Fabric protectants build sales
By Gary Evans -- Furniture Today, March 6, 2005
High Point — As seating sales go, so go the fortunes of the stain protection industry.
Based on consumer surveys, the sale of stationary sofas is expected to top $10 billion this year, and other seating segments are expected to show consistent, if somewhat modest, growth. That should bode well for fabric protectants, according to several leaders in the field.
"In our estimation of the business model for upholstery, a properly trained retail salesperson should be able to support 2% of his total revenue generation through upholstery stain protection programs," said Jack Castella Sr., president of Guar-dian, a major supplier to the industry.
"We believe that, while the overall expectation of growth in upholstery should continue to trend upward, the contribution from leather upholstery will be the most significant contributor to revenue on a per-unit basis," Castella said.
He added, "We remain cautiously optimistic for the coming calendar year and expect that our revenue gains will be resultant from our focus upon sales training and communication of value. In comparison to last year, we have expectations of modest and healthy growth."
Training proves critical
Guardian knows its growth depends on the retail floor salesman, so the company plans to focus on training that will help increase closing ratios.
In addition, Castella said, "We intend to continue aggressive industry advertising of our message while we maintain highly competitive opportunities that are attractive to retailers wishing to improve their revenue per sale. We do not focus directly upon the consumer although our highly visible brand receives recognition and credibility from the consumer.
"Our Web sites provide informational access for the consumer in addition to portal access for warranty services and information requests."
Nancy Burge, senior sales manager for Shield Inds., whose brand is ForceField, said that add-on sales such as stain protection warranties have a direct correlation to the industry's growth.
"Extended service contracts or 'warranties' are a great revenue source for retailers, Burge said. "As a consequence, I see stain protection sales growing proportionally in strength to furniture retail sales. Customers still want to protect their furniture investments, and will continue to purchase stain protection for the upholstered and leather pieces."
ForceField is sold to big and small retailers alike, including many stores that "are beginning to think outside the box in an effort to keep customer satisfaction and loyalty at high levels," she said. "They recognize that no one will treat their customer as well as they will."
Doug Vunder, senior vice president of sales and marketing for Stainsafe, also a major supplier, expects a strong growth year.
"We expect our sales to expand on an existing customer basis at a rate that mirrors our customers' increase in sales," he said. "This is due to the fact that conversion rates or close ratios on fabric treatment tend to be stable within a customer (retailer), and as their sales grow, so does our level of sales. We expect double-digit increases over our current run rate."
New customers, products
In addition, Stainsafe expects the bulk of its sales growth to come from new customers (the company just signed J.C. Penney) and new products that are being introduced to the market.
Vunder also expressed the importance of providing excellent service.
"We are rolling out a new 'customer-first' approach specifically to try and deliver the level of service to a customer that our retailer would deliver if they were in the stain solution business."
Steve Wilson, CEO of Florida-based Goldcoat, expects business to grow this year because of growing demand from retailers.
Goldcoat is part of Source International, a group of companies whose services include sales finance programs, credit insurance, service contracts and added-value services. Wilson said that, because a lot of retailers already use Source International's services, they want to bundle in fabric protection as well.
"I think that upholstery sales are going to be strong notwithstanding some of the ominous things we're seeing in the news, and the position the U.S. is taking (in Iraq) and how that may affect the market," he said.
Guardsman's strategy for growth is to offer retailers and consumers a complete package of products and services, said Marty Durkin, director of sales and marketing.
"We will focus on our complete portfolio and the advantages to retailers from dealing with a single-source supplier for their furniture protection plans, consumer furniture care products and back-room repair products."
A new Waterproof Mattress Pad program has been added to the company's offerings, rounding off the Premium, Plush and Super Plus Pad Mattress Pad programs.
Education will play a key part in heightening consumer awareness for Guardsman's furniture services and furniture care products.
"Consumers are often unaware of what they need to do to maintain their new furniture, or they are often miseducated by well-meaning friends or family members," Durkin said.
Guardsman is partnering with its retailers to educate consumers on what they should do to properly maintain their furniture investments. The company has implemented a nationwide educational TV program in partnership with Today's Family, Durkin said. The program will include tips on furniture care and cleaning.
In addition, the company has launched a Web site that features information about its furniture care product line, tips on furniture care and details on its FurniturePro in-home repair services.
Durkin said several other programs are in place to educate retail salespersons about proper selling techniques for furniture protection programs.
Strong customer service and quality products have contributed to the dramatic growth of Ultrashield, which has increased business annually from 30% to 50% over the past five years, said Yvonne Smith, executive vice president.
"We attribute that to the fact that our products work, and our pricing is more competitive than everyone else's," Smith said.
She said the company is on track with its 10-year growth plan, and expects to repeat last year's growth of $2 million this year.
The strength of customer commitment lies in the ability to service both consumers and retail customers.
"We have a 24-hour turnaround call back time" for consumers and 72-hour cleaning time deadline."
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Fabric protectants build sales
Mar 8, 2005
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