Ethan Allen, AFMA prepare for reinvention
By Clint Engel -- Furniture Today, February 18, 2002
GREENSBORO, N.C. — Both Ethan Allen and the American Furniture Manufacturers Assn. are preparing to reinvent themselves in efforts to stay in front of the changing needs of their customers.
The projects are separate but have a common leader — Farooq Kathwari, Ethan Allen's chairman and chief executive officer and this year's AFMA president.
While Kathwari couldn't offer details on the changes to come, he told attendees at AFMA's Marketing Division conference here that the need for reinvention is critical.
"We know today, more than ever, that for any brand or company that does not on a planned basis make the decision to reinvent, it's a matter of time" before it fails, he said.
As initial steps, AFMA plans to conduct two studies, one exploring the challenges and opportunities of manufacturing in the United States, the other looking at the changing retail environment. Once AFMA knows where it stands, it will be able to set its priorities, Kathwari said.
Citing a roller-coaster economy, the proliferation of imports and the Sept. 11 tragedies, Jackie Hirschhaut, AFMA vice president of public relations, said, "It's clearly our responsibility to ascertain the impact of all those events and determine all the influences, educating our members so they can compete more successfully in the marketplace."
AFMA has yet to determine how to conduct the studies, but has set a November deadline, expecting to have results ready for its annual meeting in Scottsdale, Ariz. AFMA said it will look at collaborating with colleges and perhaps doing some consumer research.
The more than 300-store Ethan Allen, the nation's oldest manufacturer's gallery store network, also is approaching reinvention head on, Kathwari said. He said it's too early to say what the new Ethan Allen would look like. The company is looking at all elements of its business, including manufacturing, retailing and marketing, he said.
In the 1980s, Ethan Allen reinvented itself by, among other things, more evenly distributing its business throughout the year, addressing inventory issues by shortening lead times and centralizing stock, and establishing more credible discounts for consumers.
In the early 1990s, it overhauled its product line and the look of its stores, both inside and out. It also created a national advertising program. Nearly half the stores moved to better locations.
Kathwari said the next change will be more incremental. He said the company is being cautious with imports and doesn't expect to give up on domestic production. "I get concerned when we lose control," he said, "so I'm not going to give up that easy."
| Kathwari |
