Strategies behind product are real story this market
Jerry Epperson -- Furniture Today, April 19, 2004
Late the other night, I glanced at the front page of my hometown weekly newspaper and saw the headline, "Sheriff's Department Going After Those Dumping Illegally."
Remember, it was late and I was even more brain-drained than usual, so it took me a moment to realize the headline referred to folks leaving trash by the side of roads in Lunenburg County rather than allegedly dumped Chinese bedroom furniture.
Am I overly focused on the antidumping petition? Probably, but only because it has taken such a huge portion of my time since I first heard of the possible filing of the petition in the early winter of 2002-2003.
Now, the up-to-50-days extension on a preliminary ruling from the Department of Commerce stretches out the anxiety a bit longer, calling into question plans based on the former April 28 action date.
We are impressed with the various strategies being implemented by the many parties involved, especially since no one knows if there will be a tariff or, if there is, what it will be or when it will be initiated.
To make decisions even harder, if there is a tariff, U.S. petitioners can request a year later that the government investigate individual Chinese manufacturers they believe are selling at prices below those determined by the original investigation. If a higher tariff is deemed necessary, it will be retroactive to the date the tariffs were initiated.
Tariffs may be difficult, but retroactive tariffs on furniture sold to consumers a year ago would be painful.
And that's only one issue! Most folks think about a furniture show in terms of product — and there is lots of new product at this market. But this may be a market most memorable for the other, not so obvious, elements. The strategies behind the pretty product out front are the real story.
Such important topics as speed of delivery, who pays for delivery, when invoices must be paid (30-60-90-120 days), price (and how long the April price will be honored), exclusivity, additional promotional aids, advertising allowances, and even the handling of damage claims are all up for discussion at this market.
Price is very important — as it nearly always is — especially in light of cost increases coming from everywhere.
And that doesn't consider the potential antidumping tariffs or the upcoming flammability standards on bedding in California.
That's a lot to consider. And great terms can always make the furniture look better.
