SHEER MAKERS PONDER PRICE HIKE FOR LYCRA
Byline: Rosemary Feitelberg
NEW YORK — Already saddled with a stagnant business, sheer legwear manufacturers consider DuPont’s planned price increase for Lycra spandex to be yet another weight to carry into 1998.
As reported, DuPont will increase the price of Lycra yarns 6 percent for shipments on or after Dec. 27 — the first hike since 1992. The increase affects products for the circular knit, core spinning, covered yarn and legwear segments.
For the past few years, sheer manufacturers have struggled to revive the business, which has dwindled due largely to the growth of casual dressing. With tights and pants continuing to gain ground as staples for corporate attire, sheer makers have been updating their lines with more casual styles, such as tights in flat packs that can be merchandised alongside their sheers. But whether opaques or sheers, these products generally use some percentage of spandex.
With the increased cost for Lycra, legwear vendors say they face raising their prices or cutting into their margins, and neither prospect makes them feel too comfortable.
While DuPont’s competitors in the U.S. spandex business — namely Globe Manufacturing and Bayer — have not said they would increase prices, legwear manufacturers are holding their breath and hoping they won’t follow suit.
Carol Pedalty, end-use marketing manager for DuPont, said its customers are generally meeting the increase with equanimity.
“Overall, the good has far outweighed the negatives. They understand the need for new products,” she said. “We’re always searching to create new product or technology. DuPont is truly focused on delivering real benefits to consumers. It’s not just because we make it; we sell it.”
Pedalty noted a pair of sheers generally requires two to three grams of Lycra. That means a few more pennies per pair for most manufacturers, she said.
However, some makers say that the cost increase could hike prices at retail as much as $1 a pair, and with a pair of department store pantyhose typically selling at roughly $6, that would be a noticeable increase — one that could cause some consumer resistance.
While the two largest sheer hosiery manufacturers — Hanes Hosiery and Kayser-Roth — declined to comment on the situation, some vendors noted they are still waiting to hear from their yarn suppliers as to how they will handle the increase.
Barry Tartarkin, executive vice president of sales and marketing for Ridgeview, the maker of licensed Ellen Tracy hosiery and Evan-Picone legwear, said, “We are going to have to look at our options. We don’t have the luxury of passing on the increase to retailers.
“We’re all in the same boat. We have to be more efficient about manufacturing or it will eat into our margins,” Tartarkin said.
Jockey For Her hosiery has no plans to change its sourcing from DuPont Lycra, said Kathy Reynolds, president. Given that, Jockey For Her’s retail prices are expected to climb during the first quarter next year.
Reynolds said she does not expect to pass off increases to casual items that have been performing well at retail.
“Our sheer business will take price increases, but they won’t be across the board,” she said.
Ithaca Industries, a private label hosiery maker, is also considering increases, said Joni Zeller-Claxton, vice president of hosiery design.However, she said, “It’s tough to pass on to customers when business is tough.”
Still, customers are buying better products with “inherent value,” Zeller-Claxton said, so it would be easier to pass on price hikes for new products than for existing programs such as Lycra 3D hosiery.
Russ Klein, president of Easton International, which markets Joop, Wolf and Pierre Mantoux hosiery in North America, said DuPont Lycra constitutes 80 percent of the spandex used in these products, but he noted the lines he represents are always evaluating suppliers.
Spandex is a competitive market today with Bayer and Globe, he said, but price is not the sole consideration. Specs and technique weigh heavily, he said.
Among sock makers, there were also concerns, even though their business has been more buoyant than sheers.
Ben Berger plans to hold prices by absorbing the costs, at least until fall 1998, said Michael Berger, vice president. “Unfortunately, we can’t pass on increases whenever there’s a fluctuation in price,” he said.
Furthermore, he noted, the company hiked its price points last year, when it developed some improved products using more spandex. Of the spandex used by Ben Berger for U.S.-made products, DuPont provides more than 80 percent. Non-DuPont spandex is used for merchandise made overseas, Berger said.
In the upgraded products, spandex now constitutes from 3 to 15 percent of the material used in a pair of socks, and wholesale prices for these improved products are 5 to 10 percent higher than the rest of the line.
Pat McNellis, president of Nine West legwear, a division of Royce Hosiery, said she does not plan to increase prices next year. Wholesale prices for the line, which bowed this spring, start at $1.89 for socks, $2.50 for trouser socks and $3.80 for tights.
“Our brand is too new to try to reposition it,” McNellis said.
The company plans to accept tighter margins to handle the increases, she said.
The Hot Sox Co. does not anticipate price increases for its line of socks or its licensed Ralph Lauren legwear in the immediate future, said Mark Gordon, an owner. Spandex — which for Hot Sox is at least 50 percent Lycra — generally makes up anywhere from 3 to 6 percent of the material used for the company’s socks, he added.
“At this point in time, the increases are something we’ll absorb and live with,” Gordon said.