Clint Engel -- Furniture Today, August 27, 2012
NATIONAL HARBOR, Md. - Nationwide Marketing Group introduced its first two gallery programs at its Prime-Time show and conference here, ratcheting up efforts to boost the gross margins of its dealer members.
The Winston-Salem, N.C.-based furniture, electronics and appliances buying group launched a Serta-exclusive Nationwide Bedding Gallery along with a Klaussner Solutions Studio program - similar to Klaussner's existing studio program for retailers but with Nationwide's added marketing muscle.
Both gallery programs were well received at the four-day conference at Gaylord National here, just outside Washington, according to all parties involved. This month's event drew some 3,000 people, including more than 1,000 vendor representatives and more than 700 retail member organizations, including a contingent from the Canadian buying group Cantrex, recently acquired by Nationwide.
More than 180 supplier partners showed their products and services in the 200,000-square-foot exhibit hall, including 34 home furnishings suppliers, including three first-time exhibitors in case goods supplier Jofran, rug source Surya and TV console supplier IGO Audio.
Nationwide - with roughly 4,000 independent retailer member organizations operating more than 9,000 stores in the U.S. and Canada with annual sales of nearly $14 billion - has long been working on offering new opportunities to its electronics and appliance dealers, which have suffered from extremely thin margins in their categories.
With its first home furnishings gallery programs, Nationwide is moving the needle again, aiming to "take the guesswork out" of entering the furniture business with turnkey solutions that are backed by the buying group's array of marketing tools, said Bill Bazemore, vice president of the Nationwide Furniture division.
Serta showed product available under the new bedding gallery program, including the Nationwide-exclusive Bellagio at Home collection, which was introduced about 18 months ago; the new Bellagio iSeries mattresses, and the value-oriented Smart Choice bedding, as well as Serta's popular iComfort gel memory foam line.
While the program is open to all members, Serta and Nationwide are targeting "appliance and electronics dealers looking for high-margin opportunity" with the gallery, said Marty Melcher, Serta group vice president of sales.
"We love appliance and electronics dealers because they're used to selling big boxes that they can move efficiently, and they also like selling (technical innovation)," he said. "So selling bedding product like iComfort should fit into their wheelhouse because it's innovative and state of the art."
The 1,600-square-foot gallery space at the show featured 22 SKUs and can be scaled down to 800 square feet, Melcher said. He added that Serta feels $200 per square foot in sales is "very achievable and at a 50% margin they are not accustomed to."
Nationwide's Bazemore noted that about 10% of the group's electronics and appliance specialists are now carrying bedding, and that he expects that number to grow significantly. He said stores can generate added traffic when they promote the category properly and added, "When they see 50% margins, they begin to salivate."
At Klaussner, Vice President of Marketing Len Burke said, "The response from the Nationwide vendors was outstanding." He said the company was particularly pleased with the interest it was seeing from the buying group's electronics and appliance dealers looking to break into the furniture business.
Klaussner showed a 2,500-square-foot version of its Solutions Studio here, featuring 19 accessorized living room groups, a sofa-sleeper section, a swatching rack and information on its automated sales center kiosk, custom capabilities and guaranteed delivery in 21 days or less. The upholstery manufacturer also recently partnered with rug supplier Surya, offering rugs that coordinate with each group.
Other furniture suppliers here were reporting positive results from the show as well.
"It wasn't a record, but it's going to exceed our expectations," said Tim Donk, director of marketing and product development for Legends Furniture.
Legends introduced dealers here to some new white carts and TV consoles that were well received, Donk said, adding that the fact that its goods come fully assembled and, for the most part, are made in the U.S.A., was also appreciated.
Boyd Specialty Sleep representative Ken Quiggins called the show "phenomenal." He said Boyd's "bonus base," which serves as both a bed frame and mattress foundation, was a big hit, especially with the rent-to-own industry members here. The 12-legged frame can be retailed at a nice margin for $150 to $200, and it solves a big sanitization issue for RTO stores when bed sets come back to the store from renters, he said.
"This thing, you just dust off and send back out," he said.
During a press conference, executives of the buying group discussed a multitude of topics, including the name change to Nationwide East for the 700-member Brand-Direct subgroup of retailers in 20 Eastern and Southeastern states.
They also discussed the recent acquisition of Cantrex - renamed Cantrex Nationwide - from Sears Canada in late April.
Cantrex veteran Jeannine Ghaleb, now chief operating officer of Cantrex Nationwide, noted among other things that former owner Sears Canada "was never a perfect fit," for the group. Cantrex had lost some members following Sears' acquisition of the group a few years ago because the dealers saw Sears as a competitor.
Now, however, the group is growing again under a much more mutually aligned owner, she said.
Cantrex, which operates across seven industries, also opens up new member bases to Nationwide, said Nationwide CEO Robert Weisner, particularly in the flooring and photography industries, where Shaw, Nikon and Cannon are supplier partners.
Cantrex will be participate full force at the next PrimeTime show set for the Venetian in Las Vegas, March 3-6.
With a 300,000-squarefoot exhibit hall and some 1,000 to 1,200 dealers expected, the spring PrimeTime will be "the super show of all super shows for us," Weisner said.
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