By Home Furnishings Business in on May 2013
There are lies, there are damned liesand then there are statistics.
Its an old saw, and while outfitting customers with products that match the lifestyle of their dreams takes a human touch, todays furniture retailersespecially if theyre running operations employing more than a few peoplecant ignore the numbers that tell them what theyre doing right and also where they could make some improvements.
Analyzing your stores numbers is more than bean counting. Its about pulling whats really useful out of the huge amount of information generated even by basic store operating systems. As importantcommunicating what you find to your sales team and management personnel in an effort to help them do their jobs more effectively.
Numbers alone arent enough, said Bob George, CEO of Impact Consulting/FurnitureCoreits more about understanding what they mean, and using them to execute a business plan.
At the recent High Point Furniture Market George gave a presentation, Big Data, on how retailers can better utilize the huge amount of information their Web sites and store systems generate.
The key to utilizing data is understanding the sorts of information; using it to identify customer segments and the opportunities they represent; using data for better promotional execution; and monitoring the results, he said.
That can be a daunting task considering how much information a store automation system can generate. The first step is to create a place where that data can be organized and accessed, and George used the smart phone as an analogy.
Every one of you probably has a smart phone, he said. Think about how much information you have on that phonepictures, addresses, contactsyouve probably become dependent on that phone.
Take one piece of data and expand it from thereits the what you did with your phoneyour kids pictures, your calendar. Do it with you business in the same way.
Take that concept of all that information you have and layer it in. ¦ If you dont integrate that data and pull it together, you cant use it.
Create a place to store that data.
The cost to store that data has fallen dramatically, and you also need the speed to get at it, George said. Where it should end up is where the rubber meets the roadin the salespersons hands. How can you use that data to influence the sales process?
With Big Data, the goal is to be able to say, Bill bought something, but I knew he was going to buy it. He went to the Web site and asked about this SKU. Help your salespeople facilitate that movement from I think I need some furniture to Im going to buy some furniture.
Traffic measurement, along with inventory, closing rate (both team and individual) and average sale, are absolutely critical sources of information, said Profitability Consulting Group CEO John Egger.
You might have those numbers, but understanding what they really mean takes deeper digging. Analyzing traffic numbers, for instance, is more than counting bodies.
If you want to, drill down and use cameras at your door you can measure things like groups of people, family, ethnicity, Egger said. If the raw numbers say 80 people came in, that drill down will tell you that you had, say, 12 families, six groups of women, etc.
Again, looking beyond the numbers, analyze where shoppers go in the store. Where do they stop?
What if 70 percent of people stopped at a particular vignette? Egger said. Thats going to tell you something you can use in your merchandising.
Say youve been gone for a week, and sales were half of what youd counted on for that period.
Your immediate reaction is to get all over the salespeople, but maybe there was a storm, maybe you were understaffed, Egger said. There are a lot of things that could have happened to let you know if there was a real problem with your people.
DIGGING DEEPER: INVENTORY
Knowing how much furniture you have in your warehouse and on your floor, and how often you turn your inventory hopefully got covered in Retail 101.
Knowing you have X dollars in hand and that you turn it X number of times a year is fine, but if thats where youre stopping, those figures dont really help you figure out how to make that investment in goods make money.
Do you know what part of that inventory has been sitting around for a while? Staying current on aging inventory is critical, Egger said.
Someone has to be in charge of an aging report, and keep track of not in location or not available for sale items, he noted. That stuff can stack up to thousands and thousands of dollars. Suddenly you end up with $500,000 in dead items that could be cash. Someone has to be accountable for that.
Egger shared an analysis Profitability Consulting Group performs for clientsslot cost.
We go into a warehouse and see how many slots can be filled there, he said. We take total occupancy cost and divide that by slotthats the slot cost.
If you have X amount of slots, we know that piece of furniture costs you X amount of money to sit there. If you have 1,200 slots that are (not in location) or (not available for sale), that could be replaced with merchandise thats making you money.
DIGGING DEEPER: TRAFFIC
While more than 50 percent of American retailers have installed traffic monitoring systems, they dont always apply the information gathered to improving sales, according to Michael Bunyar, president of Montreal-based SMS Store Traffic.
SMS furniture retail clients include names such as Ashley Furniture Homestores, City Furniture, Dufresne and The Brick.
Todays traffic counting technologies now provide queue management data, age and sex recognition, hot spot identification, group counts, employee elimination, dual view cameras and more. But retailers can do more to apply what they learn from those numbers to convert shoppers into buyers.
In applying store traffic to your operation, Bunyar said customer-to-staff hour ratio is one of the most useful ratios you can generate.
Thats total traffic divided by the number of staff hours you use in a given day, or period of the day, he said. If your customer/staff hour ratio is 15, that means everyone on your floor dealt with 15 people. When you get to 30 or more, there is simply no available service. The floor staff is getting pulled every which way.
When you look at that ratio on a daily basis, people agree that Saturday and Sunday are the big hours. The ratios for those times are typically the worst of the week, meaning your highest traffic is getting the worst service of the week.
That ratio could well be an acceptable 15 on Tuesday or Wednesday, but if its 25 or 30 on Friday, Saturday or Sunday, you might be burning turf customer-wise.
Just re-establishing staffing levels, bringing a little more available service to your key selling days has a huge impact, Bunyar said. The bottom line is that most retailers are desperate to increase sales. Its all about your conversion rate. Are you selling 1 to 2 percent of your traffic? Thats a problem. Just adjust staffing so when people come into your store you can give them the service you need.
Are you already selling 20 to 25 percent of your traffic? Taking it to 26 or 27 percent represents a huge impact in sales.
Its an easy fix, its a quick fix, and its an inexpensive fix, Bunyar said. If you talk with store managers, you find theyve been petitioning their head office for years to get more people, but are told theyre staffed properly for their sales level. Improve the service, and youll improve the sales.
DIGGING DEEPER: SALES
Jeff Winter is an owner at Discovery Furniture in Topeka, Kan., along with brother Jamie Winter. The operation includes Discovery Furniture, RoomMakers stores carrying Ashley goods Mattress Headquarters locations in Topeka, Kan., and Lawrence, Kan.; and an Ashley Furniture Homestore in Salina, Kan.
Discovery/RoomMakers has deepened its sales analytics in the past couple of years. More important, management puts the information it gets to work on managing and counseling its sales team and managers to help them perform more effectively.
All the information is in our computer systemswhat was purchased, who bought it, who sold it, Winter said. We have several components in the analysis we do. That includes normal sales specialist measurements like sales per hour, sales per guest, average sale, sales productivity.
Discovery analyzes by week, month and year for each person; and it graphs that information by performance, and by furniture category.
The manager sits down with each person so they know where they stand, Winter said. Its making it so you can change and improve. ¦ You cant improve what you cant measure, and it all leads to communication.
In the past year Discovery has added protection sales and delivery into the measurements the business tracks.
We put those in because people who purchase product protection and delivery are our happiest customers, Winter noted.
Sometimes, for example, customers decide to pick up the furniture themselves, and end up damaging it.
Thats not our fault, but you still have an unhappy customer, Winter said. Say a customer opts out of delivery. Were able to identify that, and help (the salesperson), coach them.
With a lack of information, people tend to think theyre above average. Everyone wants to do a good job, its a matter of helping them with specific things, specific sales tools.
Discovery looks at those same measurements by store and by each category. On a graph, a gold bar indicates expectations are met or exceeded; green means performance exceeds the prior period of measurement, be that year, month or week; and red indicates performance trails the prior year.
Weve formatted how we get that information into peoples hands, and its compiled every hour, Winter said.
Daily text compare performance by day, week, month and year; and store managers see not only their store but also every other store.
We also have merchandising tools, managing that in a real-time war room, Winter added. We determine whats generating our gross margin dollars.
Its all part of re-thinking the way retailers can apply the numbers available to them in their business. HFB
By Aggregated Content in Furniture Retailing on May 21, 2013
Jacksonville-based Furniture Fair is expanding to Wilmington, N.C., taking over the former Room Store space at 524 S. College Road.
The 35,000-square-foot building on 1.75 acres sold for $1.7 million, according to Patrick Riley of Maus Warwick Matthews commercial real estate, which represented Furniture Fair.
The Port City will be the 65-year-old Furniture Fair's 10th location. It has two in Jacksonville, two in Goldsboro, and one each in Greenville, Morehead City, New Bern, Kinston and Rocky Mount, said Jonathan Popkin, an owner of the family chain.
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By Aggregated Content in Furniture Retailing on May 21, 2013
Strategies honed in the U.S help Wayfair sell online in the U.K. and Germany.
After three years Europe only accounts for about 6%-$36 million-of Wayfair's annual web sales of around $600 million. But Wayfair is counting on the same niche retailing strategy it developed in the U.S. to help build business in Europe over the long haul, says CEO Niraj Shah.
Wayfair has doubled its European web sales in the last year by growing the number of products it offers on its e-commerce sites in the United Kingdom and Germany to about 100,000 products.
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By Home Furnishings Business in Markets on May 21, 2013
The International Casual Furniture & Accessories Market will host a number of shopping areas, including redesigned casual showroom floors, temporary exhibits in the Market Suites and more.
Held at the Chicago Merchandise Mart Sept. 17-20, the market is a four-day trade show that offers retailers access to a wealth of casual living products in 35,000 square feet.
This year, the Casual Market will debut two dedicated casual showroom floors. Floors 15 and 16 have been redesigned to give retailers and designers the ability to view outdoor seating collections, dining sets, and display vignettes with product demonstrations and merchandising ideas.
More than 20 showrooms relocated during the past year to new spaces on the 15th and 16th floors. Since this transition, some showrooms have expanded their new spaces.
"The September Casual Market is the first time the majority of buyers and designers will see the new redesigned and dedicated casual floor plan, which has been designed to give attendees the ability to easily navigate through showrooms more efficiently," said Jaclyn Kelly, senior director of marketing for the International Casual Furniture & Accessories Market / MMPI.
By request, the 2013 Casual Market will again feature the Garden Accessories Courtyard. This 10,000 square-foot-area located on the Northwest side of the 8th floor Market Suites, is dedicated to showcasing new accessories. The Garden Accessories Courtyard is home to exhibitors highlighting decorative outdoor accessories, lighting, hearth products, tabletop items, rugs, pottery, statuary, and much more.
New and returning temporary exhibitors in the 8th Floor Market Suites will display their product innovations and collections in an advanced look at 2014 options. From casual furniture, umbrellas and fire pits to outdoor kitchen appliances, fabric options, and a variety of accessories, the Market Suites are slated to include plentiful resources for all retailers' inventories and designers' specifications.
"Since the Chicago Merchandise Mart is the casual industry's leader in product exhibition and permanent showrooms, the combination of these display areas creates a broader range of purchasing opportunities for retailers, buyers and dealers," Kelly said.
While the Casual Market's New Product Gallery has always been known for revealing select product debuts and new exhibitors on the 1st floor of the Chicago Merchandise Mart, a New Exhibitor Showcase will be featured on the 8th floor. Those in attendance will have the ability to discover new exhibitors along the main aisle on floor 8 of Market Suites. A signage wall-display will provide a colorful glimpse of new exhibitors' product photos as attendees enter the floor from the elevators. New exhibitors include Big Green Egg, Lounge Factory, Outdura, Desert Steel, and Outdoor Interiors.
Attendees have the ability to gain insights regarding color and design trends affecting consumer purchasing behaviors as well as recent product introductions for their comprehensive seasonal and annual inventory or catalog needs. Attendees will include trade professionals working in many fields including specialty casual furniture stores, full-line home furnishing stores, department stores, pool and spa stores, garden centers, hearth and fireplace stores, catalogs, hardware centers, discount/mass merchandisers, interior design, hospitality specification, landscape design, and landscape architecture.
The Casual Market's redesigned Web site includes information for exhibitors and attendees.