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Retail climate improves

Clint Engel -- Furniture Today, February 1, 2012

LAS VEGAS - Retailers here, for the most part, are confirming a trend that has been evident through their buying here and at other recent markets.

Things are finally looking up back home.

While few want to commit to an opinion that the momentum will last, there's no doubt many retailers ended 2011 and began this year on a positive note. More and more, consumers seem ready to start spending again.

"I think people are suffering from frugality fatigue and are tired of holding onto their money," said Mark Barnes, owner of National Furniture in Spokane, Wash.

Barnes said he's hoping consumers are finally moving beyond buying furniture strictly for replacement purposes and into buying because "they want to, not because they need to."

National has been running small newspaper ads three times a week, each highlighting a niche category such as lift-top coffee tables or chaise lounges. The ads don't show a price, just the item with the tag, "Spokane's best selection." Results have been excellent, he said.

"That's a splurge," said Barnes of the chaise lounges, which his store sells for $400 to $500 a pop from suppliers such as Best, Coaster and Emerald Home Furnishings. "Nobody needs a chaise."

Bill Twelves, director of merchandising for Olum's in Vestal, N.Y., said business "is absolutely getting better."

Twelves said he saw the first signs of improvement after the April High Point Market. Then mid-September, flooding in his area led to heavy buying thanks to insurance money and a boom in reconstruction work that also put money in people's pockets.

Flood buying has tapered off, "but our numbers are still really strong," Twelves said. He said his retail contacts in the market are saying the same thing, which could indicate a changing tide.

"We're going to advertise and promote and hopefully keep customers coming through the front door," he said.

Bellwood, Pa.-based Wolf Furniture has seen business on the upswing since Labor Day, said Gene Stoltz, vice president of merchandising. The mild winter has been a big factor in helping sales.

There's also a trend toward better goods, he said, with those shoppers loosening their purse strings. Sales of Wolf's Amish bedroom and dining room have provided a big shot in the arm, he said, as have sales of other "Made in America" goods.

Stoltz said the one concern he has is gas prices. His salespeople tell him that fuel prices have a big effect on consumer confidence.

But like Twelves, Stoltz said Wolf will "keep its foot on the pedal" in advertising, regardless of changing economic winds. He said Wolf's consistent ad spending is helping it gain market share from smaller competitors, who can't afford to keep up when business tightens.

Oscar Miskelly, a partner in Jackson, Miss.-based Miskelly Furniture, attributed the retailer's late-year rally to a no-interest promotion for up to 48 months that the company ran with Wells Fargo.

"It really made the better-end goods very affordable," Miskelly said. The company ran ads showing what the monthly payment would be on hot items like Tempur-Pedic and Serta iComfort mattresses.

That momentum has carried into January, he said, with sales up about 12% so far for the month.

Still, he's concerned that any economic downturn would hurt consumer confidence, which would be difficult for Miskelly or any retailer to combat. Miskelly said he expects business to hold up at least through late summer, but he and several other retailers noted that the negative campaign advertising this year could dampen consumer sentiment.

Not everyone is seeing the consistent improvement yet. Marty Komisar, president and CEO of Biltrite Furniture in Greenfield, Wis., said business in December was fair, but January has been a struggle. The retailer wasn't helped by a New Year's holiday weekend that included the Green Bay Packers in an NFL playoffs game, which kept people glued to their TVs and out of the store.

Komisar also thinks negative political campaigns will affect this year's results.

"I think it's going to be a tough year because of the elections," he said. "Remember, we're in Wisconsin, where the governor is being recalled and a lot of people hate the unions."

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