Buyers still seek value
Uptick fuels hope for eventual rebound
By Clint Engel -- Furniture Today, September 14, 2009
LAS VEGAS — Retailers attending this week's Las Vegas Market are hoping to find the kinds of specials and great values that will turn a recent uptick in business into a bigger, better story.
Most still characterize the business climate as challenging and inconsistent, and really don't expect any big rebound until some time next year. Yet several retailers said they saw improvement in traffic and sales in August — if not earlier — reporting that consumers finally appeared to be in the mood to buy.
So they are in Las Vegas set on keeping the momentum going and looking to fill holes in their lineups across the board. Some are shopping a few price points down from their usual lines, adding bread-and-butter promotional to midpriced goods to meet the demand of today's more frugal consumers.
While one retailer interviewed maintained that the upholstery offering here remains limited, others said they plan to shop that category particularly hard.
A few retailers indicated that the market date change to September from July has been an inconvenience (or worse), leaving little time between the Las Vegas, High Point and China shows. In one case, the date change is keeping a Top 100 owner from making it here this time.
Mark Barnes, owner of Spokane, Wash.-based National Furniture, said spring was “brutal,” with March-through-June business down 30% or more from a year ago. The numbers got so bad that for a while, Barnes said he stopped looking at them.
But in August, there was a perceptible change in traffic. Consumers coming into the store “were looking for things, not just killing time,” he said.
“There was a different attitude about spending their disposable income,” he said. “And they shifted away from recliners. We sold nothing but recliners and bedding for months, but in August, we started getting some sofa tickets.”
Barnes said September and October usually are good months for National, so he is optimistic. He planned to attend a Pacific Furniture Dealers buying group meeting in the World Market Center the day before market, then begin full-scale shopping on opening day.
He said he's looking for “bargains and market specials” and will concentrate on his existing supplier base, looking for the new goods and best values in their lines rather than “trying to pioneer new things” with other sources.
“This is a lousy economy to try to determine what works and what doesn't,” he said.
National emphasizes upholstery, and Barnes will look primarily for what's new at $399 to $599 sofa price points. Spokane has seen a pickup in home sales, he said, but they are starter homes priced below $250,000, so the retailer's lineup needs to appeal to those buyers.
Niraj Shah, CEO and co-founder of Boston-based Internet retailer CSN Stores, said his company will be here primarily shopping for “key styles we think are missing,” including transitional and contemporary looks across the board.
Shah said he doesn't expect this to be a big bedding market for CSN, noting that the retailer is happy with its sourcing in that category.
Consumers are out there buying, he added, but are spending less on certain products, which will affect CSN's shopping strategy here. For example, $899 beds are not doing as well but demand for the $699 price point is up.
Shah said CSN has been encouraged by business this spring and summer.
“We have seen some very nice growth in that period,” he said, adding, “We think it's emblematic of a broader trend of positive spending in the economy coupled with some specific things we have done in our segment to take share from other online retailers.”
He said he will be shopping both the Las Vegas and High Point markets, but, in the future, “if the markets stay this close, we will likely need to change our plans and start to pick which to attend when.”
Englewood, Colo.-based American Furniture Warehouse will have buyers here, but owner and President Jake Jabs will be missing.
“My main problem is we go to China (shows) in Shanghai and Guangzhou” and won't get back until just before the Vegas market starts, he said.
He also had to consider choosing between High Point in October and Las Vegas now. Jabs had his buyers list the vendors they see in Las Vegas and those they see in High Point, and for Jabs and upholstery buyer Nicole Gunther, there was only one supplier in Las Vegas they couldn't see a month later.
“It ain't worth going to Vegas to see one factory,” he said, adding that he thinks the September move was “stupid” and that markets should be six months apart.
American typically has sent eight buyers to Las Vegas, but this time only three are going, for bedding, accessories and rugs.
Honolulu-based C.S. Wo & Sons had a similar problem because of the back-to-back China and Vegas shows, so the buying team is split between the shows, depending on niches and sourcing.
“The majority of our group decided to attend Vegas while a small contingent will be in China,” said Wendell Wo, vice president. He added that the company doesn't go to High Point's premarket, which coincides with Las Vegas this time, but will be at the main High Point Market in October.
In Las Vegas, three C.S. Wo buyers will shop for three days. “We are always looking for great values and hot promotional items,” Wo said, adding, “Upholstery is always a key category for us and room packages — with great savings — continue to grow.”
Like Jabs, Irv Blumkin, CEO of Omaha, Neb.-based Nebraska Furniture Mart, would prefer summer dates for Las Vegas, noting that there are “too many markets too close together.” He said that forces buyers to look for new goods before the previous market's introduction have yet to hit the floor.
“This whole cycle needs to be corrected,” he said.
But Blumkin said he is coming to Las Vegas, partly to “re-review and take a second look.” He also will look for opportunity buys and “something where we can really pass on terrific savings to our customers and run as traffic drivers for our business.”
NFM also will fine-tune its lineup for the fall and in areas where it has holes, including motion upholstery, bathroom vanities and Formica-top dining room tables.
“You've got to always look,” he said. “You never know.”
Martin Komisar, president and CEO of Biltrite Furniture in Greenfield Wis., said he'll miss Las Vegas this time partly because of a personal conflict but also because the timing is so close to High Point.
However, his sister Maureen Komisar, vice president, will be here for the first time representing the company — mostly to attend the Furniture First buying group symposium prior to opening day and to drop in on some of the retailer's key vendors, including Lane, Klaussner, LaCrosse, El Ran and Vaughan-Bassett.
She may come back with some recommendations, but she's not really there to buy, Martin Komisar said. He said one problem in Las Vegas is a limited upholstery offering for his type of store, because the showrooms tend to be too small for the category.
Daniel Rosenberg, owner of the three-store Anaheim, Calif.-based Daniels Home Center, said business conditions are getting a little better and now that homes are starting to sell again, “people are starting to buy furniture.”
So he is here looking for values at middle prices and “a little more promotional things to bring people into the store.” He will shop across all categories, but focus on dining room, living room and home entertainment furniture. In upholstery he'll look for sofa and loveseat packages he can retail from $599 to $1,299.
Among his showroom stops will be Coaster, Crown Mark and GuildCraft of California.
Rosenberg said he usually attends High Point and Las Vegas markets but will skip High Point next month because the shows are too close together. Like several others contacted for this story, he said he would prefer a July Las Vegas Market.
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