Exhibitors say Toronto buyers will respond mainly to sharp pricing, exceptional designs
By Michael J. Knell -- Furniture Today, January 9, 2005
Toronto — Manufacturers and importers exhibiting at this weekend's Canadian Home Furnishings Market expect healthy attendance but limited in-depth commitments, believing buyers will be moved mainly by price and the "wow" factor.
While importers generally are more optimistic about prospects for 2005, most agree 2004 wasn't the strongest year at retail, and buyers may not have the open-to-buy of previous markets.
"The dealers will come out and they will be coming to do business," said John DeFalco, vice president of sales for Primo International, the Montreal-based importer. "I think business has been good for those retailers who've been out there promoting, but for others, it's been fairly so-so."
"I believe the retailers will come in big numbers," said Rick Verjee, executive vice president of importer Hamilton & Spill. "People are going to want merchandise, but they're going to be very conservative until they see things beginning to turn around."
"We're very confident the retailers are going to be coming to market," said Gerry Themens, director of sales and marketing for motion upholstery specialist Berkline Canada. "But they've had a lousy seven or eight months (in 2004) so they'll be buying only what they need and not filling their warehouses. They're going to come with very specific needs."
Working the show floor, buyers should notice several trends:
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Among Canadian and U.S. manufacturers, the emphasis will be on selection, quick delivery and the ability to tag order.
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Importers will be stressing value, compensating for their lack of flexibility with new depth and breadth of product.
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Although it's been around for a while, China-made bedding will make a major statement this market. China-made leather upholstery also will be more prevalent than ever before.
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Price increases will be very rare. Domestic producers are decidedly wary of them at a time when deflation is rampant, particularly in key categories such as leather upholstery. While the industry always has been price sensitive to a degree, the pressure on manufacturer margins perhaps has never been greater.
"This is a year where everyone is going to take a major hit in terms of cost," said Berkline's Themens. "We're going to be driving business (with price) and some margins are going to suffer tremendously. The consumer is going to buy at the best price possible, so we'd better be able to provide it."
"This will definitely be a price-driven market," said Jim Nopper, director of corporate marketing for casual dining specialist Reflections. "The big question we're always being asked is, 'Where's the value?' "
"If you have good product with good marketing behind it, you should do well," Hamilton & Spill's Verjee said.
Domestic producers will work hard to differentiate themselves from the importers.
"These days, retailers can get a container from Asia in less than eight weeks," said Rick Lovegrove, director of sales and design for Montreal-based contemporary upholstery house G. Romano. "That means if we can't do that, it's a problem. Our emphasis is going to be on better design, better fabric and better delivery."
If Canadian factories can offer that and then add the "wow" factor, the deal is sealed, because retailers always are looking for the new, exceptional and unique — which they can't always get in container loads from China.
"They expect to see something different," Lovegrove said.
Nopper noted that while Reflections has become a player in the import game, its domestic manufacturing remains strong because of tag orders and faster delivery.
"Our business is being driven by products that retail," said Primo's DeFalco. "There definitely is a lot of price-point action out there, but it's not all price points. People are shopping for good values, so for us good product development and a lot of hard work are what it takes to be successful."
The outlook for 2005 is a bit cloudy, and forecasts are mixed. Executives point out that many key indicators, particularly housing starts, aren't as strong as they have been.
"I think 2005 is going to be a tough year," Nopper said.
"2004 was an odd year, but it's going to be very positive in 2005," Berkline's Themens said. "We're very upbeat about 2005."
"If we hit our delivery targets, we should have a great year," G. Romano's Lovegrove said.
Owned and organized by the Quebec Furniture Manufacturers Assn., the Toronto winter market will feature over 400 sources of furniture, bedding, decorative accessories and home appliances in 700,000 square feet of space in the International Center, including 70 resources with permanent showrooms in Canada's Furniture Mart.
Over the past few years, the CHFM has established itself as Canada's only national furniture event.
Eight manufacturers with showrooms in the area also are officially part of the market — Kingsdown Canada, Superstyle and its Trendline and Simmons Upholstery Canada divisions, Hamilton & Spill, Edgewood/Campio Furniture, Décor-Rest, Brentwood Classics and Sklar Peppler.
Jean François Michaud, president and CEO of the QFMA, said this will be the largest market in the event's history. Its temporary exhibit space has been sold out for months. "Our pre-registration requests are up 5% over last year," he said.
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