Tuesday, September 9, 2014

Dalton - The Carpet Capital of the World

The Carpet Capital of the World
by Polina Bublykova

This is a unique story of how a small city of Dalton became the carpet capital of the world despite hard-packed clay, poor farmland and being the last choice of areas of Georgia in the United States to settle. 

This is a unique story of how a small city of Dalton became the carpet capital of the world despite hard-packed clay, poor farmland and being the last choice of areas of Georgia in the United States to settle. In the case of Dalton a cluster was formed - a geographic concentration of interconnected businesses, suppliers, and associated institutions in a particular field, such as textile. Dalton is a great example that shows the role of chance in creating a business cluster and how firms that clustered with their industry peers can eclipse those who remain as loners or who prefer to be an unconnected enterprise.
In 1895 Catherine Evans, a fifteen-year-old Dalton girl, revived a traditional technique of hand tufting a bedspread. Her first work, which was a bedspread as wedding gift at wedding of her sister-in-law Addie Evans, was highly admired and the demand for this product extremely increased. Later Catherine sold her first spread and in order to meet a rapidly growing demand she taught her family, friends and neighbors how to tuft. The same technology was later applied in producing bath mats, robes, throw rugs etc.
When bedspreads were completed, women would put them on clotheslines to dry and they were visible from Dalton-Cartersville highway. Thus, tourists could enjoy the possibility to buy hand-tufted spreads "off the line" (not only in department stores). This boulevard, where spreads were hanging, became very famous and got the name "Bedspread Alley" or "Peacock Alley", because these feathered birds with spreading tails were the most popular pattern.

In 20 years after the first spread Addie Evans opened the first women's actual business - Evan Manufacturing Company - that triggered opening of retail stores and small tufting operations in sheds, small homes or even in unused chicken houses. It was mainly a home-based family production, hence men participated in this business as well, hauling materials and modifying and repairing sewing machines in order to use them for tufting. Many people came to Dalton to start their own business. New commercial laundries were opened to do shrinking and fluffing. During the Depression years the bedspread income was an additional source of money that helped many families to survive.

So, we can notice that growth of this cluster triggered opening of lots of new small competitive firms, related businesses and suppliers that render essential services for supporting the cluster. Moreover, in 1930-1940 the federal government legislated a minimum wage and there were no possibilities to hire "free-lance". As a result, many people went to work to local spreadhouses.
After the Second World War there was a technical advance that enabled production of tufted carpets. Due to advantages of new efficient technology, the carpets became more affordable for middle class, and this led to a boom in Dalton area. By 1980, Dalton was producing around 80% of America's carpets and started to export them. That was the time when the city was honored with the name of the Carpet Capital of the World.
In 1980-1990 because of housing boom and increase in car production, where carpets began to be used, the demand for carpets significantly rose. However, in late 1990s a drop in popularity of carpets as a domestic floor covering caused a decline in sales and profits. The most economically effective and expected reaction of a mature industry in this situation would be to consolidate ownership, which would allow to rationalize production capacity and to maximize economies of scale.
Today there are 3 big Dalton-based companies in carpet industry: Shaw Industries, Inc., Mohawk Industries, and Beaulieu of America; the Dalton area produces more than 70% of the total output of the world-wide industry of over $9 billion.
Thus, the wedding gift of Catherine Evans can be considered as a random event that gave an impulse to create a business cluster. However, Dalton's association with carpets is not a mere accident. Proximity to sources of raw material (cotton and later synthetics), transportability of the finished product, presence of supporting industries and qualified human resources, high demand and intense rivalry gave reasons for carpet industry to be competitive and to concentrate around Dalton. These four main interconnected factors of success: demand conditions, related and supporting industries, factor (input) conditions and firms strategy, structure and rivalry - are the building blocks of the Porter's Diamond theory, which explains why clusters become competitive in particular location.
The Dalton area has a great theoretical background for clustering a carpet industry. And I hope it will continue to improve and develop the cluster and will be a carpet capital of the world for long time. Good luck, Dalton!


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