Contract market catching up, continues recovery
By Cinde W. Ingram -- Casual Living, 5/1/2005 12:00:00 AM
Casual furniture manufacturers were optimistic about the vitality of the contract market approaching the Hospitality Design Expo, set for May 5–7 in Las Vegas.
"Hospitality is doing well because people are traveling more, both for business and pleasure," JANUS et Cie President Janice Feldman said. "Restaurants are doing well because so many people are working longer and harder, and frankly it is easier to eat out than in — also it becomes a way to unwind after a busy day."
The contract market remains on an upswing partly because business travel is back, said Sarah Carter Smith, contract sales, Carter Grandle. "Hotels are renovating to accommodate the business traveler who wants not only the technology, but also beautiful surroundings," Smith said. She added, "Family leisure travel is still strong. This increases the demand for outdoor areas with more elaborate pools and recreational activities. Finally, the tastes of consumers continue to grow more sophisticated. This carries over to consumer demands for hotel upgrades and renovations."
Bill Echols, president of Brown Jordan International's retail market and contract division, was upbeat about the amount of contract business early in the season. "It looks like the properties are focusing on renovating and making sure they're up to speed," he said. "We're seeing more bids than we've had in the past few years so I'm very bullish on the contract portion of the outdoor business this year."
Jonathan Lamb described the health of the contract market as excellent for the hospitality, timeshare and food service segments where Kessler International participates. He attributes the strength primarily to pent-up demand, following its contraction after 9/11, when most new and rehab projects were shelved as hospitality and food service operators struggled to stay afloat.
"Beginning about a year ago the market revitalized itself," Lamb said. "At the same time, the consumer preference for a more eclectic look surfaced. It's now catch-up as many properties race to upscale and differentiate their look."
"Furniture in hospitality is very healthy," said Dean Engelage, Woodard executive vice president. He also referred to the shutdown of tourism as a result of 9/11, but noted pent-up demand for refurbishment and development. "Downsizing during this period and a reduction of design and purchasing staffs by major hotel and restaurant chains has led to more outsourcing to design firms and purchasing firms. Outdoor and patio product has benefited even more by tougher state non-smoking laws, which create a need for outdoor environments."
To aggressively pursue this business, Woodard has introduced quick delivery and marketing programs along with extensive cast aluminum dining and bistro offerings from its Woodard Landgrave Division.
Carlos Alfaro, Grupo Kettal export manager for the Americas. sees more designers making buying decisions than in past years when purchasing managers of hotels or hotel chains used to pick, deal and buy the furniture. "If you want your product to be in the K hotels, make sure your binder is on the best interior designers' shelves," Alfaro said. "We also have noticed that in the past two years, the dollar amount per quotation is growing, because the hotels are not only looking for the practicality of the product anymore, but also for the look and glamour as well."
Lamb agreed the purchasing process for the contract market is changing. "Rather than the historic assemblage of matching pieces into a room 'package,' the guests, conditioned by their own sophistication and tastes, are now attracted to properties that have the eclectic yet coordinated look of their own living spaces," he said. "The role of the interior design professional is, therefore, becoming much more significant as they need to mix media, style and textures into their new coordinated look. The end result is once a developer or owner has bought into the look, it is difficult to make significant changes without destroying the overall feeling."
Smith also sees an increase in the use of specifiers, decorating and architectural firms. "Many times they are all working together to make the design decisions and the actual buying. This would indicate that designers are being given more responsibility in the selection and purchasing areas."
Many interior designers specify and handle purchases for projects, but Ginger Johnson said that isn't a new trend for Gloster. "We are starting to see buyers planning ahead for the outdoor furniture," she said. "Three to seven years ago, we received more jobs where there were very short deadlines to meet delivery and at that time the outdoor area was at the bottom of the list or the back of the minds of the buying department. We are seeing where this has moved up the ladder and the outdoor area is planned with the entire project."
Jennifer Mulholland of Rock Wood Casual Furniture takes the opposite view, seeing interior designers being given less responsibility for selecting, specifying and buying. "This is mainly due to budget constraints," she said. "The interior designer can suggest, and if it is in the budget, the purchasing company/department will follow the lead. However, if it is not, the purchasing company will ask for a reselect or choose what they want."
Mulholland described the contract market as healthier than in the past, but still a little reserved.
"There will be a strong market for the next foreseeable future, but it will be a more gradual and sustainable market," Mulholland said. Among the ongoing changes involved in purchasing decisions, she said price has become more important than ever. "Additionally, as people age and get heavier, liability will be even more important," she said. "As a manufacturer, you have to have exceptionally well-made product for decent pricing."
Lou Rosebrock, Whitecraft president and CEO, finds each project different as far as decision-making. "It seems some projects are brought to us by designers that see the project through and some are brought to us by the specifiers/buying agents," he said. Although he sees no real trend toward one or the other, Rosebrock described the contract market itself as healthy. "Contract is alive and well this year," Rosebrock said.
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