Retailers, consumers and prices
from Summit Notebook:
The recession wasn't kind to Ethan Allen's manufacturing plant workers, but now that the economy is recovering, so are the employment rolls. Last year, the Danbury, Connecticut-based furniture maker and retailer slashed its manufacturing workforce by about 30 percent, Farooq Kathwari, the company's chairman and chief executive, told the Reuters Consumer and Retail Summit in New York on Monday. That included closing a plant or cutting jobs in Chino, California; Andover, Maine; Orleans, Vermont and elsewhere.
I could not pinpoint exactly how many jobs he was talking about, and Kathwari did not immediately have the numbers handy, but according to the Ethan Allen website, it looks like they lost 65 workers in Chino and about 320 in Maine and Vermont. Meanwhile, the company said in 2009 that it planned to add some 300 more jobs to its larger facility in North Carolina, where it had 540 employees as of a year ago. The published numbers suggest that Ethan Allen cut a little more than 40 percent of its manufacturing staff, while Kathwari at today's interview said it was about a third. Either way, he told us, "In about six months, about half have been added back."
At a time when lots of economists and experts are telling us that we've been experiencing a "jobless recovery" in the United States, it's heartening to hear that there's at least one place in this great, big country where you don't have to worry about how you're going to afford that $2,000 tango louver door armoire when, instead, you can build one yourself.
Check out signs that consumers are getting more comfortable with spending and, at times, even splurging.
Estee Lauder reported a far better-than-expected 62 percent jump in quarterly profit and boosted its full-year forecast as consumers began to splurge on cosmetics after a year-long slide in sales. Results were helped by strong growth in Asia, new products, and a better-than-expected performance in airport stores and in the United States.
McDonald’s posted a higher-than-expected quarterly profit on Tuesday, boosted by strong overseas sales. Coach also reported a higher-than-expected profit, helped by higher sales at stores in North America and Japan.
But the impact of a weak U.S. consumer and a weak U.S. economy was clearly on display as the earnings report began to roll in this week.
Morgan Keegan cut profit estimates for Ethan Allen Interiors this week, saying it could be the next victim as a spending pullback takes hold at upscale furnishings companies.