Hometown heroes succeed in varied ways
By Clint Engel -- Furniture Today, December 14, 2009
NAPLES, Fla. — This year’s panel of Hometown Heroes at Furniture/Today’s Leadership Conference here ranged from Canada’s largest furniture store chain to a small North Carolina retailer.
They all had one quality in common: Impressive success during one of the worst economic downturns the industry has experienced.
Explaining their success were Terry Leon of Toronto-based Leon’s; Mark Mueller of Mueller Furniture in Belleville, Ill.; Tim Harris of Knoxville, Tenn.-based Knoxville Wholesale Furniture; Kyle Johansen of Coon Rapids, Minn.-based HOM Furniture; and Michael Forde and Bill Griffin, partners in Four Corners Home in Asheville, N.C.
With annual sales approaching C$1 billion, Leon’s celebrated its 100th year in business this year. Planning for the milestone began more than a year ago, said President and CEO Terry Leon, and with such a poor economic climate the retailer had to decide whether it should move forward with big spending plans.
The company wanted to hold parties in all 65 corporate and franchised stores and provide gifts to each associate. It was going to spend an additional C$1 million on charity.
“All told, the expense we were looking at was close to C$5 million, and that … was going to come right off the bottom line,” he said.
In the end, the fact that Leon’s is conservatively capitalized, owns most of its real estate and is debt-free enabled it to go through with the promotions. Leon said the company was more than rewarded for the decision by appreciative employees who “went to great lengths to make their stores look fantastic.”
Mark Mueller, a fourth-generation retailer, said the typical customer for his one-store business is “somebody who values quality and style over price.” He said his core consumer base skews to ages 50 to 75.
“We have a lot of empty-nesters with a lot of money,” he said.
Mueller said that many stores similar to his have gone out of business over the past 10 years and more will follow, “unless we join the 21st century and try to figure out what our customers really want.”
The Mueller team has worked hard not to become one of these statistics. Since 2007, it has increased sales by 21% (to $3.1 million projected this year) while cutting its advertising costs by 27%. The retailer developed a more “personalized” TV campaign featuring Mark Mueller as spokesman. It also began featuring more tech-friendly furniture.
Starting in 2006, Mueller Furniture has worked to improve its online presence as well. Indeed, www.muellerfurniture.com has “been a cornerstone to our growth,” Mueller said, saying the company dominates local online search fields, generating traffic to its sites and its store.
Knoxville Wholesale’s Tim Harris brought his former background as a school teacher and football coach to his conference presentation, emphasizing one cornerstone for success that he finds lacking at many stores — a focus on people.
At Knoxville Wholesale, Harris focuses on “creating a culture of winning” and getting everyone on the sales team to buy in.
“We unashamedly try to make our people better,” he said. “We’re interested in our guys being better fathers and husbands and on down the line. We’re going straight into that heart and mind, because we know that if we make that connection, we’re not going to have to … do as much instruction because they’re going to want to do these things on their own.”
Harris wants salespeople with the “right attitude” who will greet consumers with respect, enthusiasm and confidence.
Johansen shared some of HOM’s success strategies, including the concept of departmental branding. That program began a few years ago, when the Top 100 retailer introduced its Passages department as a way to reach higher-end customers interested in something more than $399 sofas or $999 bedroom groups.
“It worked out pretty good for us,” Johansen said, and HOM began branding other departments, including World Rugs and Sleep Express. It also bought The Design Doctors name as the umbrella for its design services.
And after HOM acquired outdoor and seasonal goods retailer Seasonal Concepts earlier this year, it folded it into HOM as a store-within-a-store.
Johansen said HOM’s Web site is another “important part of our business” that will continue to grow as the retailer upgrades features and eventually adds e-commerce capabilities.
Johansen, 24, who serves as the lead buyer for both Seasonal Concepts and World Rugs, said anyone trying to reach his generation needs to be networking online. “You need to get on Facebook (or) Twitter or we’re not going to find you.”
Wrapping up the panel were Bill Griffin and Michael Forde of Four Corners in Asheville. They told how they left corporate jobs in 2001, traveled the world for nine months and found accessories, crafts and other gifts to sell at what would become Four Corners.
The venture started as an Internet-based business in 2002. The two opened their first store in 2004. They introduced case goods a year later and upholstery in 2006. Today, Griffin and Forde operate two Four Corners locations selling “organic modern” home furnishings, as well as Mobilia, a European contemporary line.
They are projecting sales to hit around $1.6 million this year, with an average gross margin of just under 60% and pretax profit of about 10%.
Among the retailer’s strengths is a culture of continual improvement. Everyone in the organization is thinking of ways to make money and save on costs. Once a year, the stores are closed for a one-day brainstorming session with employees, where Forde and Griffin say they get their best ideas.
Griffin said the company embraces “customer-focused selling — listening to what the customer wants and needs as opposed to what we have to get rid of.”
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Hometown heroes succeed in variety of ways
Dec 14, 2009
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