From Home Furnishing Business
Eye Toward Growth
The Great American Home Store has its sites set for future growth in the South.
By Daniel Beaird
Ron Becker was out of the furniture industry when he was called about an opportunity in 2002 in the Memphis, Tenn., market that the 27-year furniture veteran couldn’t pass up. The goal was to open a full-service furniture store unlike any in the mid-South.
“I have a love and passion for it,” said Becker, co-founder and general manager of The Great American Home Store.
He got his start in the furniture business at 25 years old and spent 13 years on the floor at Fleming Furniture in Paducah, Ky., and where later stepped into management. He helped take that local furniture company from $5 million in sales to $30 million before leaving to pursue other interests.
The Great American Home Store (Great American) opened its first location Sept. 11, 2004, in Southaven, Miss., a suburb of Memphis, Tenn. It was designed after spending an entire year looking for the right location at a cost of $8 million. But in its first full year of operation, Great American generated $14 million in sales.
“We spent a ton of money on advertising before opening the first store, promising we were going to be great,” Becker said. Three furniture stores, an outlet store and two freestanding sleep shops later, the Memphis market has seen Great American’s growth firsthand. Future plans include stores in Little Rock, Ark., and possibly markets like Louisville and Lexington, Ky., and Nashville, Tenn.
“We are always looking for the right opportunity for expansion,” Becker said. “We want controlled growth. Customer service is extremely important to us and we’ll grow only when our operations manager, Bill Gill, says we’re able to.”
Great American’s second store opened in Memphis, Tenn., in 2007, bringing the furniture retailer to 110,000 square feet of total showroom space and 150,000 square feet of warehouse space in the two locations.
“We knew that in order to serve the community and distribute costs effectively, we would need two locations,” Becker said.
Both sites have on-site warehousing for customer convenience pickup.
“It’s a one-stop shop,” Becker said. “Our customers don’t have to go to a bad part of town to pick up their purchases. Because our warehouses are connected to our showrooms, a little more than one-third of our business is through our customer pickups.”
As a locally owned and operated full-line home furnishings company, Great American touts that it provides the mid-South’s largest selection of quality furniture, bedding and accessories. It was founded on the thought of providing consumers with the convenience of a one-stop home furnishings superstore.
“As we started the process of building our company, I decided we would structure the business model around customer service,” Becker said. “Usually furniture companies are built around sales and they worry about service later.”
Becker decided that Great American’s sales volume would be controlled by its service associates, and they would only increase advertising dollars after meetings with service associates confirmed they could successfully handle a larger sales volume.
According to research by Pittsburgh-based Marshall Marketing & Communications, which provides marketing intelligence from consumer market and media research for local, regional and national businesses, Great American is the top cross-shopped furniture store in the Memphis, Tenn., market. That means customers who shop the retailer’s competitors, then shop Great American more than any other furniture store in Memphis; and customers also shop Great American stores against each other.
According to Becker, 97 percent of its customer deliveries are completed to the customer’s satisfaction and the retailer boasts a triple A business rating in its market.
“That is very hard to do in the furniture business,” Becker said. “But we do what we say we’re going to do. There are no hassles and no surprises for the customers, and sometimes we take it on the chin because of that but we mark it up to marketing.”
According to Becker, all deliveries go through three phases of preparation before merchandise is readied for loading on trucks. Each driving team is responsible for its load, and once they accept the merchandise, all chargebacks for damages are the driver team’s to pay. Each driving team is paid a commission on delivered merchandise that meets the customer’s approval. The delivery process is completed via an iPad and iPhone application with each delivery, and Great American pays all sales associates and delivery people a weekly commission on delivered purchases.
Great American has treaded lightly in the digital marketing realm and hasn’t started selling online.
“We waited, and watched the good and bad of online marketing for our competitors,” said Jack Wells, marketing manager for Great American. “It’s a new territory for everyone and don’t let anyone tell you otherwise.”
“We have added new tools in our online development to help us advance to a sales funnel approach of moving customers from our web presence to our showrooms to a sale and, in the future, online sales,” Wells said.
Wells came on board in 2011 to create and steer Great American’s in-house advertising department.
“I’ve known him for 35 years,” Becker said. “He and I have the same value beliefs in life. Always do what is right and just even when nobody is watching or even when nobody cares.”
Wells started out in the bedding manufacturing industry 40 years ago and moved into the furniture retail industry in the mid-1980s.
“There I think he found his passion for advertising and marketing,” Becker said. “Jack is a great mentor for a lot of young people who are coming into our industry. He always finds time to help those who want to learn and grow in the advertising industry.”
Becker says Wells has helped Great American grow its business by double digits each year he’s been on board and has cut Great American’s advertising cost by 50 percent since joining the company.
“I convinced Ron that the company could save money by bringing advertising and marketing in house,” Wells said. “We started with print and moved toward doing all of our television advertisements recently. The team is all either cross-trained or in the process of ongoing training to make sure everyone can do everything in my department, from print to television to the ever-increasing use of Internet marketing.”
“When we started the company, I was spending 11.25 percent in advertising to revenues,” Becker said. “Last year, we finished with a 5 percent advertising cost to revenues.”
FurnitureDealer.Net recently redesigned Great American’s web site and now the company has a blog and a presence on Facebook, Twitter and Pinterest.
“We have found Andy Bernstein (FurnitureDealer.net president) and his team at FurnitureDealer.Net to be an invaluable asset to helping us foster our future vision for our web presence,” Wells said. “We worked on a mobile-friendly site first because so many consumers check their phones or tablets first. Our e-marketing segment grew from there into ‘infotainment."
Great American has also developed a monthly e-magazine with embedded video that promotes its television advertisements. All of the retailer’s design work is in house and they laid out the redesign of the website for FurnitureDealer.Net.
“Great American’s team designed the look to match their new branding, and along with that we added our best coding practices and user experience knowledge to make it a site that’s easy for customers to get the information they need and help drive leads to Great American,” said Kayla Wallace, a business consultant for Minnesota-based FurnitureDealer.Net. “One of my favorite things about Great American’s new design is the first impression. It does a great job reflecting the feeling of their physical stores online and that is always something we want to accomplish. I like how easy it is to understand, at a glance, what Great American is all about, what services they offer and why they carry the kinds of products they carry.”
“We take on challenges all day, every day,” Becker said. “I don’t worry about anything but I get frustrated because I can’t find people fast enough.”
“Ron’s going to do it the right way,” Wells said. “And we wouldn’t be in the business if it wasn’t up to our standards. Ron’s passion for the industry and attention to detail as well as his uncanny talent for selecting and building the right team is the cornerstone to our success. He understands and appreciates the value of our sales force being in position for so many years, and has worked hard for this to be a customer- and employee-focused company. Ron is very loyal to his employees, and our vendors not only respect him but many have become close friends throughout the years.”
The Great American Home Store
Headquarters: Southaven, Miss.
Year Founded: 2004
Footprint: Three furniture stores, one outlet store and two freestanding sleep shops in Memphis and Cordova, Tenn., and Southaven and Olive Branch, Miss.
Awards: Mississippi Retailer of the Year, 2007; Finalist for Memphis Business Journal’s Small Business Awards, 61-350 Employees, 2007; Best Independent Sealy Retailer in the Mid-South, 2005-2010
Key Vendors: Austin Group, Bernhardt, Catnapper, Corinthian, Flexsteel, Fusion, Hammary, Jaipur, Klaussner, La-Z-Boy, Magnussen Home, Pulaski, Sealy, Tempur-Pedic, Universal and Vaughan-Bassett