It’s rare that news is so cutting edge that I can report on it a whole three weeks after it happened, but here we stand today, with the news that DMC buys Anchor Threads.
Updated: Now includes information on the US.
In a rather under-the-radar post from three weeks ago on Linkedin, DMC announced that they have formally purchased the Anchor threads brand, including all sub-brands under it.
What’s particularly interesting about this news is that Anchor Threads produces exactly the same line of products that DMC does, and is essentially, the second-largest embroidery thread company out there.
“It is a further step towards our ambition to be the number one needlecraft brand. We are delighted to be the new home for these brands with their proud heritage, loyal customer and distribution base, and impressive product offering. We are excited to welcome new customers and distributors alike and will pledge to work hard to maintain and grow our partnership.”
Justin Wraight, CEO of the D.M.C. Group
So where does this leave Anchor and DMC?
Well the D.M.C. company actually owns a whole raft of brands including Rowan, Sirdar & Wool and the Gang, however all of these brands work in a different space to the DMC we know and love. Instead of producing embroidery-based products, they mostly focus on niche wools. So the purchase of Anchor is a major departure from DMC’s previous habits.
Why Was Anchor Sold?
Well, Anchor hasn’t had the greatest time lately.
Their complete failure of launching embroidery thread on spools has not only seen them lose a lot of favor with cross stitchers but also a lot of shelf space too as they had to pull the whole thing off the shelves. But the very fact that they tried to come up with an idea to reduce their need for shelf space in stores just goes to show that for the Anchor company, the price they were paying to stay in stores wasn’t worth it for them.
In fact, the old owners, MEZ Crafts Group, have changed their managing director 4 times in the last year alone, just going to show that something isn’t right over there.
But were they doing bad enough for a sell-off? Unsure. Considering DMC hasn’t bought a brand for over 10 years, it seems unlikely that they actively sought to buy Anchor, and instead, Anchor was put up for sale.
Is Anchor Heading For The Chopping Block?
Well, that’s impossible to say! The recent woes of Anchor threads don’t paint a good picture, and the fact that they are a direct competitor, arguably the largest direct competitor, to DMC suggests that there is a high chance that Anchor will be pushed out.
After all, in places like the UK, the only choice of threads is either DMC or Anchor and they fight for space in retailers. Doing this pushes up prices for both.
But at the very least, Anchor has a year left! Part of the press release showed a surprising line that suggests MEZ will operate the brand for 12 months before fully moving over to DMC. This sounds good at first, but digging into this a little, it means DMC will have to take over all actioning of orders, delivery, invoicing, and customer care in the future. We’re seeing redundancies written on the wall I fear.
BUT all is not lost.
The post also reveals that Anchor is planning new product launches within that 12-month window. This might be the saving grace for Anchor. If they can stick the landing on these products, or if they turn out to expand the range beyond that of DMC’s product line; then they might just keep on going.
Is This A Monopoly?
DMC is planning to run Anchor as a “separate brand”. This could include totally separate delivery, dispatch, and customer service departments too (saving those redundancies), and they could be using the 12 months to build up that architecture.
However, it does make you wonder just how much sway DMC now has.
With ownership of Anchor, and all cheaper embroidery thread companies like CXC and Royal Broiderie Threads copying DMC’s number and color system, DMC now probably has sway over 90% of the embroidery thread market.
With this power, brands like Sullivans, Madeira, and J&P Coats, which rank slightly below both DMC and Anchor threads in our roundup of best cross stitch thread brands, are being pushed out of the market more and more.
How Has The Industry Reacted?
It’s no secret that the DMC company has stepped its foot in it before when it comes to PR. DMC’s most recent issues around not paying designers called for many to boycott the brand, and so it’s no surprise that they’ve chosen to keep this news, something that is bound to cause some controversy on its own, under wraps.
However, the scale at which they’ve kept this secret is shocking. Keeping the news off all of Anchor and DMC’s social media, off their blog, corporate website, and any channel other than a very under-served Linkedin page, just shows how unsure they are of how stitchers will take the news!
In fact; this has so far kept the news from leaking to any craft news outlets, Reddit or Facebook, meaning they chose not to push a press release out either.
What About The US?
Since this post went live a few people have mentioned to me about the weird setup with Coats and Anchor. As many of you may know, Coats used to own the entirety of Anchor, but it was sold off, however, it appears some part of it remained with Coats.
I reached out to a few official channels and got to the bottom of this!
Coats sold Anchor in its entirety. However, they retained the US distribution rights. This means that if Anchor is shut down; it’ll also go in the US!
What are your thoughts about the recent purchase, and how do you think this might shake up the industry?
Shout out to Frosty XStitch for giving me the scoop!