Examining 2021 Hospitality Textile Shortages, Manufacturing Challenges – American Laundry News

Examining 2021 Hospitality Textile Shortages, Manufacturing Challenges – American Laundry News

PHILADELPHIA — If you don’t know yet, the hospitality textile market in Q1 and Q2 of 2021 saw its fair share of challenges. There is a good chance the hotel you stayed in this summer had towels and sheets that looked a bit old.

The reason is that the property (and industry) will be short on replacements as textile manufacturing challenges continue to grow.

In my years as a CEO distributing both hospitality and retail textiles, I’ve never seen so many factors come into play, putting an entire industry into chaos.

Let’s begin with some obvious facts. In 2020 the COVID-19 epidemic rocked the travel industry. The U.S. Travel Association estimates that travel spending in 2020 was down 42%.

Those numbers worsen from late March 2020 through the end of the year, totaling $492 billion in losses.

UNDERSTANDING THE SUPPLIER PIPELINE

As a supplier to the industry manufacturing towels, your supply pipeline typically consists of approximately six months of product estimates. Traditionally a distributor would have two to three months of stock on hand and two to four months in the production pipeline, including goods in transit, weaving, bleaching, etc.

When closures and travel restrictions began in March 2020, the suppliers in both hospitality and retail hit the brakes hard and developed new forecasts for the balance of 2020. Traditional buying patterns were adjusted down to new levels commensurate with “pandemic” conditions.

RETAIL SALES DROP, ONLINE SALES GROW

Retail stores closed indefinitely—some closed forever, including Pier 1, Gordmans/Stage Stores and Stein Mart. Stores that lacked full online stores suffered because customers continued buying online.

According to The NPD Group, online purchases accounted for 29% of home textiles sales from July through September, up from 23% during the same period of 2019.

As people remained at home, they focused on buying new decor and updating the spaces where they were now spending most of their time.

Good for us? Not really. Let me explain as we create the supply side landscape.

SUPPLY-SIDE MANUFACTURING CHALLENGES

While hospitality and traditional retail came to a screeching halt, the supply side was also navigating through COVID-19-related issues. An important fact to know is that conventional towel and sheet manufacturing typically runs multiple shifts with hundreds to thousands of workers in each shift—all of them in very close proximity to each other on the factory floor.

With the onset of the pandemic, social distancing restrictions started very quickly in virtually every country. In the fall of 2020, this was not much of an issue, with lower estimates of demand and weak global orders.

When the hospitality industry established forecasts for Q2 and Q3 of 2021, the spring production demands aligned with over 300,000 new COVID cases daily and massive government shutdowns.

With product demand at a two-year high and lockdowns in manufacturing facilities, there have been product shortages throughout the market.

GLOBAL GRIDLOCK ADDS TO CHALLENGES

In September of 2020, India’s Parliament passed three farm acts that caused what has commonly been referred to as the India Farmer Protest. These acts are:

hotel linen suppliers