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Labor Day sales strong

But is it a turning point? Retailers' opinions differ

By Clint Engel -- Furniture Today, September 9, 2001

HIGH POINT — Furniture stores across the country reported strong Labor Day weekend sales, but were mixed in their opinions on whether the results were a sign of a turnaround.

Some said it's taking a ton of promoting to bring in consumers these days, and that shoppers may be even more reluctant to part with their money today than they were just a few months ago. In this climate, sales that are flat with last year are a victory, they say.

But others are bucking the negative trend, and for them, Labor Day offered more proof that strong players can thrive despite the tough times.

Closed on the holiday, Omaha, Neb.-based Nebraska Furniture Mart ran a pre-Labor Day sale and a 12-hour sale the day after Labor Day that resulted in the best two days in the company's history, said Irv Blumkin, chief executive officer. The high-impact event, developed by promotions consultant Cosec International, combined a financing offer of no interest until 2003 with storewide savings.

Twenty years ago to the day (the Tuesday after Labor Day), the Mart held its first 12-hour sale, also working with Cosec, which brought in $2 million — its biggest day ever at the time.

"I can only tell you this exceeded that by a long way," Blumkin said.

But he was uncertain what it means for the rest of the year. Business has been mediocre and he isn't sure the climate has changed yet.

"I'd like to think it would be a turning point, but business is still very challenging," he said. "The consumer is very smart, and they're looking for extraordinary value."

To help draw traffic, Havertys finally broke down and did what it had been avoiding for years: It offered 12-month financing without interest or payments. Previously, the 107-store, Atlanta-based retailer's most liberal program had been a 12-month financing offer with equal monthly payment and no interest.

"We held out as long as we could, but finally felt we were probably losing business" without a more aggressive credit offer, said Jay Slater, president and chief executive officer.

This year, Havertys posted double-digit increases over a big Labor Day promotion last year.

"I think as far as Havertys goes, we hit bottom in April and we have seen (sales) and floor traffic steadily improving," he said. "We are very optimistic that for the balance of the year, we will see positive numbers. I don't think it will be as robust (for the industry) as anybody would like, but I think we've passed the bottom of the ditch and we're headed back up the other side."

In St. George, Utah, Boulevard Home Furnishings made a splash on Labor Day with a swimming pool giveaway, wrapping up an end-of-summer sale that ran through August. The 9-foot by 17-foot above-ground pool was set up inside the store — full of water.

An estimated 4,000 people registered to win, but the promotion made the owners a little nervous about a potential tidal wave if there was a leak.

"We made it," said Steve Manwaring, Boulevard's creative advertising director. The pool was drained last week for delivery to the winner.

Boulevard also held its traditional four-day Labor Day sale in which a portion of every purchase is donated to an area school. Boulevard helps draw interest with a private sale and pancake breakfast at the store for school employees.

"We're not a lot different from most of the country in that it has been a challenge this year figuring out what's going to work," said Boulevard co-owner Sheldon Wittwer.

Among other things, Boulevard has had to contend with new competition, and it's also up against strong grand-opening results from the superstore it opened last summer.

"But that aside, business has still been pretty decent," he said. "We have to work harder to get it, but that's when you work harder — when things are soft.

"Jackson, Miss.-based Miskelly Furniture had an "incredible Labor Day last year and we were about even with it this year — almost to the dollar," said Tommy Miskelly, co-owner of the two-store operation. In addition to discount pricing, Miskelly created a festive atmosphere with free hot dogs and refreshments, face painting and a caricature artist.

Like many retailers, Miskelly uses the Labor Day event as a barometer for business this fall and the balance of the year.

"It's about like we thought," he said. "You hope for some big increase, but it's not going to happen. I don't think you're going to see a (major turnaround) until the third quarter of next year."

Florida-based City Furniture doesn't stage holiday promotions, but the 12-unit chain "had a great Labor Day," said Keith Koenig, executive vice president.

"I'm noticing that every holiday weekend seems to be more and more important," he said. "We find that the consumer is more and more trained to shop those holiday periods."

Koenig said that while same-store sales gains have been smaller than in the previous two years, the company "added a big new store, so year-to-date we're still up a little under 20%. We're happy and proud of it but we've been working real hard."

Denver-based American Furniture Warehouse also is chugging along with healthy increases, including a same-store gain of about 13% through August, said Jake Jabs, president and owner of the nine-store chain.

For Labor Day, American ran its traditional 56-hour sale, donating 2% of the proceeds to the Muscular Dystrophy Assn. This year's $145,000 donation was the largest in the 20 years the store has tied the promotion to the MDA.Jabs said he believes American's business has held up well this year because competition in the market has continued to dwindle, and because of Denver's relative economic strength.

San Diego-based Super Stores of America, last year's percentage sales growth leader on the Top 100, had a "pretty good" Labor Day, said Rick Haux Jr., president and CEO.

"We're up from last year" and the company just opened a converted Mor Furniture for Less store in Fresno, Calif., that "broke every record in our company during the holiday weekend.

Still, Haux said the business climate is tougher than it was a year ago, and even six months ago.

"You just have to spend more money advertising and selling at lower prices to get the same kind of increases," he said.

Business Editor Gary Evans contributed to this story.

A pool filled with water sits inside the entrance at Boulevard Home Furnishings in St. George, Utah. The store made a splash on Labor Day, giving the pool away to a lucky winner in connection with an end-of-summer sale. The giveaway was touted in colorful ads,

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