RetailerNOW August 2016

AUGUST 2016

The Publication of the Home Furnishings Association

Passing the Baton

What happens to the family business when there’s no more family?

Las Vegas Market Issue

A E R

HARMONIZE.

OM • • • • • •

V G S

Seamlessly coordinated accessories.

Designs for every lifestyle and price point.

Top Sellers ship within 48 hours.

AT L A N TA 1 1 - A - 1

THE BEAUTY OF EASY.

ACCENT FURNITURE

RN_FP_Inside Front Cover

BEDDING

LAS VEGAS C400 OPEN 8AM-8PM

LIGHTING

PILLOWS

RUGS

Transform/ Youth G-85

THROWS

WALL DECOR

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Aug16

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AUGUST2016

TAKEAWAYS 1 2 3 4 5

Sell the business. 10 Invest in youth. 22 Plan for your store’s future. 30 Shop business insurance. 32 Wow customers. 34

10 WHAT’S INSIDE 2.

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27.

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37.

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HFA President’s Letter Editor’s Letter Member Profile: David Gardner Product Focus: Kids’ Furniture Next Generation: Matt Shuel Family Matters: No Excuses for Not Planning HFA @ Market: Las Vegas Market RRC Member Benefit: MyHFA.org Government Action: CPSC Inspectors HFA Community

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DEPARTMENTS Cover Story 10. Passing the Baton

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Sales & Marketing 20. Sleep = Quantity + Quality Operations 28. Guarantees and Warranties 32. Shopping for Business Insurance 34. Emotionally Engage Your Customers

RetailerNOWmag.com

AUGUST | 2016

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“

The sheer ease with which we can produce a superficial image often leads to creative disaster.

President Jeff Child RC Willey

—Ansel Adams

”

President-Elect Steve Kidder Vermont Furniture Galleries Vice President Jim Fee Stoney Creek Furniture

What flavor is your store?

Secretary/Treasurer Sherry Sheely Sheely’s Furniture

ummer is a time for grilling hamburgers and the other night some of the family was over doing just that. My son made sure we had Heinz ketchup because that’s the only brand of ketchup he likes. That got me thinking about brands. What was it he liked so much about Heinz? The bottle? The name?

The taste? The TV commercials? Or a combination of all? Probably the latter, but if he didn’t like the flavor none of the rest would matter

S

Chairman Marty Cramer Cramer’s Home Furnishings

Jeff Child

Executive Staff

HFA President

Sharron Bradley Chief Executive Officer sbradley@myhfa.org Mary Frye Executive Vice President mfrye@myhfa.org Membership Staff Jana Sutherland Membership Team Leader jsutherland@myhfa.org Jordan Boyst jboyst@myhfa.org

Branding a store isn’t always easy. It isn’t always about marketing firms or graphic designers telling you how you should look or what color your logo should be. The message you send out and the way your store looks are important but it’s just as important to remember the flavor, or personality, of your store. Whether you know it or not, your store has a personality; a brand. That brand is conveyed (and strengthened or weakened) anytime a customer interacts with you; it may be through an ad, an employee, curb appeal or the experience they had while in your store.

A brand is a hard thing to get your arms around, but here are a few things to get you thinking.

1. Who are you? Understanding who you are and what kind of personality you have will influence what type of store you have. Learn about who your employees are; their personalities will influence the type of experience your customers have.

2. Who are your customers? Spend time working with customers, do focus groups or just go out on the floor and ask questions of them.

Most people love to be heard. Talk to your sales associates. They spend a lot of time with those customers. Demographics are interesting, but knowing what your customers like is just as important.

If you have multiple stores, learn about the communities they’re in. Be a part of those communities.

Sherry Hansen shansen@myhfa.org Michael Hill mhill@myhfa.org Dianne Therry dtherry@myhfa.org Kaprice Crawford Director of Education kcrawford@myhfa.org Please call 800.422.3778 for membership inquires.

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3. Be true to yourself and your customers. Once you understand your store and who your customers are you’ll know how to make your customers fans of your store. You’ll know how your associates should dress, how to merchandise the store, what type of music to play and what type of product your customers like. You’ll understand what they want, how they live and how to become their brand.

Everyone has a brand. Whether it’s good or bad depends on us. Once we know ourselves and our customers we have a plan to make that brand one that’s comfortable to our customers. When they interact with us they’ll realize they like that “flavor.” That’s our goal.

Jeff Child

jeff.child@rcwilley.com

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AUGUST | 2016

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AUGUST | 2016

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“

Why has government been instituted at all? Because the passions of men will not conform to the dictates of reason and justice, without constraint. —Alexander Hamilton

RETAILERNOW STAFF Dan McCann Publisher dmcann@myhfa.org

”

We’ve got you covered

Lisa Casinger Editorial Director lcasinger@myhfa.org

I

Robert Bell Editor rbell@myhfa.org Tim Timmons Art Director ttimmons@myhfa.org Lynn Orr Business Development Lorr@myhfa.org

Robert Bell Editor, RetailerNOW

Cassie Wardlow Digital Marketing Coordinator cwardlow@myhfa.org RETAIL ADVISORY TEAM Carol Bell Contents Interiors Tucson, Ariz.

Travis Garrish Forma Furniture Fort Collins, Colo.

Rick Howard Sklar Furnishings Boca Raton, Fla. Mike Luna Pedigo’s Furniture Livingston, Texas Andrew Tepperman Tepperman’s Windsor, Ontario This Month’s Contributors

Ginny Gaylor, Marty Grosse, Karen Hornfeck, Barbie Kremer, Rieva Lesonsky, Gerry Morris, Connie Post and Wayne Rivers.

Contact Us

KEA’s announcement this summer that it would recall 29 million chests and dressers in the United States after at least six toddlers were crushed to death in tip-over accidents might have been eye-opening for consumers, but not for members of the Home Furnishings Association.

Lisa Casinger, the HFA’s government relations liaison, has doggedly followed this issue for two years now, reporting every government turn of the screw to you, our members so that you and your store are informed and up to date on what your obligations are.

Fortunately, in our industry there is a voluntary tip-over standard that many manufacturers adhere to. The safety standard (which applies to pieces 30" or taller sold as youth clothing storage) has many provisions, the very least of which is probably the tip-over restraint. Canada adopted this standard in June after Health Canada reviewed other standards, including the European one some manufacturers follow. In both the U.S. and Canada, that standard has been found lacking.

If you sell youth furniture, you have a couple of obligations.

First, check with your manufacturers to make sure their furniture meets the industry’s voluntary standard. If it does you must leave the required warning labels on the furniture with the tip restraints. You also need to explain the importance of installing them to your customers. If you don’t understand the details invite your rep in to give your staff a demo. Be open with your customers—they’re parents, they want to know how to keep their kids safe.

There’s a running joke in our office that government relations is an under-used and overlooked benefit within the HFA. In truth, we know it’s one of the most vital benefits we offer our members.

Now more than ever it’s important for you to know what’s happening not just in your state, but in Washington, D.C., within our industry. Lisa and our lobbyists are your proverbial eyes and ears on all things furniture related.

If you have a question or concern about tip-over standards, don’t hesitate to contact her at lcasinger@myhfa.org.

RetailerNOW 3910 Tinsley Dr., Suite 101 High Point, NC 27265 RetailerNOWmag.com 800.422.3778

Robert Bell

Subscription: $70/year RetailerNOW, ISSN# 2166-5249, is published monthly (except March and December) by the North American Home Furnishings Association, 500 Giuseppe Court, Ste. 6, Roseville, CA 95678.

POSTMASTER: Address changes to: RetailerNOW, NAHFA, 500 Giuseppe Court, Ste. 6, Roseville CA 95678.

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© 2016 North American Home Furnishings Association. Published by the North American Home Furnishings Association. Material herein may not be reproduced, copied or reprinted without prior written consent of the publisher. Acceptance of advertising or indication of sponsorship does not imply endorsement of publisher or the North American Home Furnishings Association. The views expressed in this publication may not reflect those of the publisher, editor or the North American Home Furnishings Association, and North American Retail Services Corp. Content herein is for general information only; readers are encouraged to consult their own attorney, accountant, tax expert and other professionals for specific advice before taking any action.

AUGUST | 2016

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Facebook’s new ads track in-store visits, purchases

The new frontier?

It’s in your hand The future of advertising continues its push into a decidedly mobile and increasingly conversational format, according to Mary Meeker’s 2016 Internet Trends report. The Kleiner Perkins Caufield & Byers partner released her highly-anticipated annual forecast in June.

The report points toward a mobile-first, data-rich, and video-heavy future for online advertising.

3 takeaways: 1. Global internet user growth is slowing Global internet use is finally slowing down, while smartphone usage worldwide has continued in its steady upward trend, implying mobile is the new frontier for growth.

2. Led by mobile, U.S. online advertising is growing Desktop advertising isn’t going anywhere, but it’s increasingly a mobilefirst world, meaning the faster retailers adapt their strategies to that reality, the better.

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3. Google and Facebook continue to dominate the market Compared to the scale of Google and Facebook, all other internet advertising companies seem somewhat trivial. Combined, the two companies own 76 percent of advertising revenue in the U.S. —and that figure is growing.

The data shows the power of platforms like Facebook and Google that have access to vast amounts of data and offer precise targeting capabilities.

For more takeaways, check out Meeker’s take at tinyurl.com/j3uq6ye

As part of Facebook’s ongoing effort to give marketers ad view and foot traffic insights that rival online data capabilities, the company announced in June an addition of new measurement tools to its campaigns. Seeking to give retailers a chance to measure how effective ads are in driving brick-andmortar sales, the new features allow advertisers to see how many people visit a store after seeing a Facebook campaign, optimize ads based on store visits, and analyze results across stores and regions to plan future campaigns.

According to TechCrunch, retailers using the new tools can compare transaction data from their stores to Facebook’s Ads Reporting to track how effective their ads are in influencing in-store purchases.

Facebook’s effort was met with good reviews. Yoram Wurmser, an analyst at eMarketer, told Ad Age, “…this new Offline Conversion API brings Facebook up at least to what Google has been offering, but probably goes beyond it…”

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Want to share a cool app? Drop us a line at rbell@myhfa.org

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Working forward to building customer loyalty, one room at a time.

Every furniture retailer is different, but all share a common ambition: to succeed. And it starts by serving customers better. Synchrony Financial delivers payment solutions that help drive traffic, increase average transaction size, and build repeat business. Whatever you’re working forward to, we can help make it happen.

Engage with us at synchronybusiness.com/furniture or 1-855-973-3552.

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HFACHAT

would raising the minimum Q: How wage affect your business?

Mandy Jeffries Colfax Furniture Greensboro, N.C.

“It would affect us for the worse because I have a budget when it comes to hiring and I have to stick close to it. I’d probably have to have a smaller staff, find people who could do more than just one job. I’m not saying people don’t deserve a fair wage, something to live on, but a lot of the people we have working for minimum wage or a little more, there’s a reason for that. This is their first job.”

Greg Greeson Collectic Home Austin, Texas

“We would expect no direct result to our business from a raise in the minimum wage—as long as the raise is to an amount less than $15 an hour.

None of our staff is paid less than that currently.

However, if a raise in the minimum wage results in a recession or mass layoffs within the larger U.S. economy, as some have predicted, THAT would affect our business—detrimentally. Overall, I’m a firm believer in LESS meddling by the federal government in business matters.”

Pam Rudolph Rudolphs Furniture Butte, Mont.

“We pay our employees considerably above the current minimum wage. If, however, the minimum was to go to $15 an hour as some are suggesting, it would be a hardship for us as a small employer.

I would foresee having to reduce our staff or reduce the hours our employees work per week.

In today’s competitive market it would be difficult to increase prices in order to cover the additional payroll expenses.”

TOPSHELF Mattress Matters Made Short and Sweet (Mattress Matters, Sheridan Books, 156 pages) You would think selling a mattress would be easy. Who doesn’t need—heck, who doesn’t want—a good night’s sleep?

Turns out the art of mattress selling is a difficult one to master.

Consumers frequently balk at making a purchase for a variety of reasons. Some of those excuses are a figment of their own minds.

Others are obstacles put in their way by the store and its sales staff.

That’s where Gerry Morris comes in. If you’ve ever sold a mattress, you’ve probably heard of Morris. He’s a regular contributor to this magazine, speaker, and veteran industry consultant with more than 25 years of experience in the mattress business. He’s also the author of Mattress Matters, one of the best investments a home furnishings retailer can make if they’re hoping to boost their bedding sales.

The book is more than a decade in the making, a compilation of some of Morris’ best columns dating back to 2006. Don’t let the age on the columns fool you. They are as relevant now as when they were first published.

Take this gem from the book’s early chapters, a 2006 column on never underestimating your customer’s ability to buy. Morris was visiting a retailer for a training seminar, but showed up a day early to see how the sales staff interacted with customers.

He observed a young man who was in need of a queen set for his new apartment and had $500 to spend. Rather than stay within those constraints, the salesman showed the customer a variety of beds before he made his choice: a $1,500 set.

The Morris moral: “Sales associates who feel a responsibility to help customers get the best set possible have tremendous persuasive influence. Associates who try to accomplish the same action with the goal of making more commission are seldom as successful and often alienate customers because they come off as being pushy and manipulative.”

Which salesperson do you have? The helper or the manipulator?

Morris uses real-life stories and draws on his years of experience to help educate and inspire today’s mattress sales associates. Topics range from can trust be trained (absolutely, and Morris shows how) to dealing with downtime (a perfect time to learn product, role play or check inventory).

Many factors can influence a shopper in your store. Brand, comfort, previous experiences and, of course, price come quickly to mind. But none is more powerful than the trust established between your sales associate and the customer. Some of Morris’ columns are obvious, such as helping the customer understand the real value to a mattress. But even the most experienced sales associate could stand for a refresher course. Mattress Matters is just the book to supply it.

Book review: by Robert Bell

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Passing the Baton 10

AUGUST | 2016

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Your store doesn’t have to end with you when there’s no next generation.

Here’s how to plan for the next chapter.

By Ginny Gaylor

RetailerNOWmag.com

AUGUST | 2016

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IN CAPABLE HANDS When Marty Cramer and his wife

Michelle retire, they’ll leave the store in the capable hands of a longtime employee.

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t may surprise you to learn that, according to the non-profit Family Business Alliance (FBA), 80 to 90 percent of all businesses are family owned. For many home furnishings retailers, there can be no greater sense of accomplishment than passing on the company they have built to the next generation. According to FBA’s research, about one-third of family businesses make their way from the first generation to the second.

About one-third of those second-generation businesses end up being run by a third generation.

Here’s where it gets really grim: Fewer than half of those thirdgeneration businesses—three percent of the original number— make it to the fourth generation. So what happens when a family business has come to the end of the line? What are the options?

Continuing the legacy HFA member Marty Cramer started Cramer’s Home Furnishings with two stores in Washington in 1995 and has found success, growing to six stores at one time, before he and his wife decided all they were doing was working, and they should pare things back. Despite having no children, the couple has a plan of succession for their stores that involves a long-time employee.

Cramer feels that, in a way, passing the business on to an employee will be easier than it would be to a family member.

“There’s not the same type of emotional attachment,” he says.

“I’ve had this idea with two different people, one did not work out at all. What that has taught me is you can’t be impatient on either side to make this type of thing work,” Cramer says.

“Patience is key. From the owner’s standpoint, you don’t want this to happen until you are ready. From the other side, they can’t be impatient and say they want it now, they have to understand the opportunity being presented to them.”

Although Cramer has no set date to make the transition, he and his wife are already putting the process in place in small ways.

“One issue I have as owner, the person you’re talking to is technically an employee, although I don’t look at it that way, but you have to make sure he’s comfortable to talk freely and not worry about the whole employee/employer relationship. I’ve consciously tried to work on that, treating him as more of a right-hand man

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so he feels comfortable telling me what he thinks.”

Cramer advises that you can’t force the idea of succession, which applies to a family member or an employee. “It has to happen naturally over time,” he says. “To me it’s the most natural thing in the world that he should end up with the store, he’s so good at it and he has the right temperament.”

Those are good tips to follow, says Wayne Rivers. Rivers runs the Family Business Institute in Raleigh, N.C. and helps dozens of companies each year with their succession planning.

Increasingly those companies are looking outside the family for a successor. Rivers, who writes a family business column for RetailerNOW, says there are a lot of differences between planning for a family member to take over and selling to an outsider.

“For starters you’re probably not going to be as charitable to an outside,” Rivers says. “A father is going to give some value to his children. If he owns the building, maybe he’ll give the business to his son or daughter and just charge them rent. You’re not going to do that to someone outside the business. You’re going to want to get everything you can out of the deal.”

Taking over the reigns What if you’re the outsider taking over a fifth-generation family business? HFA member Chris Sanders, president and owner of Everton Mattress Factory in Twin Falls, Idaho, knows what it’s like to be the non-family member taking over a well-established family business. He worked for Everton Mattress Factory for 20 years. When no other family members expressed a desire to run the business, Sanders spoke up. “I always told them I had an interest if they ever wanted to retire or move on,” he says. Sanders ended up buying the manufacturing side of the family business, and the Evertons maintained the retail entity.

Sanders advises anyone looking to purchase a family-owned business to have the details in writing. “The hardest part is to make sure the details are correct,” he says. He ended up having someone outside the deal come in to help broker and finalize everything. “Sometimes it takes a third party to make things happen.”

RetailerNOWmag.com

Now going into his third year as owner, Sanders recalls some surprises in the beginning. “Even though I’d worked for the business for some time, I wasn’t involved in the regulatory side, so I had to fine tune myself on those things.” The Everton family was available for the first several months if he had questions, but the transition has mostly been a clean break. “But sometimes they retire, and you won’t see them again. So you need to make sure you have the skill set you need if they aren’t available anymore.”

Selling it off HFA member Jeff Selik, general manager of Hillside Furniture in Detroit, had every intention of taking over the reins of the contemporary furniture business his father, Bruce Selik, began in 1974. But when his father was turning 70 and ready for something different, an intriguing offer presented itself.

Jeff Selik was called into his father’s office in November 2015, and was told that cross-town competitor Art Van Furniture wanted to buy the family business and keep Selik on to run Hillside. “Mr. Van and my father had a nice, long relationship, their business complimented us and the only segment they didn’t have and own was contemporary,” Selik says.

Selik found his position to be ideal. “They didn’t want the business unless I was going to stay on and run the brand,” he says. Now he has the backing of a larger parent company that wants to embrace his store’s brand and provide the support he could never achieve on his own, from capital to human resources.

One of the reasons why the transition is working for Selik is because the decision was his to make he says, explaining that his father left it up to him to decide on the purchase. He feels the acquisition of Hillside Furniture by Art Van enables his store to grow to the next level. “You have to make this decision because you don’t want to be repeating the same year, we’re now going in the direction of growth,” Selik says.

PLAN B When it came

time for his father to retire, HFA member Jeff Selik was given a choice: Take over Hillside Furniture or sell to cross-town rival Art Van and stay on as general manager. He chose the latter.

RetailerNOWmag.com

AUGUST | 2016

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31.4%

(that’s nearly a third) of business owners have no estate plan beyond a will.

15%

of familyowned businesses that have identified a successor say

it will not be a family member.

40%

Within 10 years,

of business owners expect to retire.

Of these, fewer than half (45.5%) of those expecting to retire in five years and fewer than a third (29%) of those expecting to retire between 6 and 11 years have selected a successor.

37%

of family businesses

Making the transition If you want to have the best odds of passing your family-owned business on to the next generation, Ron Dohr, a family business advisor based in Seattle has some advice. Dohr has worked with numerous business owners across the country looking to make this kind of transition.

“Is the next generation interested, qualified and passionate about the business?” Dohr asks. He explains that if they possess those qualities and don’t view the business as something they feel entitled to, then a family-owned business is on the right track to be transitioned. He also emphasizes that the next generation needs to be prepared and competent to take over the reins, and that usually means time spent working outside the family business and a sound education.

He adds that each generation has to understand that to keep a family business going requires work on the business itself, thinking of ways to grow the company. “Today you have to come up with three to four innovative ideas per generation,” he says. “Fifteen years ago, one idea per generation was enough.”

Why do successful multi-generational family-owned businesses have to keep searching for the next big idea? Because to sustain the new shareholders that come with each subsequent generation, you have to grow the business’ assets. “The founder is generation one, then the founder has kids (a new shareholder group), then you get to the grandkids and you can jump to double digits quickly, so by the fourth generation there can be 90 to 100 people all wanting dividends,” explains Dohr. “It can be hard for a business to continually sustain itself, but it helps to create a long-term legacy strategy so you have reasonable dividend growth to sustain future generations.”

He advises that if a company wants to make it to the next generation and beyond they need to be focusing on several areas, including a sense of shared purpose and values, an effort to constantly be adapting, a focus on professionally managing the business and an understanding that each generation has the choice to be involved.

Rivers says retailers who know they are going to be selling to an outsider need to start grooming years in advance. “Most small independent stores I’ve dealt with, when the owner is ready to retire chances are his employees are right there ready to retire, too. You need to be looking 10 to 15 years out for someone who’s aggressive and hungry and wants to one day own his or her own business.”

In looking for someone to pass the business on to Rivers says owners need to be ready to fail the first time out. “You didn’t marry the first person you came upon,” he says. “You dated a few people before finding the right person. It’s that way with finding a successor.”

have buy-sell agreements or other

Ginny Gaylor is an awarding-winning writer and editor based in Greensboro, N.C. She has more than 15 years of experience writing about the home furnishings industry. She can be reached at ginnygaylor@gmail.com.

arrangements defining who can own stock and how it is transferred.

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Giving Back

David Gardner serves more than his customers. His volunteer work reaches many throughout eastern North Carolina.

By Barbie Kremer

S

ome things never go out of style. In an industry that has seen its share of change and reinvention, David Gardner speaks volumes about what makes his third-generation home furnishings store thrive: Treating people right.

Gardner is careful to treat all people right—not just his customers. The owner of Warrenton Furniture Exchange in Warrenton, N.C., cares as much about his community and service as he does the business his grandfather started more than 80 years ago.

When I introduced myself to Gardner, he politely informed me he had to call me back. He was busy in the warehouse. When he called back, Gardner was apologetic. “I just spent 15 minutes searching, but I found an old part to a bed someone needed,” he said. When the man expressed his amazement that Gardner had the 60-year-old part he was looking for, Gardner shrugged it off as no big deal. “It was just in my junk pile,” he said. He added the pieces he has are a rare find on Ebay.

FAMILY ROOTS Long-time HFA member David Gardner is the thirdgeneration owner of Warrenton Furniture Exchange in Warrenton, N.C. RetailerNOWmag.com

AUGUST | 2016

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I don’t buy it. A junk pile? Really? It’s hard to believe that Gardner runs a fast approaching century-long reputable furniture business in rural North Carolina with a “junk pile.”

Something tells me his warehouse is stocked with any furniture item imaginable. People with rural roots that run as deep as Gardner’s seldom throw things out because you never know when you’ll need them. Something tells me Gardner knows exactly what he has and where it is. I also think he has neither junk nor a pile. Methodical and intentional businessmen like Gardner are not sloppy. They learn early that hard work cannot be sloppy and a self-respecting work ethic is the key to running a business and being a well-respected leader.

Gardner’s heritage melds easily into the saying, “The apple does not fall far from the tree.” To appreciate the man he is today and what he brings to the furniture industry can be traced back to his grandfather, Simon Gardner. Simon Gardner started Warrenton Furniture Exchange, Inc. in a time when startups were not the trendy business venture, but born of necessity and helping others. Simon Gardner was born in 1891, the youngest of 12 children. When you’re born into a farming family and you’re the baby, you have to figure things out and Simon knew “he did not want to farm,” says Gardner, whose grandfather studied at Trinity College (now Duke University) while holding down two jobs. After college, Simon returned to Warrenton and worked at a bank, started and sold an insurance business, became Registrar of Deeds and opened a dry cleaning business with his sister. Something clicked for Gardner’s grandfather. As Gardner says, “Granddaddy worked until he discovered what worked.” He knew people needed furniture. He also knew the business model had to include credit, fair trade and creating customer loyalty.

Warrenton Furniture Exchange was born in the spring of 1934.

In its early years, Simon Gardener traveled to Richmond and surrounding areas to purchase estate furniture or buy it from warehouses fallen on hard times. He would store his inventory in rented buildings throughout Warrenton. In the back room of the store, Simon employed men to touch up or stain items that would be traded or sold. The workmanship was so good that the refurbishing “graduated the used furniture into new furniture,” as Gardner tells it. Simon also had the good sense to offer credit to everyone who needed furniture and set up weekly or monthly plans.

In 1946, Gardner’s father, Scott, came home from college and a military tour and worked with his father to grow the business.

In that year, Warrenton Furniture Exchange moved to a new twostory building. New furniture and appliances were added. Scott purchased a wooden tobacco warehouse to add additional inventory. But life happens and the family business suffered a setback. A fire in 1967 destroyed the warehouse and toppled the town’s only water tower. Gardner credits his grandfather’s success to perseverance and tenacity. Three years after the fire a new and larger store was built on the former warehouse lot and is where Warrenton Furniture Exchange is today.

It only makes sense at this point that Gardner couldn’t escape developing a strong work ethic embodied with a strong character and level head. At 10 he was sweeping the warehouse floors after school and on Saturdays until he graduated from high school. By 15, he earned his Eagle Scout award. Gardner works with Boy Scouts today because he believes in the hard work of earning merit badges and moving future leaders toward paths of success.

He graduated from North Carolina State in 1972 and spent seven years in Tennessee. In 1978 he came home to work with his father. By 1985 was managing the store. Scott retired in 1988 and

“

WHAT HFA MEANS TO ME The most important member benefit is the interaction with other furniture dealers. We have similar problems, failures and successes. HFA members are always willing to share their stories, and by comparing stories we often part ways a little smarter because we’ve learned something new—might even make a buck in the process.

”

David Gardner, Warrenton Furniture Exchange, Warrenton, N.C.

U

No ret

LENDING A HAND Gardner finds time to give back to his community through his church and working on the Warren County Habitat for Humanity.

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m

Gardner became president.

In the early 1990s, Gardner was a board member and officer on the Warren Economic Development Commission. He worked with other community leaders to bring in new businesses that could use existing barns, garages or other warehousing properties.

As he puts it, “We are all here to encourage one another.” Gardner learned and lived that building each other up for success benefits everyone At his core, Gardner believes it’s his duty to give back. He’s been a member of the Warrenton Baptist Church since 1978 serving as a deacon and trustee in various capacities as well as on finance, social, building and pastoral search committees. He is a founding board member of the Warren County Habitat for Humanity, served as its treasurer and helped build many homes. Not sure if he provided the furnishings, but something tells me he made sure the new residents had comfortable chairs to sit in and beds to sleep in.

Gardner and his wife Cathy have three grown children and five grandchildren. Each and every family member is unique and special to Cathy and him. “They help us to keep young!” he says.

Back to his life’s other work—the kind that pays the bills. Like his father, he served on the Southern Home Furnishings Association board. During his tenure, Gardner was its assistant treasurer, treasurer, vice-president and president.

His grandfather and father were the people Gardner says are the “best people in the world.” He means furniture people. Folks who go out of their way and will do anything to help others (notice again, not just the customer). “We all help each other out so no one will lose a customer,” he says.

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Of course he is prudent enough to know his competitors, who he refers to as friends, need to make their fair share of selling furniture, appliances and services. But he’s also wise to say, “Friends in business make life better for everybody.” Gardner recalls an “amazing thing,” as he put it, about sharing best practices to help others in the industry. He was on a panel at High Point market last fall. Gardner says he learned something from each of the 24 panelists. He shared his idea about shopping around for insurance bids. A few months later, a fellow panelist told him his advice saved him $10,000 in premiums. “I really enjoy associating with these people and enjoy exchanging ideas,” he says.

“When you help people, they will not forget. When you treat people right, they will remember. They will tell their friends and families. They will share their positive experience of being treated right.”

Gardner has met longtime customers—those who remember his grandfather—who tell their grandchildren to shop at the Warrenton Furniture Exchange.

So, for anyone who thinks decades of wisdom about customer service and loyalty can be purchased, think again. I looked for an app about treating people right and came up short. I think if I ever need help in that area, I’ll just touch base with David Gardner.

Barbie Kremer, a trained technical writer, has been publishing and writing for 25 years. She can be reached at kremer1991@gmail.com.

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From Quantity of Coils to Quality of Sleep Sometimes the past can help predict what will sell in the future

By Gerry Morris

M

ore is better! At one time coil count was the benchmark by which mattress quality was determined. While still a factor, the approach to mattress sales has evolved, and the focus of our presentation has progressed from coil count to sleep, with many iterations in between.

Let’s take a look at some of the changes we’ve gone through, the reasons for them and what may be the next step to see how we can best accomplish our most important mission of helping improve as many people’s lives as possible.

At the most basic level, one of the main reasons for the evolvement of the selling process is trial and error. Sales associates are on the front line every day and they continually find new and better ways to sell.

Here are some other factors:

Product development

The amazing improvements in quality and comfort, style and types of mattresses have manifested in what used to be considered unimaginable retail prices. Consequently, the job of selling mattresses has become more complex and challenging. Sales associates have been forced to adapt or be left behind.

Proliferation of choice

There’s been a proliferation of brands, models, styles and types of mattresses. At one time, most stores featured a goodbetter-best program from one or possibly two suppliers. Now it’s not uncommon for retailers to have 30, 40, 50 or more choices from multiple brands.

Competition

For many years, most mattresses were sold by furniture and department stores. Now the number and types of companies selling them has increased exponentially. Don’t believe me?

Drive down the busiest stretch of road in your city and count the number of mattress stores.

Consumer empowerment

Because of the proliferation of choice, consumers have so many options that they’ve turned to the internet and social media to arm themselves with knowledge prior to going on their shopping mission.

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Reactive/proactive

In another retail lifetime, most selling consisted of sales associates trying to demonstrate value in a reactive manner to shoppers on a mission to find the best deal. Today better prepared sales associates are taking a proactive approach to selling. Rather than making presentations, they are establishing relationships and including shoppers in the process.

Here is a quick look at some of the trends and key elements of focus used in mattress sales over the years. Keep in mind, many, if not most, are still very much in play.

Price

While still high on the list, for years price was the key focus of attention, along with firmness, for shoppers and sellers.

Firmness

For several decades, the thinking “firm is better” ruled the day. In fact, the number-one request from shopping consumers was “we’re looking for a good firm mattress.” Manufacturers responded. The more expensive beds were the firmest.

Coil count

The more is better concept rewarded companies with the highest coil count. It was such a simple way to demonstrate perceived value and quality. Consumers became conditioned to ask how many coils as one of their primary questions not really knowing what difference it made.

Features

In the reactive era of demonstrating value, there was a heavy emphasis on specifications. Prevalent on most sales floors were lots of product knowledge signing, mini coil and foundation demo units and layer samples.

Benefits

The next step still emphasized demonstrating value, but the trend switched from just explaining the features themselves, to following up with an explanation of its benefits to the sleeper. A big step forward.

Comfort

At a time when firmer was better and the higher the price the firmer the bed, a new revolution was born. We discovered

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people wanted softer, more comfortable mattresses. The entire industry jumped on the bandwagon. Sales associates got a new focus that came with a heavy downside.

Hello, body impressions.

Support

With the advent of thicker, softer products, sales associates had to teach shoppers the difference between firmness and support. There was an entire generation that had to be re-educated that comfortable mattresses could provide enough support. It was a challenging time.

Problem solving

Because of improvements in product development, the focus shifted to the shopper in an effort to determine if there were issues that could be addressed by demonstrating specific features like, sagging, edge breakdown, roll together, bad backs, pressure points, etc.

Choice of comfort selling

With distinct choices, comfort selling became one of the most popular and effective methods of presenting products, a practice that is still alive and well today and has expanded into customized sleep with adjustable beds and individualized comfort choices.

Warranty/comfort guarantees

Along with non-prorated warranties, comfort guarantees became the tool for dealing with competition and the growing problem of body impressions. What was considered to be a helpful tool became a crutch. Under-prepared sales associates facing any resistance would cut the selling process short by offering skeptical shoppers the panacea of returning their mattress for most any reason. Customers obliged.

Health

As more and more evidence accumulated about the importance of sleep to one’s health, the focus of our efforts finally shifted to what’s really important. But just mentioning good health as a benefit is not enough. In the same manner that people understand that tires are good for safety, it had no real impact.

Sleep

The research keeps piling up about the amazing benefits of deep, restorative sleep on most every aspect of one’s life. This makes it the most important element of mattresses to focus on. Sales associates are being trained to connect the dots between sleep and mattresses, and customers are responding.

It’s important to note that while we’ve evolved from focusing on coil count, all the elements listed above can and should be included in the selling process, but not every one every time. Sales associates should know and use them as needed. Every selling situation is different and sales associates must be able to adapt and to be able to address the needs of each individual.

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The Next Step?

Finally, we’ve arrived at what is really important about buying quality mattresses.

One would think this may be the end of the line for the evolution of mattress sales. I say not quite.

There’s a logical conclusion to the sequence. The subconscious motive behind every decision we make and action we take is for a desired end state of being happy, feeling good and having a sense of peace and wellbeing. Deep, restorative sleep on a quality mattress enhances the ability to achieve that end state.

That means everyone wants what we’re selling, but it’s up to us to tell them.

That’s a long way from coil count and price.

Sleep well and help others do the same!

Gerry Morris has more than 20 years of experience in the mattress industry. In partnership with The Furniture Training Co., he offers a premium online training course, “Sell More Mattresses with Gerry Morris.” To view the course, visit furnituretrainingcopany.com

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Youth Furniture Grows Up It’s getting harder to tell the difference between bedroom furniture for adults and kids.

By Karen Hornfeck

T

hink back to your childhood bedroom. Remember the furniture? Probably not. Back in the day, the typical child’s room likely consisted of hand-medown pieces of furniture, a few posters and a few toys scattered around.

And the posters are probably what most stood out in terms of decorating.

Fast forward to today and Millennial parents are doing things differently. Gone are the days of nurseries being furnished with a crib and grandma’s old dresser, now retrofitted to do double-duty as a changing table. A quick computer search of “children’s rooms” or “nursery” paints a vivid picture of the modern nursery or children’s room. Pinterest, Houzz and other home decorating websites quickly pop up with a wide assortment of pictures detailing styled child-oriented rooms with much thought put into every detail, from case goods to lighting to bedding.

Euromonitor International, a research company that monitors global economic and consumer lifestyle trends, calls this new parent buying pattern the “bump” industry, as in baby bump. The “bump” industry has grown as new parents show a willingness to radically change their buying habits with impending parenthood.

Babymoons, reveal parties, pregnancy photography sessions, elaborate children’s birthday parties and yes, even furniture sales show that parents are willing to spend more as they move from being a couple to becoming a family.

Despite Great Britain’s vote to withdraw from the European Union, the U.S. economy has been stable for more than a year, leaving Millennials able and willing to spend on creating a home that reflects their own style. Women’s Marketing, a media strategy, planning and buying organization, notes that Millennials spent $27 billion on furniture and bedding in 2014, up from 11 percent from the previous year and that number continues to grow.

The trend hasn’t been lost on major furniture manufactures. “The youth market has really grown,” says Christopher Phillips, director of marketing at Legacy Furniture. “We started seeing that youth furniture is as important to today’s consumers as adult bedrooms.” Several years ago, Legacy Furniture started Classic Kids, a youthoriented furniture line that now has 16 different collections in styles for both girls and boys.

Design plays an important role as families start to shop for furniture for their children’s rooms. “Finishes in particular are popular with consumers, especially reclaimed looks with gray tones or other stylized finishes” says Phillips. Legacy’s Classic Kids line offers a variety of finishes defined by names like molasses, cinnamon and French laundry. No matter what a consumer’s personal style, there is a design and finish to help them evoke a certain feeling and theme.

The names of Legacy’s collections also paint a picture of certain lifestyles that appeal to consumers. Collection names like Park City, Danielle, Tiffany, and Summer Breeze immediately bring to mind a certain feeling and the furniture style ties in with that preferred lifestyle.

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COMING OF AGE Magnolia Kids’ Boho Playhouse Bed in a salvaged finish continues youth furniture’s trend to a more adult aesthetic that can follow a child all the way through high school.

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DOES YOUR FURNITURE MEET THE VOLUNTARY TIP-OVER STANDARD?

Any piece, 30 inches or taller, designated as storage for youth clothing has to meet all of these performance standards to comply with the voluntary standard: • The empty piece must remain stable with all of its drawers open and doors open to 90 degrees without tipping over.

• It must remain stable when 50 pounds of weight is gradually applied to the front edge of each drawer (individually), opened to the stop.

(If there is no stop, the drawer must be opened two-thirds of its operating length.) The 50-pound weight is meant to simulate the weight of a 5-year-old child in the 95th percentile of weight.

• The tests are conducted without the use of a tip restraint but tip restraints “shall be included” with each item of furniture covered. The tip restraints also have to meet testing requirements of a separate ASTM standard.

• A permanent warning label must be attached in a conspicuous location that’s visible when the product’s in use. (Most manufacturers put it in the bottom of a drawer.) The warning label must include the following information: WARNING: Serious or fatal crushing injuries can occur from furniture tipover. To help prevent tip-over: - Install tip-over restraint provided - Place heaviest items in the lower drawers - Unless specifically designed to accommodate, do not set TVs or other heavy objects on top of this product - Never allow children to climb or hang on drawers, doors, or shelves - Never open more than one drawer at a time - Use of tip-over restraints may only reduce, but not eliminate, the risk of tip-over

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TOUGH SELL Lance Romeo, an HFA member with Sheely’s Furniture & Appliance in Ohio, says retailers can’t expect youth furniture to sell on its own. “You really need to plan and invest,” he says.

Standard Furniture recently launched Magnolia Kids, a licensed line designed by Joanna Gaines. Gaines and her husband are stars of a popular HGTV show, Fixer Uppers, on which they renovate homes often using reclaimed furniture for a modern, eclectic look. Magnolia Kids reflects this popular style by combining different finishes and materials in its collection, including wood and metal. Offering an especially creative take on youth bedrooms, one Magnolia Kids dresser mimics an old card catalog storage unit, while a student desk harkens back to the type often seen in one-room schoolhouses in the turn of the century. Antique meets modern in the Magnolia Kids line, producing the clean lines for which today’s parents are looking.

Both Legacy’s Classic Kids and Magnolia Kids marketing materials detail the quality and craftsmanship of the furniture that make up their collections for a good reason. As consumers are spending more on their children’s furniture, they are also looking for longevity. “Consumers don’t want to be focused too much around a theme that will age the furniture,” explains Phillips. “Legacy likes to think of our children’s lines as timeless.” Consumers want youth furniture that can either grow with the child to adulthood or move into a guest bedroom later down the road. Many of today’s youth furniture case goods would easily fit into an adult guest bedroom when the time comes to transition a child’s room for another use.

Descriptions for Legacy’s Harmony by designer Wendy Bellissimo note that its youth furniture is made with fluted glass knobs, custom ring pulls in dusted pewter finishes, and dove-tailed drawer fronts. “Our youth furniture is the same high-quality as our adult furniture lines,” says Phillips.

One of the age-old dilemmas with youth furniture is an unwillingness on the part of some retailers to give it dedicated floor space. HFA member Marie Benfatti of Benfatti’s in Pueblo, Co., sells higher-end furniture—including adult bedroom suites. But Benfatti’s only has about 20,000 square feet of showroom space and can’t afford to give away any to such a narrow category as youth furniture. “The customers I work with are more than willing to invest in furniture for themselves, but they’re just not willing to put that same investment into their kids,” says Benfatti. “That’s just not with furniture, but mattresses also.”

Benfatti will write up special order youth furniture tickets from Universal and Vaughan Bassett on occasion, but that’s about it. “Better (youth furniture) lines just haven’t been successful for us so we stay away,” she explains.

One retailer in North Lima, Ohio has seen success with a larger youth furniture display. While most stores are content with seven or eight youth furniture groups, HFA member Sheely’s Furniture & Appliance offers 20. Lance Romeo, a buyer for Sheely’s says retailers have to go “all in” with youth furniture if they want to see returns.

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“It’s not a category you can throw out there and expect people to automatically be attracted to,” says Romeo. “You really have to plan and invest.”

For Romeo, that means walls painted in kids’ colors, accessories aimed at children and lots of desks and tables for kids to sit in and try. “You need them in the area with their parents trying things out on their own. A lot of times it’s the children who will sell the parents on the furniture.”

Understanding how Millennial parents shop may help retailers increase sales.

Women’s Marketing notes that three-fourths of Millennials shop between two and four retailers before making a buying decision. To attract today’s youth furniture buyer, retailers need to make an effort get a buyer’s attention—parents and children. As parents are shopping for new furniture, “children are being included in the decision-making process,” Phillips explains.

Phillips notes that most retailers don’t spend time setting up youth furniture displays with youth-specific accessories. Instead, any accessories used are often the same as those used to decorate adult lines.

Phillips recommends retailers take time to set up displays that draw in Millennials, positioning youth furniture lines so consumers can see how it would look in their own home. “The typical size of a child’s room is ten feet by ten feet,” says Phillips. “Set up a vignette that size so consumers can see how much furniture you can fit into that space.”

“The best retailers of youth products are sure to make the area fun and appealing to kids,” says Tim Ussery, executive vice-president of sales and marketing for Magnolia Kids. “Creating an atmosphere that can be replicated at home is key to moving the products.” Ussery recommends adding tables for children with chairs set up near the bedroom display. “This lets kids play and have fun while shopping and the buyers’ can envision the furniture in their own home much easier,” he explains.

Romeo recommends that when designing displays, retailers address the three functions that parents are looking for in youth lines—sleep, study, storage. Add in youth-oriented bedding, wall colors and accessories that attract consumers – both parents and children. Legacy, which figures prominently in Sheely’s, offers retailers a detailed style guide with suggestions for all aspects of setting up engaging, realistic vignettes.

Consumers want style but they are also mindful of safety, in particular when furnishing a room for a child. Retailers should make sure that the lines they carry meet the industry’s voluntary tip-over standard.

Drawer stops also prevent children from pulling drawers completely out and all cribs, bunk beds and loft beds must meet a variety of strict, mandatory safety standards. Most manufactures will be happy to share information about the safety of their lines and retailers should be well-versed in safety features and ready to talk about those with consumers. “The safety of consumer products is reported almost daily on news outlets and is an important component when shopping for any product for a child,” explains Ussery.

Millennials are ready and willing to spend money on their children. With a variety of stylish furniture at different price points available, retailers can move into this market and start to draw in eager shoppers ready to create a stylish, practical space for their children. Taking time to create inviting, realistic spaces can help draw consumers in and encourage them to invest in quality furniture throughout their homes – including their children’s rooms.

Karen L. Hornfeck is a freelance writer and marketing consultant in Greensboro, N.C. She has more than 20 years of experience in marketing, public relations and journalism. She can be reached at dkhornfeck@gmail.com.

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Tip-over prevention is everyone’s business!

Every two weeks, a child dies in the U.S. when furniture, an appliance, or a TV tips over on them, according to the U.S. Consumer Product Safety Commission. By working together, we can help reduce the risk and prevent tragedies involving our industry’s products.

Together, we can reduce the risk.

MANUFACTURERS:

RETAILERS:

SALES REPS:

INTERIOR DESIGNERS:

Make sure the furniture you produce or import meets the ASTM Standard Safety Specification for Clothing Storage Units (F2057-14). This is an international, voluntary consensus standard for furniture stability developed by a broad group of stakeholders, including manufacturers, retailers, regulators and child safety advocates.

Make sure all products you sell meet the voluntary stability standard. Educate your customers on the importance of using the supplied tip restraints that come with all compliant products.

Make sure the lines you represent meet the voluntary stability standard. Help your retail customers understand the importance of the standard.

Find in-store resources at:

When working with clients who have small children, emphasize the importance of anchoring furniture, appliances and televisions. Don’t source products that fail to meet the voluntary stability standard.

ahfa.us/issues/ product-safety

anchorit.gov/ get-involved

Learn more at:

Learn more at: ahfa.us/issues/ product-safety 26

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Learn more at: anchorit.gov/get-involved

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NEXTGENPROFILE

MINUTES with Matt Shuel

I

’ve always been fascinated with the furniture industry.

I started working as a delivery and set-up man when I was 14. I didn’t think the furniture business was for me at first. Finally, when I graduated from college the burning desire for retail was on full blast. I found to love the thrill of taking risks in the business with some paying off, and learning from others. During my free time, I’m a total sports junking from playing with friends to watching it as well. I think sports and retail are extremely relatable.

Both are very high octane, and require taking risks. I like to strive to take care of my customers, and will always be rooted in small business.

Why Next Generation NOW? I chose this quote in direct correlation to Next Generation Now. The relationships I’ve already made in the short time I’ve been a member are relationships for a lifetime.

There’s nothing better than talking furniture over a couple drinks with some of your closest friends. Next Generation has shown me so many different ideas to grow and sustain our business. I look forward to meeting new members and growing my relationships with existing members.

Matt Shuel Vice President, Meredith Furniture

Words to live by

“Iron sharpens iron, so one man sharpens another” �Proverbs 27:17

Matt Shuel celebrates his birthday by taking a dive 15,000 feet (and rapidly falling) over Snohomish, Wash.

5 Minutes is a monthly profile of a Next Generation Now member.

Next Gen NOW is an HFA-hosted community of young industry professionals whose mission is to give voice to the needs and goals of the industry’s next wave of leaders. Connect with members at nextgenerationnow.net or Twitter @ngnow.

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Guarantees and Warranties How do you use them in your store?

By Marty Grosse

A

n odd thing happened on the way to my back yard.

With rain pounding my home in Texas, I took a break between storms to (finally) install last year’s Father’s Day gift, a deluxe rain gauge. With the conviction of a weather expert, I marched to the back yard toting my portable drill, adult beverage and radio. Then it happened.

While reading the instructions and listening to the radio, I learned that the rain gauge had a 10-year warranty plus you could save more than $1,000 on a mattress set from the local furniture store with a 365-night comfort guarantee. Yep, no rain gauge worries for 10 years, save a $1,000 and almost a year to decide if I like a mattress.

Of course this stirred up my retailer genes and I knew it was time to delve into guarantees and warranties in the world of furniture. Guarantees and warranties provide consumers assurance and minimize the risk of purchasing from a store.

It helps them make buying decisions. John Wanamaker (a Philadelphia retailer) is credited for developing the principle of “one price and goods returnable” more than 140 years ago. Let’s just say he pioneered the approach of “Low Price and Satisfaction Guaranteed”. Today’s customers may not see these as being simply nice policies but an essential part of “a consumer’s rights.” How are you using these in your store?

Manufacturer Product Warranties

Low-Price Guarantees They’re a staple in most furniture stores. Although the industry continues to promote the importance of selling lifestyle solutions, connecting with the customer on an emotional basis, and selling the importance of quality, price always seems to come back to the surface. I reviewed the top 100 furniture retailers and the majority of them have a low-price guarantee.

Most have the fine print and hoop jumping for matching a price honed to a degree that makes lawyers smile.

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If truth be told, it is probably a rare occurrence where you have to match another price. If you’re going to promote the lowest price guarantee and the concept of low price in your store, then define why your prices are the guaranteed lowest and arm your sales people with those reasons. Here are some of the best reasons I’ve gleaned from the top 100.

• We have tremendous buying power with many stores and buy for less, passing the savings on to you.

• We are vertically integrated and do many things in house to reduce our overhead.

• We operate our own trucks and control our freight costs.

• We are a debt-free company and have low or no rent. We pay with cash.

• We belong to gigantic buying groups that pool resources and provide efficiencies of large companies.

• We shop our competition so you don’t have to.

To simply tout “we have the lowest price guaranteed” without some teeth backing up the claim, is missing the true opportunity.

I dare say it may be as important to have your sales team understand and believe these facts as it will be your customers. After all, they are the ultimate messenger and influencer for the customer.

These would seem on the surface easier to present. Manufacturers generally have defined these warranties and as a retailer don’t you simply have to point the customer to the manufacturer warranty? Here are some key issues to consider and issues others have defined when presenting specific product warranties.

• Does the customer have to return the item to the store for service?

• Is there a charge to have an item serviced?

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• Will the customer work directly with the manufacturer on service?

• What exclusions might not be covered?

• What does the customer need to provide or do to take advantage of factory warranty support?

Without wading into the deep weeds of product warranties with customers during the buying process, I suggest that as much information as possible is committed to writing or accessible via your website. There are those customers who want to know more. Manufacturer hang tags explaining warranty details may be a way to quickly point to some basic information. Providing basic warranty information on your price tags is another option.

One top 100 retailer goes to the extreme of creating their own hang tags pointing out the inherent natural issues of furniture and what might be expected with normal use. Setting expectations in advance could arguably make warranty situations more palatable for customers and retailers. Defining what is normal in a warranty situation even opens the door for selling extended warranties to customers.

TM

THE FIRST CHOICE FOR SECONDARY FINANCING

Satisfaction Guarantees The guarantees may be the most difficult to communicate, define and honor. It was not uncommon to find many of the top 100 stating they want customers to be satisfied with their purchase without any clear definition. With the exception of mattress comfort guarantees, the idea of guaranteeing and defining customer satisfaction due to the array of color, style, size and comfort elements of home furnishings seems a bit daunting. My research of the top 100 found satisfaction guarantees from 3 days to 30 days with exclusions for delivery/pickup fees and condition of the product. Better Business Bureau accreditations are also methods for communicating to your customers a commitment to keeping them satisfied. (Besides, keeping your BBB grade up holds your feet to the fire.) In today’s review driven world, it may be as simple as telling customers you want them to be satisfied and to give the store a good review if satisfied and give the store a call if they are not.

Once you have your antenna up, guarantees and warranties seem to be everywhere and in many products. Whether it’s guaranteed fresh coffee at the local diner or gasoline guaranteed to clean your engine, today’s customers want and need the reassurance in buying decisions. Even George Zimmer from The Men’s Wearhouse guaranteed me “I was gonna love the way I looked.”

As for the rain gauge, it is working perfectly. But now it’s summer here in Texas, I am searching for a rain dance class. Hopefully I can find the one with a low price and guaranteed results.

Marty Grosse is an industry veteran who’s held executive positions across six top-tier furniture retailers. His website, Furniche.com provides furniture shoppers real, relevant and timely shopping advice while researching local furniture stores and manufacturer information. Email martygrosse@ furniche.com to learn more.

• Revolving Lines of Credit • Deferred Interest Options • No Down Payment • Industry Leading Technology • Instant Approvals

Visit us at the Las Vegas Market Jul 31 - Aug 4, 2016 Retailer Resource Center | B1050 - 4 1.866.785.0235 | tcsmarketing@twcs.com | www.tidewater.credit © 2016 Tidewater Finance Company™. All rights reserved.

Program may not be available in all states.

FAMILYMATTERS

Retailers offer plenty of reasons why they don’t plan for their future Our three-part series wraps up with a few more

By Wayne Rivers

S

ummer is heading for the homestretch and so is our summer series in which we address why family businesses fail to do succession planning. You can check out the first two columns in this series in RetailerNOW, but here’s a quick recap of last month: One of the biggest reasons families fail to plan is because they feel it’s not urgent. If you’re healthy with employed children, my guess is succession planning is the least of your worries. That’s how it should be, but it should not be ignored. This month, we’ll address three additional rationales for failing to plan. Do any of them strike a nerve with you and your store?

1. Senior generation family business leaders don’t know how to be fair to their non-employee children relative to their employee children with respect to their inheritance.

A poll we did years ago identified that 80 percent of family businesses had children in the business, and 80 percent also had children not in the business (there is, of course, some overlap in the answers). There are two schools of thought here, and the proponents of either school would say the other side is all wet. The first side says that only employee family business members should own stock in the company.

Non-employee family members should be compensated in terms of their inheritance with non-business assets like cash, insurance proceeds, or real estate. The other side says, “I have four children, and, while one is in the business, I love them all equally; therefore, I’ll split all my assets into one-fourth increments, and my children will inherit share and share alike.”

Depending on which family business advisors you talk to, you

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may get a very strong opinion on one side of that argument or the other. Here’s a dirty little family business secret: Either way can work equally well! As long as the family goes into ownership succession planning with their eyes open and understands the pros and cons of the two most widely accepted methodologies, either can work. They just need the right structure and safeguards in place.

2. Family businesses see succession planning as an event—not as a process.

According to an unpublished study by Dr. Jim Lea, family businesses that allowed 10 years for their succession plans to take root and go into effect were far more likely to enjoy business success 15 years later than firms that allowed five years or less for transition. The secret to succession planning, if there is one, is to allow enough time for the plans to work. There will be fits and starts, joys and disappointments, successes and failures, and home runs and strikeouts throughout the succession process. But the main thing is to recognize that it is a process with easily identifiable steps and milestones. What succession is NOT is an event. It’s not Dad announcing on April 1st that he’s retiring and will be out the door December 31st. It’s Dad, Mom, the adult children, the in-laws, and the key non-family employees coming together to develop a common vision for where the business ought to be in 10 years and then crafting a step-by-step plan for getting it there.

Succession is a long-term project like any other; there is a beginning, a middle and an end with plans and contingencies for each step and fairly predictable challenges along the way. Done correctly, every component of succession planning utilizes and builds on that which has gone before it.

RetailerNOWmag.com

FINE-TUNING AS YOU GO

3. Succession planning costs too much.

Family business owners are thrifty. Nothing wrong with that.

In fact, that’s among the keys to their success. However, there’s a vast difference between an expense, a cost, and an investment which will pay a rate of return. All too often, family business leaders fail to make this distinction; they fail to recognize the opportunity costs of not engaging in a robust succession-planning process, and the lack of planning doesn’t really impede them in the short run. Where those chickens come home to roost, however, is in 10 or 15 years when the business has failed to upgrade its people, systems, practices, IT, and thinking, and the competition has passed them by. A successful family business failing to reinvest in renewing itself periodically isn’t thrifty; it’s cheap and misguided and is often an excuse for clinging to the status quo.

Do you remember last month’s issue when I talked about retailers feeling safe in never having to change?

In the short run, it’s always easy to decide not to change.

That’s why so many store owners embrace the status quo. It doesn’t cost anything in terms of time or money to leave things the way they are. But the status quo is like burying your head in the sand. When you come up for air, the problem is still there.

Succession planning is needed.

Wayne Rivers is president of The Family Business Institute. He has appeared on The Today Show, CNN, CNBC and is an expert panelist for The Wall Street Journal. Email your questions to Wayne @ wayne.rivers@familybusinessinstitute.com

NEWPORT

Q:

I’m 51 and have no intention of going anywhere anytime soon (knock on wood).

You’ve said it’s never too early to implement a succession plan. But how do I go about updating it as the years go by? What changes in my business should prompt me to re-evaluate my plan?

A:

You’re 51 and not going anywhere soon.

That’s fine, but it doesn’t relieve you of the need to continually refine your business. If you want the best succession plan on earth, you need to engineer the company so it works superbly well whether you show up for work or not. If you can’t take off a month without brushfires breaking out all over, you may not have a business at all. You may just have a very demanding job.

In your relative youth, you have an amazing opportunity to focus your activities so your business runs like a well-oiled machine. Start by creating a “stop doing” list. Identify the things you’re currently doing that a $20/hour employee could do just as well, and stop doing them. This will free up your time so you can focus on high-payoff activities like hiring and training the best people to support you.

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6/6/16 1:30 PM

Shopping for Business Insurance You’re covered at home, but what about work?

Here’s a small-business insurance checklist.

By Rieva Lesonsky

W

e’ve all heard horror stories of small business owners being taken to court and even put out of business after being sued by a customer. If you don’t think this can happen to you, think again: Something as simple as accidentally spilling coffee on a customer’s computer or having a customer slip and fall on your showroom floor or out in the parking lot could lead to a

costly and time-consuming lawsuit. How can you protect yourself?

Having the proper small-business insurance can help keep your business safe from these risks. Here’s a quick checklist of the basic types of liability insurance your store might need.

General Liability Insurance: Also called commercial general liability insurance, general liability insurance helps protect your business against a third party’s claims of bodily injury, property damage or personal injury. What does liability insurance cover? In the examples above—a slip and fall accident or damaging a computer—general liability insurance would cover the loss. It will also

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RetailerNOWmag.com

protect you against personal injury—for instance, if one of your employees slanders a customer on social media and the customer files a lawsuit.

When do you need business liability insurance? In general, if you or your employees interact with clients face to face—in other words, every day in the home furnishings business— liability insurance is a good idea. You may also run into situations where a client requires you to have general liability insurance as part of a contract.

Professional Liability Insurance: Also known as errors and omissions insurance (E&O), this type of insurance protects your business if a customer claims you’ve been negligent in performing your work. For instance, professional liability insurance would protect an insured business if a client claims one of your delivery drivers damaged their house while unpacking and positioning furniture.

When do you need professional liability insurance? If you regularly give advice to clients or provide a professional service, you should have this insurance. You may also be required to have professional liability insurance as a condition of a customer contract. Professional liability insurance covers you for claims of financial harm from a third party, namely a customer.

Business Owners Policy (BOP): General liability insurance covers you against your customers’ losses, but it doesn’t cover your business’s own losses, such as damage to your business property or equipment in case of a fire at your office.

You can get a Business Owners Policy that combines general liability insurance with property liability insurance for your

business. Look for a Business Owners Policy that can be customized to protect you for losses from business interruption, employee theft, business vehicles and electronic data loss.

When do you need a Business Owners Policy? If you own the building where your business is located, work with large amounts of data, have employees or own business equipment, getting such a policy is a good idea.

Home-based Business Insurance: If you operate part of your store’s business from home, you may not realize that your homeowner’s insurance may not cover business-related losses. For example, if your business computer crashes and you lose valuable data, you’re going to wish you had home-based business insurance to cover the losses. You can get general liability insurance and professional liability insurance for home-based businesses, or purchase a Business Owners Policy customized for home-based businesses that encompasses both types of insurance.

In addition to the above, keep in mind that different industries and professions have different needs when it comes to insurance.

To best protect yourself, look for an insurer that offers specialized industry insurance policies tailored to your particular industry’s risks, and talk to an insurance agent with experience in small business to make sure you get the coverage you need.

RetailerNOWmag.com

Rieva Lesonsky is CEO of GrowBiz Media, a consulting company specializing in small businesses and entrepreneurship. Sign up for free small-business stories and tips at smallbiz.com

AUGUST | 2016

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Let’s Give Them

SOMETHING to Talk About

By Connie Post

T

oday’s leading brands have discovered the “moment” that matters the most to their customers by identifying emotional points in the customer’s shopping journey.

The goal is to give your brand an edge by emotionally engaging your customers and delivering experiences that will not only drive sales and create loyalty, but get them talking about you.

First Impressions: First and foremost, the first 1,000-squarefeet of your store must deliver a “wow” that changes frequently, and is always focused on what’s new and exciting. This area is the first and last thing a potential shopper sees, and the most critical moment in the engagement process. Within seconds, she will decide if shopping the store is worth her time and energy. If nothing instantly grabs her, you’ve lost her. This is the moment where we must take her breath away.

Size Matters: Following the initial wow, shoppers respond to open site lines that reinforce the impression that the store has a broad offering from which to choose. Research has proven that selection perception is extremely important to busy women today. Her immediate impression should be, “Wow, if I can’t find it here, I’m not going to find it anywhere!”

Inspire Change: Creating memorable focal points throughout the space inspires her to linger and imagine what something would look like in her space. Focal points can be as simple as a change in flooring materials that grab the eye, or as elaborate as an authentic fireplace that replicates a movie star’s home as portrayed in a recent issue of Architectural Digest, as we recently did at Gabberts. These are the areas along the shopping path that continue to draw her further into the store, exposing her to as much of your selection as possible.

Light It Up: There is nothing so off-putting to female shoppers as poor lighting. Beyond the fact that improper lighting drags down the product and makes everything look old, adding decorative lighting fixtures such as chandeliers and large drum shades in walkways adds a sense of drama and newness. She wants to see the kind of presentation she pours over in the pages of a Restoration Hardware and Pottery Barn catalog. Large, orbstyle chandeliers over the dining areas will make a simple dining group look modern and new.

Step Up the Entrances: Creating focal points that draw her through the store necessitates stepping up the entrances to galleries and other special areas. This means moving beyond simply dropping a sign from the ceiling and adding columns to define an area. Change out the flooring at the entry of each space, hang cool lighting fixtures, and add dimension with stacked stone or 34

AUGUST | 2016

a flash of color to emphasize that there is something special to see.

Inject Some Fun: Make the presentation relevant by injecting fun where appropriate. For example, one retailer we work with is a NASCAR sponsor: We’re placing one of his cars at the entry of a new store. Another bit of fun that appeals to male shoppers is themed Man Caves. “She-sheds” are also all the rage now in the shelter magazines, so move one into your store and decorate it monthly to reflect different moods and styles. Create an outstanding kids’ area that children not only want to hang out in, but don’t want to leave!

Get Cozy: Add draperies around windows to cozy up the space a bit and make it feel more residential. There was a day that all furniture stores had beautiful draperies for an authentic presentation of what the furniture would look like at home. Naked windows look cheap. At the same time, divide spaces with large, oversized window grids to stop the eye and create dynamic presentations.

Go Luxe: When it comes to higher-end furniture, it’s all about the story you tell through the environment around the products.

Walk into a Lexus or Cadillac dealership and note the differences in presentation. Luxury customers want (no, they expect!) to be treated differently than Ford or Chevrolet customers. It’s all about the glamour!

Opt for the Best View: One way to get your customers imagining what it feels like to live the glamorous life is by showing them the view from the Penthouse. Create a setting with a huge skyline photo of your city (and by huge I mean at least 12 to 15-feet wide and ten-feet tall) for authentic and dramatic effect.

Get into Their Heads: Your customer is looking for expert sales staff that “gets” them and getting into their heads starts with giving them an amazing experience in product presentation. There are “girly girls,” “country girls,” “city girls,” and “beach girls” to name a few and it’s vital to create environments that address the decorating styles that speak to each of them. They each have friends, and you want them talking about what they have seen in your store!

Deliver Outstanding Hospitality: Start by greeting consumers at the door with a small bottle of water with your store’s name on it.

Offer to check their coat so they can shop in ease and with the kind of excitement and anticipation that comes with finding a “wow” around every corner! Now that’s something to talk about!

RetailerNOWmag.com

Retail design strategist, trend expert, author and owner of Affordable Design Solutions Connie Post International, Connie specializes in retail home furnishings store designs. She can be reached at missconniepost@aol.com

CONNECT NOW

You’ve got product, we’ve got buyers.

Let us help you connect.

RetailerNOW is the only association print and digital media dedicated entirely to your target retail audience. Our readers are the CEOs, owners and decision makers you want to reach. Ready to connect? Advertise now.

Call Call Michelle at 916.757.1160.

LynnNygaard Orr at 916.757.1160

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Introducing the New HFA Buying Source. It’s FREE with membership!

800.422.3778 MyHFA.org

FREE SEMINARS

YOUR PERKS JUST GOT BETTER? BREAKFAST & COFFEE SERVED!

Visit HFA’s Retailer Resource Center in space B1050 during Las Vegas Market to find out our biggest member perk yet!

AND IT’S TOTALLY FREE!

40 PLUS EXHIBITORS

HFA supports your what if— your success is our business.

HOME FURNISHINGS AS S OC I ATI ON B1050

EXHIBITOR DIRECTORY

Net Center

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Entrance Hallway

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Restrooms

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Amber Engine .............................. 19

Arthur S. Gallagher ................... 32

ACA - Advertising Concepts of America ..11

Best Buy for Business .............. 42

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Imagine Advertising ................................1

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Knorr Marketing .....................................5

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RTUI ............................................8A

Moso Graphics .....................................40

Service Lamp Corporation .......... 27

Spectrum Marketing...............................9

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BUSINESS CONSULTING

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ENDORSED PROGRAM

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Furniture Wizard .......................... 15

Profitability Consulting Group ..............30

Genesis Software Systems ......... 29

FINANCIAL SERVICES

MicroD, Inc. ................................. 16 Myriad Software .......................... 17

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EasyPay Finance .................................37 Genesis Financial Solutions ...................2

WAREHOUSE & DELIVERY

Tidewater Finance Company..................4

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TEMPOE .................................................6

Diakon Logistics .......................... 33

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United Steel Storage (USSI) ........ 21

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ENDORSED

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PROGRAM

Along with the many business service providers showing in the Retailer Resource Center, HFA is proud to feature Endorsed Program Partners. When researching your next partner, look for the Endorsed Program icon for exclusive HFA member discounts and/or services.

HOME FURNISHINGS A SSOCI ATI ON

LAS VEGAS MARKET SEMINARS July 31-Aug 2, 2016 - Showroom B-1050

SUNDAY, JULY 31 9:00 am – 10:00 am Differentiate Your Store in an eCommerce World

TUESDAY, AUGUST 2 9:00 am – 10:00 am Use Cutting-edge Tech to Boost Your Business

Lee Rychel, PROFITsystems Inc.

Michael Robinson, Video Engager

10:30 am – 11:30 am

10:30 am – 11:30 am Marketing Solutions in Store and Online

How to Sell Value Instead of Price Phil Gutsell, GutSELL & Associates

Erika Sparrow, Imagine Retailer

1:00 pm – 2:00 pm

1:00 pm – 2:00 pm The Management Challenge: Delegate unto Others Before They Delegate unto You

Manage Your Shopper’s Digital Path to Purchase Bill Napier, Napier Marketing Group

2:30 pm – 3:30 pm Real Time Business Intelligence to Improve Your Business Amitesh Sinha, iConnect Group

4:00 pm – 5:00 pm Selling to Today’s Design-Oriented Customer Rene’ Johnston-Gingrich, Profitability Consulting

Joe Milevsky, CEO, JRM Sales Management

2:30 pm – 3:30 pm How the Right POS System Can Enhance Your Retail Operations Greg Strosnider, Storis Technology

4:00 pm – 5:00 pm Make Google Work for You Denise Keniston, Web4Retail

MONDAY, AUGUST 1 9:00 am – 10:00 am The High-Performance Sales Manager Brad Huisken, IAS Training

10:30 am – 11:30 am Make Higher Margins while Selling More

David McMahon, VP Consulting & Performance Groups, HighJump

HFA Las Vegas Market seminars sponsored by:

1:00 pm – 2:00 pm Give Your Website a Much-needed Checkup Ron Gordon, Sr. VP, Technology, MicroD Inc.

2:30 pm – 3:30 pm Dynamic Retail Solutions for a Modern World Connie Post, Affordable Design Solutions

4:00 pm – 5:00 pm Google has Changed the Rules! Is Your Website Responsive?

Issac Knorr and Kurt Strasser, Knorr Marketing

RetailerNOWmag.com

AUGUST | 2016

39

MEMBERBENEFIT

Members asked, we delivered (A new website, that is)

By Mary Frye

T

he Home Furnishings Association, like every other business on the planet, embraces the concept that if you don’t have a “robust web presence” you aren’t present enough. Does “robust web presence” make you smile? The vision of a big, strapping, “get-it-done” kind of person being robust gives way to an easy-to-navigate, takeme-from-what-I-know to what-I-need-to-know position, and a full-of-needed-information website. Now that’s robust.

We’re happy to introduce you to our newly re-branded MyHFA.org site with all the pride that comes with providing a more effective site than we had before and with the understanding that it will always be a work in progress. Hey, that’s just like your website, right?

Here’s a little of the back story about how we got here. At the 2015 Spring Board Meeting, the member-driven Technology Collaborative Team voted on one initiative for the year: To build a better website. The Association’s board unanimously voted to redesign the NAHFA.org website. The directive was to create a content-rich site with a clean, modern design, easy navigation and a password-protected members-only section.

We surveyed the membership and looked at the history of the Google analytics because isn’t that where any great, techfocused initiative starts? We came away with four key areas of focus for the new site: Education, government affairs, events, and programs.

As we delved into all things website related we realized that the HFA identity was being fragmented by the success of RetailerNOW magazine, the Next Gen-Now group and the annual Networking Conference. Each of these had separate identities and websites that were not always recognized as part of the Association. It was time to bring them all together under one domain and benefit from the interest and traffic each brings with their specific audiences.

At MyHFA.org you’ll find out how to become a member (and why), what’s happening in the industry and the As-

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sociation, who the Next Gen-NOW group is and what they’re up to, what legislation and regulations are affecting retailers, which member is profiled in the current issue of RetailerNOW and much, much more.

Under the Resources tab, you can learn about and register for the webinars (free to HFA members and available for a small fee to non-members), shop the product store (where members enjoy a discount) and read the latest issue of the Association’s magazine, RetailerNOW. Other, easily-navigated tabs include information on Membership, Events (from HFA-hosted to industry-wide, the HFA networking conference and markets), the Next Gen-NOW group and Government Relations.

For members, there are even more perks. With their Association-provided login credentials, members can access the member center. Here they’ll find links to all past on-demand webinars, the membership directory, exclusive white papers/articles, an archive of their monthly legislative updates (state and federal for the past six months), as well as key industry and general business issues.

Members can also update their contact and company data, pay product and dues invoices and register for events in a secure online environment.

Visit MyHFA.org and learn more about the Home Furnishings Association. If you’re a member, explore the members-only portion and update your contact information—the more we know about you and your business the better we can serve you.

Mary Frye is the Home Furnishings Association’s executive vice president. She can be reached at mfrye@ myhfa.org or 800.422.3778 ext. 201.

NOTE: Collaborative Teams are made up of HFA retailers and service and product suppliers. The teams were formed to analyze retailer needs, create initiatives and take action. If you’re interested in joining a team, please contact HFA CEO Sharron Bradley at sbradley@MyHFA.org.

RetailerNOWmag.com

HFA FOR ALL Our new site is more robust and easier to navigate. Visit MyHFA.org.

MEMBERS ONLY Access state and federal legislative updates and stay informed. We do the legwork for you.

MEMBERS ONLY Update your company info, register for events, shop the HFA store and access other members with a mouse click. Give it a try!

MEMBERS ONLY Missed a webinar?

Want to use it to train staff? We've made it easy. View and share past webinars sorted by relevant topics.

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THE ULTIMATE DESTINATION FOR

ALL THINGS OUTDOOR Lloyd Flanders, Inc.

SEPTEMBER 20 SEPTEMBER 23 2016

Merchandise Mart, Chicago

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#casualmarket

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Lloyd Flanders, Inc.

GOVACTION

Who Can It Be Knocking at My Door?

By Neal S. Cohen, Esq. and Mary Martha McNamara, Esq.

W

ith its increased resources, the U.S. Consumer Product Safety Commission (CPSC) has stepped up its field inspections significantly in the past several years. Retailers bear a special burden when facing government investigators, since by their very nature, they’re open to the public. There’s no requirement that CPSC investigators identify themselves if they are conducting surveillance about certain products on your sales floor. For example, they may be investigating a particular product, they may be verifying that a recall was successfully implemented, or they may be verifying that recalled products are not being resold. Especially as some retailers have moved towards direct importing of some of their products, the government will treat such retailers as importers. And under its law, “importers” are treated as “manufacturers”, with all of the responsibilities that a manufacturer has to ensure compliance with mandatory federal product safety requirements.

The purpose of this article is twofold.

First, we want to discuss your rights when a serious looking investigator carrying a laminate card (that looks like it was produced in the late 1970s) and a written Notice of Inspection appears in your store. Second, we want to provide you with our thoughts on how to handle such inspections.

1. CPSC has the absolute right to enter your premises with a written CPSC Notice of Inspection and appropriate

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credentials. You have the right to insist that the inspection occurs at reasonable times, in a reasonable manner, and with your attorney present during the inspection. It’s our experience that having counsel present during an inspection helps keep the field investigator “on task” and discourages wandering, wide ranging conversations, record searches, and document requests. You want to do everything you can to prevent inspection from becoming a “fishing expedition” for the investigator.

By law, the Commission may conduct inspections at factories, warehouses, and anywhere “in which consumer products are manufactured or held, in connection with distribution in commerce.” This includes, of course, retail stores. Most CPSC field investigators don’t give you prior notice of their inspection so their arrival normally comes as a surprise.

Generally, they will ask to speak with the store owner or the manager. But the statute also requires that the Commission staff person do so “at reasonable times and in a reasonable manner”. Therefore, if you or your manager are in a major meeting or midst a crowded sales floor or at a furniture market or your attorney unavailable, it’s entirely appropriate to request the inspection be rescheduled at a later date mutually agreeable to both parties.

You can either do this yourself or advise the investigator that your product safety attorney will contact them to reschedule when you’re available.

RetailerNOWmag.com

If you do the inspection without counsel present, don’t hesitate to stop or interrupt an inspection in progress if you become concerned about its direction.

Ask the field investigator for a break, place them in a conference room or lobby, and call your counsel for guidance. Your counsel may ask to speak with the field investigator to establish some ground rules as to the purpose or scope of the inspection or ask to reschedule the inspection until a time when counsel can be present.

We would be remiss if we didn’t say that legally you also have the right to demand that the government procure a search warrant to inspect your store or premises. However, refusing entry to a properly credentialed federal investigator is no small matter and should be carefully considered. We generally recommend cooperation. The courts typically defer to the CPSC and similar health and safety regulatory agencies and give the government a great degree of latitude in its request for warrants. In other words, the government usually gets its warrant or, if applicable, its subpoena. Practically speaking, it is very rare for a company to refuse entry categorically, although a company may request that the inspection be rescheduled to a later date or until its attorney arrives to be present for the inspection. Furthermore, you should always choose your battles carefully with the government. We know that some of the information they are asking for is innocuous whereas other information is more

charged and could potentially adversely affect your company.

1. The CPSC is entitled to have access to and may copy all relevant records, books, documents, paper, packaging, or labeling relevant to its investigation. You have the right to stop the government from copying records that may contain sensitive, confidential business information until you have labeled them appropriately.

Never allow the field investigator to use any of your computers or to access any hard copy files that you maintain without the advice of experienced counsel. Instead ask the investigator for a list of all records, books, documents etc. they need and provide them in a reasonable amount of time (usually seven days). This will allow you time to go through the documents, determine what is relevant, and mark them. Marking them CONFIDENTIAL should help shield the disclosure of your confidential business information to competitors, the public, and may help maintain some protections and privileges for those documents in the event the matter eventually landed in a court. And we recommend doing so in a firm but polite way.

There’s nothing wrong with asserting your claims of confidentiality and protecting your confidential business information, the disclosure of which could materially harm your company.

2. The CPSC also has the right to take samples of your products. You have the right to demand payment for those samples at retailers’ cost, unless you elect to voluntarily provide them.

In terms of physical samples of products, there is no claim of confidentiality that you can plausibly assert in most situations. You may object to the number of samples, especially if the product is fairly expensive. Again, an attorney can help negotiate that number for you if you believe it is excessive.

3. The CPSC has the right to present an affidavit. You have the right to review and revise that affidavit before signing it.

At the conclusion of the inspection, the CPSC investigator will present you with a handwritten affidavit for signature. Before signing it, you should always review it

very carefully. The purpose of the affidavit is to recite the fact that the inspector visited your premises on a particular date, what transpired during the inspection, what samples were picked up (or will be provided), and what documents, if any, were provided to the inspector. Do not sign it until you are completely satisfied with the accuracy of all the details mentioned. If you have any concerns whatsoever, request that you be allowed time for your attorney to review it before you execute it.

As attorneys who have both courtroom and extensive CPSC experience, the keys to successfully navigating a government inspection are as follows:

Swear to tell the whole truth and nothing but the truth. There’s no rea-

son to misrepresent or lie to the government. Lying to the government during an investigation is punishable by law. It is also prohibited to misrepresent information or materials to a CPSC employee or officer during the course of a CPSC investigation.

If you have any reason for concern, simply ask for time to consult with your attorney. Your attorney can advise you with legal strategies that permit you to answer a question honestly and can also advise you when not to answer a question.

But in no event should you provide false, inaccurate, or misleading information to the government. Such a strategy can end up risking far greater consequences for you and your company.

Answer the questions you are asked. Keep your answers brief and

simple, i.e. yes or no if at all possible.

Don’t volunteer any information that is not specifically requested. As you know, there’s a difference between telling the truth when answering a question and telling everything you know about a particular subject. Yes, you will understandably be nervous, especially if you have been caught off guard by the field investigator. Nevertheless, keep your wits about you and provide the answers in a clear, honest, and succinct manner. If you don’t understand any question posed or its relevancy, ask for a clarification before you answer the question. Resist the “charms” of a CPSC investigator who appears sympathetic to your situation or protests that the visit is only for the purpose of “nailing” a bad manufacturer. Your attorney will thank you later (and might

RetailerNOWmag.com

discount your bill) when confronted with memoranda of your conversations with the CPSC staff person.

Be courteous and patient at all times. Treat the field investigators

politely and with great respect. Most of them are only doing the job assigned to them. Unfortunately, the Commission’s current “tough talk” has been interpreted by some investigators as a mandate to be rude, suspicious, and condescending.

Exercise great patience if you encounter such an individual. You might want to step away from the inspection and consult with your counsel if you start to lose your temper with the attitude displayed.

Of course, if a field investigator appears to be acting inappropriately or impaired upon arrival, report that immediately to your product safety lawyer so that the appropriate headquarters supervisor can be advised.

The intent of our piece is not to frighten you but to arm you with your rights in the event of a government inspection from the CPSC or another regulatory enforcement agency. Make sure your store managers are aware of your rights as well and instruct them how you wish them to handle inspections from regulatory agencies such as the CPSC. Consult with your product safety counsel to obtain their thoughts and recommendations for how to proceed in the future.

Mary Martha McNamara, Partner at McNamara & L’Heureux, P.C., has represented manufacturers, distributors, and retailers in CPSC matters for more than 30 years. Mary Martha can be reached at mmcnamara@mclh.com.

Neal Cohen, Principal at Neal Cohen Law LLC, is the former CPSC Small Business Ombudsman. He has also served in the CPSC Office of General Counsel and the Office of Compliance. Neal can be reached at Neal@NealCohenLaw.com. www.

NealCohenLaw.com

This article does not, and is not intended to, constitute legal advice as it is general in nature. You should consult competent legal counsel before acting on any of the information in this article.

AUGUST | 2016

45

HFACOMMUNITY After 27 Years, Longtime HFA Member Valerie Watters is Calling it a Career It’s Tuesday morning and longtime HFA member Valerie Watters is hard at work—only not the kind of work you’d associate with a successful home furnishings retailer. Instead of checking inventory, Watters is making sure there’s plenty of water in the bowls for the chickens to soak their feet. Instead of rearranging the showroom floor, Watters is hosing down Henry, her 40-year-old donkey to keep him cool in the stifling Arizona heat.

“This is my future,” says Watters, who runs Valerie’s Furniture and Accents, in Cave Creek, Ariz. “Feeding my babies and making sure they’re comfortable. And you know what? I’m looking forward to it.”

After 27 years helping furnish and decorate homes throughout Arizona—the world, really—Watters is calling it quits.

Sort of. She still wants to have a part in the home furnishings industry, but she’s ready to move on from running her own store.

She’s equally nervous and excited about what the future holds for her. “It’s been a fun ride and now it’s time to try something new,” she says.

Watters’ fun ride began on April Fool’s Day in 1989, when she opened her 3,000 square foot store in Scottsdale, Ariz., with $14,000 to her name. This is not one of those stories about persevering through the hard times. “Right away I had a fan club,” she recalls. “People came by and appreciated the merchandise I had. I knew

the first week I was on to something.”

Watters has an eye for finding eclectic southwestern-themed furniture and accessories and she quickly gained a following not just in Arizona, but throughout the West. There are even homes in Europe decorated with Watters’ furnishings.

Watters says she remembers from the start wanting to go against the grain in terms of what she sold. Part of that came from her free spirit. Part of that came from having managed a furniture store for eight years earlier. “I didn’t want to open the newspaper every Sunday and see that I was selling the exact same thing as the competition. I just couldn’t do that—not to my competition, but to myself!”

As business grew, Watters decided she needed a bigger store. She bought a 6,300-square-foot building in Cave Creek closer to home. Her loyal customers from Scottsdale 30 miles away didn’t mind making the drive and business never seemed to slow down with the move.

But now Watters wants to slow down herself. The industry has changed, she says, not always for the better. She says Millennials don’t desire the high-end collectible furniture she sells. “The majority want to live in a disposable furniture world,” she says. “It sounds like I’m judging, but I’m not. That’s just not what I want to get into.”

The manufacturing side has changed, too, she says. “The smaller manufacturers

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are gone. It seems the bigger guys don’t care anymore about the smaller, independents. I like relationships—with my customers, with my manufacturers. That’s the kind of person I am so when I lose those relationships it’s like a stab in the heart.”

Watters says she’s closing the store.

She’ll be running a liquidation sale in the fall. She said she could have sold it, but after 27 years “it’s a part of me. I just couldn’t turn something so close to me over to someone else. What if they drove it into the ground? It’s always been a business for me, but sometime along the way it also became something very personal, too.”

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HFACOMMUNITY HFA Adds IHFRA Member to Board The Home Furnishings Association (HFA) has added a seat on its board of directors for a member of the International Home Furnishings Representatives Association (IHFRA). IHFRA and HFA executives met in May during HFA’s conference in Long Beach to discuss issues that continue to strengthen their support of each other. IHFRA’s board elected its second vice president, Al David, to sit on HFA’s board. David is the Ashley marketing specialist in the case goods division and works out of Michigan.

HFA’s Partner Relations team, led by David Gunn, president of Knight Furniture, Sherman Texas spearheaded this initiative. The team’s purpose is to discover opportunities that strengthen the HFA and its members via partnerships with other groups and organizations, which in turn strengthens the industry as a whole.

“Al David joining the HFA board is an exciting step in the relationship between HFA and the rep association, IHFRA,” Gunn said. “His experience, expertise and years of dedication to the furniture industry make him an outstanding addition to help the FHA continue to expand its support for all aspects of the furniture business.”

HFA Networking

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The Home Furnishings Association provides networking and education events across the country throughout the year.

Webinars are free to HFA members, and cover topics ranging from technology, sales, marketing and operations to consumer studies, e-commerce and more.

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Monday, August 1, 11:30 am – 1 pm Las Vegas Market

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Thursday, August 18 Mirabeau Park Hotel, Spokane, Wash.

Today’s Store for Tomorrow’s Customer

Thursday, August 18 (Store Design/Merchandising)

Exit Strategies: What are Your Options?

Wednesday, September 21 (Transition Planning)

Omni-Channel Revenue: Go and Get It Wednesday, October 19 (Technology/Marketing)

Visit myhfa.org/events for more information and registration.

Do you have something for the HFA Community? Send your information and hi-res photos to Robert Bell, rbell@myhfa.org.

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55

II

THE WAY WE WERE

T

his photo of co-founder Ira (left) and me was taken in 1989 at our first office in Parsippany, N.J. Ira was a driving force behind putting our company on the map and while he is missed today, his competitive nature and commitment to success lives on here at STORIS. The photo brings me back to the home furnishings industry in 1989. At the time, most retailers ran their businesses manually and were not focused on the benefits of technology. Today, technology is an integral part of a retailer’s success and one that many can’t

imagine operating without. Technology no longer means automating transactions, but rather the ability to improve operations and customer experience at every step along the way. This picture is a reminder of how far we’ve come in only 28 short years.

STORIS has and will continue to evolve to ensure we provide our home furnishing partners with the tools they need to succeed.

This was the vision Ira and I had in 1989 when we founded STORIS, and it remains our vision today.

Donald J. Surdoval—CEO STORIS Mt. Arlington, N.J.

 Share your old photograph and memory by contacting Robert Bell at 916.757.1169 or rbell@myhfa.org

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