Working to win market share
Casual Living Industry News
By Marc Barnes -- Casual Living, 4/1/2009 12:00:00 AM
Industry observers say the last half of 2009 will show the home furnishings industry starting to make its climb out of the weakened economy, with some acceleration in growth possible next year.
But that’s the future. Retailers, especially those in the casual furniture industry, are in the here and now.
They’re at the beginning of an upcoming spring and summer season, reviewing their inventories and working to estimate what their foot traffic will be -- working now to determine what they’ll need and when they’ll need it.
For their part, manufacturers and importers are finding ways that can help retailers win market share, whether through new offerings, changes in pricing or extending time for payments. The key, say many, is to be focused and intentional.
Lloyd/Flanders President Dudley Flanders said his company put together a new product line in record time, specifically to deal with the economy.
“We started at the first of December and, in a six-week period, we developed a brand new product line called Weekend Retreat,” Flanders said. “It’s a domestically made product that’s designed to retail 20 to 25 percent under our normal price points.”
In addition, Lloyd/Flanders has made factory-authorized sale dates more flexible. It developed Made in USA hangtags for domestic products and highlighted its 12-day delivery.
“There really is a tremendous reluctance of anyone to load up their warehouse in this day in time,” Flanders said. “We feel the best alternative is to go with a supplier who can turn it around in a reasonable period of time.”
Gene Saenger Jr., president of Ficks Reed, is picking up on a familiar national theme.
“We are looking at getting on board with President Obama by picking ourself up and dusting ourselves off and getting to work,” Saenger said. “We are in the TARP program, which stands for 'Transform A Room to Paradise.’ ”
TARP will involve concentrated promotions of in-stock products, delivered quickly, at a promoted price.
“We are trying to provide a real value that our dealers can take to their customers,” Saenger said. “The product is as good as it always was, but we are trying to give dealers something to talk about in a more attractive price level for the customer who wants better quality.”
Braxton Culler, president of Braxton Culler, said he also is focusing on product and delivery times. At the April High Point Market, he will be introducing three new products in full outdoor – and offering two week delivery times.
“That is one of the most important parts of this story right now, to have product available for quick delivery and the fabrics available to back the product up,” Culler said.
At Domus Ventures, Dave Hill, manager of North American operations, said his firm is helping retailers through making some operational changes. The most significant is a new cross-dock program, in which containers come in and much smaller orders go out.
“They get the benefit of the container pricing,” Hill said. “That’s been beneficial for getting people who are reluctant to pull the trigger on a major investment.”
Domus Ventures also has come up with some creative factoring and extended financing terms, which Hill says can help credit-worthy retailers survive the downturn without tying up their assets too deeply.
Similarly, Rebecca Price, manager of sales and marketing for Uwharrie Chair, said her company was offering promotions early this season for the first time. The offers include net 60 on pricing for select accounts, deep discounts on two best-selling chairs if they are used as floor samples and some advertising allowances.
“Usually, our dating happens during the September, October and November time frame,” Price said. “This is the first time we have done this in February and it seems to be getting a positive response.”
Eric Graham, senior director at Century Leisure, said his firm is helping retailers by introducing a new collection and a new color for an existing one, along with additional incentives to help boost sales.
“We are going to continue to put out good product to create the excitement that people are used to,” Graham said. “We have had some interesting opportunities, things coming to us and we are shipping them out in very short order. Basically, we are doing what we can to capture and work with the order.”
At Three Coins/TC Castings, Susanna Powell said her firm is helping retailers by cutting prices on a cushion program and sourcing a new, high-quality product at a lower price point.
“We are also not having a price increase, which we normally do,” Powell said.
“What we have done is taken most of our basic seating groups and put together married programs of groupings and offered a substantial discount for these groupings,” Boyer said. “We are also offering discounts, more than normal for us, for those dealers who did not commit back in the fall.”
Additionally, the company is offering as a package the Furniture Classics brand of antique reproductions with the Two Palms Casual pieces.
“It enables dealers, especially those that are not dedicated pool and patio types of stores, to do both,” Boyer said.
Acacia Home & Garden President and Chief Executive Officer Alex Te said he is finding ways to help retailers by concentrating on servicing the account, using branding to provide excitement and keeping the consumer in mind.
Acacia recently entered into a licensing partnership with Bonnie Jesseph, who is the author of the WINOS (Women In Need Of Sanity) series of cookbooks.
“It’s like this, the economy is tough and there are restaurants, but people don’t want to spend money,” Te said. “Instead, they want to go to houses and help their friends cook. They are nesting, instead.”
A new collection will take off from that brand, with pieces that make it easy to entertain at home, Te said. “You don’t want to come out with a new collection that has no meaning to it,” Te said. “Branding is taking what you have and putting the consumer desire to it.”
At Charleston Forge, Art Barber, president and CEO, said he, too, is looking at helping the retailer by helping market directly to the consumer, to make a purchase of Charleston Forge furniture an experience.
Barber is looking to not only introduce products, including a new line of outdoor furniture, but also to improve his Web site to drive customers into the store. Barber is also looking into offering factory tours where travelers to Boone, N.C., could come by and either watch furniture being made or actually help build it.
“People are looking for something that’s not out there, that is different, that brings some excitement, I think,” Barber said.
At Barlow Tyrie, Charles Hessler, executive vice president, said product offerings are special order and targeted to higher-end buyers, who are not as sensitive to the economy.
Still, he said, Barlow Tyrie is introducing a product range that will be at a little softer price point and has adopted a more flexible policy with its dealers.
“We have allowed some smaller dealers to qualify for early buys and we did accept early buys below what we normally do,” Hessler said. “It is nice for them to have fresh furniture on the floor, instead of saying, 'that’s the program.’ We give them special pricing when we can.”
Eric Parsons, president of Gloster, said his firm didn’t wait for an economic downturn to find ways to help retailers. Already in place was a system to minimize inventory risk, through a commitment to have plenty of inventory on hand – and shipping it out within three days of the order.
More than that, Gloster believes in training. The company takes its own employees to Asia to learn more about the product – and brings retailers in for training on how the furniture is maintained and made. The retailers leave not only with product knowledge, but they also network with other retailers who they can turn to for advice on how to market in this economy.
Gloster also has taken the lead in marketing directly to consumers, Parsons said. Visitors to the Gloster Web site can receive a fully bound catalog, with a list of retailers in their area.
Gloster also contacts the retailers with the customer’s name and contact information, so they can follow up with them.
“The last thing we have done to really help bring more business to the retailer is that we have increased our marketing staff by an additional head this year, and she is solely focused on our public relations efforts, maintaining relationships with 350 media contacts,” Parsons said. “Not only does it help advance the industry, but it also helps advance the Gloster name either to the retailer or to the Web site.”
We would love your feedback!