Buyers seeking an edge
Hunt for exclusives, goods that ‘scream value'
Clint Engel -- Furniture Today, April 28, 2011
HIGH POINT - Despite continuing scary news on the housing front, most retailers are reporting better business since at least late last year and will be at this week's High Point Market shopping for ways to keep that positive momentum going.
That essentially equates to searching for ways to stand out from competitors, but how retailers go about doing that will vary.
One smaller independent, for instance, said she will be on the hunt for exclusives. Others said that while business is better, consumers remain extremely price-conscious, so these buyers will place emphasis on what one retailer called goods that "scream value."
And this is all happening in a market environment where retailers are likely to
to see higher prices coming from suppliers, thanks to inflation in oil, cotton and other raw materials as well as higher Chinese labor costs. But the same retailers looking for values and specials at the market say they expect to see some price increase and can work around them.
Some stores are looking for ways to shift more of their assortment to domestic suppliers. And as usual, the hunt will be on for the best fresh new looks from both old favorites and new sources.
Freed's business better
"We're seeing an uptick. Business is better in the last 90 days," said Howard Freed, owner of the two-store Freed's Home Furnishings in Dallas. "We're kind of bullish, and we're hoping to see new stuff - that's why we go there."
Among other things, Freed's buyers will be on the lookout for goods they can promote in stores as "Made in America." The retailer recently participated in the "Made in America" series on ABC News and got some free advertising when its truck pulled up to a Dallas home with a load of furniture from Vaughan-Bassett.
While Freed's sells Vaughan-Bassett, it didn't regularly carry the bedroom group it delivered. But "we bought it after that because people kept calling us wanting to see that suite" and other U.S.-made goods, Freed said.
Interest has trailed off since then, but "there's definitely an undercurrent" of interest in American goods, he said. "People would like to help our economy."
While the bulk of his stores' upholstery is domestic, Freed he said he realizes finding competitively priced domestic case goods will prove more difficult.
"No matter how much the customer says they want made in America, if it's twice as much as the stuff from China, they're not going to buy," he said.
In addition, Freed's has received customer requests for game room furniture, currently a small category for the retailer, "but we're going to work on that," he said.
Freed's also has started getting requests for armoires, although it doesn't sell them anymore. Consumers used to buy armoires to hide ugly television sets, Freed said. Then big-screen, flat-panel TVs came out and consumers wanting to show off their sleek new sets.
Now that big screens are more common, consumers think they're ugly again, Freed said. He's not ready to call it a trend yet, but he thinks the industry may soon see an armoire resurrection and he's looking to get in early.
He'll shop here for models scaled for the new sets - wider than the old armoires and maybe not as deep.
Proprietary goods a key
Peggy Burns, co-owner of the five-store Circle Furniture of Acton, Mass., said her Boston-area stores sell on value, not on price, and for smaller retailers like Circle, proprietary product is "what we have to look for right now."
"You can always buy cheap furniture somewhere, so what we're doing is looking for someone who has a (minimum retail price) or proprietary product," particularly in the dining category, where Circle has a void.
"Years ago, that wouldn't have been an option for someone like us because we're small," Burns said. But now, suppliers are more willing to talk and accommodate, she said.
On the other end of the spectrum is Top 100 company American Furniture Warehouse of Englewood, Colo.
President and CEO Jake Jabs said that in addition to shopping for fresh new merchandise across all categories, "We're going to market looking for anyone offering some special deals, closeouts or special purchases."
The reason: AFW has seen extraordinary success with specials as recently as Presidents Day weekend in February, when its stores were offering two Affordable Furniture L-sectionals at $599 each. Jabs said that offer reeled in customers and drove overall business for its 11 Colorado stores.
"We had four $2 million days back to back," he said.
Jabs said he and four other buyers are here looking for similar good to promote. "We always have an open-to-buy because we do a lot of business," he said.
Jabs said last year was the most profitable year in the retailer's history. This year is off to a better start than he was expecting, despite price increases AFW has been taking from suppliers for some time now and is expecting to see this market, too.
Indianapolis-based Kittle's also is running ahead of plan this year despite the price increases, which it expects to see more of at market. President and CEO Eric Easter said he doesn't believe there is anyway to avoid them.
"You just have to merchandise around it and deal with it," he said.
Still, Easter believes, "there are always opportunistic buys out there for whatever reason," and with Kittle's assortment already in good shape with only a need for minor refining, that's largely what his buyers are looking for here.
By opportunistic, Easter said he means "promotable great values," and the price point he will target depends on the category. For a great motion sofa with power, for instance, Kittle's may look for something it can retail for $799.
It's gotta scream value
"Whatever it its, it just needs to scream value to us," Easter said. "And it needs to be available quickly so we can be out there promoting aggressively." Kittle's is willing to take short margins on outstanding values, he said, because, "honesty, that's what it takes right now to get the customer's attention."
For the 76-store furniture, electronics and appliance chain Conn's of Beaumont Texas, Paula Bane is at market with a long shopping list from stationary and motion upholstery to casual dining and bedroom furniture.
Bane, the retailer's senior furniture and bedding merchandiser, said the promotional to midpriced Conn's has seen significant sale increases in her categories this year for several reasons, including improved product knowledge and training among its salespeople.
Remerchandising efforts also have contributed as have better displays, the addition of a dedicated furniture and bedding specialist to each store and field merchandisers who travel among stores to make sure displays are consistent and up to Conn's standards.
The retailer has only been selling furniture and bedding for about six years, but Bane said it has been a great addition.
"I've got a great lineup, but I'm always testing the market for (new goods that turn well)," she said.
Among other things, Bane will be looking for casual dining tables and four chairs Conn's can retail between $599 and $899. She is eager to shop Franklin and Jackson/Catnapper because she has heard "a lot of buzz about some great introductions" coming from these existing vendors.
Bane also is hearing good things about leather upholstery source Man Wah/Cheers, which Conn's doesn't sell yet and will visit for the first time here.
Jerry Baer, senior vice president of sales for Pompano Beach, Fla.-based Baer's, was a dissenter on the price-increase issue, saying he's not counting on any increases here because business remains challenging for the industry, and vendors should continue focusing on providing strong values.
High-end excitement
This market should be an exciting one for the high-end Baer's, he said, adding that he's looking forward to visiting key suppliers including Century, Natuzzi, Broyhill, Drexel Heritage, Henredon, Bernhardt and Lexington Home Brands.
"We're very excited to see what (Lexington) is doing with Henry Link" Trading Co., the new collection of bedroom, dining room, upholstery and home accents, Baer said.
"Phil Haney (Lexington's president and CEO) and his team have done of great job bringing out some really exciting product over the past few years and we're really proud to partner with them."
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