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Design, service key in uph.

Import issue produces talk, but not concern

By Gary Evans -- Furniture Today, December 30, 2001

Stationary upholstery makers expect their industry to hit a few hot buttons in the coming year, but imports from Asia won't be one of them.

Upholstery producers remember that a decade ago, wood factories were saying "no way" to case goods from halfway around the world. So, while they have that "never-say-never" attitude, stationary upholstery vendors don't expect an onslaught of foreign upholstery anytime soon.

Reflecting on the possibility of imported upholstery, Bruce Birnbach, president of Rowe Furniture, said, "Currently, I'm not real comfortable with it. But I'm keeping a close eye on it and watching it very carefully."

Like many manufacturers here, the Rowe executive has made the trip East. "I went over there to see what is happening," he said. "Eventually, I expect to see some upholstery go offshore."

Rowe is using fabric from China but not cut-and-sew and other import programs. He remembers when case goods imports were being dismissed for a myriad of reasons. "If they put their minds to (the upholstery) business like they did to case goods, then, at that time, we may have to make some strategic decisions."

Far more important to Rowe than the import issue is making money in a tight economy. "I think it's going to be a tough year. We have to stay focused and be very sharp in everything that we do," he said.

Manufacturers say custom ordering is a roadblock to finished upholstery products from Asia. But offshore components — particularly fabrics — are another thing entirely. "The thing I see is the extraordinary value in fabrics as a result of the offshore competition," said Ken Fonville, president of Pennsylvania House.

Say it with service

But Fonville and John Hoff, vice president and general manager of the upholstery division, see other issues as more important. "In tight times, (quick) delivery is going to be a big deal. Dealers are not putting in inventory," said Fonville. "That's always the case in a soft economy."

And Hoff noted, "Service, service, service, is what I hear. We're a custom order house, so service is the key. Everyone wants instant gratification. They want it tomorrow. So we're keeping our fabric and frame inventories as full as possible and still run the business profitably."

Pennsylvania House is looking for other ways to give consumers more comfort in shopping. Hoff said the company is planning to introduce a fabric correlate locator system so consumers can buy one piece of furniture and use number identification to correlate fabrics for other pieces.

Custom orders preclude imports so that is not an issue with Clayton Marcus either. "The customer wants it her way, not our way," said Ken Church, president. "We're not Burger King."

Looks count

Design is more in the spotlight. "One of the things our company has seen over the past few months is a return to classic traditional items," he said. "That includes scale, color and detail." He said that retailers are tired of "plain fabric with pillows" that is indistinguishable across the price spectrum and are "looking for a difference." Since Clayton Marcus is a traditional house, "frames with matched patterns bode well for our company," Church said.

Keith Feuerhaken, vice president of sales, Flexsteel Inds., says "business conditions have put a lot of pressure on the fabric people. That, on top of imports, is something we'll all be talking about. It's an issue that is going to get hotter as we get to Showtime in January."

Chinese fabrics are often cheaper than domestic fabrics, "but they come at a price — selection and service," said Feuerhaken. "We're all concerned because we're so used to having such good service from our domestic sources.

"Another thing that's going to be talked a lot about in the coming year is licensing," he noted. Manufacturers are searching for the right licensing and licensing partners, he said, noting the company's own two-year search before settling on Christopher Lowell Home.

"The Christopher Lowell thing . . . Flexsteel has been around for 108 years, and we didn't have as good recognition as Christopher Lowell did in seven. It's been an eye-opening experience. The challenge is to get a licensing agreement that is meaningful."

Meeting demand

The big issue in the upcoming year for Highland House is problematic but a good one to have, according to Tom Staats, president. Historically, he says that research has shown that strong buying triggered by pent-up demand follows every downturn.

"All of a sudden the person who wanted to buy a sofa a year or 15 months ago wants to buy. The need has gone away. We're prepared for that as a company, but I think it's like everything else …it takes several months to fill the pipeline," he said.

"Retailers have been controlling inventories. The first thing that happens is that they buy at a much larger rate than their general increase in business. It is those companies that have tried to organize themselves during this period of time (who will be quick to buy)," Staats noted. "You have to be prepared to jump on that as quickly as possible and service those retailers."

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