Everyone looks to good weather and strong sales
Cinde Ingram -- Casual Living, March 15, 2005
The majority of casual furniture retailers who shared expectations for the 2005 season chose descriptions like strong, great and exceptional as they predicted increased sales and profits ahead.
"My expectations for 2005 are for an increase in sales due to the bright color trends in outdoor materials and the variety of media used in furniture," said Anna Papp, owner, Outdoor Living Center, Covington, La.
Retailers Joe Antonelli, Antonelli's Dinette & Patio Plus, and Javed Bhaghani, The Wacky Wicker, based their positive outlooks on housing booms in Melbourne, Fla., and Palm Desert, Calif., respectively.
Cliff White, owner, On The Deck, Oconomowoc, Wis., was among several retailers who based his view on last year's selling success. "At this time, we feel 2005 should pick up where we left off last season and keep rolling," he said. "Having a nice, early spring would be a big help." White spoke for many retailers, who tempered their sales forecasts with comments related to weather conducive for consumer demand.
Although largely optimistic, manufacturers, too, cited weather challenges along with economic and importing issues.
"We're pretty bullish about 2005, assuming the sun's going to come out," said Ken Burrows, Terra. "We've had an extreme amount of rain in the West so we're having what I would call a late season start."
Terri Lee Rogers, O.W. Lee, also noted wet weather dampened sales in the desert area, usually a good lead indicator of the upcoming season. "Competition is fierce and, from what I have seen so far, retailers are looking for items and looks to set them apart as a specialist," she said.
Dougan Clarke, CEO, TUUCI, expects more attention in the high end of the market in the 2005 selling season. "We believe specialty retail customers are looking for products which are different from the homogenous assortments available in the national chains," he said.
"We're expecting a strong 2005 season based on solid early-buy orders this past fall," said Gary McCray, Laneventure. "We feel like much of the work that we've done in driving the Outdoor Room concept through product, advertising and publicity is now paying off with added consumer interest in the high-end part of the market."
Randy Wells, Century Leisure, said the threshold separating indoor and outdoor living spaces has become nearly transparent. "We anticipate continued growth in the trend towards creating outdoor rooms which are a true extension of the living space within the home," he said.
Bill Echols, Brown Jordan International, expects the continuing evolvement of outdoor living will become the industry's major marketing effort. "The consumer has a wider range of unique products to select from and quality dealers to provide the service and direction necessary to create the ultimate outdoor room," he said.
Research shows the outdoor living trend continuing to rise in popularity, Homecrest CEO John Sundet said. "After years of decorating and redecorating their interiors, American consumers are now turning their energy outside," he said.
Rory Rehmert said Meadowcraft experienced good early buy, expects the 2005 season to be strong and looks toward future growth through innovative products. "Weather, as always, will be the deciding factor," he said.
The Northeast, which faced tough weather for selling outdoor products over the last couple of years, is poised for better results.
"If we get some nice early weather in March/April and it continues through May, we all will do well," said Stephen Magnotti, president, The Fireplace and Patioplace, Pittsburgh. "Many of the manufacturers have really done a nice job with their introductions and lineups this year, but if it snows in March and rains in April, all that hard work sometimes is not enough to overcome the weather."
David Sirna of DeVries described winter in New Jersey this year as ironic with some weeks mild, "some blustery cold, others 12 inches knee-deep in snow." he added, "A warm and rain-free spring will be ideal, thus driving the consumers out to buy the outdoor furniture, grills and landscaping projects."
"Weather can make us or break us and this year may bring an El Nino to Southern California," said Bonnie Richins, general manager, Anaheim Patio & Fireside, Brea, Calif. Despite that risk, she projects a 5% sales increase.
"As always, if the sun shines, we'll be fine," said Doug Wheat, president, Hauser's Patio & Rattan, San Diego. "Our major challenge is to align ourselves with manufacturers who are not in every category and in every store. We need to find the manufacturer who wants the specialty retailer to 'sell up,' and offer that premium product on a limited distribution basis."
Henry Vanderminden IV, Telescope Casual Furniture, said big box national retailers also present challenges for specialty manufacturers. "We have focused on this challenge and have changed our collections substantially, creating products for retailers that are innovative, comfortable and have added a lot of depth to our collections," he said. "These attributes are not found in the big box."
Oliver Ma, Treasure Garden president and CEO, is cautiously optimistic due to good early buys, consumer confidence and economic trends. But he expects more intense big box competition. "The mass is getting better and we need to continually strive to add value for our specialty dealers by improving our product, features and service," Ma said.
Retailers repeated the mass-market threat as a challenge nearly as often as weather-related ones. "For the next five years or so, I expect specialty stores will try to differentiate themselves from mass merchants by upscaling the looks on the floor — not necessarily by carrying more expensive furniture, but by showing more stylish goods that aren't available in the mass markets," said Bruce Aronson, The Pool & Patio Center, New Orleans.
Ken Ehrlich, president, Harrow's, Melville, N.Y., voiced concerns about big box stores moving into higher price points, working on slim mark-ups and offering products "that don't belong in a store without a salesperson to explain why it is what it is. There are always ways of cheapening products and that's what big box companies do."
"Consumers are very savvy and it is important to be able to point out the features and benefits of the products on our floor," said Janet Zittrer, Universal Patio Furniture, Studio City, Calif. "We know what we do, what our niche is, what our customers expect of our store and that is what we concentrate on."
Connie Jacobus, president, Leisure Furniture Designs, New Hampton, N.Y., anticipates cast aluminum and outdoor wicker categories will pick up more steam. But she added, "The season is short and delays in moving a product rapidly can make a huge difference between a successful season and a mediocre season."
Waterloo Gardens, Exton, Pa., spent time last year identifying customers who spent there, buyer Carol Christensen said. "Having decided Waterloo doesn't have to be all things to all people, we redirected our purchasing," she said. "Our clients have indicated that they are interested in quality and in investing for the long term, but that they don't want to have ordinary, cookie-cutter looking styling."
Mary Fruehauf, president, Fruehauf's Patio & Garden Center, Boulder, Colo., expects 2005 to be an excellent sales season, but not void of challenges. Competition now comes not only from other retailers but also events that compete for customers' time. "We must keep continually improving ourselves," Fruehauf said.
Dean Luckino, president and CEO, Georgia Backyard and American Backyard, said the major challenge specialty retailers face is in executing business models. "Training has never been more important than it is today," he said. "The advent and continuing escalation of business with vendors who have origins or some type of partnerships with international countries has put added pressure on us to change some of the ways we do things in our vendor relations."
Eunice Conine, Garden Cottage, Morristown, N.J., finds it challenging when vendors don't provide information about new materials on a timely basis. "Customers are asking for finishes and fabrics and we have to make excuses for our vendors."
The Greenhouse Mall in Austin, Texas, has invested in creating vignettes and landscaping with decks and stone patios to show furniture in settings the customer can envision at home. "The greatest challenge we face is making sure that we do the specialty product justice and display it properly, train our staff about the excellent design and quality aspects of it, and merchandise it so the consumer sees what a value it is to their lifestyle," Karen Galindo said.
Sunnyland Furniture, Dallas, also has changed its "patio store caterpillar into a casual furniture/outdoor room butterfly." In addition to its "shoppertainment" experience, "our manufacturers have raised the bar as far as the quality and diversity of products they are offering," President David Schweig said.
Carl Vice, Casual Living & Patio Center, Lexington, Ky., expects a lofty sales increase. "The hidden challenges of every sale will be attacked by increased inbound freight charges, higher utilities, insurance premiums, advertising rates, delivery expenses, labor, fuel costs, selling expenses and consumer credit expenses. It will cost a lot more to place a set of furniture on a homeowner's deck in 2005."
Other challenges retailers face are "having just-in-time inventory and hoping the trends in colors and fabrics continue to sell through the season," said Jack Sproehnle, buyer, Watson's of Cincinnati.
That's a challenge for manufacturers, too. Whitecraft president/CEO Lou Rosebrock said estimating the needs of customers and fulfilling them in a timely manner present critical challenges.
"Given many of our aluminum collections rely on sourced components, proper inventory management is critical," said Dean Engelage, Woodard. He expects a solid season, based on economic trends, dealers with a reasonable level of carryover inventory and moderate optimism.
Jennifer Mulholland, Rock Wood Casual Furniture, said she expects a solid year with respectable sales increases.
All-weather wicker is on a successful surge among consumers. Pictured here is Ebel's Corsica Collection, an extra large deep seating line with rolled arms, cast feet, and highlighted by finials.