DMC Buys Anchor Threads: A New Era in Cross Stitch Supplies

In a surprising development that occurred three weeks ago, DMC announced its acquisition of the renowned Anchor Threads brand, marking a significant shift in the cross stitch industry. While this news may not be fresh off the press, it's still worth exploring the implications of this merger.

Anchor Threads, long considered the second-largest embroidery thread company, offers a product line that directly competes with DMC. The acquisition aligns with DMC's ambition to solidify its position as the foremost needlecraft brand. Justin Wraight, CEO of the D.M.C. Group, expressed enthusiasm about the partnership, emphasizing the rich heritage, dedicated customer base, and remarkable product range associated with Anchor Threads.

This acquisition stands in stark contrast to DMC's other holdings, such as Rowan, Sirdar & Wool and the Gang, which focus on niche wools rather than embroidery products. It's evident that DMC is charting a new course with the Anchor brand.

The question of why Anchor was sold arises. Recent events have not been kind to Anchor Threads, particularly their ill-fated attempt to introduce embroidery thread on spools, leading to a decline in favor among cross stitchers and the removal of their products from store shelves. The frequent change in managing directors within the former owning company, MEZ Crafts Group, suggests internal turmoil. Although the extent of Anchor's troubles may not have merited a sell-off, the fact that DMC hadn't acquired a brand in over a decade indicates that Anchor was likely put up for sale.

The future for Anchor under DMC's ownership remains uncertain. While Anchor will continue to operate for the next year under MEZ, DMC will gradually assume control over order fulfillment, delivery, invoicing, and customer service. This transition could imply potential redundancies.

However, all hope is not lost. The acquisition announcement also hints at forthcoming product launches by Anchor within the next year. If these new products are well-received and expand beyond DMC's current offerings, Anchor may secure its place in the market.

Is this acquisition a monopoly? Technically, no. DMC intends to maintain Anchor as a separate brand, possibly with distinct delivery, dispatch, and customer service departments, which could alleviate concerns about redundancies. Yet, the dominance DMC now exerts, especially in conjunction with other budget-friendly embroidery thread brands like CXC and Royal Broiderie Threads that have adopted DMC's numbering and coloring system, is substantial. Brands slightly below DMC and Anchor in the hierarchy, such as Sullivans, Madeira, and J&P Coats, may face increasing market pressure.

The industry's reaction to this acquisition is intriguing. DMC has had PR-related issues in the past, including disputes about paying designers that led to calls for boycotts. It seems that they are handling this acquisition discreetly, keeping it off their social media, blog, and corporate website. This low-key approach suggests some uncertainty about how the cross-stitch community will receive the news, as it has yet to reach craft news outlets, Reddit, or Facebook.

What are your thoughts on this recent development? How do you foresee it reshaping the cross stitch industry? Happy stitching from all the CXC Crafty Threads Team.