sales and sales management
Journal of the Western Home Furnishings association
westernreporter
February 2009
est.1944
Western Home Furnishings Association 500 Giuseppe Court, #6 Roseville, CA 95678 CHANGE SERVICE REQUESTED
www.WHFA.org
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Journal of the Western Home Furnishings association
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EDITORIAL STAFF MANAGING EDITOR: Melissa Dressler ............................... mdressler@whfa.org PUBLISHER: Melissa Robinson ........................................... mrobinson@whfa.org
table of contents featured articles
2008 WHFA OFFICERS AND EXECUTIVE COMMITTEE WHFA PRESIDENT Marty Cramer - Cramer’s Home Furnishings, Ellensburg, WA ..........(509) 933-2172
Pros and Cons of Layaway . . . . . 12
PRESIDENT ELECT
New Media Marketing . . . . . . . . 15
Claudia LeClair - Fiesta Home Furnishings, Scottsdale, AZ..............(480) 951-3239 VICE PRESIDENT
Working with Your Manufacturer Representives . . 23
Angel Lopez - Dearden’s, Los Angeles, CA.......................................(213) 362-9600 TREASURER Chris Sanders - Everton Mattress Factory, Inc., Twin Falls, ID .........(208) 326-3407 SECRETARY Valerie Watters - Valerie’s Furniture and Accents, Cave Creek, AZ...(480) 483-3327 EXECUTIVE COMMITTEE CHAIR Keith Koplan - Koplan’s Furniture, Vancouver, WA............................(360) 695-3388
Your Association’s 2008 Achievements . . . . . . . . 28
PAST PRESIDENTS George Nader - Nader’s La Popular, Gardena, CA ...........................(310) 327-8585 Cherie Rose - The Rose Collection, Los Gatos, CA..........................(408) 395-7773 EXECUTIVE DIRECTOR Sharron Bradley - WHFA, Roseville, CA............................................(916) 784-7677 AT LARGE EXECUTIVE COMMITTEE MEMBERS Gary Absalonson - Walker’s Furniture Inc., Spokane, WA.................(509) 533-5500 Howard Haimsohn - Lawrance Contemporary, San Diego, CA ......... (619) 291-1911 Marvin Kerby - Kerby’s Furniture, Mesa, AZ ......................................(480) 834-3888 Lael Thompson - Broyhill Home Collections, Aurora, CO ..................(303) 360-9653
Sales Contests. . . . . . . . . . . . . . . 33
WHFA/NHFA LIAISON David Harkness - Harkness Furniture, Tacoma, WA..........................(253) 473-1234 WHFA BOARD MEMBERS Gene DeMeerleer - Furniture West, LaGrande, OR ..........................(541) 963-5440 Patti Evans - Consignment Plus, Walnut Creek, CA..........................(925) 927-6600 Greg Follett - Follett’s Furniture, Lewiston, ID ...................................(208) 743-0177 Eric Foucrier - Linder’s Furniture Mart, Garden Grove, CA ...............(714) 210-4848 Giff Gates - Gates Furniture, Grants Pass, OR .................................(541) 476-4627 Eric Harms - Black’s Home Furnishings, Yreka, CA ..........................(530) 842-3876 Karen Hatterle - Thomasville of Portland, Tigard, OR .......................(503) 863-3040 Ron Hoesterey - Royal Mattress Company, Inc., Orange, CA...........(800) 987-6925 Paula Holt - Home Collections/Dining Collections, Salem, OR .........(503) 589-4358 Jerome James - Hafer’s Home Furnishings, Manteca, CA................(209) 823-2122 Julian Jeppe - Reeds Furniture, Agoura Hills, CA .............................(818) 597-7800 Doug Kays - Premiere Home Furnishings, Los Angeles, CA............. (310) 268-0811 Chuck Kill - Bedmart, Tucson, AZ ......................................................(520) 887-7039 Tim Koerner - Koerner Furniture, Coeur D’Alene, ID.........................(208) 666-1525 Karen Kohlman - West Harvard Furniture, Roseburg. OR ................(541) 673-4221 Don Lemieux - Naturwood, Rancho Cordova, CA .............................(916) 638-2424 Jeff Lindsley - Lindsley’s Home Furnishings, Grangeville, ID ............(208) 983-1040 Sandy Lundgren - Olsen Furniture, Shelton, WA...............................(360) 426-4702 Robert Myers - Ashley Furniture HomeStore, Chico, CA...................(530) 345-2616 Mark Navarra - Jerome’s, San Diego, CA..........................................(858) 753-1549 Michael Nermon - Ergo Customized Comfort, Irvine, CA ..................(949) 833-0338 Ray Nunez - Furniture Savings Center, Sacramento, CA..................(916) 487-6005 Scott Selden - Selden’s - Tacoma, WA ..............................................(253) 922-5700 Sally Servidio - Silverado Home & Design, Napa, CA .......................(707) 251-0888 Mike Shuel - Meredith Furniture, Yakima, WA ...................................(509) 452-6221 Tom Slater - Slater’s Home Furnishings, Modesto, CA .....................(209) 522-9097 Pam Wright - Davis Furniture, Wenatchee, WA................................. (509) 662-4511
WESTERN HOME FURNISHINGS ASSOCIATION STAFF Executive Director: Sharron Bradley ...............................................(916) 960-0345 Asst. Exec./Marketing Director: Kaprice Crawford.........................(916) 960-0346 Business Manager: Janice Carlson .................................................(916) 960-0347 Events Manager: Cindi Williams ......................................................(916) 960-0277 Operations/Warehouse Manager: Jef Spencer ..............................(916) 960-0386 Communications Planning Manager: Melissa Robinson ...............(916) 960-0349 Managing Editor & Webmaster: Melissa Dressler ..........................(916) 960-0385 Membership Manager: Michael Hill .................................................(916) 960-0263 Member Services Specialist: Margie Jacobs..................................(916) 960-0199 Member Services Rep: Adam Gardner ...........................................(916) 960-0291 Accounting Assistant: Melody King ................................................(916) 960-2476
Contact WHFa at www.WHFa.org or (800) 422-3778.
Fast Forward — Family Business Mistakes . . . . 36
in every issue Industry Beat . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Board Member Q&A with Tom Slater . . . . . . . . 8 Retailer Notes: Dead Inventory . . . . . . . . . . . . 10 Member Profile with Cramer’s Home Furnishings . . . . . . . . 20 Program of the Month: Argo Select . . . . . . . . 27
contact est.1944
Phone: (800) 422-3778 (12 western states) (916) 784-7677 Online: www.WHFA.org Fax:
(916) 784-7697
Mail:
500 Giuseppe Court, Suite 6 Roseville, CA 95678
Western Home Furnishings Association is the western affiliate of National Home Furnishings Association
westernreporter
February 2009
3
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president’s message I am excited and honored to have been chosen as the WHFA 2009 president. It is my sincerest wish and No. 1 goal for those of you who are members, but not actively involved in the WHFA, to encourage you to bring your ideas, experience and love of our business and get involved this year. I promise, you will never regret getting more active in this great organization. The term sales management means so many different things to so many of us. For our stores, the best way to manage sales has been in the hiring process. I was in one of our stores a few weeks ago and although we did not have an opening on our sales staff, the store manager had scheduled an interview for that afternoon. I mentioned that I did not know we were hiring. She said, “We aren’t, but you have always stressed the importance of being open to upgrading the staff, and when you see his resume, I am sure you will agree that we should talk with him.” (Who knew anyone was listening.) I sat in on the interview, and after a few minutes, two things became obvious: One, this was definitely going to be a two-way interview and secondly, this guy knew a thing or two about sales. I sat there trying my best to stay out of it. For those of you who don’t know me, “staying out of things,” is not something that comes naturally to me. Finally when I couldn’t resist any longer, I asked my favorite question, “What do you think is the thing that makes a salesperson great instead of just good?” He looked right at me and with no hesitation said, “They have to be motivated by money.” I could have sworn I heard a chorus of hallelujah’s when he said that. Needless to say he started the next week. Someone in that store will lose their job eventually, if this guy is as good as I think he is. That is not a great feeling. Sometimes it is hard to be the person making those decisions. One thing that is certain, if we don’t hire him the store down the road will. Well, if the store down the road is hiring let them have the “good” salesperson, and we will take the “great” one. If someone comes into your store asking if you are hiring, don’t be too quick to say no. We all know that having the right salespeople on the floor can have a tremendous affect on sales. Being open to “upgrading” is one way to have a great staff. I know that the point I am making is obvious to many of you. Here is one more point that may be obvious. The reason we pay our salespeople commission is so when we are looking for additional staff, we are attracting the type of people who have the confidence and skills to be great. The effects of a sales management plan will only be as successful as the potential of the people you are managing. We will work short staffed rather than settle for the wrong person. By the way, if you have a commissioned salesperson that complains when you are short staffed, you have the wrong person on your floor. Our salespeople love it when we are running short. It is a new year with all the potential that starting fresh gives us. I for one am looking forward to having a “great” year. I hope you are too. I would love to hear from you if you have any comments on this or any of the columns I write during the coming year. Please feel free to email any time.
Marty Cramer 2009 WHFA president Cramer’s Home Furnishings Ellensburg, WA marty@cramershomefurnishings.com
ON THE COVER The Aerolo Collection from Lazar. For more information, please visit www.lazarind.com.
Contact WHFa at www.WHFa.org or (800) 422-3778.
westernreporter
February 2009
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editor’s message Dealing with Economic Uncertainty I am not going to sugar coat things — it is tough out there. The economy keeps spiraling downward and your consumers are becoming even tighter with what money they are willing spend. Many businesses have reacted by closing down facilities for two weeks or longer over the recent holidays, freezing all hiring and wage increases, enforcing employee pay cuts, laying off employees, and worst of all, going out of business. Despite a few glimmers of hope that the consumer has more money (gas prices are at the lowest level in years, prices on everyday necessities are dropping) there is still a dismal outlook for the rest of this year. In spite of the dismal outlook, I am trying to maintain a positive attitude — and a positive attitude is the No. 1 thing you need to survive this downturn. We all know the economy will eventually rebound, so everyone needs to seriously look at their business and see what can be done to survive. Recently, a question was posted on the WHFA website Discussion Boards asking: What specific steps have you taken or plan to take in your business to deal with this economic uncertainty and slowdown in consumer spending? Numerous retailers, like you, responded with amazing tips and insight on what they have been doing to survive — and a few are even maintaining a profit. I wanted to share a few of their cost-saving ideas for you to look into implementing in your store: • Renegotiate your lease. Rent is often your largest expense and many times your landlord is willing to work out a deal instead of having you go out of business. • DON’T stop advertising. This is often the first area many people think of cutting but it can also be the most dangerous to cut. Instead, re-evaluate your advertising and only use the most effective medium for your store. • Go out to the community. Since business is slow, you most likely have more time to participate in the local chamber of commerce, school board, etc. Supporting the community will make customers remember your store and name. • Rent out your extra warehouse space to outside designers and contractors who need the space but don’t want to maintain their own warehouse and overhead. • Outsource deliveries to another company. This can save you money on truck maintenance, fuel, labor and insurance costs. • Cut your own wage. • Shrink your inventory down to 20 percent of annual sales. • Develop electronic marketing and look into “free” ways to promote your business online (i.e. social networking, blogs, etc). There were many other terrific ideas mentioned in this discussion. If you are interested in reading more or adding your own cost-saving tips, visit www.WHFA.org, click on “Community” and “Join the Discussion”. This issue of Western Reporter looks at sales and sales management, and it explores topics such as offering layaway services, using social networking to market yourself and using your manufacturer’s reps to train your staff. While 2009 is starting off bleak, let’s all join together, maintain a positive attitude and survive this downturn.
looking forward
Melissa “Mel” Dressler Western Reporter managing editor MDressler@whfa.org
to March 2009
Advantages of Being a Credit Store
the future
J o u r n a l o f t h e We s t e r n H o m e F u r n i s h i n g s A s s o c i a t i o n
westernreporter
january 2009
Retirement Plans
www.WHFA.org
Web.Simple Part III
Presorted Standard U S Postage PAID Permit #604 Sacramento, CA
... and much more!
Last month’s feature articles are available online at www.WHFA.org.
Member Profile: Selden’s Interior Furnishings, Tacoma, WA
Western Home Furnishings Association 500 Giuseppe Court, #6 Roseville, CA 95678 CHANGE SERVICE REQUESTED
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February 2009
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Contact WHFa at www.WHFa.org or (800) 422-3778.
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industry
beat
Bedmart Expands Green Valley, AZ Location Bedmart opened its newly expanded Green Valley, AZ location in November 2008. “The Green Valley, Tubac, Sahuarita areas are experiencing phenomenal growth,” said Chuck Kill, CEO. “This store serves all of these Southern Arizona towns, and we wanted to give these customers similar choices to what they would find in Tucson.” While keeping the same location, the Bedmart store has grown from 2,940 square feet to 4,200 square feet. It now displays 55 different mattress sets which include traditional innerspring mattresses, mattresses that are engineered to not require turning, Visco memory foam mattresses, Latex foam mattresses, adjustable beds and more.
board
Jerome’s Furniture Wins San Diego National Bank Founders Award Family-owned and operated in San Diego, Jerome’s Furniture was awarded with the San Diego National Bank Founders Award at the 2008 Family-Owned & Closely-Held Business Awards Ceremony, hosted by the San Diego Business Journal at the San Diego Marriott Del Mar. “We are so honored to receive this award from the San Diego Business Journal,” said Jim Navarra, marketing manager, who accepted the award on behalf of Jerome’s. “Jerome’s was started by my grandparents, Jim and Esther Navarra, in 1954, and now, the third generation of the Navarra family is deeply involved in the business. We take great pride in being a family-run company, and having worked together for so many years, we truly understand how to run the business successfully as a family.”
member
Q&A
Q What is your biggest challenge in furniture retailing? A Obviously we are all in the biggest retail challenge right now. More
specifically, I think getting the consumer to come in and buy without just offering a huge discount is the biggest challenge.
Q What CD is in your vehicle right now? A I can’t remember the name of the CD, but it is the only one that
with Tom
features Emily-Lou Harris and Mark Knoffler.
Q If you won the lottery, what would you do with the money?
une onth t mber m y r e Eve oard M re into B o learn mo t Q&A your WHFA u o ab t members. board
A If I won the lottery, you would have my resignation from the board, and it would have been sent from my new home on the island of Hawaii.
Q What is the most overlooked secret to success? A I think the secret to success, overlooked or not, is over the top customer service.
Q I wish I knew how to: A I wish I knew how to use the computer much better. Maybe I should
Tom Slater Slater’s Home Furniture 1605 J St Modesto, CA 95354-1187 (209) 522-9097 tslater@arrival.net
just be younger!
Q What do you enjoy most about being a WHFA member? A I enjoy being with and networking with the other members. It’s the best way to learn to be a better retailer and businessman.
8
February 2009
westernreporter
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retailer
notes How do you get rid of dead inventory? These responses were provided by home furnishings retailers on the WHFA Discussion Forum. To post your own question or answer another retailer’s, visit www.WHFA.org, click on “Community” and then select “Join the Discussion.” I go throughout the store before our two big sales during July and December and tag every old closeout item with a bright lime green tag that says: LAST ONE. I run the sale “UP TO 70 percent OFF” and with these old items I make some great deals from 70 percent off. Then I list all these items on a 18 X 24 inch lime green poster and put them on an easel by the entrance. Each day as we sell these items, I draw a line through them. The items are scattered throughout the store. - Anonymous
It will depend on why it is “dead” and how much of it you have. If there is quite a bit and you are willing to sell it at a huge discount, market it! Parking lot sale, warehouse clearance sale — get creative. Send out a one page letter to all your customers inviting them to the event. Give them a story about why you are giving such incredible discounts. You can also guarantee a larger response by putting everything on sale inside the store, just with smaller discounts. The result of this will be a blending of increased sales on your profitable items with your “give-away” prices on the clearance items. - Anonymous
We used to pull sale merchandise off the floor and bring new product in, but we had to wait until our twice annual sale. Now we mark our sale merchandise down, but photograph it and put it on a “sale” board where everyone can see it as they come into the store. We have sold tags we pin to the photo of what’s sold and that hopefully psychologically draws interest. If traffic is down, as it has been, nothing has sold even at 50 percent off, so after 60 days we’ve pulled what hasn’t sold and replaced it with a new item. We do keep the photos of what’s on sale, and it goes in our stock book. Because we don’t have a large warehouse we can look in the book to see what’s available if someone asks. - Anonymous
I move it to a different part of the store. Sometimes if something has been in the same spot for a long time, I feel like the stor boring. I put it on sale and offer the e is salespeople $50-100 spiff. - Sally Servidio, Silverado Home Furnishings
It depends how many items are “dead”. I would put a spiff for your salespeople to benefit from selling it. Build your spiff into the reduced price. I would make sure you have it displayed as beautifully as possible and that the customer can clearly understand how much they are saving. Don’t just price it at $599. Show what it would sell for at your full mark-up and then show the lower price. Be sure your staff knows the features and benefits of that item. Sometimes it’s a dead item because of where it is placed. Try moving it around. If you put it in a “hot” spot and it doesn’t sell, it might just be a bad buy. Find out what people are buying instead of that dog. Maybe mark-up the faster selling item to either sell the dog or make more money on the better seller. I sometimes take a $20 or $50 bill and create a contest for that day. You could say whoever sells the most “dead” items that day takes it home. I usually do it for the highest ticket for that day. Whoever makes the first sale gets the $20 or $50 bill. Then whoever writes a largest invoice takes it away from the other salesperson. It can get passed back and forth several times and everyone wants to walk out the door with it. You can the contest award could be gift cards, movie tickets or any other item your staff would get excited about. Several great years have spoiled us. These times make us better retailers! - Anonymous 10
February 2009
westernreporter
Contact WHFA at www.WHFA.org or (800) 422-3778.
feature article
Pros and Cons of Layaway James Grandillo senior retail consultant JRM Sales & Management
12
February 2009
R
emember layaways? I do. Most retail stores back in the day had layaway programs. They were set up in a variety of ways, but essentially they all worked like this: 1. You select an item you wish to own; 2. You immediately remit a certain percentage of the purchase price as down payment; 3. You make several incremental payments until the item is fully paid for; 4. Then, and only then, do you take delivery of the item in question. Sounds easy, doesn’t it? On the surface it is easy. Back in the days before paying by credit card was the norm, customers unable to pay immediately in full liked layaway because they could “hold” an in-stock item (guaranteeing it would be available when they wanted it) and pay for it gradually. Stores liked layaway because, with a layaway program, the customer with less cash resources could be more easily persuaded to purchase a product they could not afford to pay for in full at time of purchase. Seems like everybody wins. Customers unable to pay in full paid gradually over time. The retailers got some small cash flow and — usually — a good assurance that the item in question would actually be delivered at some later date. However, what appears simple on the surface is usually very complicated just below… Smaller stores with limited staff found that administering a layaway program could be a nightmare. In the fuzzy, pre-computer days before 1985 keeping track of who owes how much and when payments are due was an enormous effort. People did not always pay on
westernreporter
time or at all. Some customers would renege on their commitment and ask for their payments to be returned. Stores found that layaways tied up their inventory and, inevitably, inventories would rise. Often customers chose the layaway option to tie up goods that were usually new to the store and potentially “hot” items as well… items that were destined to move quickly. Companies with tight cash flow had to pay for the goods within 30 days but they might not receive payment from the customer for 90 days or more. However, as credit became looser and “instant gratification” became the norm, the need for the layaway option in retail stores diminished. With interest rates low and consumer optimism high, banks fell all over themselves to offer plastic cards to anyone who would apply for them. In addition, in the 1980s there emerged the dreaded NO! NO! NO! advertising and promotion strategy that our industry embraced in a death grip that continues to this day. So the message was clear: 1. Credit was easily available through banksupported credit cards; 2. We will offer you easy financing terms with NO money down and NO interest for X months (although this meant either higher prices to the consumer or lower margins to the retailer: someone had to pay for this money!); 3. You can have it all and you can have it now! A heady wine, indeed. Like sailors on leave, consumers waving their plastic lined up to buy. And for those people whose personal financial situation made them a poor risk for the credit card companies or the banks (around 38 percent Contact WHFA at www.WHFA.org or (800) 422-3778.
of all consumers cannot obtain a credit card even today), the meteoric growth of the Rentto-Own industry provided instant gratification and ownership for millions of people with the following message: We will NOT run a credit check on you. EVERYONE with a bonafide job will be granted the right to purchase here on time. In this intoxicating climate who needed layaway? The world of 2009 is not the world of 1985. (Have you noticed fewer credit card offers in your mailbox of late?) All banks have tightened up. Retailers have a more difficult time obtaining credit lines to purchase inventory. Consumers whose wallets once bulged with a dozen credit cards are now slicing them into little pieces and letting them sleep with the fishes. In addition, many people have maxed out their personal credit and can barely make their minimums each month. Our national addiction to instant gratification and easy credit terms is still very, very strong, but in some people it has been replaced with a hyper-sensitivity to anything that threatens our future security: a growing number of consumers are gradually becoming anti-credit. This bodes poorly for companies who have built their entire business empire on the Charge It and Have it NOW! mentality. Many of them — notably the larger, more strategic chain stores, are beginning to re-think their prior aversion to layaway — because, properly administered, a layaway program provides the consumer with options to going further into debt to have the things they need. It might be useful for the retail home furnishings industries to dust off their old layaway programs and see if they may have new meaning in today’s difficult business climate. Kmart, Sears, Target, and others have streamlined their layaway programs and are advertising them aggressively to the consumer. They are doing so to capture the attention of the careful consumer. Cautious consumers like layaway because of the discipline it requires, for most programs demand regular payments and the layaway term itself is brief — typically, rarely longer than 90 days. A new breed of “frugalista” is emerging, and they love layaway, because it is suddenly very now to be careful with your finances. From one perspective, layaways allow the retailer to penetrate/capture a market segment that normally would be lost to them. Those without credit cards or a high enough credit rating cannot purchase anything in this country without using hard cash or going to the rent-toown companies — and they will pay substantially more money for goods in the long run if they do. If a retailer is willing to provide the administration necessary to keep the program under control, a layaway process will help this customer obtain the things they want and need. Contact WHFA at www.WHFA.org or (800) 422-3778.
But the pitfalls are great. Inventory is “locked” up and immovable. Many layaway items are ultimately cancelled as customers find more urgent places to invest their money — meaning the retailer has held onto the goods for months and suddenly has to give back the monies paid to them. Now the retailer has inventory than he doesn’t actually need. In the case of seasonal merchandise this could be a disaster: little patio furniture is sold in December! Smaller companies find it difficult to keep customers informed when payments are late — thus the cash flow position is weakened. So while layaway programs can open up a new market for the retailers they must be administered with caution and care. Here are a few suggestions on how to establish a layaway program and avoid problems. Remember, the more restrictive the program, the less attractive it is to the consumer. You have to decide how much hassle or risk you are willing to take to provide this additional service to your customers: 1. Limit the term of the layaway to 90 days for home furnishings; 2. Require a high initial investment — between 3350 percent. The customer is thus more deeply committed to completing the transaction; 3. Create a system that requires someone well-trained to phone the customer if an installment payment is more that five days late; 4. If you must have a cancellation policy, make sure the fee for this service (“restocking” fee) is reasonably large — say 25 percent of the original price; 5. Assess administrative fees to service the layaway agreement; 6. Establish as a policy the dollar amount of goods that can be placed on layaway — i.e. make the sale attractive enough to the company to justify the time and effort necessary to service it. Don’t put $20 candlesticks on layaway; 7. Test the viability of a layaway program by offering it initially for a limited time only — say, during a 30-day period. See if your system works properly and your sales staff understands how and when to promote it. If it is working and gives your store the edge that it needs, roll it out further. Every retailer today is desperately looking for new ways to make something happen and grow their business. Properly administered, a layaway program can help certain stores better service certain customers. There are risks, but these risks can be mitigated with careful planning, training and systems that are carefully adhered to. Provided that a layaway program is well-conceived, it can mean additional business for the retailer who wishes to grow his business and penetrate a new market segment.
JRM Sales & Management is a team of consultants and trainers to the retail home furnishings industry. Visit their website at www. jrmsales-mgmt.com for additional information or call them directly at (678) 574-0937. James Grandillo, senior retail consultant — Jim has over 30 years of hands-on retail experience in all aspects of the home furnishings industry. As a consultant, he has personally helped to improve the performance of nearly 100 independent retailers.
westernreporter
February 2009
13
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New Media Marketing What’s In It For You?
Here are 10 reasons why it might be a good idea for you to consider a comprehensive digital marketing plan for 2009: 1. Over 570 million people worldwide use some type of social networking site —not just the Internet, but, specifically, a social networking site such as those shown above. Facebook has the highest adoption rate worldwide at this time with over 52 million users alone. This means it is highly likely that at least some of your potential consumers can be reached this way and Facebook for Business is but one of many very powerful, free applications available to you to do so. 2. General Internet usage by consumers is exploding: According to Nielsen/Net Ratings, there are over 1,463,632,361 people using the Internet as of June 2008. Yes, 1.4+ BILLION. Contact WHFa at www.WHFa.org or (800) 422-3778.
This is approximately one-sixth of the entire world population and represents a worldwide usage growth rate of 305.5 percent from 2000 until 2008. North America alone has had a 129.6 percent increase in usage between the year 2000-2008, but that pales in comparison to the Middle East and Latin America at 1,176.8 percent and 669.3 percent respectively. 3. Social networking sites are free for you to use. There is no cost. They are generally supported through ads or through premium levels of subscription services. Facebook for Business is free and supported by ads, LinkedIn is supported through premium subscriptions. Twitter is free. Flickr is free. YouTube is free. 4. By careful use of social media and social networking platforms, you can find out in real time what your customers want, what they are thinking and how you can serve them more effectively. 5. Setting up digital marketing strategies does not require you to spend additional money. It requires you to migrate part of your
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Leslie Carothers principal The Kaleidoscope Partnership
When was the last time you had to spend no money to drive traffic to your website and into your store? When was the last time paid advertising and marketing were directly measurable on an hourly basis? westernreporter
February 2009
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igital marketing. New media marketing. Social media marketing. Web 2.0 marketing. These are all interchangeable terms which have at their core the crafting of a marketing strategy that combines social media such as blogs, podcasts, webinars, videos and social networking sites such as LinkedIn, Twitter, Bebo, Facebook, Flickr, Ning, etc. to costeffectively and directly connect with your current and future consumers. Why are so many brands switching from traditional media to social media or, at the very least, combining the two? Simply put, because that’s where consumers are spending their time — over 570 million of them a year and growing. In addition, social media is cost effective, completely measurable and targeted. Just what are some of the social media tools available to you and why consider using them? The rest of the article will examine that topic in depth.
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Hear Leslie speak during WHFA’s 2009 Conference and Expo in Maui, HI, May 17 – 19, 2009. Visit www.WHFAconference.com for more details.
traditional marketing and advertising expense into new media platforms. Once the strategy has been implemented, the cost is free with the exception of online community moderation. This cost, while real, means that you or someone you hire is actively talking with your potential consumers every second of the day through online conversations. You can’t get much closer to the pulse of the consumer than that nor show them a better level of customer service. Active community management through engagement and conversation will be a key differentiator for smart retailers in 2009 and beyond. 6. Mobile phone text messaging usage is increasing: The official Google blog writes: There are currently about 3.2 billion mobile subscribers in the world, and that number is expected to grow by at least a billion in the next few years. Today, mobile phones are more prevalent than cars (about 800 million registered vehicles in the world) and credit cards (only 1.4 billion of those). While it took 100 years for landline phones to spread to more than 80 percent of the countries in the world, their wireless descendants did it in 16. By utilizing new media tools, you will be able to connect with your potential customers as they are driving around on a Saturday afternoon. You will be able to invite them all in for a special event or give them a discount for the next two hours only. 7. Every time your company engages in an online media strategy, your company name and your company’s keywords are indexed and search engine optimized. Why is this important? Because if a potential customer types in to Google’s browser the words “traditional sofas Portland Oregon” and you don’t show up, then you are invisible to that consumer. If that consumer lives out of state and is moving to your area, you have just lost your opportunity for them to know you exist. Points 8, 9 and 10 are the same: Social media and social networking marketing initiatives are directly measurable. You can see exactly which initiatives and sites are sending traffic to your website, how many visitors are coming,
what time of day, what pages they are landing on, how long they stay on the page, what they click through to from one page to the next, and many more data points.
I leave you with this: When was the last time you had to spend no money to drive traffic to your website and into your store? When was the last time paid advertising and marketing were directly measurable on an hourly basis? That’s why so many consumer durables companies are setting up a presence within the social networking and social media communities. IKEA, NestLiving, HomeReserve, Landfair Furniture+Design, many interior designers (wouldn’t you like to connect with interior designers in your market for free?) are all adopting new media tools as a key component of their 2009 marketing and sales strategy. Within the greater consumer durables world, Proctor and Gamble, Ford, Constant Contact, Dunkin’ Donuts, Sears, Kmart and Comcast, to name a few, are all developing a personal connection with their customers in the social networking world. It’s easy, it’s simple, it’s free except for upfront strategy development and ongoing monitoring costs. Digital marketing using social networking and social media tools will cut your marketing budgets by two-thirds, give you the ability to listen and learn from your potential customers, prospect extremely fast and develop a reputation amongst your customers and on consumer online opinion sites as being connected, engaged and caring. What could be better than that? Sales. More. Larger. Faster because your customers know you are listening and engaging them where they are in the online communities they have chosen to participate in. To survive and thrive in 2009 and beyond, I think it’s time for all retailers, manufacturers suppliers and designers to be there, too.
What do you think? Please email me with your comments or questions at leslie@tkpartnership.com or call me at (713) 705-2482. Your opinion is the one that really matters to me.
The Kaleidoscope Partnership is a new media consulting firm specializing in providing retailers, manufacturers and suppliers in the home industries with the tools they need to execute social networking, online reputation management, e-conversion and analytics sales and marketing strategies. For more information, please see Leslie’s profile on www.linkedin.com/in/lesliecarothers, visit her company page on Facebook at The Kaleidoscope Partnership, follow her on Twitter at tkpleslie or visit her website at www.tkpartnership.com.
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Contact WHFa at www.WHFa.org or (800) 422-3778.
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ACCESS Visit over 50 industry service providers dedicated to bettering your performance and your bottom line. Check out www.WHFA.org and click on the RRC logo to view a complete listing of service providers showing at the two RRC locations.
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ACA/ Advertising Concepts of America American General Finance Argo Select AYR1.com B&B/CMK - Banker & Brisebois Advertising BA Merchant Services Bryant-Forney Associates California Air Resources Board Citi Retail Services Cosec International, Inc. Custom Design Software Email Broadcast Escalate Retail Furniture Training Company Furniture Transportation Group Furniture Wizard FurnitureDealer.net FurnServe Genesis Software Systems Global Link Logistics Guardian Protection Products Guardsman, a business Unit of Valspar GutSELL & Associates HEP Direct HomeDirect USA Horich Parks Lebow Advertising HunterDouglas IAS Training I.C.E. Signs International Storage Systems, Inc. JRM Sales & Management, Inc. Kizer & Bender Speaking! Mail America MDG Group, Inc. MicroD Inc. Morry Dickter Associates Myriad Software & Consulting National Home Furnishings Association Profitability Consulting Group PROFITconsulting PROFITsystems, Inc. Retail Radio Sale-in-a-Box State Compensation Ins. Fund Storis Management Systems The Lively Merchant The Marketing Academy The Retail Institute TruckSkin, LLC ViewIt Technologies Western Home Furnishings Association Western Retail Services Corporation Worldwide Logistics Specialists, Inc. list as of 1/6/09
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member profile
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Cramer’s Home Furnishings Ellensburg, WA 3
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Melissa Dressler Western Reporter managing editor
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February 2009
ince 1995, Cramer’s Furniture has been synonymous with quality furniture and excellent customer service in the state of Washington. Owners Marty and Michelle Cramer drew upon their previous experiences to build a furniture retail empire that caters to the customer and is successful by running a lean operation. Prior to opening their home furnishings business, Marty and Michelle met while working at a Hallmark store. After leaving Hallmark, they ventured into the publishing world, but quickly grew tired of the business. Looking for a new adventure to embark upon, they took a trip to their cabin, which was being remodeled, in the San Juan Islands in Washington. During the trip, Marty and Michelle began to discuss the furniture industry with their contractor, who owned a construction company as well as a furniture store. The idea of returning to retail had always been in the back of their minds, but both wanted to have a business where the average ticket was more then a $3 greeting card. “Our contractor told us a little bit about the furniture business, offered to help us get started, introduced us to the right people and the rest is history,” said Marty. Marty and Michelle opened their first store in 1995, and they were the only two employees. Their merchandise consisted of, “Nothing but imports and cheap imports — $99 three-pack tables,” Marty said. Everything was sold off of the floor and there was no back stock. After the
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store closed at night, Marty and Michelle would load up their van and make deliveries to their customers. Today, Cramer’s Home Furnishings has evolved into three beautiful stores, selling merchandise in the medium to high price range and has its own delivery team. Over the years, Marty and Michelle have learned many tricks on how to hire motivated employees, keep their operating expenses lean and they have realized that they are a part of the best industry out there.
Friendly and Motivated Employees When it comes to hiring employees, Marty and Michelle look for friendly people who are naturally motivated by money. “We care more about a person’s personality and less about their experience,” Marty said. “One of my favorite questions to ask during an interview, and I would say 95 percent of people answer it incorrectly, is, ‘Why do you want this job?’ And they always say, ‘Well, I am looking for a place to fit in, or self-fulfillment, or I have always loved furniture, etc…’ When what we want to hear is, ‘For the money.’ When you are in an interview and someone answers that they want the job because it is commissioned or they want to control their money, then we hire that person then and there. That is the perfect answer.” Since the best salespeople are motivated by money, Marty believes that it is important to find Contact WHFA at www.WHFA.org or (800) 422-3778.
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people who are motivated by the ability to control their own income, which can be difficult to find. By asking this question during his interviews, Marty has been able to find a great team of salespeople which are self-motivated to succeed.
Lean and Mean Operation One thing that has given Cramer’s Home Furnishings an advantage over other home furnishings stores is they run a lean and mean operation. Marty and Michelle keep their employee overhead in check by always evaluating the workload. “We always tell people that are considering working with us that there will always be too much to do, and if the day comes that you can get everything you need to do done in one day, then we have too many people,” Marty said. Another item that has helped keep costs low is selecting store locations that others don’t want. Marty learned about negotiating leases and finding“diamond in the rough” locations while working for Hallmark and has used this to lockin on some great leases. “I think the only reason I get good leases is because I ask for them,” he said. “In a lot of cases, I will find a good building, in a good location but there is something wrong with it. Case in point is the building that we have in Ellensburg: we don’t own the building, and it was a dump when we began our lease but it is in a great location. I went to the landlord and got a very long lease, 15-plus years, at an exceptionally low rate with no bumps but I had to put a lot of money into remodeling his building. There was some investment for us, but overall, we now have one of, if not the nicest building in town at a rent that people just can’t believe.” By keeping their employee overhead low and negotiating incredible lease deals, Marty and Michelle have been able to survive tough times like the current economic downturn. 1. Shane Francis and Steve Hickey from the Omak store. 2. Michelle and Marty Cramer with their one of their dogs. 3. Lindsey Parisio from the Ellensburg store. 4. Omak storefront. 5. Ellensburg storefront.
Contact WHFA at www.WHFA.org or (800) 422-3778.
The Industry Marty and Michelle have worked with a variety of people over the years in retail and publishing but none have been as friendly as the people in the home furnishings industry. “I love the furniture business, it is just full of the nicest people you have ever met,” Marty said. “The publishing business taught us how much we appreciate the business that we are currently in. That is a mean, nasty business, and you would never catch two competitors sitting down at the same table for any reason. In this industry, we play golf together!” Marty is close friends with his local competitors and they all hope each other succeeds. Marty knows that if his store did well on a particular weekend, then his competitor’s store also did well. “I always feel sorry for the retailer that hopes he does really well and everyone else does poorly because that isn’t going to happen,” he said.
The Future As WHFA’s 2009 President, Marty is optimistic about what the upcoming year will bring, “I am optimistic that things won’t get worse in 2009 and that they might even get better. I feel like those of us that are here now are survivors, and I think it is going to be a fun year.” Over the next few years, Marty and Michelle want to concentrate on refining the business to make it stronger and more profitable. They also plan on taking more time off to spend with their family of two dogs, a horse and two miniature donkeys. With their optimism, unique hiring strategies, lean business practices, and joy for the industry, Marty and Michelle will be furnishing the homes in Washington for years to come.
At a Glance
Store Locations: Ellensburg, Omak & Yakima, WA Type of Store: Full-line Year Founded: 1995 Number of Employees: 48 Number of Store Locations: 3 Annual Sales Volume: $5 million Website: www.cramersfurniture.com Top Manufacturers: La-Z-Boy, Ashley, Emerald, Comfort Solutions/King Koil, Joffran WHFA Member Since: 1998
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Working with Your Manufacturer Representives
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n this New Year and new economy, it is essential that we, as manufacturers and retailers, maximize any and every opportunity to increase our business prospects. We should stop and evaluate our current training and sales practices to ensure that we are making the most of our training curriculum and sales opportunities. If we are effective in our practices, your sales force can be assured of success on the retail floor. With this in mind, I think this is an excellent time to discuss how the participation of manufacturer’s representatives can play an important role in training the retail sales associates. After many years in retail, as a buyer and merchandise manager, and now a sales and marketing VP in the manufacturer’s arena, I have seen firsthand the numerous benefits that the manufacturer’s rep can have on retail training and sales strategies. Before we can educate the consumer, we must first educate the sales force on the finer points of the product they will be selling. Traditionally, much of this training has been done through the retail sales manager and follows a course set by their company. But who knows each individual line better than the manufacturer’s rep. By incorporating their vast knowledge base, your retail sales team can learn the product in greater depth and be better prepared to educate the consumer regarding the value of their potential purchase. When your sales force has one on one training time with the manufacturer’s rep, they have a chance to really focus on the details of a particular line. This gives your associates the opportunity to not only learn about product engineering and quality, but also what I call the FAB of the product. That is, the Features, Advantages and Benefits of the product. In this economic environment, a good understanding of product FAB is vital; providing the salesperson with an argument that can motivate their client to close a sale. Reps should also work with your
Contact WHFA at www.WHFA.org or (800) 422-3778.
sales team to guide them in taking advantage of “add-on” sales. A well trained salesperson will know exactly what occasional tables to suggest to a client who is considering the purchase of an upholstery group. This sales tactic is critical; sales associates need to learn the art of selling an “environment”, not just a “piece of furniture”. A knowledgeable, confident sales associate will be more likely to increase their average sale, improve their closing ratio, and, as a result, make more money for themselves and for their store. Industry-wide, retailers do not appear to have a consistent method of utilizing manufacturer’s reps in the process of training their sales teams, nor is there a clear way to measure how successful the rep’s time has been. Some retailers have programs to monitor how often a rep is in their store, such as sign in sheets and sheets that record who was trained that day and on what product. These sheets also typically address any pricelist, catalog, and fabric swatch concerns, along with plans for future sales meetings. The manufacturer’s rep today can either partner up with the retail sales force and be diligent in training the retailers in the details of their product lines, or face the potential loss of business to a competitor that is willing to take the time to provide this service. A successful manufacturer’s rep will schedule quarterly meetings with retail stores and will be in the store at least once a month to offer new hire training and the newest updates on their company’s product. Each visit is a new opportunity for the rep to re-educate the existing sales force and begin an on-going educational relationship with newly hired associates. As the saying goes, knowledge is power; and in this case, knowledge can equate to increased sales and a more successful sales team. In addition, ongoing training by the manufacturer’s rep can help reduce high turnover on the retail sales floor. A well educated associate will be more confident and passionate about their job and the product they are selling. westernreporter
Michael Cohen vice president of sales Emerald Home Furnishings
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In my travels, I have run across several training success stories: A prominent mid-west retailer offers an extensive sales training program that begins the first day a new hire starts and continues throughout their career. As part of this program, the new hire will not only learn product details, but also spend an entire day in customer service listening to incoming service calls. Hearing these customer concerns, and especially issues that were caused by their original salesperson, allows
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the trainee to identify and avoid these problems in the future. Many consumer problems are a direct result of the salesperson’s lack of product knowledge; or in some cases, not asking the customer the right questions. A successfully retailer in Michigan also pays close attention to their dedicated sales training program. A core component of this training is having the sales force meet with various manufacturer reps. In addition; the sales force is offered continual training on a month to month basis. This way, the company can target their training to specific issues and specific salespeople. One month the course may be an indepth look at the newest techniques for fabric protection. The next month, the course may focus on bedding. The retailer sends one or two of their sales associates to train at their corporate headquarters. At times, a manufacturer’s rep will speak at these training classes about products and sales tools. This allows the trainee to strengthen their knowledge in a particular area and share their knowledge with the rest of the retail sales team. Another western regional retailer has a great sales training program that is noteworthy. The
Contact WHFA at www.WHFA.org or (800) 422-3778.
retailer has manufacturer reps visit and talk with multiple sales teams each week. The process is simple and efficient, taking only 15 minutes or so for the sales teams to get a refresher course on the product being discussed. The reps talk about new product that has recently hit the sales floor or discuss product from their standard line. The result is a knowledgeable and successful sales force that helps to ensure the company’s continued success. I believe a Saturday morning sales meeting is a great way to start the weekend. The sales manager or store owner can recap the previous week and set a direction for the week to come. This is also a great way to make sure that everyone is on the same page as far as goals and product knowledge. Why stop there? Ask your customer service employees to join these meetings. After all, these employees keep selling product long after it is delivered. Single message selling is a must for any retailer. Sales and customer service must work as a team and they should both be telling every customer the same story about the product they are selling or supporting. This meeting is also a great time to schedule various manufacturer reps to meet with the sales force. Since everyone is there already, it is an efficient use of training time and the message will be consistent. Sales training is a must for the coming year. As consumers become more product savvy and their wallets shrink, they will increasingly use the internet as a research and decision making tool. It is, therefore, paramount to our future success to invest in dedicated training for the retail sales associates. Once the customer enters the store, the salesperson must have a more thorough understanding of their product to keep the customer’s interest. One of my goals for 2009 is to be as consistent as possible with my sales training in the field. I will be expecting my (manufacturer) reps to schedule regular product training with their customers, both for new hires
Contact WHFA at www.WHFA.org or (800) 422-3778.
as well as ongoing education for all associates. And I will expect the retailer to raise their expectations of the manufacturers’ representatives. I think you will find that the investment that is put into this endeavor will reap the benefits of success almost immediately.
Michael Cohen is the vice president of sales for the western region of Emerald Home Furnishings. Emerald is a full-line importer of upholstery, bedroom, dining and occasional and is a manufacturer or a full-line of bedding through its Emerald Sleep Systems division. For more information, visit www.EmeraldHome.com.
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It’s all the rage, but we’ve been that color for years. Our Full Circle suite of electronic products – PreVue and ePreVue, Exim Commerce, EasyPlan, EasySwatch, EasyOrder and MPCat are completely paperless. That not only makes them environmentally friendly, they also make it easier for you to work more efficiently. And that’s good for everybody. To find out more, call 800-964-3876 or visit us at www.microdinc.com.
The best furniture business technology. Please see us as the Retailer Resource Center, Building B #1630, space # 17 February 9 - 13, 2009
WHFA program of the month Best Way to Cut Overhead is with Insurance Premiums
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n tight times it is a necessity to trim overhead. One significant overhead expense is business insurance. You can put your membership to work with the WHFA’s unique insurance program through Argo Select. The program offers comprehensive, cost-effective business insurance specifically designed for furniture retailers. Argo Select is a specialty insurance provider with over 39 years of dedicated service to retail operations. Argo Select partners with furniture store owners to protect their greatest asset — their business — by providing tailored property, liability, crime, auto, and umbrella and business owners packages. Their Furniture Program Advantage endorsement is available with your policy and provides additional, enhanced coverage. Argo Select’s safety training services pinpoint exposures and help reduce the frequency and severity of claims. If a claim does occur, their exceptional claims handling staff helps to minimize your loss, coordinate repairs, and get you back to business. With Argo Select you receive exemplary customer service and competitive rates. When you receive a quote from Argo Select you speak directly with their agents; no brokers or commissioned salespeople need be involved. Argo Select’s rates and service all benefit you, the client. Lower your premium costs today and get a quote with WHFA’s program through Argo Select. Call (800) 422-3778 today, to receive a direct quote. This program is not offered through regular business channels, although brokers do have access through WHFA.
Kaprice Crawford WHFA marketing director
Coverage’s Include: Property Liability Auto Workers Compensation Employment Practices Liability Insurance Motion Cargo
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Not only does Argo Select know my retail business, their quote was NEARLY 20 percent UNDER my renewal and they worked with my existing broker. Thank you WHFA and Argo Select!
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to Open rokers B e OutsidET A G E QUOT Y A D TO
Keith Koplan Koplan’s Furniture Vancouver, WA
WHFA insurance programs Business Insurance
through WHFA’s partner
Health Insurance Workers' Compensation Employment Practices Liability Insurance (EPLI)
Contact WHFa at www.WHFa.org or (800) 422-3778.
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February 2009
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Your Association’s 2008 Achievements est.1944
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HFA has stood by you for over 60 years and no matter how difficult the times may be we’ll always be there for you. Now more than ever you must count on your association for all the resources that can simplify your business life, help you cut costs and find ways to increase your revenue stream. We bring powerful benefits to our members that come from our ability to join together to obtain the best prices on business services, to bring the most up to date education and information and to provide the most significant network for developing your business’s best practices. In spite of the turbulence of 2008 your association has been hard at work. We are proud of what has been accomplished for you and would like to share our plans for 2009. Take a look and you’ll discover the enormous value WHFA brings to members throughout the west.
Highlights of 2008 • WHFA is the largest affiliate of the National Home Furnishings Association. This year over 100 new members joined our organization. Your membership investment in WHFA continues to prove its value year after year. • Over 90 percent of WHFA members continue to experience reduced operating costs from participation in your association’s programs. • Our Las Vegas Retailer Resource Center located in Building B on the 16th floor of the World Market Center along with the satellite RRC brought a variety of new educational opportunities and business resources to members in 2008. Retailers came to take advantage of great networking, the business services tradeshow, and a perfect place to access the Internet and catch up on business back home in a casual relaxing atmosphere. • FAST FORWARD, the community of young home furnishings professionals hosted two excellent seminars during the Las Vegas markets last year along with a exceptional session focused on optimizing your exit strategy during WHFA’s annual conference in Tucson, AZ. • Our magazine, Western Reporter, brought a host of intriguing articles to members specifically focused on enhancing the business practices of home furnishings retailers and offering guidance to help them meet their goals during a very challenging year. • New look, fresh style, cool format and more FUN, that’s what attendees found when they came to the all new 2008 conference & expo in Tucson, AZ, last May. The conference featured the perfect mix of education, relaxation, networking and fun. Everyone left with hundreds of new ideas and a multitude of new friendships.
New Programs Music & messaging program – Retail Radio allows you to create your own radio station. Create a customized radio station for your business that is designed to target your specific consumer. Whether you are a single location or have multiple stores across the country, Retail Radio brings you a personalized radio station with specific music and branding messages designed to highlight the unique services of your store. Newsletter and Article Program – Be your customers’ top resource for ideas and information. Whipsmart Creative can help you beef up the content on your website with customized newsletters and informative articles that give visitors a reason to linger and see more of what you have to offer. Provide your customers with informative monthly newsletters packed with tips and trends for idea-hungry consumers — and customized just for your business with your logo on the cover and contact information inside. Alternative Finance Program – Help CreditChallenged Customers. 4Sales Finance provides 28
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members with a hybrid lease/option for creditchallenged customers that are declined by your primary credit source. Customers can qualify for the program if they have been employed for the last six months and have a gross monthly income of a least $1,000. Furniture warranty Program – Help customers feel better about their purchase. Furniture Protection Plan by 4Warranty provides extended service plan programs for furniture, upholstery, appliances and electronics, and includes an after-market opportunity to capture income missed at the point-of-sale. Interior Design Course for sales associates – Give your sales team the design knowledge they need. selling x design is a correspondence course that offers basic design skills that will increase the knowledge and professionalism of sales specialists and individuals entering the residential interior design industry. Developed by Interior Design Society professionals, selling x design combines expertise with tools-of-the-trade by focusing on the eight key elements of design. Retail Software Systems Survey. Updated in Contact WHFa at www.WHFa.org or (800) 422-3778.
2008, the Retail Software Systems Survey gives you a direct comparison of various computer systems available in the market today for use in retail furniture stores. Use the survey for a quick reference tool when evaluating computer systems for your store. Book Series – Furniture Retailing 101. This book series written by industry veteran Jim Green will help bring new entrants into our industry up to speed and help them become far more productive and effective, faster. With its practical, nuts and bolts information, this series should be required reading for anyone entering the furniture industry. Safety Information and Manuals to keep your employees safe. Keeping employees from injuries on the job should be the number one business concern of every home furnishings store owner and executive. WHFA has organized safety resources and information in one spot, the “Safety Spot,” for your use and convenience. Here you will find articles, websites and manuals to keep you in compliance and your employees safe. Visit our website at www.WHFA.org > Resources > Safety Spot. Competitive Business Insurance through Argo Select is the flagship insurance program for our industry. This vital, members only program is designed specifically for furniture retail operations like yours. All business lines
of insurance including Employment Practices Liability Insurance and worker’s compensation for companies located outside of California are offered. Be sure to compare this extremely competitive program when you are ready to renew this year. Your wHFA worker’s Compensation Insurance program in California provides significant discounts for California members. Four group programs that encompass all class codes for home furnishings retailers and a substantial 6 percent discount make this an extremely important member benefit. Check out our insurance rates through State Compensation Insurance Fund, they are more competitive than ever. Your wHFA California health insurance program offers features that mirror large corporate programs and the most competitive group rates available. Flexible options, great rates and multiple carriers make this comprehensive program an important benefit for all members. Your program includes all facets of health and dental insurance for you and your employees. Compare our program during open enrollment and enjoy fast professional service on one of the premier health insurance programs in California. Health insurance options for members outside of California include a discounted Regence Blue Shield health program for members in Washington and group plans for dental, vision, chiropractic and life as well as site specific health insurance plans for all states. In concert with Bob Aita and Associates, our WHFA insurance broker, we offer competitive insurance choices through “A” rated companies to all 12 western states.
15 months of Membership for the price of 12! What a Deal! WHFA is extending this limited-time membership offer* only for nonmembers attending the 2009 Winter Las Vegas Market!
Come see us!
In order to qualify, you must: Visit the Retailer Resource Center, Building B, 16th Floor or Building C, 4th Floor, and speak to one of the WHFA Membership Team.
Building B 16th Floor
Western Home Furnishings Association is a non-profit trade association dedicated to providing furniture retailers essential resources needed to simplify their business life and be successful.
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*
Building C 4th Floor
Western Home Furnishings Association 800-422-3778 • www.WHFA.org
Come up and visit Adam, Mike, Kaprice and Margie.
not applicable to renewing members
Contact WHFa at www.WHFa.org or (800) 422-3778.
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Education and Networking Opportunities to network and discuss best practices with fellow retailers are one of the most important aspects of your association membership. Each year members enjoy several outstanding events that bring retailers together to share ideas and opportunities. During every market, conference and even online, WHFA members gather to discuss solutions to the everyday challenges of running a home furnishings business. During the Las Vegas Markets, WHFA hosts the Retailer Resource Center where members and guests come to enjoy a relaxed setting to catch up on business connections. The annual WHFA conference provides a place to learn and discuss best practices and gives members and industry partners the opportunity to discuss pertinent business issues during social events, interactive learning sessions and by the pool or bar. WHFA members can also come to the association forums, found at www.WHFA.org, to cultivate new ideas and get feedback from peers 24/7.
Your Products Program 2008 brought exciting changes and additions to the WHFA Products Program. All product lines have been combined into one, easy-to-use catalog to facilitate simplified ordering of warehouse, touch-up and lighting products. In addition to new products, monthly specials and “pre-packaged kits” were introduced to give the WHFA members the opportunity to save even more with everyday low truckload pricing. Members are “going green” with a new line of Compact Fluorescent PAR Halogen lamp
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Website WHFA’s informative website, www.WHFA.org, is a one-stop resource for industry information. Redesigned in 2008, the new site makes it easier for retailers and industry partners to find the information they are looking for — quickly. Visitors to the new WHFA website will immediately notice the site’s enhancements. With a brand new home page, WHFA.org features intuitive navigation, expanded content and more resources. Newly expanded sections of the website include the Safety Spot, Advocacy and online publications. The Safety Spot features important safety articles and links while the Advocacy section gives retailers the most up-to-date legislative news that affects their business. Another new feature includes an assortment of WHFA’s publications, such as the Western Reporter magazine and WHFA Member Benefits Brochure, all with interactive online viewing capabilities that can now be seen on the new site. Along with these new sections, we have revamped our online discussion area. Created as an online community for retailers across the country to exchange ideas and receive advice, the
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replacement products while saving on their energy costs too! To wrap things up, the special order process for non-stock Mohawk products has been fully implemented to meet the ever changing needs of the WHFA membership.
February 2009
SAVE 15% on all kits and assortments
Western Home Furnishings Association Call Jef Spencer, WHFA warehouse manager, today to place an order. (916) 960-0386 • (800) 422-3778
westernreporter
Contact WHFA at www.WHFA.org or (800) 422-3778.
online discussion forum now allows retailers to receive specific discussion threads in their inbox on topics ranging from sales to warehouse and delivery. To sign up to receive discussion email notices, visit the WHFA website at www.WHFA.org/ forum.cfm and select Preferences.
Western Reporter Western Reporter magazine continues to provide readers with relevant business articles and industry information. An online version of Western Reporter magazine was launched in June 2008. Readers can now view the entire issue online and use state-of-the-art features such as turning a page, magnifying a page, rating the issue and sending to a co-worker.
• In every way, the 2009 WHFA Conference & Expo is designed to bring you value. Value is what we know you are looking for, especially in these turbulent times. This may be the one time in 2009 that you decide to get out of your business to work on your business so WHFA has pledged value when planning every detail of conference. Travel discounts, exceptional education, an abundance of networking and plenty of time to enjoy a spectacular resort at a very affordable price, your decision to attend will provide you with the refreshing outlook you need. • WHFA will be re-assessing its educational offerings in 2009. Technology will become a big part of our educational strategy so be sure to share your thoughts and needs with us. Webinars, podcastings, online forums, blogs and so much more make education available 24/7/365. Look for your association to branch out in many new areas this year.
Looking Forward to 2009 We definitely understand the importance of providing our members with the best programs and customer service and that is even more important in this economic climate. We will be investigating even more cost saving and educational opportunities for you in 2009. When business is tough you should expect your association to be there for you, providing the tools you need to survive in today’s economy and to set the stage for your future success. Creating value for our members and partners is the foundation of WHFA. Here is a preview of what we have planned in 2009. • A litany of cutting-edge educational seminars will continue to be a cornerstone of what is offered at the Las Vegas Retailer Resource Center. Expand your knowledge and your overall market experience with a visit to the RRC and you will experience a strong impact on your bottom line. Along with exceptional seminars offered at each market, more than 50 business service providers are ready to assist you with their expertise. With software, marketing, consulting, advertising, warehousing, financing and everything in between, the RRC is the only place on the market campus dedicated to the operations of your business.
Contact WHFA at www.WHFA.org or (800) 422-3778.
You’re the boss. We’re your bank. For merchant card processing.
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Bank of America is your preferred merchant services provider. Start the new year off and take advantage of our reliable services, multiple terminal options, and the following preferred pricing for WHFA members.
1.71%*
Reduced discount rate on qualified Visa® and MasterCard® transactions of $500 or more.
$0.10
Per item fee for Visa and MasterCard swipe transactions.
Call WHFA at 1.800.422.3778. Please mention promo code #415 to take advantage of this special offer. Or contact Denise Langham at 1.916.861.9283.
* Certain eligibility requirements may apply. A surcharge will be applied for key-entered and other non-qualified transactions. © 2007 BA Merchant Services, LLC, a subsidiary of Bank of America, N.A.
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• New member programs in the key operational areas of home furnishings retail that will keep you competitive and cost-effective. Our collective strength allows us to negotiate the best programs and costs for our members. Call or email us with your ideas and let us investigate and negotiate for you. • Expansion of offerings in your warehouse, delivery, lighting and touch-up products programs and upgrade to our online store making it more userfriendly and convenient for you to use.
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See uS in vegaS one look is worth a thousand words
WHFA’s Financial Position In spite of a very difficult economy, your association continues to maintain an extremely strong financial position. WHFA was profitable in 2008 and our operational reserves remain strong. Our financial strength allows us to continue to invest in new programs, research innovative opportunities to assist our members and support our organization. We will continue to invest in education and explore possibilities in new technologies that will make our members competitive in a rapidly changing business environment. Our approach to cost containment will maintain our financial health and allow us to focus on providing extreme value to our members now and in the future. It is more important than ever to lean on your association in challenging economic times. Your investment in WHFA membership will benefit you by providing cost effective alternatives to many of the programs and services you use every day. More importantly you will gain the support and knowledge you need to survive and thrive. WHFA is an essential asset in working to contain costs and increase sales. Our goal is to provide you with the benefits that will help you simplify your business life and become more profitable. Your WHFA staff is here to help. They can save you much time and effort in your search for the most effective and viable business programs. Your involvement along with the exceptional work of our board and staff makes our endeavors possible. Our entire team thanks you for your participation in our programs, services and events. We are proud of our partnerships with our members and the industry and we look forward to serving you for many years to come. Best Regards,
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Contact WHFa at www.WHFa.org or (800) 422-3778.
Sales Contests S
ales contests are a means by which you can increase sales and/or profits while at the same time making the job fun for your salespeople. Salespeople overall are very competitive by nature and it is to your advantage to make the most of this competitive spirit. Some people just want to win, not even knowing or caring what they won. Other people are motivated by what they might have a chance to win. Everyone is different, but everyone likes to win. If you structure your sales contests correctly, you will have no problem getting people involved and striving to win the game. The following are some very important points to remember when designing a sales contest: The purpose of sales contests is to increase a statistic or improve the result of tasks. There is no need to give away free money or incentives just to give it away. A contest must be designed to improve some statistic. Run individual sales contests frequently, team contests occasionally and major contests once a year. There should always be some type of contest or action happening on the floor. In order to increase team spirit, run a team contest. Run major contests during slow times as opposed to your busiest time of year. The best sales contests are structured so everyone can win. I want people competing with themselves rather than with other salespeople. When people compete against themselves, you avoid a lot of over aggressive, internal turmoil. Have the sales contest rules written and posted. When the rules are written and posted, you avoid any misunderstanding about specifics of the contest. I would also add a line that says any controversy concerning the contest will be decided by the sales manager and that decision will be final. Sales contest should be structured as short bursts of energy. Run several contests during the course of your busiest day or a daily contest and keep the ideas fresh and updated.
Contact WHFa at www.WHFa.org or (800) 422-3778.
Sell the sales contest to your staff. You will have to sell the contest to the staff and remind them of the contest through its run. Play up the contest with written and posted tracking of progress. With contests that run for more than a day, have visual progress posted. Using a poster with a thermometer, pie chart or graph works just fine. The prize or award for the sales contest must be of value to the individual. How do you find out what would be of value to your people? Ask them. At seminars, I ask a group, if I were to run a contest, and the prize is $500 worth of something, which of the following five choices would you want the most? $500, in cash, $500, in paid time off, $500 in store merchandise, $500 in something you wouldn’t normally buy for yourself, or $500 in Lottery tickets? If you have more than five people you will probably get five different answers. The prize or award doesn’t always have to cost large amount. You might be surprised at how little you really need to spend on a contest. A car wash, lunch, verbal praise, written recognition, added responsibility, preferred schedule, additional store discount, etc. all cost very little, but will go a long way in rewarding your staff. Change the teams for every contest. If you run team contests make sure you change the teams up on a regular basis. This will increase your total teamwork and get everybody working together. Statistics, competition, contests, rewards and positive feedback make the job fun.
Contest / Games Ideas Cash Box – Put equal denominations of bills ($1, $5, $10, $20, $50, $100) in a box. For example, $300 worth of each denomination. Each time a salesperson sells an add-on, converts a turnover, converts a repair or service customer to a sale, sells a piece of obsolete merchandise, receives back a referral business card, etc., they westernreporter
Brad Huisken president IAS Training
Hear Brad sp eak Feb. 10 at th Tuesday, e RRC durin g Las Vegas M arket and a t WHFA’s 200 9 Conference and Expo in Maui, HI, May 17 – 19 , 2009. Visit www.W HFA.org for more de tails.
February 2009
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will be allowed one pull from the cash box. The pulls should be done as a group at the end of each day. The salespeople are to bring documentation of the sales that entitle the salesperson to pull for the day. In a group, with management present, each salesperson will take their pulls for the day. Should a salesperson pull out two bills, both bills should be dropped and a new pull will be taken. Folding or marking of certain denominations of bills will not be tolerated and will cause the responsible person to be excluded from the contest. Real currency can be substituted with monopoly money if need be. Other options would be to give people a spin of a wheel or roll of the dice with prizes or monetary rewards attached to the spin or the roll.
amount of money divided based on the hours worked in the given time period. For example, if the store record for the largest single day were broken then each person that worked that day would receive his or her share based on dividing the total man hours of the store for that day by the individual’s hours. Salesperson A worked eight hours and the store total was 32 hours — Salesperson A would receive 25 percent of the prize money. If an individual record was broken, then the individual that broke the record would receive a predetermined amount for breaking the record. Predetermine if a record can be broken several times during a period of time by different people or if one new record can be set per the time period. Keep consistent when determining rules.
Pass the Buck – The first person making a sale on a given day will be given a certain denomination of money. When a larger sale is made during the day, the person with the money will then pass it to the person making the larger sale. The process continues until the end of the day at which time the person with the largest sale for the day retains the money. Know Your Customers – Each salesperson will receive a certain denomination of money for each completed Customer Profile Card. A completed profile card will contain the following information: name, address, telephone, birth date, anniversary (if applicable), with permission for a follow-up telephone call or email for a future appointment. Recruit a Customer – Each salesperson will be given a certain reward or denomination of money for each new customer that comes into the store with his or her business card. Cards handed out in the store will not apply. Business cards passed out off-site of the store are the only business cards that will apply. Business cards handed out outside the store will be marked in a specific manner to show they were given outside the store. Get Rid of It – Each salesperson will be given a certain prize or denomination of money for each ____ number of pieces of obsolete merchandise that they have sold during a week or month. Record Breakers – Determine and post the store records for largest dollar: day, week and month, along with the same for an individual salesperson with the addition of the single largest dollar sale. Each time a store record is broken the entire team shares in a predetermined
Darts – Set-up a dartboard or a dartboard wall with pieces of paper or balloons with prizes in the balloons. Each time a salesperson accomplishes certain pre-determined tasks or levels of productivity the salesperson throws a dart to determine the prize or award. Should the dart miss the paper or fail to pop the balloon no prize is won until the next opportunity. Race Track – Set-up a racetrack where each salesperson is given a horse, car, dog, etc., to race. Divide the racetrack into sections. Each time a salesperson accomplishes a certain pre-determined task or level of productivity they are awarded a certain number of sections of the track. For example, a sale over $1000 would be worth two sections while selling two items on one ticket may receive one section. Prizes or rewards are given for a certain number of laps or winning of the race etc. depending on the rules of the contest. Again, the best contests are set up so that everyone can win.
February 2009
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Author, trainer, consultant, and speaker Brad Huisken is President of IAS Training. Mr. Huisken authored the books “I’M a salesman! Not a PhD.” and “Munchies For Salespeople, Selling Tips That You Can Sink Your Teeth Into,” he developed the PMSA Relationship Selling Program, the PSMC Professional Sales Management Course, The Mystery Shoppers Kit, The Employee Handbook and Policy & Procedures Manual, The Weekly Sales Training Meeting series along with Aptitude Tests and Proficiency Exams for new hires, current sales staff and sales managers, along with the new Weekly Internet Sales Training Series. In addition, he publishes a free weekly newsletter called “Sales Insight” For a free subscription or more information contact IAS Training at (800) 248-7703, info@iastraining.com, www.iastraining.com or fax (303) 936-9581. Contact WHFA at www.WHFA.org or (800) 422-3778.
FTG International Import • Provides dealers and retailers, regardless of size, the ability to facilitate an economical consolidation of orders from Asian factories • Allows individual orders (as small as 300 cubic feet) to ship directly to final destinations in US through FTG • This process removes the expense of warehousing and the costs associated with it • International Import allows small and mid-sized dealers who lack the volume for direct containers and are too far from US warehouses to realize cost effective delivery • Import Solutions - FTG International Import Come visit us at the World Market Center Las Vegas, WHFA Retail Resource Center, B-1630.
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fast
forward
Your Next Generation of Retailing
W
ant to ruin your family business in a hurry? Here are some common mistakes that can lead a family businesses from riches to rags.
fast
forward
Owning a business is hard work. But when your business is a family business, the number of problems and pitfalls multiply exponentially. Just one misstep is enough to send your company careening into oblivion, so you had better know what the mistakes are before you make them.
Family Relationships vs. Working Relationships One of the most common — and most deadly — mistakes in a family business is to assume that tight knit family relationships will translate into effective working relationships. Unfortunately it doesn’t always happen that way. Kids who admire their parents outside of the workplace can suddenly start second-guessing their father’s decisions when he is their boss, and siblings who are inseparable at home can quickly become caught up in interoffice jealousies and petty rivalries. To be fair, some family relationships do actually strengthen working relationships in family businesses, but you need to evaluate the situation on a case by case basis.
Full Family Employment
Family Business Mistakes
Interested in becoming a part of Fast Forward?
Visit www.WHFA.org and click on the Fast Forward logo or contact Kaprice Crawford at (800)422-3778 or kcrawford@whfa.org. You can also participate in monthly discussion forum topics on the WHFA website.
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Another common mistake in family companies occurs when the owner feels it is his responsibility to employ every family member who wants a job. Full family employment is not a realistic goal for a business. Some family members are qualified to fill roles in the organization and some aren’t. Rather than hiring people based solely on their DNA, hiring decisions should be based on the individual’s education, experience, and competency to fulfill job requirements. If you have a hard time turning down family members, find a non-related individual in your company to take the lead in personnel decisions. You may even consider helping non-qualified families gain the qualifications they need to fill the position at some point in the future.
Contact WHFa at www.WHFa.org or (800) 422-3778.
State & Federal Labor Law Posters
Lack of Professionalism Family businesses are notorious for lacking professional decorum. Although your workplace may be teeming with relatives, it is still a workplace and it demands a certain amount of professionalism to run smoothly. Family politics and family discussions are not appropriate and can make non-family members feel uncomfortable. Along the same lines, interactions between family members should reflect business protocols rather than familial ones. Even though the business owner may also be the family patriarch, the way he interacts with family members at work should be similar to the way he interacts with other employees – not the way he interacts with his family at a summer barbecue.
No Succession Plan Do you know who will take over the business when you retire? More importantly, does everyone else know? Family businesses experience high failure rates during periods of generational transition. Transition problems are exacerbated when the current owner fails to adequately prepare for the transition by neglecting to name a successor early and decisively. If squabbles and disagreements arise over the successor, at least an early succession plan buys time to resolve infighting before the transition actually occurs.
ver Space Sa nly o Poster is $39.95
Avoid Fines & Penalties Each year federal and state FREE aut oma employee laws change. The WHFA updates fo tic Space Saver Poster is only $39.95 ra full year for members and has all federal and state labor laws on one compact 38� by 24� poster. This poster is long-lasting, printed with fade-resistant inks and laminated. The posters are registered with the Library of Congress and will help you
prevent fines of up to $17,000.
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WHFA Members: To obtain a Labor Law Poster, contact your WHFA membership representative at (800) 422-3778.
Input from Younger Generations Family businesses involve the entire family, including members of younger generations. Since older generations usually occupy the top of the pecking order, the insights and suggestions of younger family members are often ignored. When generational transitions occur, the younger generation immediately implements their ideas, typically in broad, sweeping changes that are detrimental to the organization. A better approach is to involve younger generations in the decision-making process and implement their ideas gradually rather than all at once.
Gaebler Ventures is a business incubator and holding company that develops and nurtures companies that are shaping the future. With an emphasis on seed-stage and early-stage investments, the Chicago-based partnership has invested in companies since 1999 and has established numerous innovative and market-leading enterprises. Visit www.gaebler.com for more information.
Interested in becoming a part of Fast Forward? Visit www.wHFA.org and click on Community > Next Generation: Fast Forward or contact Kaprice Crawford at (800)422-3778 or kcrawford@whfa.org. You can also participate in online discussions on the WHFA website.
Contact WHFa at www.WHFa.org or (800) 422-3778.
Interested in becoming a part of Fast Forward? Visit www.WHFA.org and click on Fast Forward or contact Kaprice Crawford at (800)422-3778 or kcrawford@whfa.org. You can also participate in online message boards on the WHFA website.
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fun facts
& figures
A
re you getting bored of having the same old tired sales each month? Below are just some of the many “observances” that are celebrated monthly. Get creative and create some fun in-store sales, charity or community events centered around a not so standard holiday. Last month’s issue covered the months of January through July.
National Immunization Awareness Month Simplify Your Life Week (August 1-7)
September
National Chicken Month Family Day (September 22)
October “We own a casual furniture store in Oregon. Last September we ran a promotion around the National Chicken Month theme. What a great success! We had local chefs come in and teachcustomers different chicken recipes using barbecues and accessories. It was a lot of fun and customers who bought merchandise during the event received 10 percent off. Win-win-win for all — customers, local restaurants and us. WHFA Member since 1998
“
“
August
National Breast Cancer Awareness Month Eat Better, Eat Together Month National Cookie Month National Pizza Month National Popcorn Month
November
American Diabetes Month National Peanut Butter Lovers Month National Family Week (November 22-28)
December
National Stress-Free Family Holidays Month Identity Theft Awareness & Prevention Month
advertisers
index
Please sup port the ad ver tis ers that support your magazine. Advertiser Page
Phone
American General Finance .........................................9 .............................. (800) 422-3778 Argo Select..................................................................14 ............................. (800) 422-3778 BA Merchant Solutions...............................................31 ............................. (800) 422-3778 B&B Banker & Brisebois Advertising ........................32 ............................. (800) 456-0210 Emerald Home Furnishings ........................................2 .............................. (800) 685-6646 Furniture Transport Group .........................................35 ............................. (800) 438-8244 Furniture Wizard .........................................................11 ............................. (619) 869-7200 High Point Market.......................................................22 ............................. (336) 869-1000 JRM Sales & Management.........................................25 ............................. (678) 574-5541
advertising inquiries & rates Contact: Cindi Williams, WHFA Events Manager, 500 Giuseppe Court, Ste. 6, Roseville, CA 95678. (916) 960-0277 E-mail: cwilliams@whfa.org. Subscriptions: $35.00/year, USA. Published by Western Home Furnishings Association, a National Home Furnishings Association affiliate, in the interests of retail home furnishings dealers, manufacturers, distributors and sales people. Distributed to retail merchants handling furniture, accessories, bedding, floor coverings, and specialty home furnishings in Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, Oregon, Utah, Washington and Wyoming. Mailing list compiled by WHFA. Official publication of Western Home Furnishings Association, which is responsible for editorial content and advertising policy. The views expressed in articles appearing in Western Reporter are not necessarily those of Western Home Furnishings Association. Western Reporter magazine is copyrighted by Western Home Furnishings Association. February 2009, all rights reserved.
Western Reporter:
Read by Retailers in the West
MicoD Inc. ...................................................................26 ............................. (800) 964-3876
distribution:
PROFITsystems, Inc. ................................................4 & 39 ......................... (866) 453-5010
Western Reporter is read by more than 10,000 home furnishing retail store personnel handling furniture, accessories, bedding, floorcovering and specialty home furnishings in Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, Oregon, Utah, Washington and Wyoming.
Retailer Resource Center ...........................................16 ............................. (800) 422-3778 ServerLogic..................................................................37 ............................. (866) 835-6932 Simmons Company ............................................ Back Cover...................... (510) 357-2230 TruckSKIN ....................................................................24 ............................. (877) 866-7546 WHFA 2009 Conference & Expo ................................7 .............................. (800) 422-3778 WHFA Membership ....................................................29 ............................. (800) 422-3778 WHFA Warehouse Products ......................................30 ............................. (800) 422-3778
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marketing philosophy: Western Reporter focuses on western market trends in the furniture, bedding, flooring and accessories industry. It highlights industry finance, state legislation, retail store layout and design, transportation, retail advertising trends, retail store computerization, insurance, succession planning and industry social events.
Contact WHFa at www.WHFa.org or (800) 422-3778.
Are you and your inventory ready for
Relati nship Counseling? Inventory — Do you love it, hate it…or a little of both? Selling inventory makes you money — love that! But, if you aren’t careful, you end up overstocked with a crammed warehouse and little to no cash flow — hate that! PROFITprofessional has all the tools you need to keep in stock only those items that make you money, get rid of those not making you money, and recognize trends so that you can keep your floor fresh with merchandise that sells. We will help you manage your inventory and improve your bottom line. You gotta love that! Interested in more ways to improve your bottom line? Visit us at:
www.profitsystems.com 800.888.5565
“Using PROFITprofessional, we learned to manage our inventory and our profitability has improved substantially. We are able to stay ahead of our competition.” Chuck McMillin McMillin’s Furniture Inc. Yale, MI
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