RTA sources keep pace with HDTV
By Larry Thomas -- Furniture Today, July 16, 2007
High Point — Producers of ready-to-assemble furniture aren't in the consumer electronics business, but they've spent many a night trying to catch the HDTV express.
On the surface, that would appear to be a Herculean task, given the recent rapid-fire changes in consumer electronics and the furniture industry's knack for reacting ever so slowly.
But RTA producers say they have little choice but to try to keep pace with their electronics brethren, particularly those who are turning out millions and millions of high-definition televisions annually.
The overwhelming majority of these new-fangled TVs won't fit inside RTA furniture designed for traditional TVs, so producers are scrambling to take advantage of what may be a once-in-a-generation opportunity to sell furniture to these new TV buyers.
"Entertainment is a very hot category right now," said Jeff Housman, senior vice president of sales at Ameriwood. "But the consumer may not be thinking about furniture at the time they purchase their TV."
But since high-definition TVs typically have a wide-screen format (known as a 16:9 aspect ratio in electronics parlance), it doesn't take long for the excited HDTV owner to learn that his new toy won't fit in his existing entertainment center. And it may even be too wide for his non-descript TV stand.
A growing need
That's where RTA furniture producers say they have an opportunity to satisfy an immediate need at a relatively low price.
"Our challenge is to come up with more creative solutions to meet those needs," said Mike Lambright, director of marketing at RTA sales leader Sauder Woodworking. "For most consumers, a lot has changed since they last bought a TV stand."
With the advent of HDTV, producers say the furniture focus has shifted away from large-scale wall systems and armoires to more compact consoles that sometimes resemble home office credenzas.
Sauder and most other producers have developed hutches, pier units and related add-ons for their consoles (they shun the term "stand," but it's the unit on which the TV rests that gets the most attention from consumers).
But the consumer needs more than just a flat surface for his new TV, says Mike Rush, president of Rush Inds.
Rush said consumers also are demanding space to handle components such as a DVD player and stereo receiver, and many also want a place to store music, movies and gaming cartridges.
But one thing most consumers aren't demanding, according to Housman, is the ability to mount their HDTV on the wall.
"Wall mounting looks cool when you see it in TV commercials, but it's not very practical for most people," he said. "It can be very difficult and expensive to do."
As an alternative to wall mounting, Ameriwood and several other producers have developed consoles with rear panels that are suitable for mounting a flat-panel TV. Such products deliver the wall-mounted look without drilling a large hole in the wall and running a network of cables through it.
But given the slump that has plagued the furniture industry since late last year, RTA producers are more than happy to tackle such issues, since it means there's still plenty of demand from consumers.
Executives believe the market for HDTVs is nowhere near its peak, and data from the Consumer Electronics Assn. would appear to support their contention (see story below). The trade association believes that, by the end of the year, only 36% of U.S. households will own at least one HDTV.
But that's up from 30% less than six months ago, and up from virtually nothing five years ago.
Key deadline coming in '09
Lambright believes flat-panel TV sales will keep booming at least through 2009, when TV stations must switch to all-digital broadcast signals and stop using analog signals.
The switch means that after February of 2009, older TVs without digital tuners (generally any model more than five years old) won't be able to receive over-the-air signals without attaching a converter box to their set.
Lambright said he believes many consumers won't go to the trouble of hooking up the converter, and will simply buy a new TV before the analog cut-off date.
"As that date gets closer, more people could decide to get a new TV, and that should help our sales, too," he said.
The challenge, according to Lambright and other executives, is to develop affordable pieces that accommodate the myriad of screen sizes now on the market.
"Even though TV prices have fallen quite a bit, it's still an awful lot of money for some people," said Housman. "So they may not have a lot of money to spend on a piece of furniture."
And that means still more SKUs to meet the rapidly changing needs of consumer electronics purchasers.
Rush said, for example, that his company has developed nine new entertainment centers and eight new finishes in the last three months alone. And he doesn't believe the pace of change will stop as consumers sort out the sometimes confusing array of plasma, LCD and DLP televisions on the market.
"I don't think the new configurations have settled in yet," said Rush. "For a while, everybody seemed to be buying plasma, but now LCD is starting to overtake plasma."
And what does that trend mean for furniture producers? Back to the drawing board.
"With LCD, you need a much wider console," Rush said.
