Buying groups gain more clout

Clint Engel -- Furniture Today, March 4, 2013

HIGH POINT - For years, North American home furnishings buying groups have been an important tool in the playbook of independent furniture retailers, helping them better compete with the marketing prowess and buying power of big-box competitors.
     Today, the role of these buying and marketing groups is even more crucial, with competition more heated and coming from more directions - not only from neighboring retailers, but online, from a host of savvy, pure e-commerce retailers.
     It's no wonder buying groups in the United States and Canada are thriving, growing their membership numbers, for the most part, even as the number of mom-and-pop businesses has declined across the country.
     At Contemporary Design Group's recent annual conference, Jeff Hiller of ProAction Marketing Group told members of the San Diego-based buying group that if they looked at themselves as if they were a single entity, CDG would rank around No. 60 in the Top 100, with about $90 million in annual sales.
     Indeed, every buying group, if considered a single retailer, would make the list; some would top it.
     "The point was ... if we think of ourselves that way, it's going to help us compete in the future," said Howard Haimsohn, CDG lead member and president of Lawrance Furniture in San Diego. Manufacturers, he said, look at Top 100 companies differently, and because of their size, Top 100 companies have buying and marketing strengths that smaller players, on their own, can't match.
     There are 15 major home furnishings buying and marketing groups operating in North America - four in Canada and 11 based in the United States. The numbers include Cantrex, now Cantrex Nationwide, the Canadian buying group that Nationwide Marketing Group of Winston-Salem, N.C., acquired last year from Sears Canada.
     The groups have teamed up with each other in other ways, too, to further strengthen their members through sharing of common supplier partners, banners and programs, marketing intelligence and other information.
     In most cases, they are loose partnerships, which the groups call strategic alliances. BrandSource, for instance, is aligned with Canada's Mega Group as well as TRIB Group, the rent-to-own buying group; and Nationwide, in addition to the Cantrex alignment through acquisition, has an alliance with Furniture Marketing Group, which itself includes many of the largest furniture retailers in the nation.
     "I can't imagine how my business would be different and handicapped without a group like this," Haimsohn said of his association with CDG, started by his father in 1983. But Haimsohn wasn't referring so much to the buying power benefits as the brain power.