Furniture|Today 09/12/2005 Table of Contents

Table of Contents

Furniture|Today -- 09/12/2005

Bedding Today

Retailers have mixed views on key visco bedding issues
It is the proverbial $64,000 question: How long will the visco-elastic boom continue? I am asked some version of that question almost every week. If I had a dollar for every Wall Street type or analyst calling me with visco questions (which I don't), I would be a wealthy man today. Alas... There are as many opinions on the future of visco as there are companies selling visco mattresses.

Editor's Desk

This bank truly makes a difference
Thousands of Americans in Louisiana, Mississippi and Alabama are still homeless in the wake of Hurricane Katrina. Unfortunately, the nightmare along the Gulf Coast is far from over. As I write this, task forces headed by environmental and medical experts have been deployed to monitor the outbreak of potentially deadly diseases.

Industry Numbers

FBI expectations unchanged
St. Louis— Following mixed Labor Day weekend results and unchanged business conditions, Furniture Brands International has reaffirmed its earlier earnings guidance for its third quarter ended Sept. 30. The company expects earnings per share from 14 cents to 18 cents in the quarter, including the effect of six cents in previously announced restructuring, asset impairment and severance char...
Havertys Aug. sales rise 4.2%
Atlanta— Top 100 chain Havertys recorded sales of $68.4 million in August, up 4.2% over year-earlier results. Same-store sales inched up 0.4% in the month. Sales for both July and August slipped 0.8% to $135 million from $136.1 million in the same months a year ago. Same-store sales for the latest two-month period declined 4.
Financial results
Earnings per share are fully diluted, and all figures in parentheses are losses or declines.
Natuzzi sales fall 18.3%
Santeramo in Colle, Italy— For the fourth consecutive quarter, Italian leather upholstery giant Natuzzi reported declining sales, as revenues in its second quarter ended June 30 dropped 18.3% to 165.6 million euros, or $208.5 million, from $244.1 million in the comparable 2004 period. Natuzzi recorded a net loss of 8.

Insider's View

Furniture industry fulfills many consumers' dreams
A while back, I entered the hospital for some tests. Nothing unusual for someone my age and weight, and everything came back OK, but still it makes you pause and consider. My life has been blessed: a wonderful wife for nearly 36 years, great kids who are married, happy and successful, the best granddaughter ever, a business I can be proud of with partners and associates who are not just talente...

News

Ikea opens store in Mass., sets 2 units for Japan
Plymouth Meeting, Pa.— Ikea said last week it plans a Nov. 9 opening for its Stoughton, Mass., store, and will open its first two stores in Japan next year. Stoughton will be the Swedish home furnishings giant's first store in Massachusetts, its second in New England after the New Haven, Conn., unit that opened last summer, and its 26th in the United States.
Broyhill taps McCollum for senior VP post
Lenoir, N.C.— Michael McCollum has joined manufacturer Broyhill Furniture Inds. as senior vice president of bedroom and dining room merchandising. He reports to Harvey Dondero, president and CEO. McCollum takes over the position from Jeff Stone, who has been named vice president of bedroom and dining room merchandising and will report to McCollum.
DeCoro still plans stock offering
High Point— China-based, Italian-owned leather upholstery producer DeCoro still expects to make a public stock offering, probably next year in Hong Kong. DeCoro, which says it has sales of about $300 million worldwide, announced its intention to go public in October 2004 and said an IPO could occur as early as mid-2005.
Katrina's damage heavy
New Orleans— Furniture retailers in the devastated city of New Orleans remained closed indefinitely two weeks after Hurricane Katrina, but others outside the direct path of the storm were beginning to return to normal. Some areas of the city where furniture stores stand remained under water late last week, and it seemed unlikely they would reopen any time soon.
Industry aid pouring in
High Point— From major manufacturers to small retailers, the furniture industry is pitching in with efforts to assist victims of Hurricane Katrina. Here are examples of some of the many efforts. For a more complete list, see our Web site at www.furnituretoday.com. Marty Libowsky, a sales representative for Powell, also purchased 150 pairs of shoes, carts of non-perishable food and gasolin...
Rent-A-Center to close up to 162 units
Plano, Texas— Rent-A-Center said last week it would close as many as 162 stores nationwide by year's end, citing an aggressive acquisition program that left it with too many units. Chairman and CEO Mark Speese said the company had "over-penetration in some markets." Rent-A-Center, the largest U.
Our Community
Vacation house for sick kids, families gets support
Hilton Head Island, S.C.— Some furniture companies are helping to make life a little easier here for the families of children with terminal illnesses. Eighteen companies and individuals have donated about $27,000 worth of furniture to the Hilton Head Heroes House. Founded in 1999 by Glenn and Lindy Russell, Heroes House is a volunteer-supported group that provides free vacations to sick c...
Our Community
FHFRA cues up to save panthers
Hollywood, Fla.— Furniture retailers and sales representatives raised their cues at a club here to raise money to help Florida's endangered state animal, the panther. The Florida Home Furnishings Representatives Assn. hosted a pool tournament to benefit the Save the Florida Panther Fund. This and other events have raised much of the nearly $80,000 needed to build a natural habitat for the...
Our Community
FAFM funds diabetes research
Miami— The Florida Assn. of Furniture Manufacturers has made its largest ever donation, for diabetes research. The $25,000 gift was presented to the Diabetes Research Institute at the University of Miami's Leonard M. Miller School of Medicine. The donation was prompted by Camilo Lopez Jr., a trustee of the FAFM and owner of Miami-based Camilo Office Furniture, whose son was diagnosed with...
Our Community
Bay helps family recover from house fire
Chicago— When a fire destroyed Anna Whitson's home in December, her family was devastated but her community rallied to help. Local retailer Bay Furniture was among the private and individual donors helping rebuild and refurnish Whitson's home in Steger, Ill. Bay donated three bedroom sets, including beds, dressers, mirrors and desks.
Our Community
Kidnapping prompts aid
Fort Smith, Ark.— Manufacturer Riverside Furniture and retailer Today's Furniture have teamed up to help furnish a dream home for a family that has spent a decade searching for a missing daughter. The Nick family, featured on ABC-TV's "Extreme Makeover: Home Edition," lost Morgan Chauntel Nick in 1995, when she was 6 years old.
Our Community
Audi to lead SUNY search
Manlius, N.Y.— Aminy Audi, president of high-end full-line manufacturer Stickley, will chair the search committee for the next chancellor of the State University of New York. The 14-member committee includes trustees, presidents and citizens who regularly volunteer their services on behalf of the state university.
Saloom's new logo emphasizes its roots
Winchendon, Mass.— Aiming to differentiate itself from the growing wave of import competition, casual dining specialist Saloom Furniture has created a marketing campaign that emphasizes the company's New England roots. "New England has a rich furniture manufacturing history," said Peter Saloom, co-owner of the company with his wife, Linda.
Justin David, David Dee merge
El Cajon, Calif.— Justin David Textiles, a fabric supplier to the design trade, and contract fabric supplier David Dee and Co., previously located in Hollywood, Fla., have merged. Key personnel from David Dee and Co. have relocated to El Cajon. Former president David Dee will continue to be actively involved as a consultant.
Bedding Benchmarks
Kluft focuses on partnerships
Ontario, Calif.— The bedding industry doesn't need just another mattress company, says a man who has owned a couple of them. But there is a place for a veteran mattress man who is focused on helping retailers boost their profits, according to Earl Kluft, president and founder of E.S. Kluft & Co.
Bedding Benchmarks
White Dove launches new SleepLogic brand
Cleveland— SleepLogic, a new bedding brand being launched by a long-time bedding producer, is stirring interest in the bedding industry. The new brand is being launched by White Dove Mattress, a bedding company formed in 1922. Bruce Goodman, the great grandson of the founder, now heads White Dove, and is also heading its new SleepLogic launch.
Bedding Benchmarks
SleepLogic offers classic good, better, best lineup
Cleveland— SleepLogic, a new bedding brand being launched by White Dove Mattress, offers the classic good, better, best lineup familiar in the bedding industry. The "good" part of the line is the Refresh program, which retails from $299 to $699 in queen. Comfort choices of firm, plush and pillowtop are offered.
Oriental Weavers merges divisions, appoints Riley
Dalton, Ga.— Major rug resource Oriental Weavers Group has merged its North American divisions and named Mike Riley president of the unified company, which will continue to market products under the Sphinx and OW America brands. Riley, who had been head of the Sphinx division, reports to Ahmed Salama, president and CEO of Oriental Holdings.
FIDX approves electronic inventory schema
High Point— The Furniture Industry Data Exchange has approved a vendor managed inventory schema, one of the many electronic document standards the committee has worked to develop over the past several years. In an online meeting, Mike Overholt of Ashley Inds. presented the vendor managed inventory schema, which will facilitate the reporting of sales data by retailers to manufacturers and ...
Bassett buys N.Y., Atlanta BFD stores
Bassett, Va.— Bassett Furniture Inds. has acquired three Bassett Furniture Direct stores in upstate New York and a controlling interest in four BFD stores in Atlanta. The company said it expects to record a pretax charge of $1 million to $2 million in its fiscal third quarter in connection with the deals.
Ikea offering private-label GE credit card
Stamford, Conn.— GE Consumer Finance will offer a private-label credit card to U.S. customers of Top 100 retailer Ikea. Consumers will be able to apply for the Ikea Card at in-store kiosks or on the company's Web site at www.ikea-usa.com. Those approved will be able to shop with the card right away.
Edwin McCain ready to rock the block party in High Point
High Point— A big event at the upcoming High Point market will get bigger with rock star Edwin McCain performing on an outdoor stage at the All-Industry Market Block Party on Wednesday evening, Oct. 19. The party on High Street between Main and Wrenn streets, will coincide with Furniture/Today's traditional Market Kickoff Party at Noble's restaurant, at Main and High.
Napier joins uph. maker
San Diego— Bill Napier has joined upholstery maker Robinson & Robinson Group as group vice president of marketing. Napier, most recently with Ashley, brings 25 years of experience in various business-to-business and consumer industries. He is responsible for creating brand awareness for all the Robinson divisions, including LeatherTrend, SofaTrend and EasyTrend.
Homestead closing
Broomfield, Colo.— Homestead House will be no more by the end of the year. The Top 100 company, which sold its three Colorado stores to American Furniture Warehouse in June, then shut down its Touchstone upholstery plant in California, now plans to close its remaining five stores, said Roy Hester, president of Zimmer/Hester Furniture Liquidations.
Bowrings seeks buyer
Toronto— Furniture and home accents retailer Bowrings is seeking protection from creditors under the Companies' Creditors Arrangement Act, a procedure akin to a Chapter 11 filing in the United States. The privately held, 64-store national chain has been operated by Mississauga, Ontario-based Tereve Holdings since 1993, when Royal Canadian Securities Ltd.
Raymour expanding distribution
Liverpool, N.Y.— Raymour & Flanigan will more than double the size and triple the inventory capacity of its distribution center here with a $24.3 million expansion. The 59-store, Top 100 company will expand the 191,000-square-foot distribution center at its home base by 345,000 square feet and create 120 jobs.
Badcock honors dealers, vendors
Nashville— Top 100 company W.S. Badcock gave awards to its top dealers and vendors and raised more than $250,000 for charity during its semiannual meeting here. Kenneth Hobby, the Badcock dealer in Eustis, Fla., won the President's Cup, given to the top associate dealer based on sales, receipts, price differences, inventory control and accounts receivable.
Calgary exhibitors write orders; traffic down
Calgary, Alberta— Exhibitors at last month's market here said order-writing was sufficiently encouraging to make them believe 2005 will end on a strong note, despite a noticeable drop in attendance at the three-day show for Western retailers. "We had a very good show, although I have to admit we didn't expect much," said Martin Hiebert, president of Ambassador Dinettes, a casual dining sp...
U.S. and German arms of Klaussner get major stake in U.K. company
Asheboro, N.C.— U.S. manufacturer Klaussner Furniture Inds. and sister company Klaussner Beteiligungs GMBH in Germany have teamed up to acquire a major portion of the business and assets of Klaussner Furniture Inds. Ltd. in the United Kingdom. The U.S. and German companies said they would offer financial and operational support to Klaussner U.
Reykdal tests RTO kiosks in Brick stores
Edmonton, Alberta— In a bid to become a national rent-to-own furniture merchant, Rentcash has forged a strategic alliance with major retailer The Brick/United Furniture Warehouse to offer RTO merchandise via kiosks inside the stores. Insta-rent, a division of publicly traded Rentcash, is renting brand-name furniture, appliances, electronics and computers, with or without the option to pur...
Ethan Allen Va. plant to be distribution center
Danbury, Conn.— Manufacturer, importer and retailer Ethan Allen will convert its Dublin, Va., case goods plant into a large regional distribution center. In addition to shutting down manufacturing at the 570,000-square-foot plant, which the company acquired from Pulaski in October 2000, Ethan Allen will fold its existing Old Fort, N.
Therapedic honors American — on TV, no less
Englewood, Colo.— When Therapedic President Gerry Borreggine came here to honor his largest dealer, he didn't know the presentation would be such a big deal. But a camera crew, bright television lights and a ready script welcomed him to the high-powered advertising, marketing and merchandising juggernaut that is American Furniture Warehouse.
American Furniture Warehouse event raises $175K for Project C.U.R.E.
Englewood, Colo.— American Furniture Warehouse raised nearly $175,000 at a golf tournament to support Project C.U.R.E., a non-profit group that delivers medical supplies and equipment to needy developing countries. Jake Jabs, president and CEO of the Englewood-based retailer, was the title sponsor of the tournament, presented by Re/Max International.
Fiber supplier DAK links surcharge to hurricane
Charlotte, N.C.— Polyester fiber producer DAK Americas, a supplier to makers of upholstery fabric, has instituted a 15-cent-per-pound surcharge on all its fiber products in anticipation of dramatic increases in raw material and energy costs because of Hurricane Katrina. In a Sept. 1 memo to its customers, DAK also said its supply chain was disrupted, with facilities of some key suppliers ...
DJM will sell remaining Rhodes stores
Atlanta— Rhodes has hired DJM Asset Management to dispose of the Atlanta-based retailer's 12 remaining owned and leased stores and four distribution centers. The properties in Illinois, Indiana, Kentucky, Missouri and Georgia were not among those the bankrupt retailer sold last month to a Rooms To Go affiliate and Great American Group.
Akzo Nobel to acquire German firm
Sassenheim, the Netherlands— Akzo Nobel is boosting its wood finishes business by acquiring the interior finishes division of a German company. Akzo Nobel has reached an agreement with ICI Group to purchase the finishes business Zweihorn Gmbh for an undisclosed amount. Zweihorn, which has 55 workers at its plant in Hilden, Germany, had 2004 sales of about 18 million euro, equivalent to ab...
Ehle named sales VP at SLF
Phoenix— Case goods importer SLF, formerly Samuel Lawrence Furniture, has named Kevin Ehle as vice president of sales. He reports to George Revington, president and CEO. Ehle replaces Mike McCollum, who has joined Broyhill. Ehle has been in the industry more than 23 years, the past 13 at metal bed specialist Fashion Bed Group, most recently as senior vice president of sales.
Correction
A list on page 273 of the 2005 Buyers Guide, a supplement distributed with the Aug. 15 issue, contained incorrect contact information for Yeh Brothers World Trade. Here is the correct listing: Yeh Brothers World Trade 15th Floor, No. 2 Chung Cheng 3rd Road Kaohsiung City, 800 Taiwan 886 7 238 5883 Fax: 886 7 238 5500 team1@ywt.

Opinion Today

Furniture, lighting prove Paris trend stars
It's interesting watching home furnishings trends around the world. Last week's Maison et Objet show in Paris was a prime example of how they come about and move forward. In recent years, at Maison and other key international markets, decorative fabrics and rugs have been the fashion-forward stars. This time around, furniture and lighting were the two standouts in style direction.

Special Report

Recliner players share strategies for growth
High Point— There's plenty of growing room in the $3.4 billion recliner category, but producers say numerous challenges lie ahead for those trying to tap into it. Not only are consumer tastes changing — some people actually want a recliner in their living room nowadays — but producers are under increasing pressure from rising raw materials costs and low-cost imports.
La-Z-Boy stays strong with broad assortment
Monroe, Mich.— When you're the sales leader in the recliner category — with the furniture industry's best-known brand name, to boot — it's only natural to be the target of every other producer's potshots. But over the years, La-Z-Boy has become adept at ducking those projectiles, while firing off a few of its own at strategic moments.
Lane concentrates on comfort
Tupelo, Miss.— Style and product innovation certainly are important, but at Lane, nothing takes a back seat to comfort. "Comfort is what it's all about," said Greg Roy, vice president and general merchandise manager. "We still believe the consumer ultimately wants the most comfortable seat available.
Franklin Corp. strives to deliver 'more for less'
Houston, Miss.— Located near the scenic Natchez Trace Parkway in a quiet town that bears no resemblance to the Texas city of the same name is an equally quiet upholstery producer that has become a heavy hitter in the recliner category. Executives at family-run Franklin Corp. say they're not interested in building a brand name.
Furniture Store Performance Report
Medium stores
$5–20 million in annual sales Efficiency measures Space allocation Non-store activities Sourcing Direct importing 56% of retailers imported directly in 2004 8% of retailers who did not import directly in 2004 will in 2005, while 3% who imported in 2004 will not in 2005 Buying groups 43% of medium-sized stores belonged to a buying group in 2004 Private label 33% of medium-sized stores offe...
Furniture Store Performance Report
Large stores
$20 million + in annual sales Efficiency measures Space allocation Non-store activities Sourcing Direct importing 70% of retailers imported directly in 2004 11% of retailers who did not import directly in 2004 will in 2005, while 4% who imported in 2004 will not in 2005 Buying groups 24% of large stores belonged to a buying group in 2004 Another 12% are joining a buying group in 2005 Private la...
Furniture Store Performance Report
Western stores
Efficiency measures Space allocation Non-store activities Sourcing Direct importing 40% of retailers imported directly in 2004 9% of retailers who did not import directly in 2004 will in 2005, while 7% who imported in 2004 will not in 2005 Buying groups 21% of Western stores belonged to a buying group in 2004 Another 3% are joining a buying group in 2005 Private label 21% of Western stores offe...
Furniture Store Performance Report
Midwestern stores
Efficiency measures Space allocation Non-store activities Sourcing Direct importing 27% of retailers imported directly in 2004 15% of retailers who did not import directly in 2004 will in 2005, while 3% who imported in 2004 will not in 2005 Buying groups 21% of Midwestern stores belonged to a buying group in 2004 Another 7% are joining a buying group in 2005 Private label 20% of Midwestern stor...
Asia Spotlight
U.S. brand names appeal to growing Chinese market
Shanghai, China— The secret is out: China is a great place to make furniture. Already in the loop on that? Well, here's one that may not be so obvious: China is also a great place to sell furniture. That's something more U.S. companies are learning, thanks to a small but increasing retail presence in China.
Asia Spotlight
Asians also eyeing China
Kuala Lumpur, Malaysia— Many Asian furniture manufacturers are devoting their energies to the U.S. market. But that attention soon could shift as a new market emerges in their back yard — the growing Chinese middle class. Definitions of this segment vary. According to China's National Bureau of Statistics, the Chinese middle class, with annual incomes between $7,230 and $60,240, inc...
Asia Spotlight
Natuzzi, Club 8 have presence in China
Shanghai, China— U.S. furniture manufacturers aren't the only ones interested in selling to China. European brands also are expanding their retail presence here. Italian leather producer Natuzzi is one company with stores in China. It opened its first in Shanghai in April 2000 and now has 10 stores.
Asia Spotlight
China is brand aware
Shanghai, China— Companies looking to sell furniture to this country's middle and upper classes may want to start thinking like Chinese consumers, reaching out to those willing to pay for the quality and status associated with brand-name goods. "People in ... China are very concerned about brand," said Juricka Chu, overseas marketing director for the Hong Kong-based International Furnitur...
Catnapper scores with swivel-glider
Cleveland, Tenn.— When the first swivel-glider mechanisms were installed in a few Catnapper recliners about 18 months ago, the company's sales team was a bit skeptical. But when retailers started placing large orders for the product at the first High Point market in which it was available, the skepticism quickly vanished.
Berkline maximizes space with Three 27
Morristown, Tenn.— After watching retailers gradually reduce the amount of floor space they were devoting to recliners, Berkline came up with an offer that many of them couldn't refuse. Display just three of our recliners, but sell 27 different models from this small display. The pitch seems to be resonating with Berkline dealers, who have enthusiastically embraced the concept, which offi...
Furniture Store Performance Report
Small stores
$2–5 million in annual sales Efficiency measures Space allocation Non-store activities Sourcing Direct importing 42% of retailers imported directly in 2004 12% of retailers who did not import directly in 2004 will in 2005, while 3% who imported in 2004 will not in 2005 Buying groups 23% of small stores belonged to a buying group in 2004 Another 9% are joining a buying group in 2005 Privat...
Furniture Store Performance Report
Smallest stores
<$2 million in annual sales Efficiency measures Space allocation Non-store activities Sourcing Direct importing 13% of retailers imported directly in 2004 11% of retailers who did not import directly in 2004 will in 2005, while 4% who imported in 2004 will not in 2005 Buying groups 7% of smallest stores belonged to a buying group in 2004 Another 9% are joining a buying group in 2005 Private ...
Furniture Store Performance Report
Southern stores
Efficiency measures Space allocation Non-store activities Sourcing Direct importing 36% of retailers imported directly in, 2004 13% of retailers who did not import directly in 2004 will in 2005, while 4% who imported in 2004 will not in 2005 Buying groups 16% of Southern stores belonged to a buying group in 2004 Another 11% are joining a buying group in 2005 Private label 17% of Southern stores...
Furniture Store Performance Report
Northeastern stores
Efficiency measures Space allocation Non-store activities Sourcing Direct importing 30% of retailers imported directly in 2004 5% of retailers who did not import directly in 2004 will in 2005 Buying groups 21% of Northeastern stores belonged to a buying group in 2004 Another 4% are joining a buying group in 2005 Private label 12% of Northeastern stores offer private-label merchandise Employees ...
Furniture Store Performance Report
Retailers upbeat about 2005 sales
Retailers participating in Furniture/Today's exclusive Furniture Store Performance Report are more upbeat than not about sales prospects for 2005. Only one-fourth expect furniture sales to be lower than in 2004 when sales were up 9% over 2003. There are huge differences in sales expectations by region, however.
Furniture Store Performance Report
All stores
Advertising & promotions A median of 6% of sales is allocated to advertising & promotions *Other includes local, regional, state, national magazines, in-store events, the Internet, Yellow Pages, sponsorships, billboards, etc. Employees and payroll A median of 17% of payroll expense goes to fringe benefits Sourcing Direct imports 34% of retailers imported directly in 2004 11% of retailer...

Store Openings

Thomasville opens Philly unit
King of Prussia, Pa.— A dedicated Thomasville store has opened here in The Court at King of Prussia, said to be the nation's third-largest mall. The 16,000-square-foot store west of Philadelphia is owned by Brian Good and Clair Sauder, and is managed by Debra Strong-Hudgins. Good and Sauder own three other Pennsylvania stores, in Allentown, Montgomeryville and Oxford Valley, and also own ...
Broyhill adds Colorado store
Aurora, Colo.— A dedicated Broyhill Home Collections store has opened here, the first such store in Colorado. The 40,000-square-foot unit is owned and operated by the Thompson family — Tom, Sylvia and their son, Lael. The family has operated a Sonshine Furniture store since 1983, in a facility that was built in the late '40s/early '50s as a JCPenney department store.
Jadora launches 1st U.S. store
San Francisco— Jadora, an importer of Vietnamese-made furniture and home accessories based here, has opened its first U.S. store. The 1,700-square-foot store on Union Street in San Francisco sells the company's furniture, pillows and luxury bedding, lamps, table runners, wine holders and Swarowski crystal place settings.

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