Q&A: How Faribault Woolen Mill Is Weaving Plans For All Seasons

Q&A: How Faribault Woolen Mill Is Weaving Plans For All Seasons

CEO Terry Mackenthun talks about the brand's storied history, the holiday shopping surge and plans for new product lines in 2017.

It’s been a few years since the revival of Faribault Woolen Mill, remaking it from a fusty to cherished American heritage brand. It should come as no surprise that its products, primarily made for the Minnesota fall and winter seasons, sees its sales start to rise in September and continue strong through the holidays.
 
But the company has a vision beyond blankets and scarves, according to Terry Mackenthun, who took over two years as CEO of the 152-year-old company. In an interview with TCB, he laid out the company’s plans to break into cotton products in the next year and explained what that meant for Faribault’s business model, as well as how more staff will be needed as year-round demand for the brand rises.
 
Note: This interview has been lightly edited for clarity and length.
 
 
TCB: People know Faribault Woolen Mill as a cold-weather brand. It’s likely safe to say that demand is high this time of year, right?

Terry.jpgTerry Mackenthun: Absolutely. On one hand, people’s mindset with wool is that it’s fall or winter that people are going to buy our product the most. But we also try to broaden people’s understanding that wool is not just a winter product either. Part of our innovation as we go forward is to create lighter-weight wool products that work very well during the spring and summer season. But this time of year, especially, we are in the 60- to 90-day window where blankets are in high demand and we sell the large percentage of our blankets direct-to-consumer. While we do sell quite a bit of our business through wholesale, a lot of it is done through direct-to-consumer just given the size of the purchase. It’s a premium, high quality product and it resonates well with our individual consumers. We’ll be selling blankets pretty heavily into the middle of February.
 
Up until the 1990s, Faribault was primarily known for durable wool blankets used by the U.S. military. For many decades, blankets made up 90 percent of Faribault’s output. What does the product lineup look like today?

Obviously blankets are a high-dollar item, so in terms of dollars it still makes up a fairly large percentage—it’s north of 50 to 60 percent of what we do. As far as units go, it’s smaller though. What’s changing in the retail climate is that some of our products are becoming more ‘top of bed,’ meaning they are competing for that space of duvets, and people’s bedrooms are becoming more of a visual merchandising element. So not only are people wanting to match a blanket, but they want pillows and shams with a throw at the bottom of it all to have some sort of lifestyle fashion statement within the bedroom. Our product line in the blanket side still needs to be true to that person who wants a bone white clean blanket to put out on top of the sheets, but we also have a growing audience who wants a creative design to match whatever else is going on in that room. In the throw business, which is much more of that 50-inch wide, 72-inch long type of product that plays much better in the living room space. That’s where a lot of our creative work is put in on the design side because people are seasonally changing out their homes in a much greater manner than they used to. Throws, on a unit basis, is a larger business for us than our blanket business.
 
So then is Faribault’s best opportunity to be uniformity in its many products versus creating many separate, individual items?
 
IMG_5161-KH.jpgIn this photo we did of a blond woman sitting in a living room, that whole collection was put together just for the holiday season. We started with throws and expanded that into lumbar pillows and full size pillows. We did tree skirts and log carriers to match that. So we kind of merchandised out the entire living room space with variations of patterned reds and silvers. When I arrived at Faribault a couple years ago, the product line was very archival. The company had reached back in its history and pulled a lot of traditional pieces, which we still sell a lot of. But what was missing was the fact that each of those pieces was an individual purchase. A lot of where we’re moving to is being able to mix and match these other patterns and themes, and as a result creating lower price points.
 
Faribault has worked in the past with retailers like Target on exclusive product lines. What value do you see there in the future as you expand what you offer?
 
Target was a great partnership for us. We made products for them, although the partnerships we have now are probably not to the scale of what we did with them. Right now, I want to mix and match partners with different capabilities so I can test new products that we haven’t done yet, while leveraging what they do well. Additionally, collaborations tend to be a great way to market products without putting a commercial on national TV. We did two beautiful blankets this year with Filson, and those blankets will be co-labeled in all of the Filson stores, meaning it’ll have their name and our name on it. So we’re kind of building our historical equity together in those products. We’ve done a lot of collaborations with CB2 and J. Crew over the years. Other partnerships that I’m getting into might be on the handbag or tote side of things where there might be someone who is really strong in that space. So taking our fabric and taking their accessory line, we can build a product and co-launch it on our business sites together. Right now we’re doing something like that on the sock line and I’d like to do something like that with mittens.
 
As you branch into new product lines, are you attracting the attention of style influencers like GQ or Esquire?
 
It seems so. We merchandise really well with other people’s products. So at this time of the season we show up all over because our items are really giftable for men, women and the home.
 
In an interview with TCB a couple years back, your predecessor, former Faribault CEO Tom Irvine, said, “One of the fastest ways to become a flash in the pan is to overexpose. We need to bring the mill up slowly and deliberately.” Have you taken on a similar approach with Faribault’s media exposure?
 
What Tom may have said as well is the legacy of the Faribault company is pretty large compared to what it used to be. Hypothetically, I could take 40 percent of the capacity of the mill and have it just run off custom business to appeal to draw attention from the media. But a lot of those things are just one-time sales opportunities that next year may not be there. So it’s important to stay focused on our product line and brand that reaches a wide range of consumers and retailers. That helps us keep a little bit grounded. I think Tom was right about that and I’m certainly following a similar approach because the mill is still coming up to speed and we want to grow our capacity—although, in many cases, we are running at 100 percent capacity right now. Our ability to add new product lines and add growth and volume will require us to bring more workers in, bring more equipment in and add a second shift, which we are starting to lean into right now.
 
How many workers do you plan to have in the near future?
 
We’re at 105 employees now, and that doesn’t include the fact that a lot of us are working 10-, 12- or 14-hour days. Our environment is very trade-skill driven, so we are recruiting from all over the world to find people that are schooled in the world of textiles. There are certainly some aspects of what we do in our manufacturing facilities that doesn’t require you to have that background. But whether its research and development, chemistry, running a weave operation or carting frames, these are unique skill sets to the textile industry. And we’re one of the last ones standing—if not the last one—in the Midwest that is doing what we’re doing. For us to grow in some of these areas, we have to bring in people from the Carolinas or New England where they do a lot more textile work. We’ll definitely be adding more staff next year, some of it seasonal.
 
As Faribault grows its operations and product line, do you see that having some effect on who buys your products, specifically between retailers and individual consumers?
 
Let’s do a little math together. About 15 percent of our business is to independent boutique retailers that are spread out from San Francisco to Manhattan. They typically buy a variety of our products with $2,000 orders or so. We do another 35 percent in direct-to-consumer. That might mean here at the Faribault store, online or at things like last year when we went to the Minnesota State Fair. We do about 5 to 10 percent in larger specialty wholesale. Places like Filson are in that space. And the rest is spread out between contracts with the Department of Defense and other companies that just want to buy a bunch of blankets that they have outlets that they turn around and sell to. As we expand our product line, we’ll probably do less of that contract business, or add capacity and it’ll just become a smaller percentage as we reach deeper into our branded business.
 
How does the holiday season compare to your average week of the year?
 
This time of year certainly sees an uptick in direct-to-consumer shipments. Those one or two item sales certainly peak starting around Labor Day and run all the way through the holidays. Parallel to that, we do a lot of business with the Department of Defense. We have significant contracts with the U.S. Navy and other departments for blankets for European efforts. Those numbers are in the multi-thousands and the need for those products run pretty evenly from month to month all year. One more piece to that: We’re introducing in January or February a cotton line of pillows and throws. Those will be made with a combed cotton product, which is probably the finest cotton you could get your hands on here in the United States. We’ll be working with some partners and bringing that cotton into our mill here to weave it. This way we’ll have a wide variety of spring and summer products that will be used to balance our fall and winter business. I think it’s going to do very well all over the country, but especially in the southeast part of the U.S. where it’s a warmer climate and wool isn’t as traditional. By doing this, I think we’ll be balancing our product line not by just extending into new types of products, but extending the existing products with more, in a sense, seasonally accepted fibers.

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