Ottawa — Canada's furniture buying groups continue to wield considerable influence, although their growth has tapered off in recent years.
Mega Group has established itself as Canada's largest furniture buying and marketing group. In 2003, its 340 members operated 390 stores and generated furniture, bedding and accessory retail sales of C$400 million. Total revenues of all members and categories were C$1.2 billion. The previous year, its 335 members with 385 stores had furniture, bedding and accessory sales of C$375 million, with total revenues at C$1.1 billion.
Under President and CEO Michael Graydon, the cooperatively owned and operated group has shifted its focus to the development and implementation of retail systems. It also has successfully converted Countrywide, its primary banner for English Canada, and Multi Meubles, its Quebec counterpart, to a more disciplined franchise network.
Although not all members signed on, both networks are poised to grow this year. Countrywide will add seven stores to its existing 45, while 20-member Multi Meubles will add three.
Mega also rolled out a specialty sleep concept in 2003, with three in-store Sleep Experience galleries and one freestanding store. The network now has 10 units, with plans to add another 15 in 2004.
Cantrex Group lost a little ground in 2003, when its 600 members had furniture, bedding and accessory sales of C$317 million and total revenues of C$1.1 billion. That compares to 642 members with sales of C$339 million and total revenues of C$1.2 billion in 2002. Three of its four main furniture banners — Accent, Furniture Plus and Mattress World — each lost one store during the year.
However, 2003 may prove to be a transition year for the fee-for-service entity, once this country's largest furniture buying group. Senior management was let go in mid-year. Then parent Transamerica Commercial Finance (Canada) was acquired by what is now GE Commercial Finance Distribution. The purchase caused TCFC to postpone implementing a promised new senior management structure for Cantrex.
Cantrex forging strategy
Earlier this year, Cantrex veteran Pierre Vezina was named national manager for furniture, bedding and appliances, and Terry Moore, a vice president at GE Commercial Finance, was given additional responsibilities as general manager of Cantrex. At the time, Moore said a new business strategy was being developed and would be announced this summer.
Cantrex plans to add two stores each to its 13-unit Mattress World and its four-store Decocentre/Tendance banners this year, while five stores will join the 18-unit Accent and the 44-store Furniture Plus.
Les Marchands P.A.S., meanwhile, saw total revenues drop from C$450 million in 2002 to C$375 million last year. P.A.S. is an alliance of major multi-unit regional players throughout Quebec and French-speaking New Brunswick. It had 28 members operating 82 stores last year, compared to 29 with 61 stores in 2002.
This year, P.A.S. has opened two liquidation centers and expanded its shared container program, and developed a pre-planned booking program in appliances. It also is experimenting with central billing on a limited basis. P.A.S. has contracted Mega to provide some of these key support services.
Limited candidates
Growth could be hampered because there are only four or five retailers in Quebec who fit the P.A.S. profile that aren't already members. This means the group must concentrate on growing same-store sales and capturing market share.
Sales and membership figures couldn't be determined for Allied Home Furnishings Network, based in Vancouver, British Columbia, or for Home Furniture Stores of Elmira, Ontario.
Allied is the English Canada counterpart to P.A.S., comprised of regional, multi-unit players. Over the past few years, Mega has provided most of its support services.
Home, the smallest furniture buying group, has about 50 members in Ontario, western and Atlantic Canada, down from a high of about 74 in the mid-1990s. The group is part of Home Hardware, the largest cooperatively owned network of hardware stores and building supply centers in Canada.
