Klaussner plans N.C. store, updates Sofa Express units
By Clint Engel -- Furniture Today, August 28, 2005
Asheboro, N.C. — Klaussner Furniture Inds., the fourth-largest U.S. manufacturer and importer, has several distribution initiatives in the works, including the licensing of dedicated Sofa Express stores to independent dealers and the rollout of an entirely new retail concept.
The company wants to grow and get a better handle on its retail business, but not at the expense of current customers, said Jeff Davis, recently promoted to senior vice president of marketing and strategic development at KFI.
Coming up are the opening of a big, dedicated, company-owned store in Jamestown, N.C., near High Point, and the conversion of existing Sofa Express stores, which are mainly upholstery, to full-line Sofa Express and More units.
On the new retail concept, Davis declined to give details but described it as something "that will give us a vehicle we can take across the country and into some of the hottest markets."
"We're talking about different types of venues, different types of merchandise mixes" that will target a different consumer from that of the mainstream, midpriced Sofa Express stores, "so that they might be able to coexist in the same vicinity," he said.
Klaussner might start with one or two company-owned stores, Davis said — one in North Carolina, opening in 2007 or sooner, and perhaps another on the West Coast.
"When successful, we'll fill in the gaps from there," he said, adding there are no plans now to license the concept.
Davis emphasized that all of Klaussner's plans will be friendly to existing distribution.
"The thing we will continue to do is treat our existing customer base with the utmost respect," he said. "We are not going to go storming into markets where we have good customers that give us a good, strong (product presentation) and upset that apple cart."
Davis said he couldn't project the sales potential of any of the initiatives. Sofa Express, Klaussner's largest single customer, accounts for 10% to 12% of total business, and finished last year with 64 stores doing $200 million in furniture, bedding and accessory sales, up 8.1% from the year before.
The conversion of the Top 100 Sofa Express chain to Sofa Express and More already is under way. A handful of test stores were opened last year in Greensboro, N.C., followed by units in Atlanta and Columbia, S.C. The tests proved successful, Davis said.
By the end of this year, he estimated 95% of the roughly 70 stores will have been converted to the full-line format, carrying an assortment of Klaussner upholstery and imported living room, bedroom and dining room furniture.
As for licensing Sofa Express and More stores to independent dealers, Davis said KFI will have something to present to interested retailers by the October market. It's already talking to about a dozen parties, he said, primarily existing customers. "I think we can add anywhere from 15 to 25 locations right off the bat," he said.
"So much of the infrastructure already is in place — the administration, the marketing the brand awareness," Davis said. "We already have great stores and we would like to be able to give dealers and our distribution partners the opportunity to ride the wave with us."
Separately, on a stretch of Business Interstate 85 near the large Boyles and Furnitureland South stores in Jamestown, N.C., Klaussner will build a 60,000- to 70,000-square-foot dedicated store to open in early 2007.
At nearly three times the size of most Sofa Express stores, the still unnamed company-owned showroom will give Klaussner the space it needs to show the breadth of its line in a lifestyle format, both to consumers from across the country who trek to High Point for furniture, as well as to retail customers.
Why open such a dedicated store? High Point is a "furniture mecca," Davis said, drawing lots of out-of-state and in-state traffic, and it's also within driving distance of other markets where the company doesn't have adequate distribution.
He noted the store will be about 30 minutes away from Klaussner's manufacturing plant and distribution center in Asheboro, which means the company probably won't build additional warehouse space to serve the store and its customers.
Plus, the store will be only slightly smaller than its Asheboro showroom that dealers visit twice a year. When the Asheboro showroom is broken down between markets, retailers still will be able to see and hear Klaussner's full pitch.
"We hope to be able to illustrate to our retailer partners the types of products we can offer, and the value, quality and service that go along with that," Davis said. "And I think it will drive home the fact that we really are a full-home resource."
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