Monthly Issue
From Home Furnishing Business
July 2,
2015 by in Business Strategy, Industry 
By Tom Zollar
Over the years, I have received many questions about the concepts of teaching, training and coaching. Are they the same? Or, are they separate functions and activities? If separate, what does each do? How do they interrelate? The concern is how to best use the trifecta to improve sales team performance.
Most would agree that training is extremely important in any performance related endeavor, be it sports, music or selling. Julius Caesar presented his opinion a long time ago when he commented about an army that his legions had just defeated. “For lack of training they lacked knowledge, for lack of knowledge they lacked confidence, for lack of confidence they lacked victory.”
When people know more about what they are doing, they gain confidence and are better able to compete, because they anticipate winning instead of fearing defeat. While this is a great reason to train people, it shouldn’t be the primary reason. The more a selling staff learns about both the products and how to help customers create the comfortable and stylish living environments they desire, the more they will sell and the greater success businesses will have.
Even knowing this, some retailers are reluctant to invest the needed time, effort and money into training their sales staff. One of the most common reasons we hear is: “What it I train them and they leave?” I think Harry Friedman had the best answer for that, which is: “What if you don’t train them and they stay?” The bottom line is that a fully trained sales staff that consistently provides superior service when helping people is the best way to maximize sales performance.
So how do we get them up to speed? Do we teach them, train them or coach them?
To be successful requires all three. While we often use the words interchangeably, teaching, training and coaching are very different. They are three different activities that work together to create learning in a way that sticks and becomes a consistent tool.
A skill is a habit of doing the right thing at the right time in a process. Based on proper knowledge and behaviors, it is applied to an activity consistently and virtually automatically, almost without thinking:
Knowledge (Teaching) + Behaviors to Apply It (Training) + Supervised Practice (Coaching) = Habit (Skill)
Teaching and training are critical preparation functions for the performance of an activity. They form the foundation for greatness. While the behaviors are initially presented in training, coaching encourages and reinforces the behaviors until they become habit. When delivering a successful outcome consistently occurs, it is a skill.
Now that we have a better understanding of how they work together, let’s look at each function separately and focus on what can be done to make each one more effective.
Teaching is the act of educating someone. It is the process of giving knowledge to another person. Often presented in a class or group environment, teaching can also be done individually. While we can and do teach behaviors, in a performance environment it is more focused on giving information about why and what, than how.
Adults normally only expend energy to learn about things they think will get them something they want. The first step in adult education is to ensure the audience understands why the information is important to learn. One of my professors called it the WIIFM Principle—What’s In It for ME? His point was that most adults will not try very hard to learn something unless they feel they will get something from the process. Before beginning any training, make certain the audience understands what they will get from the program and how it will benefit them.
The best way to give people information is through a mixture of media. Lectures and discussions are good to get the message out. However, most people tend to remember best what they read or view graphically. Supporting printed material allows students to read and study.
This is particularly important for company policies, systems usage, product knowledge and the selling process. In most cases you will have a policy manual and your office staff can create a systems process manual for the sales staff to use for training. Product knowledge is more difficult with most stores offering a variety of products and vendors.
The Furniture Training Co. has an online general product knowledge program to get any new hires started and most vendor websites provide access to specific product information. Remember teaching is the giving of knowledge. In order to measure success, have tests and quizzes to verify staff has learned the information.
In order to maintain excellence in the customer experience, a printed selling manual os required to explain how customers should treated in the store. Even though this process is mainly behavior based and therefore more of a training function, it is critical for the manual to provide solid reasons that support the behaviors you train them to use.
Support of all training with print or online information access is crucial.
Training is the process of introducing the target audience to the behaviors or actions to use when applying the knowledge taught to an activity to achieve the desired results. It is not only demonstrating what to do but also interacting with trainees to ensure they can use the behaviors and apply the knowledge they have. Training can begin in a classroom environment, but is usually most effective when done individually or in small groups allowing for individual attention.
Since this function is focused on what students do with the information, demonstrations are a must. Don’t assume the audience has learned to do.
Role playing several times proves they can do it. Golf pros don’t just demonstrate how to grip and swing a club, then leave students. Instead, students hit many buckets of balls in front of the pro before moving to the next phase of training. While most trainees do not enjoy role playing, it is essential they demonstrate the ability before trying it on a customer.
It is like a pop quiz. The real test comes when they hit the floor and the trainer must truly become the coach.
Coaching takes place during and after the training process. It involves a skilled individual working with the trainee over time to maximize results from the use of the newly developed expertise. As discussed in previous articles, coaching is possibly the most important part of the process.
It is the quality control element that helps ensure a high level of performance is achieved when the staff does the right things at the right time with the right people—the customers. It starts in the training process during role play and other demonstrations. The coach observes the performance and offers feedback for improvement until satisfied that the student can do what has been taught. Experience has shown that left to their own devices, most people revert to old habits or easier methods if not held accountable on the sales floor. The focus of the ongoing coaching role in a store—to track, observe and give feedback for improvement on the sales floor—will maximize a team’s performance.
A training program should include segments to address three areas the selling staff needs to be proficient in—selling skills, product knowledge, and administration and operations. Each segment should begin with the WIIFM process so they know why they need to learn it. Next, would be teaching the information needed to support that step. Finally, train them on behaviors to apply the information they have. Once they are through the initial program they should either be mentored by a qualified staff member or closely monitored and work with a coach on the floor.
June 11,
2015 by in Business Strategy, Industry
By Sheila Long O'Mara
Boutique home furnishings retailer Boston Interiors has its sights firmly set on growth with a methodical strategy in location selection, building on its omni-channel presence and capitalizing on the knack for remaining true to its niche.
The 36-year-old retailer, which operates seven stores, plays in one of the most competitive markets in the United States. The Boston retail scene offers an abundance of options for consumers on the hunt for furniture.
That competitive playing field, however, hasn’t kept Boston Interiors from growing. Last fall, Boston Interiors opened its most recent location in Burlington, Mass., and Stefanie Lucas, CEO, sees great things in the company’s future.
Lucas, by no means a newcomer to furniture or retail, joined the company in October. Prior to taking over the day-to-day operations from Boston Interiors founder Ken Loring, Lucas was president of upholstery supplier HTL International.
Before HTL, she spent a number of years as president and CEO of Rowe Furniture. Her background also includes stints with women’s apparel retailer Chico’s and with Reebok International.
Know Thyself
With stores ranging from 12,000 square feet to 20,000 square feet, Boston Interiors is far from the big-box, mega furniture stores in the market—think Jordan’s Furniture and Bob’s Discount Furniture. Instead, the retailer presents itself as a lifestyle boutique where consumers come for inspiration and customized furnishings.
“We’ve always been good at having a pretty focused point of view and knowing who our customer is,” Lucas said. “We’re not trying to be everything to everybody.”
In any of the Boston Interiors stores, consumers are welcome to work with a designer if they’d like, or not. The approach is without high pressure, Lucas said.
“We have a focused brand image, and we’ve stuck to that. It doesn’t require a mega-store footprint,” she said. “For us, the focus has always been on beautiful product and a high level of service.”
The abundance of retailers in the Boston market vary. Many are price-driven and promote sales constantly. That’s not Boston Interiors’ style.
“We’re trying to get out of that noise and be true to the customer we target,” Lucas said, adding that the target is mostly women. “They like to shop the way I like to shop. I don’t want to be bombarded. If I need help, I like for them to feel more like a friend who is giving me advice. If I want help, it’s available. If I want to do it on my own, I can.”
Lucas said she’s overwhelmed by the number of retailers who think everything needs to be cheaper.
“It has to be a longer journey,” she said. “You have to be true to who you are. We’re not going to be reactive on a daily basis. We understand who our customer is, and give them the environment in which they want to shop.”
In addition to the retailers driven by price, all of the major lifestyle retailers like Pottery Barn, Arhaus, Crate & Barrel and Restoration Hardware, have locations in the Boston market. Lucas compliments them on their ability to understand the consumer.
At Boston Interiors, consumers can find a more “intimacy with a local relationship,” Lucas said.
Giving the consumer a comfortable, welcoming and helpful visit makes all the difference in return business. Shopping for furniture shouldn’t be like shopping for a car, Lucas said.
“Everyone wants to have the feeling they’re buying a great product,” she said. “It has to be about more than what’s under the hood and what’s the price.
“It’s about how furniture fits into your lifestyle and how it will represent you and your style when you have friends over,” Lucas said.
Into the Future
Looking back over the company’s history, Lucas said she sees a strong foundation on which to build and asks herself frequently what the best strategy is for growth.
“I have the luxury of not coming in and having to fix something,” she said. “I’ve come into a great business, and my job is to grow it. The surrounding Boston area offers a lot of opportunity to spread out.”
The retailer is currently looking at new store locations that meet its current focus of free-standing stores or spaces in open-air lifestyle shopping centers.
Lucas said Boston Interiors will plan for new store openings, as well as building on the foundation of becoming a more significant player in the omni-channel universe.
“We’re currently updating our website so that we can grow our e-commerce business,” she said, adding that the site will feature easier-to-use functionality for consumers. “The ultimate goal is for the site to mirror the look and feel of our stores.”
In addition to expanding the e-commerce business, Boston Interiors will be mailing its first consumer catalog in September to broaden its reach.
“The goal is to make it easy,” Lucas said. “Wherever the customer chooses to shop, we want to offer them a seamless shopping experience.”
Get Casual
That shopping experience offers a range of traditional to contemporary designs with a heavy emphasis on comfortable living designs for dining rooms, living rooms and bedrooms.
“I think of it as the way people like to live,” Lucas said. “In today’s world, it’s rare that people have a super formal living room and only a few people have super modern homes. People want a beautiful home that is livable.”
More than 50 percent of Boston Interiors business is derived from special orders throughout the store in both upholstery and case goods. The retailer places great emphasis on quick delivery wherever possible.
Boston Interiors understands consumers don’t like lengthy waits when it comes to furniture, so the retailer works with vendors who can delivery quickly.
Typically that means domestically produced furniture.
While the retailer’s entire stock isn’t 100 percent domestic, Lucas said it makes good business sense to source from the U.S. where possible.
So far, that direction is working well.
“Customers’ expectations are that they can buy things they want to buy them,” Lucas said. “Customization isn’t a problem for us. If someone comes in and doesn’t see what they want, we can offer it to them in a relatively short amount of time from one of our suppliers.”
While the custom wait depends from vendor to vendor and product to product, Lucas said upholstery is usually delivered within 30 days, and often case goods make the turnaround quicker.
Sharing the News
Again, the Boston market is filled with furniture retailers ranging from traditional stores to independent retailers to lifestyle chains to manufacturers’ vertical stores. It’s a busy furniture market, and all of those channels are eager to have a slice of the pie.
Lucas said because of the sheer number of players in the market, furniture makes “a lot of noise in the marketplace.” That noise requires a multi-pronged approach to advertising and marketing just to be heard.
For Boston Interiors that means television, some print and the retailer is increasing its online media spend in its plan.
“That aspect is going to be more and more important, especially as we become more omni-channel in our business strategy,” Lucas said. “Our catalog will be a big piece of the change, and it will take us into markets outside of Massachusetts.”
Lucas said the catalog will provide the retailer with a testing ground outside of the Boston market and the state. “We’re not close-minded to crossing the border,” she said.
As for the online marketing and social media, Lucas said both are “fascinating” with the ability to turn strategies quickly and create very targeted messaging depending on how the targeted consumer searches and shops online.
“A better understanding of online habits allows you to buy media and make changes by the day or minute if needed,” she said. “There’s no longer a line between social media and online marketing. It has become blurred. Now, it’s more about understanding where your customer travels online and how to talk to them the way they want to be communicated with.”
Lucas is realistic about where the company is now and where it could be in the future with its online advertising. “The potential of where we can be in the next year is great,” she said.
To get there, it’s imperative that retailers understand how the different generations of shoppers want to be approached with marketing. Baby Boomers want one approach while Gen X and the Millennials are completely different and want to see things on phone screens and hear an authentic message.
“Old school online is two years ago,” Lucas said. “We’re all evolving so quickly. We’re not going to be stuck in the way we’ve always done it. We have the right people on our team to ensure that.”
The Early Days
Boston Interiors was started in 1979 by Ken Loring as a waterbed store.
At that time, Loring was working with a man who sold waterbeds and decided to open his own store focused on selling nothing but waterbeds. He set up shop in Brookline, Mass. Later the store evolved to sell other bedroom furniture, and Loring changed the name to Boston Bedrooms.
The retailer then expanded into other home furnishings and the name changed in 1984 to Boston Interiors.
Stefanie Lucas, CEO, said the growth through the years was planned and more organic.
Prior to jumping into the waterbed retail business, Loring had no furniture experience. In fact, he was in the motorcycle business.
Loring remains chairman of the retailer, while Lucas runs the day-to-day operations.
June 11,
2015 by in Business Strategy, Industry
By Sheila Long O'Mara
In the last week, two magazines featuring cover stories dedicated to the importance of taking time off and taking a break from all things work have been delivered to my mailbox.
One publication—Time—questions who killed the summer vacation. The other—Inc.—zeroes in on the importance of shutting down and getting away from it all. I’m sure if we subscribed to Psychology Today that publication would also have a number of dedicated pages about how employees and managers are much more productive when they’ve had time to recharge their batteries.
And, just now, an e-mail with the subject line “you need a vacation” pinged. Oh, how very true that is.
The headlines captured my attention because this is the time of the year when schools are winding down for the summer, families are making travel plans and everyone is dreaming of long days out of the office. While the calendar says it’s still spring for a few more weeks, the unofficial start of summer is here for most of us.
But what does that mean for a business? How do we keep the wheels still turning while so many associates and partners want (and need) to take time away?
According to the Bureau of Labor Statistics, the average American worker had 4.9 unused vacation days in 2013. During that same year, the average number of vacation days that weren’t carried over was 1.6 days. Want another staggering statistic? The average employee did $504 worth of work because of unused vacation days. Some folks did much more and some did much less.
Here in the U.S., we are the only economy that doesn’t require employers to provide paid holidays or time off. The ONLY one. How can that be?
Study upon study reveals that employees are much more productive when they’re allowed to unwind and recharge. However, in today’s hurry-up, ping-filled world, it’s more challenging to escape.
I suppose we could blame the first-generation BlackBerry. Those black, Pop-Tart sized phones we all toted around 15 years ago. Today, iPhones and Android devices are so ubiquitous and allow us to check e-mail and voicemail with an easy swipe of the finger. Toss in texting and very few of us can truly shutdown.
As we dive into the summer months, keep in mind that you’re more likely to get the best out of your employees if they’re given time away. Most will return with a new zest for what they do, which in turn will be better for your business.
Happy summer!
June 11,
2015 by in Furniture Retailing, Industry
By Bob George
As a nation with our smartphones, we have become obsessed with our personal performance. We measure the number of steps we take each day, the calories we consume and the hours we sleep.
Moving to the next level, we measure how we compare to others (typically anonymous others) in terms of the best time on this defined jogging trail or the highest finish in a road race. We self monitor our health by checking our heart rate and, in the not too distant future, we will do this with all of our vital signs. In our financial lives on a daily basis we monitor the daily stock updates and note any changes in our bank balances.
From a business perspective we are just beginning to monitor our business activities such as daily traffic and daily sales.
As we move to the next level we will begin to compare our businesses to other similar retailers. In this issue of Home Furnishings Business we have addressed retail metrics and, specifically the financials. Overall, as an industry, the results are pretty poor. However, this is understandable with a high percentage of retailers having under $5 million in sales. A small retailer with sales of about $2 milion is primarily a family income with no reason to show a profit. Our focus is on the retailers with sales of $5 million or more. We are measuring against the top 25 percent of performers and then the top 10 percent to provide a perspective of what could be.
Creating a high performance company starts with a vision. However, the emphasis must quickly focus on the details. It begins with increasing margin by half a point and reducing warehousing costs by 5 percent.
Think of the way you would approach that anonymous jogger who bested you by 10 minutes on this new course. You would view this not as a discouragement, but as a challenge to do better. You would probably never meet that runner, but you know he or she is aware that someone else is in the game. That is what defines a high performance retailer.
Our total organization from the magazine to the research division to the consulting group celebrates high performers. If you are not currently in the race, get to the starting line. We are here to cheer you on.
June 11,
2015 by in Furniture Retailing, Industry
By Sheila Long O'Mara
As furniture retailers continue to bounce back from the Great Recession, they’re paying close attention to a variety of metrics.
While the furniture industry as a whole would like to completely forget the dark years between 2007 and 2009, there are a slew of lessons to be learned.
Those dark and gloomy days of the recession had furniture retailers doing some real soul searching and number crunching to make it through to the other side. That struggling time taught many a lesson on where to look and how to come out stronger and better.
Retailers vary on the metrics they turn to for keeping tabs on their operations. In addition to the basics, many use new measurements or are re-evaluating the way they look at some of the old standbys.
Metrics like gross margin return on investment—the old GMROI—inventory turns, inventory to sales, traffic counts, sales close rations and average ticket remain at the top of the heap.
Managers at some stores track total inventory, GMROI, inventory on hand awaiting delivery, gross margin on written and delivered goods by category and vendor, sales by salesperson and by square foot, advertising spend and return on that spend.
The figures can be mind-swelling, but those bread-and-butter stats are key to keeping a retail operation going.
Woody Whichard at Midtown Furniture Superstore & Mattress in Madison, N.C., likes to keep up with his store’s close ratio.
“We don’t have a door counter nor a sales manager on staff keeping count,” he said. “This is the responsibility of the entire sales team and is tracked through their contact cards.”
Individual and store gross margin sales are reviewed every Saturday morning during a sales meeting. The results are shared with the entire staff. Whichard is a stickler for following closely to the budget.
“The budget is very important for us to create and stick to as a course of action throughout the year,” he said. “The budget is watched daily.”
For Acton, Mass.-based Circle Furniture, it’s all about merchandise turns.
Peggy Burns said she things too many furniture people get stuck on tracking gross margin return on investment when at the end of the day it’s all about selling furniture.
“If something is a dog, it doesn’t matter,” she said. “If I put something on the floor, I want to see that it’s turning and earning its keep.”
As for just how much a product has to sell? It’s all relative, Burns said, but at the minimum it has to turn several times a month to remain in Circle’s merchandising lineup. If not, it’s gone and another product takes its place.
Like other retailers, Travis Garrish of Forma Furniture in Fort Collins, Colo., there’s not just one magic, go-to number that is the Holy Grail. He does, however, have a first stop, and it’s just as Burns said—gross margin return on investment.
“I always look at GMROI,” he said. “That’s been our focus this year. It does change with what needs the most attention at any given time.”
It’s the Quality
A key element to all retailers is how well their team is grooving. How’s the attitude quotient? Happy people tend to work harder and harder workers sell more.
“The main measure I look for is a good attitude every day from every team member companywide,” Whichard said, adding that good attitudes translate into a better customer experience for consumers shopping the store.
Several retailers mentioned positive attitude and high levels of customer service as important aspects of maintaining and building a loyal customer base. Retail is all about the detail and ensuring each minute one is managed.
Cost Squeezing
Here are a few areas that retailers like to watch and ways to get the most out of every metric for successful retailing. Some are top-of-mind ideas, but always good to repeat.
1 Occupancy Costs
If you lease your building, consider renegotiating your lease rate. It never hurts to ask, and your landlord could be willing to cut a deal.
2 Delivery
Lower costs by ensuring you get it right the first time. Prompt, clean and neat or words to live by and cuts down on return trips.
3 Cash Flow
Daily sales and deposit reports are must. How are receivables? Staying on top of cash flow is critical.
4 Budget
Set an annual budget and stick to it. Make a point to examine where you stand on a regular basis.
5 Merchandise Mix
Check the store and warehouse for product you’ve always had on hand but rarely sold. Get it rid of it.
Safety in Numbers
Furniture retailers are finding safety in numbers when it comes to idea and information sharing.
Through retail performance groups, independent retailers are pooling ideas, financials and support to stay on top of emerging business trends, merchandising trends and smart ways to run their businesses.
Are you having trouble finding good ideas for advertising? Do you know what marketing or categories are bringing positive results for other retailers? Are you tired of ordering goods at market that don't pan out sales-wise?
Performance groups give dealers the chance to gather with like-minded peers to exchange ideas, swap best practices and in some cases, conduct shared financial analysis. Such analysis allows retailers to rate their operation relative to others in the dealing with many of the same issues. (Full disclosure: Impact Consulting Services, parent company of Home Furnishings Business, helps run a number of retail performance groups within the industry.)
The concept of performance groups emerged from the automobile industry, where competing companies joined together to share information they used to develop performance standards each could use to measure themselves relative to the industry as a whole.