production was designed for retailers on an exclusive basis. CHF Prêt-a-Porter was introduced as a collection for regional department stores that were not large enough to afford the full custom private label treatment.

KEY DATES

1979:: Chicago financier Henry Crown acquires Aberdeen Manufacturing Corporation.
1982:: Crown Home Furnishings (CHF) is incorporated; Cameo Interiors is acquired.
1987:: Joanna window treatments and Jakson shower curtains acquired.
1989:: Headquarters move to Charlotte, North Carolina.
1992:: CHF buys out the Chace Curtain and Roomaker lines of United Merchants & Manufacturers Inc.
1993:: Reflections Fine Bedding Attire is acquired.
1995:: Trace International Holdings Inc. buys CHF; the Joanna division is sold to Newell Group.
1997:: New management led by Frank Foley steers company to licensed production, including Australia's Peri brand.
2002:: CHF gains Donna Karan, Ocean Pacific licenses.
2004:: Umbra license is added.
2006:: The Ernest Hemingway collection is unfurled.

A new license agreement in 2006 featured the Ernest Hemingway collection, meant to evoke locales associated with the famous writer. Designs of the company's other upscale lines were simplified in terms of embellishment in order to reflect changing consumer tastes, which were the target of much contemplation for CHF designers and executives at mid-decade. "What we do best is take bigger-picture ideas and interpret them," CEO Frank Foley told Home Textiles Today.

Frederick C. Ingram