The CATALOG AGE 100: Who’s on Top?

When the year 2000 arrived amid fireworks and galas, the economy was still going strong. The first three quarters of the year continued to bring solid growth in both sales and income to many catalogers.

Going into the fourth quarter was another story, however. A hike in fuel prices, the confusion over the presidential election outcome, the dot-com crash, and the slowdown in the PC market pushed consumer confidence and spending downward. So how did these factors affect the companies of the Catalog Age 100?

Catalog Age’s exclusive ranking of the top 100 catalogers for 2000 shows that some mailers, such as general merchant J.C. Penney and computer manufacturer/marketer Systemax, indeed took a beating in 2000, with sales down from 1999. Others, such as hunting supplies cataloger AcuSport and gifts mailer Miles Kimball, reported flat sales. And personalized gifts and home products cataloger Lillian Vernon posted a drop in sales for the second year in a row. The company’s sales fell from $255.2 million in ’99 to $246.6 million last year.

At the other end of the spectrum, several mailers reported significant gains in 2000. Office supplies marketer Corporate Express North America was the biggest winner in terms of growth, with a staggering 193% sales increase over ’99, to more than $4.05 billion.

Computer cataloger CDW also enjoyed a year of solid sales growth, watching its sales jump 48%. The company, which stepped up its television advertising, has been successful in bringing in new customers through the Internet. In fact, CDW’s Web sales increased 132% in 2000.

Among other impressive gainers was home furnishings cataloger/retailer Crate & Barrel. Its direct sales jumped 47%, reaching $125 million in 2000. Direct sales for women’s and children’s apparel cataloger/retailer Talbots climbed more than 40% since ’99, to $269 million. Venator Group, which includes athletic shoes cataloger Eastbay and the up-for-sale gifts cataloger/retailer The San Francisco Music Box Co., posted a nearly 40% increase, to $279 million.

Looking at the rankings among companies in the consumer apparel segment, Nordstrom posted a 32% increase in sales for 2000, from $234.9 million to $310.6 million, while Intimate Brands’ sales grew 20%, to $962 million. And while Blair Corp.’s sales were up just 10% over 1999, to $574.6 million, its net income increased 27%.

Powerhouses Lands’ End and L.L. Bean recorded much more modest growth. Lands’ End’s sales rose less than 3%, while Bean’s increased less than 4%. But that’s greater growth than the catalogers had the previous year. In fact, in 1999, Lands’ End’s sales had fallen almost 4%.

Some clothing catalogers that seemed to be doing well in 2000 have since hit snags. For instance, Coldwater Creek saw sales rise 24%, from $323.2 million in ’99 to $400 million in ’00. But this past February, the company laid off 160 employees.

Similarly, Brylane (which has a home decor title as well as numerous apparel catalogs) posted a 17% increase in sales, to $1.4 billion in ’00. Yet the company’s Chadwick’s of Boston apparel division began cutting 300 jobs in April.

On the business-to-business side, communications equipment catalog Andrew Corp. reported a remarkable turnaround, with a 31% gain in sales. The company, which had suffered a 4% drop in sales in 1999, credits its success to growth in China and Latin America as well as in the States.

Multititle educational products cataloger School Specialty had a 23% surge in sales, from $521.7 million in ’99 to $639.3 million in ’00. And maintenance and repair products marketer Interline Brands the result of the September 2000 merger of Wilmar Industries and Barnett reported a 21% hike in sales. In 1999, the combined sales of Wilmar and Barnett were $494.4 million; Interline Brands’ sales for 2000 hit $597 million.

Less impressive was Kennametal, which reacquired its spin-off catalog division JLK Direct Distribution in September. JLK’s sales slipped from $504.2 million in ’99 to $496.7 million in ’00.

Evidence of a computer slowdown

Many computer catalogers on the the Catalog Age 100 seem to have posted healthy sales gains. For instance, PC Connection’s sales grew 37%, from less than $1.06 billion in ’99 to $1.45 billion in ’00. But if you compare those numbers to the previous year’s, when PC Connection’s sales increased 44%, it’s apparent that the company’s growth is slowing.

Likewise, revenue at fellow computer mailer Insight Enterprises grew 34% in 2000, reaching $2.04 billion. Yet between 1998 and ’99, the company’s growth rate had exceeded 51%.

Even the big Kahuna, Dell Computer Corp. number-one on the list for six years in a row posted slower sales growth. Dell’s sales increased 26% from ’99 to ’00, reaching nearly $31.9 billion. But between ’98 and ’99, Dell’s sales had increased 38%.

And Dell’s problems extend beyond slowing growth. Its first-quarter revenue for 2001 increased a disappointing 10% over the same quarter of 2000, while operating income fell 6%, and net income dropped 1%. The lackluster results have forced Dell into two rounds of layoffs in the first half of this year.

Although the computer marketers’ growth is somewhat stunted compared to last year, many catalogers would be more than happy with double-digit sales growth or any growth, for that matter. After years of steady sales increases, consumer catalog industry veterans J. Jill and Ross-Simons posted decreases for 2000.

Women’s apparel cataloger J. Jill’s sales fell from $250.3 million in ’99 to $ 246.3 million in ’00. Jewelry, gifts, and tableware items marketer Ross-Simons saw sales slip 16%, to $189 million.

Considering that the economic good times were still rolling for most of 2000 and that the financial outlook has worsened for this year it looks like 2001 is going to be a bumpy ride.

THE BIG 10

Rank

Company

2000 sales
($ in millions)

1999 sales
($ in millions)

1 Dell Computer Corp. $31,890.0 $25,265.0
2 IBM $7,575.0 $7,500.0
3 W.W. Grainger $4,977.0 $4,636.3
4 Corporate Express North America $4,054.3 $1,381.9
5 J.C. Penney Co. $3,823.0 $3,933.0
6 CDW Computer Centers $3,800.0 $2,561.2
7 Office Depot $3,600.0 $3,200.0
8 Staples $2,955.0 $2,457.0
9 Micro Warehouse $2,564.8 $2,442.0
10 Henry Schein $2,381.7 $2,285.5
Source: Company reports/Catalog Age estimates

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