From Home Furnishing Business
At first glance, it may seem like Colorado-based bedding chain Urban Mattress is doing everything … well, wrong. The stores give a percentage of all sales to charity. They don’t do big promotions. They’re very selective in what they carry, avoiding most of the big mattress brands. They encourage employees to own their own franchises.
Thing is, these unconventional principles are working. The eight-store chain (with more locations in the works) is thriving, experiencing growth in a still-hurting economy, with no end in sight. How did they do it, and why is it working so well?
“The driving force behind what we do … our value system … it’s really about justice, fairness and humility,” said Steve Von Diest , a co-founder and franchise owner in Urban Mattress who also coaches new franchisees.
“How justice plays out in the mattress industry is fairly deceiving,” Von Diest continued. “The bait-and-switching, even the labeling of mattresses from the same vendor between two different stores is very different … so we said, ‘What products can we choose that are going to eliminate the three-to-six-year turnaround (between beds)?’ We focused on products that we believe (are) right for the customer. We may not see the customers back for 10 to 20 years. That may not necessarily be right for our bottom line, but it’s right for them.
“We’re very upfront. We don’t do sales (promotions) because we’ve noticed a pattern in the industry—sales are typically a markup with a dropdown … we’ve lowered our margins to as low as possible because we’re owner-operated and we can do that.”
As for the second part of the equation, mercy, Von Diest defined that as “the driving force for what we believe a for-profit business can do in the community. … We care about our customers—not just what their mattress feels like, but also what’s going on in their marriage, their lives, because it all fits into taking care of people.
“We also tweak their mentality on how they too can give back to the community. So our giving program is not just me and (co-founder) Ethan Rietma giving in the background. We’ve actually put it very upfront in our stores, so our customers know that 1 to 2 percent (of sales) is going to go to a local non-profit (charity), and our customer gets to choose the emphasis. … In each of our stores, there are four to five local charities that the owner or their staff is passionate about.”
Addressing humility, Von Diest said “I wouldn’t necessarily call the mattress industry a humble industry. There’s not a lot of admitting of fault and errors. Ethan and I know that many of our customers may know more than us. They’ve done research, so we’ll humbly say we’re sorry, we’re ignorant. We’ll also own our mistakes, and we’re going to make it right with the customer. If we’re replacing something, we want to be very upfront.”
A Chat Between Neighbors
Urban Mattress started out in 2008 as nothing more than a friendly exchange between neighbors. “Billy Williams, who owns the franchise, was my neighbor and a good friend, as was Ethan,” Von Diest recalls. “We all lived on the same street, and Ethan and I had done non-profit work, community development, we were former pastors. … Billy said ‘Hey, I’m going to start a mattress store and I’d love to have you and Ethan join me to infuse the non-profit values—caring for people, caring for the community—into Urban Mattress.” Williams launched the store in Boulder, Colo., with Von Diest and Rietma, who eventually started three more franchises.
To Von Diest, it was crucial that they bring in like-minded people to open new stores. He recalled, “What Ethan and I said was ‘We’re going to take on young guys—upper 20s to mid 30s—and we’re going to teach them how to do this non-profit value set/for-profit mattress business. … We’ll help them launch new stores of their own because I really believe that the owner-operated model allows for care and an opportunity to sell that’s really different than your big box stores.”
The leaders of Urban Mattress bring their carefully thought-out mindset to their selection of products as well. “We’re an elite retailer of Tempur-Pedic, and we love them,” Von Diest said. “Most of our staff sleep on them. Also, we are an exclusive retailer for Vi-Spring out of England. … We carry Sherwood Bedding out of Phoenix. Those are our main manufacturers. We do carry Sweet Sleep out of Boulder, Colo.—she is the provider of most of our organic pillows and accessories in the natural world.
“We’re not in bed with Serta, Sealy and Simmons and some of the big brands, so it allows us to differentiate product in our stores. It’s very difficult oftentimes to find our product style and quality in the big box stores … we’ve chosen our product to give (customers) a wide variety.”
No Push, Push, Push
Von Diest and his fellow franchisees pride themselves on Urban Mattress’ no-pressure sales approach.
“Our new staff, we script them that ‘You have to talk very upfront,’” he said. “Let’s just use the idea that there’s going to be no additional add-on prices of delivery, set-up, removal. All of that is very clear: It’s free. … We talk about why we price things the way we do. … The product we carry is good enough to sell itself. I just want (customers) to discover the best thing for them according to their pocketbook, as well as what’s good for their body.”
While he was explaining the features and benefits of the product, I casually mentioned a feature I saw on a similar product in another showroom. The feature I mentioned is a definite benefit and could easily be adapted to most any product you see at Market.
It addresses a problem most consumers have had an issue with at some point before. The fix was a very simple one, but one I had never seen. When I mentioned this, the manufacturer said in jest, “Thanks for the tip.” When I heard his response I just paused and thought, “oh damn, I just let the cat out of the bag.” After a couple of seconds, we both chuckled and our conversation began on how long it would take before others in the industry began knocking off this particular feature.
I’m guessing I’ll see it again in High Point at the April Market, but not from my manufacturing friend. He’s far too reputable and classy to blatantly “take” someone’s idea—but there are others, I’m sure, who are implementing this into the design right now.
I’ve heard it said, “Imitation is the highest form of flattery”, but maybe not in this case. Designers spend months working on a concept, picking the right materials and coming up with the perfect lines to create the perfect piece.
Once they are happy with the product, work begins with a manufacturer to produce it. The manufacturer builds and markets it, with hopes of getting it to retailers and in front of the consumer. A lot of time and effort go into this piece. It was an idea in someone’s head just a few months ago. Now the whole world can see it, draw inspiration from it and well, knock it off.
I’m really not sure how I feel about this. When does a person cross the line from drawing inspiration to outright knocking off an idea? You all have seen a number of bedroom suits with similar designs and features, someone was first up with the idea, so did all others knock it off? Do you or your customer really care?
I’m guessing the deciding factor is whether or not it moves off your showroom floor; and I’m OK with that. Maybe the original manufacturer that made this piece should have done a better job of marketing this item. They need to make the potential buyer aware of why the original design is hands down a better product.
They have to distinguish a value at that price point. Then, the consumer has a better understanding on why the price point is set as such. As they decide on which product to purchase, original or knock off, maybe that saying “you get what you pay for” will echo in their heads.
This issue of Home Furnishings Business magazine takes a look at intellectual properties and potential issues that could arise from buying and selling copyright infringed goods. Please take some time to read this issue and make sure you aren’t putting your business in a potential situation that you may regret later.
Think about it, after all; retail has amazingly long hours, little thanks, sometimes finicky consumers.
That’s a lot to take without a love for helping people create welcoming homes.
Several conversations with retail friends have all led back to the frustration that legal topics and issues bring into their businesses. Staying abreast of changes in regulations impacting business owners is more than a full-time affair—there are hour and wage regulations; safety regulations; truth in advertising regulations and the list goes on and on.
Hint at the possibilities of a lawsuit over copyright infringement from a competitor or supplier and some retailers may break out into a body-coating sweat. Heaven forbid a legal squabble with a consumer who happened to break her arm and injure her rotator cuff when she stumbled over a low-profile cocktail table while she was admiring great artwork on the wall. (True story, by the way, that cost a retailer a good chunk of change in lawyer and settlement fees.)
In today’s world of hurry-up electronics, smartphones, the Internet and social media, copyright regs get more and more murky and indepth. It’s hard to know what is a copyrighted content, images or designs when surfing through Pinterest, Facebook and Google+. When does someone cross the line from sharing and step into copying?
On another regulation front, the industry is having to reevaluate the use of flame-retardant chemicals in upholstery and bedding. I remember stepping into this industry nearly 20 years ago when the debate over flame retardants was raging as to should we or shouldn’t we use such chemicals in home furnishings to prevent fires.
Today’s research shows the chemicals could leach and result in ill effects to people. Back in 1994, there were folks in the industry who stood firmly against such treatments for the very reason of the unknown human impact of the chemicals. California—the state with some of the strictest regulations—is currently leaning toward changing its standards on chemical treatment for upholstery. Typically, as goes California, so does the rest of the Union.
It’s enough to make one’s head spin, and it’s not easy.
The legal aspects of running a retail business seem more complicated than our country’s tax code. Thankfully, there are lawyers in the world who understand the ins and outs of legal matters that mean the most to retailers.
Inside this month, we take a look at a few of the legal issues retailers face on a regular basis. By no means did we delve into every single law or nuance that you or your colleagues have to worry about. THAT would take some doing.
Read the issue, and take some notes. Voice your concerns with your legal counsel. Make him or her a true business partner that you consult on a regular basis instead of only in times of legal crisis. You’ll be glad you did.
By Powell Slaughter
Toronto furniture retailer Decorium is blending big selection, looks at a value and a family touch to create a home furnishings destination for Canada’s largest metropolitan area.
A constantly changing showroom, marketing that verges on “guerilla” and a willingness to change have Decorium making moves this year.
A new location in a prime Toronto shopping district and a high-end gallery at its existing store has the family owned retailer optimistic for the year to come.
A DEVELOPING STORY
Decorium’s roots trace to the manufacturing operation that Steve’s grandfather, David Forberg, started when he immigrated to Canada from Europe.
He began manufacturing dinettes in the early 1950s, becoming one of the countries largest producers in the category. Forberg’s father, Joe Forberg, had joined the business, and David suggested opening a retail operation. A few years later, Joe’s brother came on board, and the Grand Designs retail brand grew to include eight stores.
In 1986, the family started Decorium as an import business for the design trade, offering chairs, chests, armoires and accent pieces from Italy, Spain, the United States and Asia. In the early 1990s, a recession in Canada and new tax laws put a squeeze on Grand Designs, which led the family to close the eight stores and turn Decorium into a retail business, located in what had previously served as the distribution center for Grand Designs.
CREATING A DESTINATION
As a retail operation, Decorium started in 5,000 square feet of the facility, but quickly expanded.
“Being open to the public, it took on a new life,” said Steve Forberg. “Now we’re a full-service store, with a full range of styles from classic traditional to contemporary to modern to glamour, to leather and fabric upholstery to rugs and accents. We have 700 rugs on display in the store.”
With one exception, Decorium doesn’t brand any manufacturers. Everything in the store is a “Decorium” item.
“Our customers say, ‘I bought this Decorium sofa,’ or ‘I bought a Decorium dining room,’” Forberg said. “We are the brand.
“The only thing we brand separately in the store is HGTV (product).”
On the floor, Decorium wants customers to be wowed by selection and understand they’ve arrived at a true shopping destination with outstanding looks at a value.
“We want them to feel they’re in a unique environment that offers a good customer experience,” Forberg said, “with high-end looks at accessible prices.”
Decorium also encourages customers to keep coming back to see what’s new.
“We’re constantly shifting product in our 60,000-square-foot showroom to make it fresh for the customer and keep it fresh for our sales staff,” Forberg said. “We have 60 to 100 new items on the floor each week. We have customers who come in monthly to see what’s new and fresh, and how things are laid out.”
Decorium relies on two taglines in its marketing: “Definitely—Decorium” and “Just what you’re looking for in a furniture store.”
“It’s a one-stop shop. In our advertising we ask why visit five stores when you can visit five in one,” Forberg said. “We’re large enough to move a lot of product, and we’re small enough to care.”
In addition to radio, magazine and direct mail, Decorium relies a lot on what Forberg called non-traditional advertising.
Commuters in the Toronto area see Decorium’s message via outdoor advertising on bridges, bus shelters and in the subway system.
“My philosophy is to try to advertise where others aren’t,” Forberg said. “I like to swim in a pool where no one else is swimming. Once people start swimming with me, I try to jump out of that pool and into another one.”
A HIGH-END MOVE
Decorium’s new store is located on Toronto’s Yonge Street in the upscale Rosedale area. Most surrounding stores don’t run more than a couple thousand square feet, so Decorium’s 9,000 square feet there make a statement. Plus, the location was home to other furnishings retail operations, so Decorium will be filling a gap.
“It’s a trendy part of the city,” Forberg said. “The new store on Yonge Street is on the longest street in North America. It runs from Lake Ontario to the Northwest Territories. In Toronto, it’s the street to be—it’s like being on Rodeo Drive.”
(Check this link for Yonge Street’s significance in Canada: En.Wikipedia.org/Wiki/Yonge_Street)
Renovations are nearing completion, and after a scheduled soft opening later this month, Decorium will hold a grand opening event in April.
“That store offer’s the fashion and style our brand’s known fore but it’s in more of a boutique setting,” Forberg said. “There’s more layering, more accessories, and overall it’s a little more high-end.”
This past fall, Decorium also opened a 5,000-square-foot high-end gallery at the main store branded as “Signature Collection by Decorium.”
The space features a decidedly upscale product selection, complemented with fixtures such as crown molding, hardwood floors and wainscoting.
“We’ve partnered with some factories for some exclusives that are really unique and high-end,” Forberg said.
WHAT LIES AHEAD
“Business was challenging, obviously in 2008 and 2009,” Forberg said.
Sales leveled in 2010, though, and he reports double-digit growth for the past two years.
“There’s an analogy I like to use,” Forberg said. “We’re like a retractable roof on a stadium. As a family business, we can open it and close it as needed. We’re hands on, we can watch our expenses, and we live and breathe the business.”
Decorium’s making moves, so Forberg feels pretty good about what lies ahead for furniture retailing in general and his family’s business in particular.
“If we listen to the news, how things are hard, we can get complacent and stand still,” he said. “We’re not going to let the economy and the news people tell us times are tough and that we need to hunker down.
“We know when we have to hunker down, and we can when we need to. We’re opening a new store, we’re taking risks, and I think those who are willing to make a leap of faith are the ones who’ll be successful.” HFB
Decorium co-CEO Steve Forberg is a father of two boys—10 and 12—and is coming up on his 15th anniversary of marriage.
Away from the store, he enjoys family time, both at home and on the road.
“We love to travel as a family,” Forberg said.
A hockey forward in his younger days, Forberg still spends time on the ice.
“I coach both my boys in hockey, and in my spare time I like playing hockey and golf,” he said.
Decorium at a Glance
• Founded in July 1986.
• Flagship location is a 100,000-square-foot store and distribution center in Toronto with a 60,000-square-foot showroom and 40,000-square-foot warehouse
• Opening a 9,000-square-foot location on Toronto’s Yonge Street in mid-February, with grand opening set for early April.
• Employees: 64
• Key management: Steve Forberg, and brother, Howard Forberg , co-CEOs; father, Joe Forberg, “ambassador”; Danny Abladi, distribution center manager; Tara Lindsay , advertising manager/buyer; Phil Raso, sales manager; Gabriella Mocanu, controller; Maribeth Bautista, customer care manager.
• Annual revenue: $10-20 million
• Web site: Decorium .com
Gel continues to be the buzz ingredient of choice among many leading bedding manufacturers, as more and more beds featuring gel (frequently infused with memory foam) were introduced.
One of the main appeals of gel—cooler sleep—was also a recurring theme in the new beds on display. Besides gel, this is also achieved through ventilation techniques as a result of retooled mattress construction.
And adjustable beds continue to be a hot trend among leading bedding manufacturers, as the technology continues to pull away from the hospital/Kraft-matic senior-citizen stereotype and emerge as an important add-on for younger consumers.
Here’s a round-up of the new bedding products shown at Las Vegas Market.
Sealy unveiled its updated Posturepedic line, which encompasses three series:
• Posturepedic Hybrid, a half-gel memory foam/half-springs line;
• Posturepedic Gel, which combines gel memory foam with titanium alloy coils; and
• Posturepedic Classic, which features Sealy’s redesigned Classic Coil.
The company will launch the new Posturepedic beds with an invigorated advertising campaign based on its acclaimed “Whatever you do in bed, Sealy supports it” campaign. New commercials coming to TV are geared to make an emotional connection with viewers by touching upon how key moments of life are spent in bed.
Serta announced it will build upon the success of its gel/memory foam-based iComfort line with iComfort Directions, which adds four new models to the collection.
The new beds feature EverCool Gfx, which adds grapheme for support and heat dissipation; Cool Action Dual Effects, which has new gels for support and coolness; Pods Gel-Active Support, which are macro-gel discs that add support; and ThermoCool Fabric Covers that have Tencel fibers for moisture transfer. The four new beds will range in price from $1,999 to $2,999. The company also showed its redesigned Perfect Sleeper mattress line, which includes a new Sleep To Go pillow that will retail for $39.
Simmons launched two new collections, Beautyrest Recharge and Beautyrest Recharge World Class, which will replace its Beautyrest Classic and Elite lines, respectively. Both lines combine pocketed coil springs with gel foam. The Recharge line, priced from $699 to $1,299, feature Aircool memory foam and GelTouch foam, while the Recharge World Class series (priced from $1,399 to $1,999) adds TruTemp gel, which is said to release warmth for a cooler sleep surface. The company also announced the addition of three new beds to its high-end Comforpedic from Beautyrest line, which will be priced from $2,999 to $3,999. All three beds feature the company’s proprietary Multi-Action Support Layer.
Memory foam giant Tempur-Pedic announced a new push into sleep personalization with the Tempur-Choice line. These beds have a new multi-zone adjustable support system in which a hand-held remote allows each sleeper to modify his or her side of the bed to achieve desired a level of firmness that feels just right from more than 120 different comfort settings. The line includes the 14-inch Tempur-Choice Luxe mattress ($3,999 in queen), and the 13-inch Tempur-Choice Supreme ($3,499).
Responding to customer requests for a plusher feel, Tempur-Pedic showed its new Tempur-Cloud Allura ($4,599 in queen), which combines soft Tempur-ES material with its cozy Tempur-Top pillow top. Another new model, the Tempur-Cloud Luxe Breeze ($4,999) has Tempur-Breeze technology to add an extra-cool feel to the company’s customary support and no-motion-transfer memory foam. Finally, the company showed its new Tempur-Ergo Premier adjustable base ($1,999), which can be run by a free app via wireless Apple or Android devices. These new Tempur-Pedic products will hit retail this spring.
Boyd Specialty Sleep introduced a new line of four Natural Flex latex beds priced from $699 to $1,499 in queen. The company also showed its new Cosmopolitan platform bed that will sell for $199 in queen, as well as four revamped air beds—the Operetta, Orion, Comet and Stardust—which have been updated with Boyd’s new TPU air core and will retail from $1,999 to $3,499 in queen. Finally, Boyd showed two new occasional-use beds, the $79 Siesta mattress and $129 Comfort Ease II fold-away guest bed.
Canadian mattress protection specialist Caber Sure Fit showed its new line of DreamSeren mattress and pillow protectors, made from a variety of fabrics including terry, bamboo and eucalyptus, and priced from $59 to $199.
Classic Brands announced the addition of a new mattress to its Dormia Memory Foam Collection, as well as three new gel memory foam mattresses to its E-Commerce Collection. New accessories from the company include the Cool Gel Memory Foam Topper.
Comfort Solutions showed its revamped five-model Perfect Contour collection, which combines a foam core with layers of latex, latex gel foam, and gel memory foam. This line is expected to retail from $799 to $1,299 in queen. Also redesigned was the company’s health-skewed Dr. Breus Bed line, which now consists of six new beds: Vitality, Longevity, Endurance, Synergy, Stability and Success, set to range at retail from $1,299 to $3,499 in queen.
Europe-based specialty provider Dormeo Octaspring, which made its U.S. debut in 2012, showed its proprietary memory foam honeycomb-structured springs that are the basis of its line of beds.
Englander Sleep Products debuted its LifeStyle line of specialty gel beds, along with new gel-based Tension Ease and Anniversary models, for a collection priced from $499 to $1,899 in queen.
FXI/Anatomic Global showed its Rejuvigel mattresses at Market. The line combines soft Visco foam with swirled waves of gel for better support and air/moisture movement. The beds are priced in queen at $1,199 (11-inch), $1,499 (12-inch) and $1,899 (13-inch). The company also showed its Bed Bug Defense Shield Mattress Protector, a disposable, flexible mat placed under a mattress to protect from bed bug infestation.
Glideaway Sleep Products premiered its Natural Awakenings by Sleepharmony latex and gel collection, which includes the eight-inch Nightshade, 10-inch Calypso and 12-inch Primrose. The beds, which have a temperature-regulating treatment and a top layer of latex to remove heat from the body for cooler sleep, will retail from $999 to $1,799 in queen.
The big news from Kingsdown at Market was the unveiling of the company’s new Sleep Smart beds, which come with interactive technology that, according to the vendor, monitors a sleeper’s movements, pain, pressure and sleep patterns throughout the night, and can reconfigure the sleep setting on an ongoing basis to ensure maximum comfort and health benefits. The company demonstrated the Sleep Smart system in a closed-door theater in its Market space.
High-end bedding specialist E.S. Kluft & Co. showcased its Aireloom brand’s Adapt-and-React collection, which includes all-foam, hybrid foam and innerspring versions that utilize gel for temperature regulation. The beds have a heavyweight zippered cover and a non-quilted Scandinavian look, and will be priced from $1,799 to $3,499 in queen.
Italian bedmaker Magniflex debuted its eco-friendly Linen Natursoft Deluxe line, which has a linen cover and layers of mallow extract and soy-based foam, and will retail for $3,999 in queen. The company also showed its new GeoEthic group, which are made with non-toxic, renewable materials. The Magnigel collection, into which pre-polymer gel is swirled into the foam, was also shown.
The big reveal from green-skewing Organic Mattresses Inc. was of the company’s new Point-of-Purchase program, which includes branded upholstered organic chenille materials including a headboard; pillows with shams; and an upholstered mattress base.
Pure Latex BLISS rolled out its new Yulex collection, a line of mattresses, toppers and pillows made with eco-friendly biorubber from the Yulex Corp. According to the company, these beds will offer a lush feel not commonly associated with environmentally friendly beds. The line includes the eight-inch Eco, 10-inch Sustain and 12-inch Renew.
The five-model Response Sleep System by Sharper Image collection was shown at Vegas Market, and, according to its manufacturer Southerland, can provide zero-gravity pressure relief, responsive support and contoured comfort. The beds have layers of open-cell Talalay latex and foam layers.
Adjustable base specialist Reverie showed its high-tech 7S (Supreme), which features “Made for Mobile” technology that enables control of lift, massage and other functions by tablets and smartphones via a remote app. The base will sell for $1,700 in queen.
Under-bed specialist Seahawk Designs unveiled a new upholstered 19-inch by 50-inch storage bench that complements the company’s Davenport storage foundation system. The company also introduced an adjustable bed base option, an extension to to its Casual Elegance collection.
Spring Air celebrated its Back Supporter collection by rolling out two new Special Edition Back Supporter models, available in firm and plush feels and priced at $599 in queen.
Therapedic International showcased its Agility collection, which combines gel foam and micro-pocket coils for coolness and support. Bio-based Preserve VG gel is swirled into the bed’s foam compound. Four models, Dash, Tango, Freestyle and Crossover comprise the line, which ranges in retail price from $1,299 to $2,499 in queen.