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Knoxville Wholesale Furniture bets on growth

Tennessee retailer invests $16 million in new store, distribution center

Clint Engel -- Furniture Today, January 23, 2009

KNOXVILLE, Tenn. — In the face of a tough economy, Tim Harris of Knoxville Wholesale Furniture has invested $16 million to open a big new store and distribution center here.
Key suppliers and other guests who recently took a tour of the facility on Old Callahan Drive in north Knoxville were impressed.

Tim Harris, second from left, of Knoxville Wholesale Furniture, welcomes Ralph Scozzafava, left, Furniture Brands International; Skipper Holliman, Lane Home Furnishings; and Jeff Cook, Broyhill, to a vendor event celebrating the opening of the retailer’s largest showroom and new distribution center.

Dave Pinamonti, left, and Jeff Nanney, Universal; and Jane Wear, Robin Harris and Tim Harris, all of Knoxville Wholesale Furniture

Tyler Harris, left, Knoxville Wholesale Furniture, Knoxville, Tenn.; Davis Odom and Robert Patten, both of Spring Air.

Connie Grund, left; Ed Grund, A.R.T. Furniture; Beth Sibbick; and Bill Sibbick, A.R.T. Furniture.

Harris, president and owner of the three-store chain, which he said is Tennessee's largest independent furniture company, said the 93,000-square-foot, two-level store is drawing strong business.
The new 130,000-square-foot distribution center is only partially racked to the 38-foot ceilings, leaving room to grow.
Although he expects this year to be challenging, Harris said he hopes the new store will do between $12 million and $15 million in sales, pushing the chain's total sales past $40 million. Since the soft opening in December, sales for the store are running about 15% ahead of projections, he said.
"The customers here really embraced us," Harris said. "North Knoxville has been underserved. We feel like there is substantial growth here."
He said the retailer has about 24% of the market share in greater Knoxville, and "we think now we will be over 40%, and 50% is very achievable."
The primarily midpriced store includes an 8,500-square-foot Broyhill gallery and a 4,500-square-foot Lane Comfort Showcase as well as lifestyle and product category displays, with styles ranging from traditional to casual contemporary. Other key suppliers include Universal, Corinthian, Cheers, Liberty Furniture, Ashley, A.R.T. Furniture and Spring Air.
With the new store, the retailer also has added Craftmaster and Universal's Better Homes and Gardens line.
Harris praised upholstery source Corinthian, calling it the "vendor of the decade" and "the finest company to deal with for its complete integrity, incredible values, incredible service, and that's over a 12-year period."
In case goods, he said Liberty is a "little known star" for its imported entertainment, bedroom and dining room presentations, offering "incredible value and timely delivery."
Harris started Knoxville Wholesale Furniture in 1992 as a wholesale operation, eventually morphing into a full-line retailer.
It now has three stores, including a clearance outlet. It still does wholesale business with more than 100 furniture stores in five states as well as manufactured homebuilder Clayton Homes, but wholesale accounts for less than 10% of total revenues, he said.
The business is a family affair. Tim's brother Daniel Harris is vice president of finance, his son Tyler Harris is vice president of operations, and his wife Robin Harris worked with a display team to accessorize the store with more than 4,000, lamps, florals and other home accents. Longtime employee Jane Wear - who Tim Harris considers family - is vice president of merchandising.

A traditional Corinthian living room group (sofa for $559), shown with an Ashley table, is showcased near the entrance of the store.

A.R.T. Furniture’s Mediterranean–influenced Marbella dining room collection (table and china group on sale for $4,299) receives prominent display space on the upper floor of the new store.

A Lane Home Furnishings leather recliner for $599 and reclining sofa for $999 are among the offerings in Knoxville Wholesale Furniture’s Lane Comfort Showcase gallery.

Knoxville Wholesale Furniture President Tim Harris leads suppliers and other guests on a tour of his new showroom and distribution complex in north Knoxville.

Harris said his operation's focus on the best midpriced suppliers helps the retailer to appeal to all but the most affluent consumers. He also said his clearance center's prices beat what bargain-oriented consumers can find at Big Lots.
Harris's background as a former coach and the strength of his Christian faith were obvious in his remarks to suppliers and other guests at a lunch event celebrating the store's opening.
"We've got a lot of faith in what were trying to do here," he said.
"Success is not one thing," he added. "It's thousands of things, and you have to execute."
And No. 1 on that list is attitude, he said, adding that he hired every person at the new store based on attitude. Each employee is intensely and continually trained, giving the retailer a huge competitive advantage, he said.
Because his crew knows its stuff, Harris said he never overloads the floor with too many salespeople. As a result, he said, Knoxville Wholesale has little turnover and has an experienced staff earning a decent living.
Knoxville Wholesale's Web site is unsophisticated, Harris admitted, but added that he's not interested in selling goods online. His goal is to get customers into the stores.
"What we want more than anything else is for them to come here because they're going to see better salespeople, better display and better prices," he said.
With the new distribution facility, Harris said, the retailer can recycle everything from cardboard to foam to plastic, a move that he calculates has already saved the company $17,000 to $18,000 on waste disposal.
The response from vendors here was overwhelmingly positive.
Furniture Brands International Chairman and CEO Ralph Scozzafava said Harris' move is "a great show of leadership, and that's exactly what it's going to take."
"In today's marketplace, with everything going on in our industry, for an individual to make this kind of commitment to the community and to our industry is remarkable," said Ed Grund, CEO of A.R.T.
"You'd have to call him an individual with vision and fortitude to be able to bring this about," added Grund. "Stores across the country are closing, and here we are at the opening of a magnificent store."

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Knoxville retailer bets on growth

Jan 26, 2009

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