It seems only natural that the first column should deal with Alsy+Cycle II, the largest decorative lighting manufacturer–a company which for the past decade has dominated the lighting industry.
lsy+Cycle II, the largest decorative lighting manufacturer
While Alsy+Cycle II’s market share is sizable–especially among the nation’s leading department stores and home furnishings chains–the firm’s plans for expansion during the eighties is equally significant.
According to chairman and chief executive Sy Stewart, growth continues at leading stores in all forms of retailing: carriage trade department stores, regular stores, specialty shops, furniture stores, chain stores, discounters, mass merchandisers and catalog houses.
“Each one has certain products, mark-up, service and price point requirements and I’m going to try and sell the best of each one of them. I want to sell the winners,” Stewart said.
Few lighting resources have the breadth of product, style and price that Alsy+Cycle II has. This broad assortment gives Alsy the leverage to successfully penetrate all the distribution channels.
As a privately held company, Stewart chose not to specifiy his annual sales volume, but he did say, “My volume is more than my two closest competitors’ volumes combined.”
Stewart has identified two factors contributing to this hefty volume: fulfilling a need in the market and creating one.
By being a better merchandiser and manufacturer, we’ve grown at the expense of our competition,” he explained. “And, we’ve created a need: We’ve made the consumer aware that our business is a fashion decorative accessory with a bulb. The product is not only trendy, but above all, it’s extremely affordable.”
The firm has remained sensitive to trends. Stewart is known for working with key department and furniture store executives to develop new products at least four times a year. He has always compared the decorative accessoires business to such fashion businesses as cosmetics and women’s wear, identifying key color and style trends. Most of these trends emerge at least six months before they hit the retail floor. Alsy, like some of its competitors, is also sensitive to strong selling features in lighting, whether the lamp be size, shape and shade style, or a particular color or finish–and the company makes a concerted effort to introduce products reflecting those trends.
Stewart has attempted to allay retailers’ concenrs regarding potential distribution problems by offering assortments of merchandise through two different divisions: Alsy+Cycle II and Atom/ Westbury. Alsy and Atom both manufacture ceramics, hydrocal–a man-made substance which can take on the look of ceramics or clay–and metal lamps, while Cycle II and Westbury manufacture glass lamps.
Atom/Westbury was created six years ago in an effort to further develop the firm’s lighting business. Each division is independent.
When the firm moved to its plant in Hicksville, N.Y. in 1976, it began to branch out to additional department stores, trading stamp companies, mass merchandisers–like J.C. Penney–and a few discounters. By creating Atom and Westbury, the firm could offer service to the discounters too.
“We recognize that regular and catalog discounters need certain products looks, price points and types of merchandising,” he explained. “We knew we couldn’t have the same exact products for department stores as discounters and accepted the challenges of replacing those identifiable styles we gave discounters with new, uptrended ones for the department stores. Trend merchandising ia a challenge every retailer has, starting with Neiman Marcus down to Wal-Mart.”
He added, “My responsibilities have been to keep abreast of all changes going on in the lighting industry and then develop new products to compete head-on. That’s what we’ve done for 13 years,” Stewart said.
“My responsibilities have been to develop new products to compete head-on”
Stewart and his partner, Al Gindel, had headed up quartite Creative Corp., a totally vertical lighting operation up until its sale in 1966 to Continental Group. In January 1971 both executives came out of retirement and formed Alsy+Cycle II.
When Stewart and Ginder formed Alsy+Cycle II, they concentrated on being important to a few accounts–400 versus 6,000–identifying their consumer as an “upper-end, fashion-oriented person who is also a refurbisher.” The firm also looked at lamps as decorative accessories, not just lamps.
Alsy+Cycle II has only one showroom, located in Manhatta. The executives have designed it as a “think-tank”: a showroom that is constantly changing–at least four times a year. The firm displays lmaps in vignettes, focusing on new colors and styles. It is not difficult for the buyer to envision the products on a retail floor: the Alsy+cycle II showroom is modeled after a retail store.
Stewart’s strength, his dealers agree, is in interpreting and forecasting key product and style trends in lighting. “There are two kinds of people,” Stewart said, “Those who make history and those who read history. Our company makes history. Our competition reads it.”
While Alsy+Cycle II is not the only firm concentrating on such trends as post modern, contemporary, Bold color themes and brass, the firm does market its products differently. More Products offered
First, it offers more products, styles. For example, most lighting firms specialize in either ceramics or metals; few manufacture ceramics and metals in a totally vertical operation. Secondly, those who might offer breadth, do not always compete as fiercely as Alsy on prices or maketing aids.
“Our strength is not just marketing,” Stewart said, “We have the ability to make a product, deliver it on time and competitively, and above all, know what to make,” Alsy’s operation is housed in three plants: Hicksville, Pottsville, Pa. and Copiague, N.Y. Alsy can better compete because it uses its own materials to manufacture and package the lamps, rather than relying on other firms to supply those parts.
As lighting and accessories becomes a stronger part of retailers’ business, Stewart is aiming to gain an even greater share of the market.
“Decorative lighting has one of the greatest potentials of growing,” he said. “there are 84 million households in the United Staes with approximately five rooms per house. Our challenge is not to beat each other’s head, but to convince the consumer to buy lamps. That’s one of our greatest growth potentials.”
Lamps are one of their greatest growth potentials
Stewart hopes to reach this objective by strengthening the firm’s marketing program and its merchandising aids. In one area of the showroom, Stewart has designed a media room with ad slicks, slides and other marketing tools.
Stewart is not afraid of change and has developed his lighting business to reflect just that. “I change as fast as I can. The faster I change, the fast as I can. The faster I change, the faster the consumer changes,” he said. “If the manufacturer doesn’t change, how can I expect the consuer to change?”