Retailers still shopping Las Vegas Market despite business struggles
Bedding, contemporary furniture, hot deals on many lists
Clint Engel -- Furniture Today, August 1, 2011
AT THE MARKET — Retailers working the Las Vegas Market this week characterize business as a continuing struggle, but that's not putting too much of a crimp in their shopping plans.
Dealers are still seeking goods to spice up their lineups with an emphasis on specials and other great deals they can promote this fall. Some say they will shop case goods aggressively, in part looking for possible replacements for a couple of imported lines that have had delivery and other problems lately.
Contemporary furniture is on many shopping lists. And retailers will visit the showrooms of suppliers who have become known for using Las Vegas to stage major introductions, including Ashley, AICO and most of the bedding companies.
"Ashley is kind of a given," said Oscar Miskelly, partner in the six-store Miskelly Furniture of Jackson, Miss. "We'll spend probably half of our market time at Ashley."
Bedding also continues to drive this market for Miskelly and many others. The retailer will be nurturing relationships with key sources such as Tempur-Pedic - one of Miskelly's top three vendors now - and Sealy, Simmons, Restonic and Serta. The retailer has standalone bedding showrooms and also sells the category in its full-line stores.
In furniture, Miskelly will be in the hunt for light, reclaimed wood looks in bedroom and dining room that have been popular lately. He said he's also interested in worn, painted finishes, something that "looks like it has been sitting up in the attic" for years and "will just catch the consumer's eye and break the monotony of dark woods on your floor."
In upholstery and other categories, Miskelly buyers will look for fresh looks and new trends, but also for specials it can promote this fall for its annual tent sale and the Veterans Day holiday weekend.
"It's anything that would be a good promotional item or a look that would kind of get us out of the box a bit for those events," he said. "It may be one item that we can run at a low margin or maybe a whole container of bedroom groups a supplier is closing out."
Business so far this year has been "OK but nothing great," he said. Miskelly has had to fight for every dime - a sentiment many retailers echo.
Lately, the store has been running longer-term deferred interest offers (up to four years), and it's also had success showing consumers the value they are getting for a low monthly payment. A recent Tempur-Pedic commercial, for instance, played up the long-term financing and a monthly payment of $52 for a Tempur-Cloud mattress with an adjustable base and two pillows.
Sales for Englewood, Colo.-based American Furniture Warehouse are up about 5% for the year, said owner and President Jake Jabs, who will have a team of buyers here looking for doorbuster items and contemporary looks, among other things.
Jabs said fewer houses are going up these days in Colorado because of the economic slump. But there has been an influx of interest in condominiums and apartments, which tend to be on the small side, he said.
"I think there's more of demand for smaller, more contemporary furniture, so that's probably what we'll be looking for," said Jabs. AFW will shop modern looks across its broad promotional to middle price spectrum.
And with new competitor Ikea having opened in the Denver market last week, Jabs said he may look to bolster the low end of his business - although he's confident AFW already is in a good position, noting a chrome-legged sofa he's running for $199, for example.
While upholstery is what Jabs buys here, he said it's also the category that continues to disappoint him at this market. Jabs said his vendors continue to pull out of Las Vegas and that he's down to about nine companies he will see here, including Ashley, Lane, Fairmont Designs and Emerald Home Furnishings. That's why Jabs said he's only coming for a day and a half, while AFW's other buyers will stay a little longer.
Gary Baugh, owner of the nine-store Marquis Furniture of Tecumseh, Okla., said the main thing he's looking for at market this week is "some kind of stability."
"It's seems like every time we turn around we're getting hit with a price increase, and I don't know where it ends," he said.
Baugh is not holding out too much hope he'll find that stability, given the long-ago shift in case goods furniture production overseas and the slim chances of getting any of it back in the form of new U.S. production facilities.
Baugh said he started seeing business weaken at his stores in October. Since the end of his company's fiscal year in February, sales are running about even with last year, he said. Marquis had been accustomed to increases every year, even when the industry was in a tailspin in 2008 and 2009.
"It's pretty challenging," he said. "We're spending quite a bit of money advertising and still not seeing the door swing like it was."
Marquis and related stores under the Snow's Furniture and Hoffmans Furniture banners were carrying about seven bedroom groups from importer Great River Trading, which recently confirmed it was liquidating its domestic warehousing operations. Baugh said Great River changed its payment terms, "and I don't have any confidence in the way they do business." He is considering replacements for that line, and is looking at reducing his bedroom offering to make room for a broader upholstery assortment.
"It seems like sales in upholstery are ticking up somewhat and the trend on case goods is down," he said, adding that this typically happens when consumer spending gets tight.
Marquis doesn't see the same kind of demand for contemporary styles that many retailers report, so his emphasis here will be more on casual and traditional.
In master bedroom, Baugh said Marquis once was selling five-piece groups starting at $799, but with the series of price hikes it has been seeing, that starting price has jumped to about $1,099.
"If we could find someone at $899 or $999 we sure would be interested in it," he said.
Business is up this year for Miami Gardens, Fla.-based El Dorado Furniture, but that doesn't mean it hasn't been a day-to-day struggle, said Alfredo Lopez, purchasing director.
He said he believes the retailer's sales are up primarily because of a better lineup of merchandise, as well as the opening of new stores and a continuing strategy of updating and remodeling stores. El Dorado opened a new store in West Palm Beach, Fla., in January and gave its Plantation, Fla., store a nearly 100% overhaul.
Among the top items on El Dorado's shopping list here are more contemporary looks across all categories, and also fabric upholstery, primarily in the $599 to $999 retail price range for sofas.
El Dorado doesn't plan on changing its bedding sourcing, but will check in with existing mattress suppliers - including Tempur-Pedic, Simmons, Sealy and Comfort Solutions - and others to see what's new.
El Dorado also will pay close attention to suppliers that show both in High Point and Las Vegas, but seem to use Vegas to get a head start on introductions going into High Point - suppliers like AICO, Lopez said.
Unlike Marquis, Lopez said El Dorado is moving forward with case goods importer Great River Trading despite recent changes there. He noted that initially there were some communications problems, but they have since been cleared up.
"It's been like a new beginning for us with them," he said, and the new arrangement - with a percentage paid up front - is more like buying direct form China, which El Dorado knows how to handle.
Describing business conditions as "still very inconsistent," Steinhafels CEO Gary Steinhafel said the Waukesha, Wis.-based retailer has been staying aggressive in its advertising. Sales are up in the low single digits this year, but consumers are cautious. "We seem to be working a lot harder to get a little bit more business."
Like others, Steinhafel said the company is shopping Las Vegas for great deals and special purchases it can promote this fall.
"A lot of manufacturers have excess inventory or overstocks and we'll negotiate a one-time buy," he said, noting that Steinhafels has been active in the special purchase arena for years. The retailer uses the deeply discounted goods to build traffic.
"Las Vegas Market has a few core competencies we focus our efforts on," Steinhafel added, noting that buyers will spend a lot of time shopping the bedding category and area rugs - categories in which Vegas really shines. Rug and upholstery buyer Elaine Haskey said that among her stops for rugs will be Surya, Mohawk, Shawn Dalyn, Oriental Weavers, Nourison and Kas.
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