Cotton Costs Increase Rapidly        
According to the National Council of Cotton, world cotton prices are now about 50% more than last year at this time – from about 60 cents per pound to 90 cents per pound – and will likely increase further in the coming months. With T-shirts the top-selling item in the ad specialty industry, suppliers, already feeling the pressure of the increase, are advising distributors to prepare for costs on apparel to climb in the next few months.    

"By late summer and early fall distributors will start to see across-the-board price increases," says Anthony Corsano, CEO and president of Anvil Knitwear (asi/36350), though he could not say exactly how much costs would increase by. Corsano suggests that distributors order supplies for orders as soon as they can to lock in lower prices where possible.

Gary Adams, vice president of economics and policy analysis for the National Council of Cotton, agrees, saying that distributors, "have to anticipate what their needs are going to be as much as possible so they're not caught short or unaware." Adams says that not only has the price gone up, but as corn and soybeans have become more profitable crops to produce, and regions like India have curbed their exports, the supply of available cotton has gone down. "We are seeing those higher prices moving up the textile processing chain – yarn prices are higher than they were a year ago, and eventually that's going to make its way up to the retail level."

Echoing this sentiment, Garry Hurvitz, president and CEO of Counselor Top 40 supplier Ash City (asi/37127), recently sent a letter to customers outlining the current apparel pricing environment and specifically pinpointing cotton as a raw material cost that was increasing. In the letter, Hurvitz wrote, "Specifically impacting our cotton based apparel is the worldwide shortage of this product and with yarns being more difficult to obtain, we are seeing production delays and material cost increases everywhere."    

Video Report: Industry News Of The Week
Every week, Counselor PromoGram offers a video news report that highlights the industry's top stories. Called Industry Update, each episode details the most important trends and news items impacting the ad specialty market.

In this episode, we discuss new sunscreen labeling regulations and a Colorado tax law that could change how business is done over the Internet. Plus, which State of the Industry statistics are we revealing this week? Check out the video to find out.

Click here to see the trends and to watch Counselor PromoGram's Industry Update.

If you have any news you'd like to see covered on Industry Update or in Counselor PromoGram, please send it to newsdesk@asicentral.com.

PremiumPromo Acquires NPI
New York-based supplier PremiumPromo USA (asi/79372) has acquired the line name from financially-distressed New Products International (formerly asi/73780), which is closing its doors after 34 years in business. Financial terms of the deal were not disclosed, but the companies have announced that PremiumPromo will now exclusively supply all NPI brands, including its patented Hawk line of lighted magnifiers. "When people want to give a nice gift that's a little more prestigious, I want them to think of us," says Guy Jacobs, owner of PremiumPromo. "I don't want to be a pencil and pen supplier. We're going to offer a higher-end line of products to the industry."

Founded in 2004, PremiumPromo joined the ad specialty industry last year and is currently negotiating to expand its promotional offerings. The company is in discussions to allow it to offer brands like The Sharper Image and the George Foreman Grill, as well as labels like Seiko, Movado, Bushnell and Bulova. "We expect to close these deals in the next two weeks," says Jacobs. "I want people to know that everything we offer will be done in-house, including printing."

According to Jacobs, the staff at PremiumPromo is currently working to update the company's website and create a print catalog. "We hope to have a catalog within one month," Jacobs says.

Lungsal To Supply Poppenex Line
Supplier Lungsal Int'l (asi/68190) has reached an agreement to be the industry provider of Poppenex's (formerly asi/79000) logo in motion line, the companies have announced. The deal means Poppenex will exit the ad specialty industry, although the company's staff will work closely with Lungsal to expand the line, which is known for its lenticular or lens-like effects. Danny Lee, sales manager of Poppenex, will be joining the staff at Lungsal, which is accepting logo in motion line inquiries starting today. Lungsal, a California based supplier that was founded in 1990, primarily manufactures pens, coasters and luggage tags.

As a point of clarification from a previous report, Lungsal has not purchased the logo in motion line from Poppenex, but it will offer the line within the ad specialty industry.

Podcast: New Marketing Strategies That Work
On Tuesday's ASI Internet Radio Show, the hosts took questions from callers looking for advice on how to capitalize on new marketing techniques. Wondering about how to make the most of online social media or looking for ways to incorporate video into your marketing plans? Listen now to this clip from the show. 

Click here to listen to the marketing advice segment from Tuesday's show.

If you'd like to check out a recording of the whole online radio show, go to www.asicentral.com/radio. And, don't forget to join us next Tuesday, July 6, for our next broadcast. Log on to www.asicentral.com/radio at 10:30 am eastern time and give us a call at 215-953-4979 or e-mail us at radio@asicentral.com to participate on the show. We want to hear from you.

FDA Considers New Sunscreen Labeling Rules
The U.S. Food and Drug Administration (FDA) is considering implementing new guidelines for retail and promotional sunscreen later this year, potentially updating standards that have been in place since 1978. As part of its proposals, the FDA is looking at stricter rules to prevent misleading labeling, while also developing a rating system to measure a sunscreen's effectiveness against ultraviolet A rays. "The FDA has been talking about new labeling for sunscreen for a dozen years," says Bijan Hosseini, president of HandsFree Sunscreen (asi/59523). "I do think a rating system would be effective because of the technology that exists today."

If the current proposals become regulations, companies would be banned from using terms like "sunblock" and "all-day protection" on labels. The maximum sun protection factor (SPF) that a product could claim would be capped at 50+ and a multi-star ranking system would be established, with a one-star rated sunscreen offering the least protection and a four-star rated sunscreen offering the most. "I think you'll see a move to improve formulas," says Larry Wilhelm, CEO of Custom HBC (asi/47934). "Sunscreens will be updated to provide broader spectrum coverage. We've done that with our sunscreen over the last year in anticipation of these rules."

Since 2007, when the latest proposals were first discussed, the FDA has received thousands of comments from companies, including large retailers that are lobbying for testing standards that would benefit their individual product lines. Within the promotional market, the real concern about the proposals relates to the scope of the enforcement. "The FDA is vigilant and very thorough," says Mel Ellis, president of HumphreyLine (asi/62050). "The system for domestically sourced product is sophisticated. The problem is there's no apparatus for international sourcing."

Besides updating sunscreen guidelines, the FDA is also considering approving the use of Tinosorb M, a popular ingredient in sunscreens found in Europe. Tinosorb M and similar ingredients appear to be effective against ultraviolet A rays, which cause wrinkles and cancer. Compliant and improved sunscreen products could be on the American market by 2012, according to an FDA spokesman.

Nominations Open For 2010 Counselor Power 50
Counselor is now compiling its Power 50 list for 2010 – our recognition of the industry's most powerful individuals – and we're looking for feedback from you. Click here to see the list of last year's Power 50 and let us know whether you think the members are more or less influential today than they were a year ago.

Plus, this is also the place to nominate new people who you think should be on the 2010 Power 50 list. Scroll to the bottom of the survey to submit new candidates for the Counselor Power 50 list. Please write their name and company in the space provided.

Click here to take the survey and make new nominations.

ASICentral: Top 100 Markets For Ad Specialty Sales
A recent exclusive Counselor study unveiled the best cities for ad specialty distributors to do business in right now. For the interactive online version, we decided to extend the list to the largest 100 markets and give them not only a rank, but a grade too.

Want to know where the best – and worst – cities are for ad specialty sales? Click here.

Got questions, comments or any type of feedback regarding anything ASICentral, don't hesitate to contact us at feedback@asicentral.com. Also, follow ASICentral at: .

ASI Online Learning Center
Did you know you can take self-paced, on-demand courses at ASI Education's Online Learning Center? This is the newest and most convenient way for distributors, decorators and suppliers to get educated. In our newest course for distributors, "Break Into These Five Hot Apparel Markets," we'll unveil five markets that are buying lots of decorated apparel (think: education, high-tech companies, government entities and more), the types of apparel they buy and how to make the pitch and close the sale.

Click here to take the course.

In the News
Compass Industries (asi/46170) announced that its new address, effective July 7, is 104 West 29th St., 12th Floor, New York, NY 10001. The company's phone and fax numbers are unchanged.

The Innovative Line (asi/62677) announced that it has launched "promotional bandz," customized molded silicone band products.
 
RecognitionWorx Inc. (asi/71340) announced that it has hired Team Donlin to provide sales representation in MN, IL, IN, IA, MI, ND, SD, NE, OH and WI.

People on the Move
iClick (asi/62124) announced that it has named Jeff Hall as its new president.  

Pinnacle Designs (asi/78140) hired Jeff and Shelley Stevens of Wesco Marketing to represent the supplier in the Southern California territory – San Luis Obispo to San Diego.

Polyconcept North America has promoted Shannon Sylva from customer operations at Leed's (asi/66887) to director of internal operations at Bullet (asi/42424).

Prime Line (asi/79530) announced the promotion of Margie Acosta to customer service manager.