CDG retailers want price protection, fewer intros
By Jeff Linville -- Furniture Today, December 31, 2006
San Diego — Retailers in the Contemporary Design Group want price protection on products, better sales tools and a little more time to see if introductions are going to sell.
Those were some of the concerns group members raised in speaking to manufacturers at the CDG conference here.
Andy Thornton of retailer LaDifférence in Richmond, Va., said the product introduction cycle is so short that retailers don't have time to see if a collection is going to sell before the manufacturer is pushing new items.
His wife and business partner, Sarah Paxton, said that in such a case, manufacturers become their own worst competition.
Paxton suggested that vendors offer fewer groups and frames with more wood finishes and fabrics. That could help companies save money on research and development and redirect the funds to marketing, such as shooting photos and providing high-resolution images on CDs for stores.
Michael Gennet, a consultant to manufacturer Weiman, said his work group at the CDG meeting agreed that quality photography is a necessity for advertising.
Better communication is something else his group suggested, Gennet said. With today's technology, including wireless phones with Internet access, there is no excuse for sales reps taking days to respond to a question, he said.
He added that better in-house communication can ensure problems don't hurt retailers, like a container of furniture getting held up because of a dispute over a bill for $100.
Another group said distribution conflicts can arise because of poor communication. For example, a store may buy a collection thinking it has an exclusive in a city. Then a different sales rep sells the same group to a national chain that competes in that market
Shelter magazines are raising awareness of ecologically friendly products, Gennet said. It may not be an issue is some areas, but eco-friendly furniture could become more important, he said.
Paxton said more and more consumers in Virginia are looking for "green" goods.
Eco-friendly is fine, said Tamara Scott-Anderson of retailer Contents in Tucson, Ariz. But, she asked, how much more are consumers willing to pay for this furniture?
She noted product from Europe already has some eco-friendly benefits because it is made under stricter manufacturing guidelines than Asian goods.
A big concern for the CDG retailers was price protection. They asked for minimum pricing so that a chain retailer or Internet company can't undercut a store's pricing. They said Bose headphones, for example, are the same price whether in a store or online.
There was some debate over whether or not such a pricing practice would be illegal, but retailers suggested that it is within manufacturers' powers to regulate a minimum advertised price.
The retailers also asked for protection of brands. If a manufacturer sells its goods to a promotional retailer — brick-and-mortar or Internet — then the product looks cheaper and the consumer is left confused over the value of the goods, said Gennet.
One group suggested that CDG members could be protected on pricing and branding by having manufacturers supply the buying group with some exclusive collections.
Many of the retailers agreed that with today's savvy consumers, manufacturers need to provide more product information, whether it's over a Web site or in catalogs and point-of-purchase materials.
Paxton also said her group considered the benefits of having the CDG maintain warehouse space. The group could buy containers and then distribute the goods to members in smaller amounts.
Some of these points raise issues that won't be resolved easily, but retailers and manufacturers can make changes that will help, said CDG President Howard Haimsohn of Lawrance Furniture in San Diego.
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