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Outsiders continue to come and go

By Carole Sloan -- Furniture Today, December 16, 2001

The breakup of LifeStyle Furnishings International brings into focus, once again, what happens when mavens outside furnitureland think they know more than those in the industry who have spent lifetimes building businesses.

That definitely is not to say that everyone in furnitureland is a supreme genius and knows all.

But the outsiders, as has been shown again and again, certainly don't either. They come in with deep pockets, combined with expansive financial expectations. But generally, they have little knowledge of how the industry does business, and little understanding of the myriad details that are unique to furniture manufacturing and retailing.

Strictly a financial matter is the way most of the outside mavens view the challenge.

Over the years, there have been many companies, as Furniture/Today has reported in detail, which have come in, bought up, disposed of and left — either in shambles or wounded.

The LifeStyle Furnishings scenario is somewhat different. The financial investor in this case, a Citicorp venture capital fund, has been involved in half a dozen or so other furnitureland transactions.

Amazingly, they've spread their financial largesse across both the retail and manufacturing landscapes.

At retail, there are HomeLife, This End Up, Levitz and Rhodes. Two are gone. The jury's still out on the others.

On the manufacturing side, in addition to LifeStyle, Citicorp has made investments in Mohasco, Barcalounger and Stratford/Simmons Upholstery.

This roster could well serve as interesting case studies in business investments at any business school in the country.

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