Daily News Archive
Brought to you by Home Furnishings Business
November 30,
2012 by in UnCategorized 
By Home Furnishings Business in on December 2012
Considering the economy in recent years, in retrospect 2005 might not have been the best time to start a furniture retail operation, but thats when then-23-year-old Jay Howard launched I.O. Metro, a contemporary leaning retailer based in Northwest Arkansas.
While a lot of home furnishings retailers have closed since then, I.O. Metro has grown to 17 locations across Arkansas, Alabama, Missouri, Oklahoma, Texas, Tennessee, Mississippi and Georgia.
Howard, CEO and president, oversees all merchandising and marketing aspects of the company, and has worked hard in product development and sourcing to serve a model that depends largely on private label merchandise the retailer can call its own.
Howard was first inspired to start a furniture retail operation after he found himself frustrated in his own shopping for home furnishings.
I was young and probably naïve, didnt really know that much about the business, but I have a personality that if I get into something Ill make it work, he said.
During the first 12 to 18 months, we were just out doing our own thingit was driven by my desire to start something and a will to succeed.
Even during a slow period for most of the furniture retail business, I.O. Metro has continued to add stores.
We havent had a negative year yet, Howard said. Were a young company, and were still learning the business. I think youth and an entrepreneurial vibe made us innovate.
For example, in the midst of the recession, I.O. Metro introduced a custom upholstery program, which now accounts for 50 percent of its upholstery business.
That alone kept us from having year-over-year negative comps, Howard said.
2012 has seen more of the same at I.O. Metro, which bills itself as A Different Kind of Furniture Store. Plans call for another Dallas location to open in 2013, and the company is looking for real estate to add three to four stores a year moving ahead.
THREE POINT PLAY I.O. Metro looks to build upon that momentum with a three-tier strategy that combines its brick-and-mortar operations with e-commerce capability it launched on its Web site a little over a year ago; and a brand-new catalog that debuted in November.
Business has been particularly good this year, and initial results from the catalog in November are very strong, Howard said. Three things have been very important to us: custom upholstery; nailing down core items and backing those up with additional inventory; and finally, our catalog.
Lou Spagna joined the company this year as chief operating officer, and hes played an integral role a recent logistics restructuring that allows I.O. Metro to ship nationwide in support of its e-commerce and catalog business; and has helped streamline customer service in general.
Consistency across touch points has been key to I.O. Metros approach to brick-and-mortar, online and catalog retailing. The Web site has product icons identifying items as part of its various collections, whose billings include Eco-Metro, Metro Custom, Real Wood and Local Art.
Those same icons identify products both in the stores and within the catalog. Design associates in the stores use the Web site a lot when dealing with customers, so it is also important for the site to offer as much information as possible, as well as appropriate product photography.
I.O. Metro also has an online room planner that customers and designers use to determine how products will fit within their spaces. The Web site is mobile- and tablet-friendly and was designed to respond to whichever device its being viewed on and adjusts itself accordingly.
Right now were using iPads in the store to take people to our Web site, Howard said.
He views e-commerce as strong growth area, but that channel is a ways from meeting eventual expectations.
Were hoping it will account for 15 to 20 percent of our business within the next three years, Howard noted.
REMOTE SERVICE Customer service has been an at times problematic issue for retailers looking to expand their reach through the Internet and catalogs. Earlier this year, I.O. Metro developed a corporate customer service department to serve as the hub for customer issues. Redirecting that function, previously done at the store level, was key in making sure customers receive the attention and information they need for both online and in-store purchases. A personal touch remains key.
Its always much easier to interact with the customer personally, Howard said. If we get an e-mail from a customer, we try to get a call to discuss the issue so youre relating to them on a personal level. The other key is to keep the customer informed. If theres an issue with a product, dont cover it up, and let them know whats going on and what their options are.
The catalog I.O. Metro debuted in early November was a long time coming for the brand and made sense for a furniture company founded on principles of good design. The idea was to go beyond the typical online presentation of home furnishingspages of photos on a white backgroundand give consumers a truer sense of how the home furnishings would look in their own space.
Its all about painting the picture for the customer, and its tough to establish a look with a white-background picture on the Internet, Howard said. It takes a while to look through all our product on the Web site, and you can see it all in a 36-page catalogand see it in a home setting.
Its largely to drive our online business, but we see the catalog as our strongest marketing tool for presenting our brand before someone gets to our Web site or goes into one of our stores.
PULLING IT ALL TOGETHER Catalog and e-commerce aside, the core of I.O. Metros business remains in its network of brick and more locations. Along with striving for consistency across all consumer touch points, the company wants to make sure people coming to shop get the sort of experience Howard was looking for when he was inspired to start the business.
Our motto is A Different Kind of Furniture Store, Howard said. If youre a shopper walking into an I.O. Metro location you hear fun, upbeat music. Salespeople greet you but dont attack you.
The hip mood strikes a chord with a lot of the business older customers.
Thirty-five to 54 is definitely our core demographic, but a big bulk of our customers are 45-plus, Howard said, with incomes in the $75,000-$125,000 range. When you look at us, most people think our customer is 25 to 35, but thats not our core.
A lot of these middle-age people are looking to simplify or to update their homes. They like change, and they want to de-clutter. It was good timing on our part.
Stores are merchandised in vignettes, not rows and rows of sofas.
We echoed that thought in our catalogif you can show a customer looking to make a change what it will look like they wont be scared to buy it, Howard said.
Core product is consistent, but store managers use accessorization to keep the stores look fresh and different.
How does I.O. Metro express that retail vision in marketing and advertising efforts, or social media?
Sometimes simple is better, and thats how the company approaches merchandising and marketing effortsdrawing customers to a look thats clean, simple and sometimes striking; and marketing reflects that.
I.O. Metro is on all major social media channels such as Facebook, Twitter, Pinterest and Instagram.
Christine Howard, Jays wife, writes the stores in-house blog, Hello Metro, where she shares design tips and trends
Weve always felt we offered great values, but the customer has pushed us to a little more of a higher-end approach, Howard said. Before, it was everyday low price ¦ Today we reward our customers whove been loyal to us.
Thats done through promotions and deals that customers might not see on the retail floor, through social media, e-mail and some direct mail. HFB
November 30,
2012 by in UnCategorized
By Home Furnishings Business in on December 2012
Welcome to our second annual Home Furnishings Business power 50 ranking. The rankingour take on how the industrys retailers should be rankedtakes into account retail sales volume, industry involvement, social media power through Klout scores, the popular vote and our editorial boards opinion.
Its a different look at home furnishings retail rankings, and throughout the section youll see the different ways in which weve sliced and diced the data.
To those who took the time to vote: Thank you. Without your input, this would likely be just another retail ranking by sales volume.
Enjoy the read.
1 Jeff Seaman Rooms To Go (Seffner, Fla.)
2 Laura Alber Williams-Sonoma (San Francisco)
3 Gordon Segal Crate & Barrel (Northbrook, Ill.)
4 The Blumkins, Nebraska Furniture Mart, R.C. Willey, Star
Jeff Child, Bill Kimbrell Furniture, Jordans Furniture and Homemakers
Eliot Tatelman,
The Merschmans
5 The Wanek Family Ashley Furniture HomeStores (Arcadia, Wis.)
6 The Goldbergs Raymour & Flanigan (Liverpool, N.Y.)
7 Alex Smith Pier 1 Imports (Fort Worth, Texas)
8 Kurt Darrow La-Z-Boy Furniture Galleries (Monroe, Mich.)
9 Art Van Elslander Art Van Furniture (Warren, Mich.)
10 Jay Schottenstein American Signature (Columbus, Ohio)
11 Lee Aaronson Lacks Valley Stores (Pharr, Texas)
12 Mikael Ohlsson Ikea (Conshohocken, Pa.)
13 Clarence Smith Havertys Furniture Co. (Atlanta)
14 Steve Stagner Mattress Firm (Houston, Texas)
15 Farooq Kathwari Ethan Allen (Danbury, Conn.)
16 David Acker Sleepys (Hicksville, N.Y.)
17 Carlos Alberini Restoration Hardware (Corte Madera, Calif.)
18 Niraj Shah Wayfair Furniture (Boston)
29 Ted English Bobs Discount (Manchester, Conn.)
20 Barry Feld Cost Plus World Market (Oakland, Calif.)
21 Steve Freeman Room & Board (Minneapolis,Minn.)
22 Bill Mathis Mathis Brothers (Oklahoma City)
23 Shelly Ibach Select Comfort (Minneapolis, Minn.)
24 Rob Spilman Bassett Home Furnishings (Bassett, Va.)
25 Jake Jabs American Furniture Warehouse (Thornton, Colo.)
26 Ed Teplitz Thomasville Home Furnishings (Thomasville, N.C.)
27 Bill McKendry Furniture Row Cos. (Denver, Colo.)
28 Dale Carlson The Sleep Train (Citrus Heights, Calif.)
29 Terry Lundgren Macys (New York)
30 Kenny Larson Slumberland (Little Canada, Minn.)
31 The Navarras, Jeromes (San Diego)
Lee Goodman
32 The Harris Family Furnitureland South (Jamestown, N.C.)
33 The Capo Family El Dorado (Miami Gardens, Fla.)
34 The Johansen Family HOM Furniture (Coon Rapids, Minn.)
35 Mike Price Badcock Home Furniture & more (Mulberry, Fla.)
36 Joe and Mike Zeiden Z Gallerie (Gardena, Calif.)
37 John Edelman Design Within Reach (Stamford, Conn.)
38 Paulette Cole ABC Carpet & Home (New York)
39 E.J. Strelitz Haynes Furniture (Virginia Beach, Va.)
40 Chris Pelcher Levin Furniture (Smithton, Pa.)
41 The Baer Family Baers (Pompano Beach, Fla.)
42 John Reed Arhaus Furniture (Walton Hills, Ohio)
43 Jim McIngvale Gallery Furniture (Houston, Texas)
44 The Haux Family Mor Furniture for Less (San Diego)
45 The Rubin Family Bernie & Phyls (Norton, Mass.)
46 Mark Stuart Regency Furniture (Brandywine, Md.)
47 Grover Geiselman, Living Spaces (Rancho Cucamonga, Calif.)
Sharm Scheuerman
48 Irwin Novack Kanes Furniture (Pinellas Park, Fla.)
49 Keith Koenig City Furniture (Fort Lauderdale, Fla.
50 George Cartledge III Grand Home Furnishings (Roanoke, Va.)
The Top 50 (Based on Retail Sales Volume):
People love comparisons, and companies are no different. We in the furniture industry fall in line with that. Here youll find our Power 50 ranking based on retail sales volume for companies in our pool. Please note that the Berkshire Hathaway family of home furnishings retailers are grouped together, as are the Williams-Sonoma Inc. stable of companies.
1 Ron and Todd Wanek Ashley Furniture HomeStores (Arcadia, Wis.) $2,686.0
2 Mikael Ohlsson Ikea (Conshohocken, Pa.) $2,280.0
3 Jeff Seaman Rooms To Go (Seffner, Fla.) $1,500.0
4 Laura Alber Williams-Sonoma (San Francisco) $1,480.1
5 The Blumkins, Jeff Child, Nebraska Furniture Mart, R.C. Willey, Star Furniture, $1,208.2
Bill Kimbrell, Eliot Tatelman, Jordans Furniture and Homemakers
The Merschmans
6 Neil Goldberg Raymour & Flanigan (Liverpool, N.Y.) $1,008.8
7 Jay Schottenstein American Signature (Columbus, Ohio) $965.8
8 Alex Smith Pier 1 Imports (Fort Worth, Texas) $957.0
9 David Acker Sleepys (Hicksville, N.Y.) $846.0
10 Steve Stagner Mattress Firm (Houston, Texas) $831.2
11 Kurt Darrow La-Z-Boy Furniture Galleries (Monroe, Mich.) $820.0
12 Gordon Segal Crate & Barrel (Northbrook, Ill.) $717.7
13 Shelly Ibach Select Comfort (Minneapolis) $713.5
14 Farooq Kathwari Ethan Allen (Danbury, Conn.) $695.0
15 Bill McKendry Furniture Row (Denver, Colo.) $640.0
16 Ted English Bobs Discount Furniture (Manchester, Conn.) $638.8
17 Clarence Smith Havertys (Atlanta) $621.0
18 Carlos Alberini Restoration Hardware (Corte Madera, Calif.) $515.0
19 Art Van Elslander Art Van (Warren, Mich.) $470.2
20 Niraj Shah Wayfair Furniture (Boston) $400.0
21 Kenny Larson Slumberland (Little Canada, Minn.) $383.7
22 Dale Carlson The Sleep Train (Citrus Heights, Calif.) $371.8
23 Bill Mathis Mathis Brothers (Oklahoma City) $344.8
24 Barry Feld Cost Plus World Market (Oakland, Calif.) $332.0
25 Jake Jabs American Furniture Warehouse (Englewood, Colo.) $323.0
26 Mike Price Badcock Home Furniture & More (Mulberry, Fla.) $305.0
27 Rob Spilman Bassett Home Furnishings (Bassett, Va.) $268.0
28 Steve Freeman Room & Board (Minneapolis) $264
29 E.J. Strelitz Haynes Furniture (Virginia Beach, Va.) $262.0
30 Ed Teplitz Thomasville Home Furnishings Stores (Thomasville, N.C.) $240.1
31 The Haux Family Mor Furniture for Less (San Diego) $238.4
32 The Johansen Family HOM Furniture (Coon Rapids, Minn.) $202.5
33 Terry Lundgren Macys Furniture Gallery (New York, N.Y.) $202.0
34 Grover Geiselman and Living Spaces (Rancho Cucamonga, Calif.) $185.0
Sharm Scheuerman
35 Chris Pelcher Levin Furniture (Smithton, Pa.) $175.0
36 John Reed Arhaus Furniture (Walton Hills, Ohio.) $165.0
37 John Edelman Design Within Reach (Stamford, Conn.) $160.0
38 The Capo Family El Dorado Furniture (Miami Gardens, Fla.) $159.1
39 Bruce Berman The RoomPlace (Lombard, Ill.) $151.0
40 Irwin Novack Kanes Furniture (Pinellas Park, Fla.) $133.0
41 The Baer Family Baers (Pompano Beach, Fla.) $132.0
42 Paulette Cole ABC Carpet & Home (New York) $130.0
43 The Harris Family Furnitureland South (Jamestown, N.C.) $129.5
44 Gordy Wallenstein Furniture Mart USA (Sioux Falls, S.D.) $124.4
45 Joe and Mike Zeiden Z Gallerie (Gardena, Calif.) $119.3
46 Jim McIngvale Gallery Furniture (Houston, Texas) $115.8
47 George Cartledge III Grand Home Furnishings (Roanoke, Va.) $110.0
48 Gary Steinhafel Steinhafels (Waukesha, Wis.) $109.3
49 Humberto Garza Valdez FAMSA (Santa Fe Springs, Calif.) $108.8
50 The Navarra Family and Jeromes (San Diego, Calif.) $102.0
Lee Goodman
The Top 50 (Based on Social Influence):
Just how influential is the home furnishings retail family? Thanks to Klout, thats not as hard to figure out as it once was.
The Klout Score, a number between one and 100, is a representation of a persons or entitys overall social media influence. The science behind the score looks at more than 400 variables on multiple social networks beyond your number of followers and friends. It examines who engages with the content and with whom they then share that information.
Klout.com features an algorithm that measures the effectiveness of your social media usage with sites like Facebook, Twitter, Instagram, Google+, LinkedIn, foursquare and Wikipedia. Its simple to determine. Login, input your Twitter name and out comes your Klout score.
While no one comes close to President Barack Obamas Klout score of 99 or Justin Beibers 91, furniture retailers arent too shabby.
Specialty retailer Pier 1 Imports is on fire with social media with its ranking of 83, four points ahead Williams-Sonoma at 79. From there, Klout scores start to drop off rather dramatically.
Heres a look at how those in our Power 50 pool shake out on Klout:
1 Pier 1 Imports 83 Online shopping, Personal Finance, Kitchen
2 Williams-Sonoma 79 Shopping, Food, Branding
3 Z Gallerie 68 Dining, Kentucky Derby, Frankenstein
4 Crate & Barrel 64 Dining, Mothers Day, Online Shopping
5 RC Willey Furniture 63 Dining, Camcorder, Digital Cameras
6 Wayfair Furniture 61 Memorial Day, Recessions, Personal Finance
7 Mattress Firm 60 Facebook, Sales, Shopping
8 Macys 57 Whitney Houston, Black History Month, Hudson River
9 Furnitureland South 55 Customer Service, Apps, Facebook
10 Art Van 53 Furniture, The Future, Nelly Furtado
11 Rooms To Go 53 Family, Customer Service, Kitchen
12 La-Z-Boy Furniture 52 Customer Service, Facebook, Chicago
13 Nebraska Furntiure Mart 51 Customer Service, Kitchen, Fifa
14 Restoration Hardware 51
15 Raymour & Flanigan 50 Dining, Personal Finance, Customer Service
16 Room & Board 50 Dining, Electricity, Customer Service
17 Jeromes Furniture 49 Pizza, Facebook, Sales
18 Sleepys 49 Greenwich, Mothers Day, Customer Service
19 ABC Carpet & Home 48 Kitchen, Andrea Bocelli, Cookbooks
20 Gardner-White 48 Billboards, Detroit 1-8-7, Metro Detroit
21 Circle Furniture 47 Rachel Ray, Community, Facebook
22 Star Furniture 47 Sales, Retail, Law
23 Sit N Sleep 47 Billboards, L.A. Times, Sales
24 The Sleep Train 47 Customer Service, Community, Sales
25 Havertys 46 Customer Service, Community, Sales
26 Walter E. Smithe 46 Facebook, Chicago, Brighton
27 American Signature 46 Customer Service, Shopping, Football
28 Ikea 44 Dining, Ikea, Burbank
29 Ashley Furniture HomeStores 43 Customer Service, Sales, Television
30 Mealeys Furniture 43 Furniture
31 Select Comfort 43 Customer Service, Sales, Health
32 FAMSA 43 Msi
33 Bobs Discount Furniture 42 New Jersey, Money
34 HD Buttercup 42 Facebook, Shopping, Money
35 Kanes Furniture 41 Pizza, Sales, Internet Marketing
36 Belfort Furniture 40 Internet Marketing, Social Media, Furniture
37 Walker Furniture 40
38 Mathis Brothers 38 Sales, Moms, Money
39 Miskelly Furniture 38 Coupons, Family
40 Weego Home 38 Santa Monica
41 City Furniture 37 Business
42 Arhaus Furniture 37 Prince, Raleigh, Texas
43 Homemakers 37 Carnival, Shopping, Moms
44 American Furniture Warehouse 36 Ikea, Facebook, Furniture
45 Jennifer Convertibles 36 Customer Service, Furniture
46 One Way Furniture 36 Furniture, Sales, Hurricans
47 Gallery Furniture 35 Moms, Money, Furniture
48 Weekends Only Furniture Outlet 33 St. Louis
49 Mor Furniture for Less 33 Customer Service, Sales, Furniture
50 Kimbrells 31
The Top 50: "The Popular Vote":
Your input matters! Heres where your vote came into play with our 2012 Power 50 retail ranking. We posted the ballot online, solicited your input, which you shared in astounding numbers. Participation was outstanding; thank you to each of you who took the time. Here, the results.
1 Ed Teplitz Thomasville Home Furnishings Stores 33%
2 Art Van Elslander Art Van Furniture 19%
3 Lee Aaronson Lacks Valley Stores 17%
4 Mike Huber Belfort Furniture 11%
5 The Blumkin Family Nebraska Furniture Mart 10%
6 The Capo Family El Dorado Furniture 7%
7 Keith Koenig City Furniture 7%
8 Peggy Burns Circle Furniture 6%
9 Jeff Child R.C. Willey Home Furnishings 6%
10 Ron and Todd Wanek Ashley Furniture HomeStores 6%
11 The Tatelman Family Jordans Furniture 6%
12 Farooq Kathwari Ethan Allen 6%
13 Clarence Smith Havertys 5%
14 Gordon Segal Crate & Barrel 5%
15 Jake Jabs American Furniture Warehouse 5%
16 Jeff Seaman Rooms To Go 5%
17 The Johansen Family HOM Furniture 5%
18 Jim McIngvale Gallery Furniture 4%
19 Neil Goldberg Raymour & Flanigan 4%
20 The Baer Family Baers 4%
21 The Wo Family C.S. Wo & Sons 4%
22 The Harris Family Furnitureland South 4%
23 Bill Mathis Mathis Brothers 4%
24 The Miskelly Family Miskelly Furniture 4%
25 Doug Wolf Wolf Furniture 4%
26 Larry Klaben Morris Furniture 4%
27 Gary Steinhafel Steinhafels 4%
28 The Smithe Family Walter E. Smithe Furniture 4%
29 Jay Schottenstein American Signature 3%
30 Bill Kimbrell Star Furniture 3%
31 Aminy Audi Stickley, Audi & Co. 3%
32 The Navarra Family Jeromes 3%
and Lee Goodman
33 Laura Alber Williams-Sonoma 3%
34 Rob Spilman Bassett Home Furnishings 3%
35 Ron Werner, Jim Hering HW Home 3%
36 Steve Freeman Room & Board 3%
37 Eric Easter Kittles 3%
38 Kurt Darrow La-Z-Boy Furniture Galleries 3%
39 Chris Pelcher Levin Furniture 3%
40 Mike Albert Pilgrim Furniture City 3%
41 The Rubin Family Bernie & Phyls Furniture 3%
42 Mike Forwood Louis Shanks of Texas 3%
43 Kenny Larson Slumberland 3%
44 Steve and Marty Darvin Darvin Furniture 3%
45 Joe and Mike Zeiden Z Gallerie 3%
46 Paulette Cole ABC Carpet & Home 3%
47 Ted English Bobs Discount Furniture 3%
48 George Cartledge III Grand Home Furnishings 3%
49 Mikael Ohlsson Ikea 3%
50 Niraj Shah Wayfair Furniture 3%
November 30,
2012 by in UnCategorized
By Home Furnishings Business in on December 2012
Samson Marketing CEO Kevin OConnors tenure as chairman of the High Point Market Authority was a time that saw plenty of changes at the key venues where furniture retailers do their own shopping.
OConnor, Samson Marketing CEO, who just passed the Market Authority chairmanship to Doug Bassett of Vaughan-Bassett, took time to talk with Home Furnishings Business about how he sees High Point in particular and the furniture market landscape in general these days.
Looking back on his time as chairman of the High Point Market Authority, OConnor gave a lot of credit to former HPMA President Brian Casey for bringing the furniture industry together around the show and securing city and state funding for the event; and improving buildings and services.
We needed someone from outside the industry ¦ who brought the constituents of market together, and Brian did that, OConnor said.
PREMARKETS COMEBACK OConnor also was a driving force behind the resurgence of Premarket. A critical point came in 2009, when the Las Vegas Market held its second show of the year in September.
There were a number of us who felt like because of the economic climate and the changes in manufacturing, especially on the case goods side, the whole premarket (concept) had fallen apart, he said. People werent sure they could get ready for premarket, and the retailers really reacted, saying it wasnt worth their time.
I thing the organization of getting what started with 15 key manufacturers ¦ when (Las Vegas) threw their market on top of us, we made a decision to introduce product only at High Point Market. That was a turning point in retailers deciding where they needed to go. ... We put a stake in the ground, and to me that was one of the key elements in bringing back High Point Premarket.
He added that while the Market Authority plays a huge role, the vendors recognized at that point that its their market.
The key vendors taking ownership and putting their money where their mouth is, that was the turning point, OConnor said. The fact that 150-plus important retailers show up for this event proves this is a meaningful event. The (vendors) who sponsor this promise to one another and their customers to make it market-ready.
A STRONG TEAM Moving forward, OConnor said that Tom Conley, who took over from Brian Casey in August last year as Market Authority president and CEO, brought a different set of skills to the table.
Hes a professional trade show analyst who collaborates and will take the market to its next level, OConnor said, adding praise for other Authority staff. One of the great things I saw occur during Brian and Toms transition is the contribution of Tammy Nagem (HPMA COO) and Cheminne Taylor-Smith, who handles PR and marketing, really stepped up. These women stepped up to the plate, were there every moment, and are the backbone of the organization.
Weve created a nice, successful plan for the executive committee. Doug (Bassett) is a vibrant, young, very bright guy who works well with people. With his D.C. experience, hes uniquely politically oriented to understand and deal with our relationship with Raleigh. We have a nice mix on the executive committee now: John Bray (of Vanguard) is back; Mike Huber (Belfort Furniture), one of the leading D.C.-area retailers; John Gunter (Jordans Furniture). Weve brought on the design part of the business, which is probably the fastest-growing part of the high-end market.
COMMON GROUND International Market Centers big ownership stake in Las Vegas and High Point, OConnor believes, will be good for both markets and good for the industry.
It eliminates some of the us and them mentality, and I think thats a good thing. You also have a financially viable owner in High Point, he said. I think Tom Mitchell, in particular, has done an outstanding job in making (Vegas and High Point) not an either/or proposition; Bob Maricich is well-respected in our industry. Its no longer an argument.
In trying to make its real estate investment in both cities more viable, IMC could make both markets better.
The point Im making is that the buildings arent in conflict, and the (High Point) Market is not owned by the real estate interests, OConnor said. The citys done a marvelous job in not only providing funding, but also services. The Market is the equivalent of multiple Super Bowls in terms of economic impact on the state.
You cant go to a convention center and and set up with poles and drapery and have the furniture look like it does in the home. At Market, we can create an environment that shows what the retail presentation should look like. With the size of the showrooms, you can afford to inspire retailers on how to stimulate their customers.
November 30,
2012 by in UnCategorized
By Home Furnishings Business in on December 2012
Furniture retailers who expect 2013 to be a growth year had best look to their own devices. Slow economic improvement and still-touchy consumers make for a business environment thats strange new territory for a lot of store owners.
Things are looking up overall, but as with 2012, any opportunities furniture retailers have for the coming year are mostly the ones they seize themselves. The overall economy has improved since we gave our last outlook a year ago, but it remains an environment where fancying up ones personal space is far from first on most consumers list of priorities.
While the macro numbers home furnishings retailers look to as indicators for their business prospects are up as 2012 winds down, the coming 12 months remain iffy for the sector as a whole.
Late last month, the Consumer Confidence Index hit 73.7, up slightly from October and the CCIs highest reading since February 2008.
Gross domestic product increased at an annual rate of 2.7 percent in the third quarter over the prior three months, according to the Bureau of Economic Analysis.
In the second quarter, real GDP had increased 1.3 percent.
Despite Hurricane Sandys putting the Northeast at a standstill, the National Association of Realtors reported that October existing-home sales rose a seasonally adjusted 2.1 percent from September; and were 10.9 percent ahead of October 2011. New home sales in October rose 17.2 percent from the prior-year month.
And according to the U.S. Census Bureau and Department of Housing and Urban Development, privately-owned housing starts in October were 3.6 percent above the revised September estimate; and 41.9 percent ahead of October.
More good news for furniture retailers, especially in electoral battleground states, is that another presidential election is in the books, and they can start advertising more on television whether or not they were pleased by the actual results.
That all sounds good, and certainly brighter than this time a year ago, but economic growth hovering around the 2 percent annual mark wont be making a big dent in continued high unemployment, which still hovered in October near 8 percent.
It wont take another big negative headline or two for consumers to lose their slowly burgeoning confidence.
ANOTHER SLOG?
If economic growth remains sluggish, home furnishings overall wont see a big increase in 2013.
Global ratings agency Fitch Ratings, which has headquarters in New York and London, expects retail sales overall to grow between 3 and 4 percent next year, driven mainly by 2 to 3 percent same-store sales increases and a modest square-footage expansion.
Thats not a big piece of growth pie for home furnishings to bite into. (For Fitchs complete 2013 retail sales outlook report, visit FitchRatings.com)
There are other areas of concern to retailers, not just next year, but down the road according to Mark Vitner, senior economist at Wells Fargo, Charlotte, N.C.
Vitner shared his take on how 2013 will shape up during a presentation last month at the annual meeting of the American Home Furnishings Alliance in Miami.
Hes concerned about the coming year, and his biggest concerns include credit availability and finance reform; and regulatory uncertainty.
He also worries that the current fiscal cliff negotiations between the White House and Congress will just put off the problem until later.
The fiscal cliff, theyll finagle their way around this, he said, adding that he anticipates a compromise on extending Bush-era tax cuts. Instead of (eliminating) tax cuts for everyone who makes over $250,000, it will be everyone but those who make more than $1 million. Theyll let the tax cuts expire Dec. 31, then re-instate them for those making less than $1 million.
Vitner doesnt think a fiscal cliff compromise will lead to a recession, but he does think it will mean continued sluggish economic growth.
He also noted that the upper-income segment that has benefited most from rising stock and home prices, and refinancing at lower interest rates represents consumers wholl sock that money away, which wont help stimulate consumer spending.
The ones who are saving most on refis are those most likely to save their money, so it wont help growth that much, Vitner said. The economy will grow at 2 percent as far as the eye can see.
The Fed is keeping interest rates low, but the election result we got (in November) is not friendly to risk taking.
Here is Vitners worst-case scenario down the road doesnt bode well.
He believes that if the slow economic growth since the recessions end in May 2009 continues, the economy wont be in good enough shape to withstand another possible downturn.
In June 2015 the current expansion will be 73-months-old, he said. Only two economic expansions since the Civil War lasted longer. What happens if we go into another recession with the current level of economic growth?
TAKING CARE OF BUSINESS
Its nice to think the economy will improve and the industry will enjoy its fruits, but the coming year will be a hard one for retailers who wait for that to happen.
Fitch Ratings likes the chances better for retailers who take a multi-channel approach. That means looking outside a simple bricks-and-mortar strategy and maybe, adding an e-commerce Web site to the mix. Or, possible a mail-order catalog to help boost sales.
In view of the strong growth in online sales and other alternative formats, traditional retailers that are willing and capable of investing in a multi-channel strategy will continue to drive market share gains at the expense of retailers that struggle to maintain relevance in a mature but dynamic sector, according to its 2013 retail outlook summary.
Does your company take proactive steps, or does it wait for an economic boon that shows no signs of coming?
Two companies with considerable retail footprints nationwideThomasville and Ethan Allenarent waiting around.
Home Furnishings Business asked Thomasville President Edward Teplitz and Ethan Allen Chairman and CEO Farooq Kathwari to share their thoughts on the keys in 2013 to growth, both as in terms of the overall economy and also in terms of what retailers can do to position themselves in order to grab consumers business.
We are cautiously optimistic, and the reason is that slowly and steadily, with ups and downs, the economy has improved, Kathwari said, adding that theres a lot of uncertainty out of any single business control. We dont know what will happen with the fiscal cliff. The concept is not very complicatedif youre an enterprise you work to increase revenue and reduce your costs. The costs of entitlements have to be weighed.
He noted that includes subsidies to business, agriculture and defense as well as those things pundits usually speak of as entitlements, such as Medicare and Social Security.
Resolving that will help us from a consumer-confidence perspective moving forward, Kathwari said.
Teplitz looks at the coming year in macro terms related to the economy and micro termsspecifically what Thomasville can do as a company to impact its future.
Business over the last few months has been stronger, housing starts, housing sales continue to grow, but theres regionality there. Nobodys saying how great it is, he said. It will be great if we have better housing numbers, better consumer confidence, but thats not what were counting on for our own growth.
First, well continue to improve the retail experience in our store with better display, more tools, retail technology. Well keep introducing product thats more updated traditional and contemporary.
Kathwari noted that in 2009 and 2010, Ethan Allens operating earnings went from $130 million to $100 million.
In the last two years, our sales are up 34 percent, he said. Last year we made up half of what we lost.
Part of that was because Ethan Allen took some harsh bottom line moves that cost in the short run but left the retailer in a position to pick up business when the economy kicked inthings like putting design associates on salary so they could make a living in the stores while times were tight, which kept design skills in place to serve customers as they started coming back.
In 2013 we see a more positive consumer attitude, and weve positioned ourselves for growth, Kathwari said.
Looking at where Thomasville is today versus a year ago, Teplitz noted that while the economys not great, everything seems to be getting a little better.
If we do everything we need to do right, as far as 2013 goes, it will get better for Thomasville, he said. Home furnishings certainly remain a discretionary item. As much as wed like otherwise, that hasnt changed much year over year.
The key is that once you get them into your store through stronger promotions or advertising, give them a better retail experience, he said. Were putting more technology into our stores, better display. We dont want it to be just about closing the sale at a great price today; and playing to the aspirational aspect is important at our price points.
CHANGING EXPECTATIONS
Thomasville also looks to change consumer expectations of its product offerings, providing traditional based design, but mixing in wood and metal and leathers to make it more relevant to the way consumers live today. Collections are shorter, too, and that has a lot to do with the companys evolution.
If you look back to the 90s when we had a domestic (manufacturing) model, we had the ability to manufacture a lot more SKUs, Teplitz said. Weve changed to adapt to an import model and our service positions. Weve changed from a manufacturing to a retail point of view. One reason wed brought out all those SKUs (in the past) was to keep our plants full.
We dont need those large collections anymore to keep the consumer interested. Well still do whole-home collections, but we can drive volume out of fewer SKUs now. Todays consumer is spending more money on upholstery and occasional pieces.
On the vendor side, Samson Marketing CEO Kevin OConnor is very cautious about next year.
The reality is if you wipe away the (election) fight that took place, were still in the same place we were, regarding the Senate, White House and House of Representatives, he said. I hope leadership and bipartisan compromise is possible. If not, we could be in for a very tough year.
If we plunge ourselves back into recession we would dowse the hope that appears with the surge in housing thats taking place, he said.
CREATING OPPORTUNITY
The successful retailers OConnor sees have staked a claim in bedding.
Theyre finding a way to market that to the general public in a way that makes people feel they need a better mattress, he said. The motion part of the upholstery business is a part of the business thats replaceable. Dining is something used every day, and with kitchens being remodeled and lifestyles changing, thats an opportunity. The case goods segment of our industry is the most sluggish at the present time.
The challenge is to create excitement along the lines of what the bedding business has done. How do we make ourselves better? I think its clear most (companies) havent recovered from 2007 to 2009. Its depleted the balance sheets of a lot of companies.
Kathwari pointed out that the United States is in a different era of economic activity.
Cautious consumerism might just be the new normal, and retailers have to take charge of their own destiny.
Our focus is to have most of our growth come from within, Kathwari said. We have 2,000 interior design professionals, 800 of whom we acquired in the last three years, and almost all of whom owned their own interior design firm. Weve invested in technology. You look at all the macro factors. Independent enterprises have to take the opportunity to do it themselves.
Today were competing in a different world, he said. In our sector, weve grown more sophisticated and have more technology. ¦ All this also is an opportunity to improve infrastructure and technology in adapting to a new environment. Customization gave us an opportunity to provide services, and technology gave us the opportunity to provide services we couldnt before.
Thomasville is positioning itself to make the most of the coming years business environment.
Were looking to expand our footprint not only with stores, but also with multiple-vendor dealers where a (stand-alone) store doesnt make sense, Teplitz said. Hopefully well get some tailwind from the economy, but thats not where were focusing for our own growth.
The bottom line for furniture retailers in 2013 is to find a creative way to make their own magic and to run a smart, tight ship. Next year is upon us, and none of the brightest prognosticators are calling for record-setting sales. A modest gain seems to be in the cards, which means scrappy business sense is needed. HFB
November 29,
2012 by in UnCategorized
By Home Furnishings Business in Mattresses on November 30, 2012
Luxury mattress brand Pure LatexBliss has signed an exclusive partnership with Yulex Corp., a manufacturer of bio-rubber latex derived from the guayule plant.
Guayule is a desert shrub grown in commercial farms throughout southern Arizona. Offering an additional option to the companys other latex products derived from Hevea rubber trees, Pure LatexBliss will be the first manufacturer in the sleep products industry to create latex mattresses and pillows with Yulex latex technology.
The new bio-Latex is desirable for its eco-friendly properties. Plant-based, Yulex sets a new standard for creating sustainable, renewable, and low carbon sleep products. It has a natural elasticity, durability and softness, which make it an ideal component for bedding. Those same qualities make Yulex appropriate for a range of goods, and the company has strategic partnerships in other consumer categories, including with Patagonia sportswear and Ansell Medical.
This is a new to the world latex technology that has never been used before in our category, said Atlanta-based Pure LatexBliss President Kurt Ling. "When we discovered Yulex, we were convinced that this was an innovation we needed to bring to our product collections. Not only does Yulex produce a high-performance latex, we were excited to learn that guayule is grown and Yulex is made in the United States."
Guayule is a new industrial crop and the only species other than Hevea that has been used for rubber production on a commercial scale, according to Pure LatexBliss. Guayule is a non-food plant that requires very little water, is grown domestically, uses no pesticides and has a clean manufacturing process. Rubber is found primarily in the bark of this desert shrub. To extract the rubber, the branches are ground, releasing intact rubber particles and an aqueous suspension. The materials are separated in a centrifuge, and the rubber mixture is culled of the top and purified.
Pure LatexBliss plans to unveil its Yulex collection of mattresses, toppers and pillows at the Jan. 28-Feb. 1 Las Vegas Furniture Market.