June 2009 Western Retailer by Western Retailer Magazine

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Western Home Furnishings Association 500 Giuseppe Court, #6 Roseville, CA 95678 CHANGE SERVICE REQUESTED

June 2009

www.WHFA.org

western retailer

Journal of the Western Home Furnishings Association trends

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

Advertising Manager: Cindi Williams..............................cwilliams@whfa.org 2009 WHFA OFFICERS AND EXECUTIVE COMMITTEE

Staying Relevant in a Recession. . . . . . . . . . . . . . 12

WHFA PRESIDENT Marty Cramer - Cramer’s Home Furnishings, Ellensburg, WA...........(509) 933-2172 PRESIDENT ELECT Claudia LeClair - Fiesta Home Furnishings, Scottsdale, AZ...............(480) 951-3239

3 Simple Ways to Drive Traffic. . 15

VICE PRESIDENT Angel Lopez - Dearden’s, Los Angeles, CA........................................(213) 362-9600

What happened to the Jones’?. 20

TREASURER Chris Sanders - Everton Mattress Factory, Inc., Twin Falls, ID..........(208) 326-3407 SECRETARY

The Current Trend is Wait to Sell — Think Again! . . . . . . 22

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 PAST PRESIDENTS George Nader - Nader’s La Popular, Gardena, CA............................(310) 327-8585

Understanding the Furniture Purchase Decision. . . . . . . . . . 25

Cherie Rose - The Rose Collection, Los Gatos, CA...........................(408) 395-7773 EXECUTIVE director Sharron Bradley - WHFA, Roseville, CA.............................................(916) 784-7677

Do your Employees Know What to do In an Accident?. . 27

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

Soy Love. . . . . . . . . . . . . . . . . . . 28

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

in every issue

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

Industry Beat . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Eric Harms - Black’s Home Furnishings, Yreka, CA...........................(530) 842-3876 Ron Hoesterey - Royal Mattress Company, Inc., Orange, CA............(800) 987-6925

Board Member Q&A with Julian Jeppe . . . . . . . 8

Jerome James - Hafer’s Home Furnishings, Manteca, CA.................(209) 823-2122

Retailer Notes: Community Events. . . . . . . . . . 10

Julian Jeppe - Reeds Furniture, Agoura Hills, CA..............................(818) 597-7800 Doug Kays - Premiere Home Furnishings, Los Angeles, CA.............. (310) 268-0811

Program of the Month: Health Insurance . . . . . 17

Chuck Kill - Bedmart, Tucson, AZ.......................................................(520) 887-7039 Tim Koerner - Koerner Furniture, Coeur D’Alene, ID..........................(208) 666-1525

Member Profile with Fashion Furniture, Fresno, CA . . . . . . . 18

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 - Ideal Home Furnishings, Olympia, WA.................(360) 790-3955 Robert Myers - Ashley Furniture HomeStore, Chico, CA....................(530) 345-2616

contact

Mark Navarra - Jerome’s, San Diego, CA..........................................(858) 753-1549 Michael Nermon - Ergo Customized Comfort, Irvine, CA...................(949) 833-0338 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

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Phone: (800) 422-3778 (12 western states) (916) 784-7677 Online: www.WHFA.org

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

Fax:

(916) 784-7697

Mail:

500 Giuseppe Court, Suite 6 Roseville, CA 95678

Business Manager: Janice Carlson..................................................(916) 960-0347

Western Home Furnishings Association is the western affiliate of National Home Furnishings Association

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

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WHFA

ACADEMY

RRC RETAILER

RESOURCE CENTER

fast

forward

Your Industry. Your Future. Your Decision.

Accounting Assistant: Melody King.................................................(916) 960-2476

Contact WHFA at www.WHFA.org or (800) 422-3778.

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JUNE 2009

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president’s message

This month’s subject is trends. I know you will find this hard to believe but I have had a hard time coming up with something pertinent to say on this subject. I thought I would start with my list of top 10 trends for 2009. 10. Every customer in the store wants a better deal. 9. Advertising space is cheaper than ever and less effective. 8. Attrition is the trendy word in personnel decisions. 7. OK, has replaced HUGE when describing the weekend’s business. 6. Manufactures have replaced “we are out of that” with “we have tons of stock”. 5. Every time you call a staff meeting the staff gets that “deer in the headlights” look. 4. Trendy phrase for 2009, “Who left the light in the bathroom on?” 3. Ordering back-stock still kills sales on that hot item. 2 Microfiber, microfiber, microfiber. 1. Ugly still sells. Here is one trend that is more on the serious side. I have always said the one thing about the furniture business I love more than any other is the type of people that choose to be in it. I have always been impressed by the amount of help I have been offered by the people I meet in our business. Never has this been more apparent than over the past year or so. The tougher business has become the closer and more tight-knit our community has become. I have had competitors tell me of advertising ideas that worked for them. I recently had a competitor I don’t know very well, call and ask if I could loan them a few bed frames until their shipment arrived. The fact that he would call and ask made me feel very good about both of us. It is a wonderful business, full of sincere and caring people. If you have not experienced that feeling lately, I would suggest you call me or one of the great staff at the WHFA office and simply ask, “How can I become more involved?” I promise you will not regret it. Start your own trend this year. Make a decision to not stand against the wall and hope someone asks you to dance. Get out on the floor and shake that thing! I know some of you are out there wishing you were “dancing”. I hope you don’t let another year slip by without finding out how much fun our business can truly be!

Marty Cramer 2009 WHFA president Cramer’s Home Furnishings Ellensburg, WA marty@cramershomefurnishings.com

ON THE COVER Mah Jong Modular Sofa by Roche-Bobois. For more information, please visit www.roche-bobois.com, (800) 717-2747

Contact WHFA at www.WHFA.org or (800) 422-3778.

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JUNE 2009

editor’s message Are you relevant? It seems like everywhere I go these days I hear people discussing relevancy. With the ever-changing economy, companies are looking at their business models and figuring out if they are relevant. WHFA recently had a meeting to discuss the Association’s relevancy and how we could become more relevant to meet the demands that are facing the 21st century home furnishings retailer. Is your store relevant to the demands of the changing consumer? As you know, people are cutting back and limiting their spending — good for them, not for you as a retailer. Do you know where your customers are going for information? Most likely, the majority of them are going to the Internet. If your customer is still spending, what is she looking for? These are all questions you need to ask yourself and find out answers to. An easy way of answering your questions is by holding small, informal focus groups. Invite 12-15 customers (and even prospective customers) into your store for lunch and ask them about themselves — what are they worried about; what do they do to relax, where do they search for information, etc. By asking questions that are focused on the customer, you will be able to gain valuable information about their wants and needs and then use that information to help with your product line-up, marketing, customer service and more. You may learn that your customer just wants to relax with a book after a long day of work — what a perfect opportunity to market chaise lounges, great for curling up in with a book. By taking a few hours to talk to your customers to find out their needs, you will be able to better focus your business and make it more relevant. This issue of Western Retailer looks at industry and consumer trends that can have an effect on your business. I hope you enjoy the issue and continually ask yourself if you are relevant.

Melissa “Mel” Dressler Western Retailer managing editor MDressler@whfa.org

looking forward to July/August 2009 Membership Issue Retailer of the Year — Naturwood Home Furnishings

Last month’s feature articles are available online at www.WHFA.org.

JUNE 2009

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Contact WHFA at www.WHFA.org or (800) 422-3778.

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industry

beat

Restonic-Idaho Donates Sleep Set to Twin Falls Optimist Club

L-R: Chris Sanders, Partner EMF, Derrick Hanson, Store Manager EMF,, Twin Falls, Marlena & Wes Price, Grand Prize Winners, Hansen, Idaho

Everton Mattress, Filer, ID, donated a King Latex/Magnetic Sleep Set to the Twin Falls Optimist Club to be used for their Lost Wages Grand Prize give-a-way. The latex core supplier Latex International has generously provided the latex components. The Twin Falls Optimist is a service club devoted to improving the lives of children. The Optimist Service Organization has the mission of “providing hope and positive vision, Optimists bring out the best in kids.” The annual Lost Wages Night is an event to raise money to support club operations and provide resources for grants that are used to support youth functions and needs.

board

Jerome’s Furniture Hosts THE AMAZING RACE Auditions San Diego based Jerome’s announced that it is celebrating its 55th anniversary year with a variety of marketing activities. For such a familiar brand, Jerome’s thirdgeneration marketing director, Jim Navarra, is pushing the envelope with activities such as hosting the Amazing Race Audition, which is expected to draw more than 1,500 San Diegans to the store for the competition and attract news coverage along with other big ideas in execution — new in-store events offering interior design education; sports-marketing with their ‘Best Seat in the House’ gearing up for baseball season and much more.

buyers. We are lucky to have traffic coming through the doors, now the focus is making sure all the salespeople take the time to really listen to the customer and close the deal. Q What are three words that describe you best? A Three words to describe me? Optimistic, fair and down to earth. That last one was more than one word, oops! Q What is your most prized possession? A My greatest possession would have to be my relationship with my parents. They have always been my compass in regards to what is right and wrong. They also have given me so much support throughout the years, I’m lucky to have them near me. Q What do you do for fun? A For fun it depends on the time of year. In the Winter, I spend a lot of time in Mammoth Lakes snowboarding and hiking. In the Summer, I can be found surfing Malibu and the surrounding point breaks. Q What did you want to be when you were growing up? A When I was growing up I really wanted to be a secret agent for the CIA. That then changed to Helicopter Pilot, for which I did get licensed and accredited. Q What do you enjoy most about being a WHFA member? A The thing I really enjoy about being a WHFA member is the type of person the WHFA attracts. All the Board members are so dynamic and knowledgeable; I’m always so inspired to go back to work after we have a meeting.

Q&A

with Julian

ne onth tu Every m rd Member a into Bo learn more o Q&A t ur WHFA o about y embers. m board Julian Jeppe Reeds Furniture 28401 Canwood St Agoura Hills, CA 91301 (818) 597-7800 jjeppe@reedsfurniture.com www.reedsfurniture.com JUNE 2009

Dearden’s, Los Angeles, CA turned 100 years old last March. Dearden’s officially opened their doors in 1909 and has been witness to many changes in the world around them. The company, which now operates nine Dearden’s in Southern California, has nearly 500 employees.

Q What is your biggest challenge in furniture retailing? A Our biggest challenge these days is converting customers from shoppers to

member

Dearden’s Turns 100

western retailer

Contact WHFA at www.WHFA.org or (800) 422-3778.

New World. New Way.

September 14-17, 2009 | Las Vegas Market

The World’s Stage. www.lasvegasmarket.com

retailer

notes

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.”

What kind of community events have you held in your store? Idea No. 1

Idea No. 3

I used to work for a furniture store which held “Decorating with Fresh Flowers” seminars with a very popular floral designer from the local Garden Club. These were very well attended. There was a fee to attend, which made it more of a professional design event. The people who came were serious and wanted to learn — education is the key to seminars. People’s time is valuable, so make your event something of value to your guests. I think a great seminar would be to educate consumers about the value of buying quality furniture, especially in the current economic climate.

We had about 1,000 people in our store for a Business After Hours event co-sponsored by our local chamber of commerce. We served food and wine and were reimbursed for most of the expense by the cover charge managed by the Chamber of Commerce. It was great PR and showed off our store tremendously but it didn’t produce much in immediate sales. We also had 500 women in our store last October when we opened a store with a health club next door to the building, and they sponsored a half marathon for women only.

Jim

Idea No. 2 We hold community events almost monthly with the “Art Walks”. These are events where people drift from store to gallery to see the latest featured artist. Once a year this turns very big with the Children’s Gallery Walk. On those nights I can have about 250 grade school children and their proud relatives in the store. Holly Barbo Barbo Furniture, Bellingham, WA

JUNE 2009

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Tom Craig Sparks Home Furnishings, Vancouver, WA

Idea No. 4 We have had many in-store events over the years — some are related to our business and some are not. Business Related Event Sweet dreams seminar: We invited key bedding vendors reps in to give 15 minute presentations on their product... Simmons, Comforpedic, Stylutions and Tempurpedic participated. We held the seminar from 6 to 9 p.m. repeating the four presentations every hour. We had a dessert buffet and drawings for the attendees. Non-Business Related Event We held a Monte Carlo fundraiser in our store for a local non-profit who aided victims of child abuse. Our last party was attended by 750 people and raised over $30,000. We had black jack, roulette, craps, live music, dancing and great food. Warning: this can be a major effort and it finally grew too large for our staff to handle and passed to a larger venue. Giff Gates Gates Home Furnishings, Grants Pass, OR

Contact WHFA at www.WHFA.org or (800) 422-3778.

Tour the WHFA website at www.WHFA.org > This month’s stop . . . Online Membership Directory Western Home Furnishings Association

About WHFA

Membership

Home

Education & Events

Benefits

Community

Store

Member Login

Resources

Dealer Locator

Advocacy

Site Search

Get Involved

Update Your Member Profile

Join Member Spotlight

and Use the Online Membership Directory

Members Only Membership FAQ

The Online Membership Directory is a powerful reference tool designed to put you in touch with other home furnishings retailers who share the same experiences as you. If you have business questions about freight carriers, computer systems, financing companies, HR issues, lines of furniture or accessories, take advantage of your access to association peers and find solutions fast by searching through this easy to use tool.

My Account Program of the Month Request More Information Testimonials

ership Directory, visit To view the Online Memb lect www.WHFA.org and se Directories > ly On Membership > Members ectory. > WHFA Membership Dir

While you are connecting with other retailers, make sure to update your profile as well — it only takes a few minutes! To quickly update your profile, click on Membership > My Account > Edit/Update Profile.

Western Home Furnishings Association • www.WHFA.org • (800) 422-3778

“

My membership in WHFA gives me strength in numbers. It is an

opportunity to share and learn from my peers, my vendors and the experts in my industry. Together, we are able to accomplish more and have a louder voice. We can learn from each other’s successes and from each other’s mistakes. When we work together, we are more powerful. We

build

”

success both for our individual companies and for our industry. It makes my WHFA membership invaluable.

Simplify Your Business Life Contact WHFA at www.WHFA.org or (800) 422-3778.

Chuck Kill, CEO, Bedmart, Inc. 26 Store Locations, WHFA Member Since 2005

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Western Home Furnishings Association 800.422.3778 • www.WHFA.org

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JUNE 2009

feature article

Staying Relevant in a Recession

Jim Green owner Furniture Industry 101

JUNE 2009

t is very easy to ignore the obvious. The latest elephant in the room is this devastating recession. In my hometown, I closely follow the marketing and sales promotional efforts of the various furniture retailers that compete here. I have been struck by one interesting observation. That is, to most retailers in the community in which I live, it seems to be, “Business as Usual”. I have no doubt that each and every retailer recognizes that there is a full-blown recession going on. If nothing else, they can surely see it in their sales numbers. But, in their marketing efforts there seems to be little acknowledgment of the dramatic slowdown. Many are merchandising and marketing as they have for the past however many years, with little difference in their approach. It is the same “Midnight” or “Six Hour” Sale. The same financing offers originally designed to convince potential customers that they really could afford to buy furniture. “Free” furniture that’s not really free. Many of the same tired promotional efforts that were worn out before the recession reared its ugly head. Certainly, to suggest that every retailer is devoid of creativity during this period would obviously be misstating the facts. But, many are presenting their businesses as if nothing has changed. Retailers in other industries are modifying some of their practices in order to fill needs or perceptions of their potential customers. During the holiday season, many general merchandise retailers reinstituted the “layaway” option. Probably taxing operationally, but a service consumers wanted, nonetheless. This is not the time to allow even one potential customer to

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walk away, or worse, go to a competitor. In January 2009, Hyundai, the South Korean automaker offered their customers the option of returning their automobile purchase if the consumer became strapped financially from some unforeseen event. In a company statement they wrote, “In this uncertain economy, we are looking for ways to reassure shoppers that Hyundai still represents the best value in the auto industry.” On their website they stated, “If you find that you cannot make your payment because of a covered life changing event, we’ll allow you to return your vehicle and walk away from your loan obligation — and in most cases we will cover most, if not all of the difference.” This type of offer would have been unheard of even a year ago but today it makes sense because consumers are nervous about their own economic situations. One airline offered the option of turning in plane tickets on future flights at no cost if the purchaser lost a job. One might argue that to signal that business is bad and that the company is hurting would be an egregious error; that it might somehow send customers away. To that, I would suggest that a retailer might create an effective strategy that does not imply anything of the sort but does address the change in the economic environment. I believe the downturn should be met headon. Many of the approaches retailers used two or three years ago during the boom times have lost much of their effectiveness and luster in the current crises. Contact WHFA at www.WHFA.org or (800) 422-3778.

and because we understand what our customers face we are announcing the opening of “XYZ Lite” (obviously not the real name) • “XYZ Lite” offers all of the fine taste, design, deluxe services, and warrantees that “XYZ Furniture” has become famous for but on furniture priced at levels unheard of, here. • After the economy recovers, we may return to our normal retail approaches but for now, we want to help. We just made it a whole lot less expensive to live the good life. (Note that the wording would obviously change but the ideas behind the words are what counts.) I certainly would not advocate this strategy for every retailer, but for this one it seemed prudent. The thinking was that the economic downturn was addressed head-on and would provide the reason for this strategic approach. At its most basic level, sales are well down in many furniture showrooms for one or more of five reasons: 1. Jobs have been lost and along with those jobs, any discretionary income is gone as well. These consumers are just not buying. 2. Consumers are insecure about keeping their jobs and aren’t making purchases that they may not be able to pay for. 3. With the financial meltdown, many consumers have lost value and/or income from their investments that heretofore would have paid for their purchases. 4. There are potential buyers that are simply unsure and nervous about the economic outlook in general. 5. Consumer credit is becoming harder to obtain. I believe it to be incumbent upon retailers to recognize and react to the economy as it is, not as it was. This means, perhaps, making decisions that might not have been warranted just one or two years ago. It means keeping an open mind, getting creative and considering new options. The Internet is just beginning as a marketing tool for savvy retailers. Harness it. Much of marketing today is (or should be) about finding and using the most cost effective, efficient ways to reach potential customers as well as being intune to and servicing their needs (of course, the message delivered is still paramount). Here is an idea: If, indeed, there are potential consumers out there that might be enticed to buy were it not for fear of losing their jobs, why not find a way to offer the following:

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SaleLayaway Program

Contact WHFA at www.WHFA.org or (800) 422-3778.

night

There are really only a few ways within a showroom’s four walls to expand sales during a period like this. There is only so much that can be done using the same strategies. A retailer might: 1. Merchandise and expand into markets, which are economically above, or below the current market. (If the retailer presently competes at upper price ranges, expand into middle price ranges with no loss at the upper end). 2. Intensify efforts and generate greater sales in segments of the market already served (just operate better). Review every operational process (sales, advertising, marketing) for cost efficiency and effectiveness. 3. Market to new users heretofore, untapped (hospitality, commercial, contract, etc.) 4. Market other home-related commodities (Closet systems, linens and domestics, etc.) 5. Spend more sales promotion dollars (unfortunately, often for diminished return). 6. Price merchandise lower but lose margin dollars. Numbers one through four, make sense to me given the unsettling era in which we are operating; five and six, not so much. It is also important to recognize that during recessionary periods many homeowners forgo their plans to buy full housefuls or even roomfuls of furniture. Many do, however, still want to freshen their homes and change it up a bit. Perceptive retailers that have endured these downturns before recognize that it is time to intensify the marketing of items (chairs, interest items, tables, etc.) and lighting and accents. I recommended the following strategy to one better-end client-company to address the recession by expanding into price levels below their current merchandise plan. The company had already reduced the size of their assortment so there was space to expand without losing sales revenue at the price levels at which they competed. The strategy was intended to attract customers from an entirely different market below the current one. The tactics were to be executed as follows: 1. The merchandise was to be commensurate in styling and fashion with the rest of the store. The retailer had a very polished image to protect. 2. Marketing was to be tasteful and commensurate with the marketing of the rest of the store. 3. The hook was: • XYZ Furniture Gets It! • We know that times are tough

id M

Free Furniture

JUNE 2009

Intere

Six Hour Sale Six Months Now/ Six Months Later! XYZ Furniture Store Gets It. We understand these are unsure times, and we want to help! Buy now and get six months interest and payments free on your purchase. Then, if at any time during the term of your loan you feel the need, you may suspend your payments for an additional six full months. OR

Free

Free Interest for X Period (with equal monthly payments) AND if the need arises, at any time during the term of the financing you may suspend your payments for up to six full months. Obviously, the details and verbiages might change but the message is clear. (If you are unsure of your situation, going forward this might make you more comfortable about

making a new purchase.) Basically, still a finance promotion with a twist and applicable to today’s economic environment. My suggestion then, is to add relevance to marketing efforts that is meaningful to the here and now. I am not suggesting eliminating all of the old tactics and strategies that may still work. I am proposing replacing those that are no longer effective with messages that might strike a chord with consumers in the market today.

Jim Green began his career in the furniture industry in 1975 at Kane’s Furniture, at the time the dominant retail furniture company in Florida. In 1989, he opened a retail furniture company in Clearwater, FL and operated it for two years until its closing in 1991, a victim of the recessionary times. Following this retailing chapter of his career, Jim became a successful sales representative for several major furniture manufacturing companies. In 2001, he chose to leave the life of a sales representative and earned an MBA in Management, a lifelong dream. Contact Jim at (727) 347-1201 or jim@furnitureindustry101.com.

"This book is just the kind of thing we need, and it is long in coming. Jim Green knows this business."

Clive Lubner

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it would have saved hundreds of hours... must-have." This book series, written by industry veteran JimaGreen, will help Jena Hall up to speed and help them bring new entrants into our industry VP Merchandising & Design, aspenhome become far more productive and effective, faster. This series should be required reading for anyone entering the furniture industry its “We are truly in an era where only the strongest willwith survive. This strength...will come from those who understand how to practical, nuts and bolts information that is timely and accurate. define profitability and run their business most efficiently. This book is practical, nuts and bolts information, timely and accurate. I recommend it to anyone.”

“I wish I’d had a book like this when Carroll I was getting started.Joe It would have saved Publisher, Furniture/Today me hundreds of hours . . . a must-have.”

Jena Hall

WHFA member only price $54.95 + shipping and handling. This discounted price is available only on the WHFA website at www.whfa.org or through your WHFA membership FURNITURE RETAILING 101, 3-Volume Set by Jim Green. In sets or individual books, representative at (800) 422-3778. Individual book pricing available. direct sales, group offers. Author available for speaking engagements. Connect to

VP merchandising the & design, aspenhome future. Contact Jim Green,

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Buy Your Copy at these High Point Market Booksignings: 14

JUNE 2009

Day, April 00: Manufacturer1, showroom location, 00:00 a.m.; Manufacturer1, showroom location, 00:00 p.m. Day, April 00: Manufacturer1, showroom location, 00:00 a.m.; Manufacturer1, showroom location, 00:00 p.m. Day, April 00: Manufacturer1, showroom location, 00:00 a.m.; Manufacturer1, showroom location, 00:00 p.m.

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Contact WHFA at www.WHFA.org or (800) 422-3778.

Simple and Effective Ways to Drive Traffic and Sales

Make Old Inventory Look New Again!

o you’ve got a lot of merchandise and it isn’t moving. You are looking for fresh ways to generate interest and sales. The market has been slow and you’ve put a moratorium on new purchases. The secret is clearly in how to make old new again and add energy, verve, and excitement to a stale mix. And you need to do this cost effectively, quickly and easily! The answer is focusing on your inventory of Flexible Furnishings™. What too few know is that home furnishings are one of the best long-term investments (short-term if the buyer is trendy) available, here’s why and here’s how to educate your customer into it! Flexible Furnishings™ are what you are selling. And the first way to boost interest and sales is to realize that any given piece whether it is a case good, a rug, a lamp, a chair, artwork, a toss pillow, or an accent has the flexibility to go in many rooms of the home. Let’s tackle a foyer setting first. Instead of using a traditional and expected console table, instead use a chest of drawers or a low bookshelf, still creating a table top surface but with storage opportunity. You are repurposing pieces typically used in the bedroom or home office. In a dining room vignette, using a chest of drawers instead of a typical buffet or china cabinet again shows a flexibility and inventiveness. Just as showcasing the same vignette with the table set half for dining and half as a home office. Yes, it does sound a little outrageous, but remember you need and want to attract new attention with out of the box thinking and inventiveness. Remember many

Contact WHFA at www.WHFA.org or (800) 422-3778.

customers are now working from home and may not have planned well for it. Show them that you are tuned in and aware of their needs. So many homes have larger closets these days with built-in storage so in your bedroom vignettes display a console table facing the bed with the flat screen mounted above, instead of a dresser which would be expected. Showing the buyer new and different ways to use home furnishings generates interest, creates traffic and drives sales. Add more romance to that same bedroom setting by adding a chandelier. As a retailer, it is about turning on your customer’s imagination and tapping into their emotions. Still stuck? Watch some TV to get inspired! The second inspired way to increase customer views and purchases is to take a look through the latest popular sitcoms. Replicate one of the rooms that would be easily recognized when you add signage about “live like your favorite TV character!” Or better yet, create your own Divine Design moments and duplicate magazine or design TV room settings being sure to attribute your inspiration. Everyone wants a TV perfect transformation, when you show them that they can have it, you will get their attention and their dollars. Window displays and visual merchandising have sold goods in the major fashion retailers for years. It can work the same for you but requires innovative thinking, using old pieces in new ways and crafting slices-of-life vignettes that showcase Flexible Furnishings™. Need traffic drivers? The third simple and cost effective means to stimulate your stores economy is to host a weekly or biweekly consumer event.

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Melissa Galt design consultant

JUNE 2009

“

Flexible Furnishings™ are what you are selling. And the first way to boost interest and sales is to realize that any given piece whether it is a case good, a rug, a lamp, a chair, artwork, a toss pillow, or an accent has the flexibility to go in many rooms of the home.

Market it by email and posters (direct mail can get costly) and share miniseminars on Success Solutions for Your Home Office (a lot who have been downsized are now working out of their homes), Romantic Ideas for Your Master Bedroom (relationship boosting), Family Friendly Ideas for Your Great Room (foster family values), Cooking Up Style in Your Kitchen (with more folks eating at home these days, this makes sense), Adding Invitation to Your Guest Bedroom (in the current climate, there are more guest rooms being used make it a positive and a reason for business). Stop thinking about WIIFM (what’s in it for me) and start thinking about WIIFT (what’s in it for them). When you can focus on your customer and not yourself, you will find that you will be able to better identify, define, target and attract your perfect prospect and turn them into your ideal customer much faster, in spite of and because of the current outlook. When you truly understand and see your merchandise as Flexible Furnishings™ and educate your buyer into this with creative vignettes and room settings that are changed weekly or biweekly, and you layer events with inspiration and advice, you will realize a surge in your traffic and a cha-ching in your register.

For more business building blocks, check out Melissa’s blog at www.todaybydesign.com. If you are ready to take your home furnishings business to the next level go to www.sixfigureprofessionals. com for a complementary strategy session that will move your business forward. Melissa Galt is an entrepreneur, an interior designer and a speaker for the home furnishings industry.

JUNE 2009

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Contact WHFA at www.WHFA.org or (800) 422-3778.

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Employer’s goals for their health plans have changed with the economic climate. In a 2008 survey by Hewitt Associates, employers ranked “offering competitive benefits” as their most important benefit objective, followed by “promoting accountability” and “tightly managing health care cost trends.” By 2009, employers’ focus had switched to “promoting employee accountability” first, followed by “offering competitive benefits” and “managing health risk.” Most companies surveyed (75 percent) plan to focus on improving employee health and productivity in the next three to five years. Hewitt reported that most employers are not planning to make drastic changes to their health benefits in 2010. “Instead, they are focusing on both conventional and progressive approaches to address the costs related to their health care plans in light of the economic climate.” These include shifting more costs to employees, reducing the number of plans available, increasing focus on wellness, and switching to consumerdriven plans. Let WHFA help you achieve your benefits goals with over 50+ different plans of various sizes, carriers and benefits to fit your needs and budget. Our health insurance partner Aita & Associates has over 20 years of experience working with furniture retailers.

Kaprice Crawford WHFA marketing director

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member profile

Fashion Furniture Fresno, CA

Melissa Dressler Western Retailer managing editor

JUNE 2009

hen you walk into Fashion Furniture, in Fresno, CA, you are immediately transported into a world of beautiful furniture, flowing pathways and well-displayed vignettes. After walking past the large fountain in the entry way, customers enter the 50,000 square foot, Connie Post designed showroom and are greeted by a friendly salesperson. From there, the customer is able to browse through the showroom and find furniture from manufacturers like Flexsteel, Guildcraft and Universal. When customers need a break from shopping, they can visit the Coca-Cola-themed diner for complimentary fresh baked cookies and refreshing Coca-Cola. Fashion Furniture opened its doors in 1960 in downtown Fresno. The business was a partnership between Kerry Avedikian and three others. Over the years, Kerry and his son Rod bought out his other partners and in the 1980s, they became the sole owners of the business. Kerry believed

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in working hard, working smart and outworking the next guy. This philosophy helped Fashion Furniture to succeed and grow and continues to help them thrive today. Eventually, Rod’s sister, Karen, and brother, Michael, joined the family business and the three of them own it today. In the late 1990s, the Avedikian family purchased land in the growing area of North Fresno. “We built our current store from the ground up,” said Rod. “We bought the property, which we had never done before, and in 2001 opened up this beautiful showroom.” Along with the Fashion Furniture showroom in North Fresno, they also operate a Lane and Broyhill store, the Sleep Retreat, which focuses on premium bedding, a Bassett Design Center and a Clearance Center. Lane, Broyhill and the Sleep Retreat are on the same property as Fashion Furniture and the Bassett Design Center is across the street, making the shopping experience easy for the customer. The Clearance Center is located Contact WHFA at www.WHFA.org or (800) 422-3778.

within one mile of Fashion Furniture. Each store is focused on providing customers with a personalized shopping experience and work on building lifelong customers. “We try to build relationships instead of just making sales,” said Rod. Their goal is to be able to recognize and talk to customers when they see them around town. This personal relationship is what has created many lifelong customers and is why Fashion Furniture has earned The Fresno Bee’s People’s Choice Award for home furnishings every year since the inception of the award.

Community Fresno State University is a large part of the Fresno community and Fashion Furniture is an avid supporter of the college. “Every year we have a weekend sale in support of the Fresno State football program,” Rod said. “The football coaches and assistant coaches come into our store to sign autographs and talk to customers. Fashion Furniture then donates 10 percent of our sales from that weekend to the Fresno State football program.” Fashion Furniture doesn’t limit their community participation just to the college. They are open to donating to any organization that is looking for help. Having been established in Fresno for almost half a century, they strongly believe in supporting the community and doing everything they can to make it a better place to live.

Left to right: Jerry Allison, Simon Meneses, Lori Saenz, Cheryl Leyva, Virginia Contreras, Ed Felten, Morgan Willis, Rod Avedikian, Pete Ariaz, Mike Avedikian, Russell Andres and Ted Cook.

Traveling Showroom A few months ago, Fashion Furniture and their Lane Home Furnishings store location were able to participate in a unique customer event of showcasing the Lane Traveling Showroom. Lane created a massive 1,000 square foot, custom-built 18-wheeler traveling showroom that is currently touring the country. Fashion Furniture was fortunate to have the Lane Traveling Showroom make a two-day visit to their store and the event brought in great traffic. “The trailer pops out at the sides, and when you walk through it, a rep asks customers a few questions about their lifestyle, their family and how they live,” said Rod. “As you go through the trailer, you see a family room, a living room and a home theater room set up. Then when you get to the end, the rep prints out product recommendations based on how you answered the questions. Once the customers were done with viewing the traveling showroom, they could come into our store and see the furniture set up in vignettes.” By participating in this unique opportunity, Fashion Furniture was able to attract a larger market of customers to the store, with many of them purchasing furniture. “We had a huge traffic day and it was very good for business,” Rod said.

At a Glance

The Future While the current economic climate has made Fashion Furniture trim some of their expenses, they have remained successful. The store offers customers free layaway for up to six months, which has helped some customers shop during these tough times. “Our layaway usage has increased a little during the current economy, but for the most part, we are finding people are just holding onto their money a little tighter because they are unsure of what will happen. Thankfully, even though sales and traffic are down some, we are still writing good business”, Rod said. With their current success, Rod is motivated to grow each store and make them stronger. There are no plans in the immediate future for additional store locations; instead he would like to focus all of his energy on making his current retail locations more successful. It will be a fun adventure to continue to watch this strong family business grow and thrive in the future. Contact WHFA at www.WHFA.org or (800) 422-3778.

Store Location: Fresno, CA Type of Store: Full-line Year Founded: 1960 Number of Employees: 80 Number of Store Locations: 5 Annual Sales Volume: $20 million combined Website: www.fashionfurnitureco.com Top Manufacturers: Guildcraft, Universal Furiture, Flexsteel, Lane, Broyhill & Bassett WHFA Member Since: 1991

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What happened to the Jones’? Selling home furnishings to the emerging “Simplifier” consumer

Krisann ParkerBrown merchandising manager Hearth and Home Technologies

JUNE 2009

he economic downturn has created a real opportunity for those of us in the consumer goods industries to better understand our buyers, meet their needs, and ultimately, to sell product. The age of order taking in our business is gone. Understanding emerging consumer trends will help your business be the first at meeting consumer group needs and desires and capturing the sale. The Harvard Business School Review features an article by Harvard professor John Quelch on the new breed of consumer — the middle-aged Simplifier. This new consumer can be recognized by her refusal to “buy-in” to the conspicuous consumption so popular in the 1990s and early 2000s. John Quelch calls out the following characteristics: Downsized – The Simplifier perceives that they have more “stuff ” than they truly need, and looks to downsize and simplify in life and in possessions. Experiences – The Simplifier seeks to add to life through rich experiences, not possessions. Dining out, foreign travel, spa experiences, learning a new sport, activity or hobby all fit the desires of this emerging consumer group. Possessions – They are embarrassed by their possessions, especially those flagrant indicators of their wealth. Wealth – Although this group is self-assured in their wealth, they remain comfortable leasing their car, renting a vacation home, and no longer feel it necessary to amass possessions. However,

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they are willing to pay for the right items that meet their needs and capture their attention. John Quelch tells us empty-nester baby boomers make up a large portion of this group, already trading in their large SUV’s for a Prius. They seek detail and architectural character in their new homes, and even special spaces to display a few carefully chosen items from their life “experiences”; be it travel or painting lessons. They seek low maintenance, smaller spaces. From a design perspective, we see this consumer seeking clean, modern minimalism. With current economic trends, consumers are focusing on key furnishing pieces with interchangeable accents, as they seek clarity in the present and try to be forward-thinking about the future. According to an article in Sherwin William’s Stir Magazine, the economic climate has led customers, including the savvy Simplifier, to be more hesitant in their big-ticket purchases. Cautious about buying big ticket items that may go out of style in a short period of time, designers and homeowners alike are playing it safe by choosing neutrals for these pieces. The new neutrals are freshened by texture or tonal highlights. The Stir article specifically calls out white as a freshly popular neutral, which fits perfectly in the ‘less is more’ approach of this consumer. A Simplifier consumer will be interested in artisan and crafted accents, especially those that recall the bevy of experiences such as travel, photography, entertaining and self-care/spa (such as yoga or fitness). Contact WHFA at www.WHFA.org or (800) 422-3778.

Stir points out, that… “in both a practical and spiritual move toward improving both their homes and their everyday lives, the Simplifiers are cleaning out the clutter; knick-knacks and unnecessary items are going by the wayside to create cleaner, more open spaces.” When buying with this consumer in mind, look for upholstered sofas and chairs, most in clean, transitional silhouettes with a twist, such as an unusual fabrication, combination or an accent like upholstery brads. In case goods, dining, bedroom and cabinetry, look for distressed pieces, with “re-used/repurposed” feel, and natural woods and surfaces, such as bamboo, maple, birch and small grain oaks, with a reference to the green aesthetic. Keeping in mind that this consumer is downsizing, keep furniture scale reasonable for smaller floor footprints. In the fireplace category this consumer is very aware of the green aspects of direct vent gas fireplaces and is willing to pay more for the energy efficiency associated with an upgraded product. From a design perspective, they are no longer satisfied with “Grandma’s fireplace”, and are purchasing pieces such as the linear rectangular fireplaces that make a statement and provide an experience such as see through fireplaces that consumer are able to elevate on their wall to create experience and art in the home. Adding additional fireplaces in the home add to the “experience” for this consumer; be it in the kitchen, bedroom or bathroom. Product quality and brand reputation are very important. This consumer will take the time to educate themselves on aspects of home furnishing quality such as materials, thread count, country of origin, framing and construction. And, because this consumer is worldly and green, they will also be very aware of fair trade practices and “giving back” programs. In your showroom, pointof-purchase materials should highlight the quality construction, craftsmanship and green and global fair trade aspects of your products. Clean design is important in home furnishings, as is storage. Because this consumer seeks experiences but does not want to appear ostentatious or showcase their possessions, consider offering pieces where the consumer can tastefully hide away their high-end electronics and television components. While this consumer is downsizing, they are not downscaling, and they value quality over quantity in goods. High-end finishes and pieces such as wine storage, closet organization and luxury

spa bathrooms will reach this consumer. Sarah Suzanka’s now 10 year classic, The Not So Big House becomes even more of a guide in creating a finely crafted and well designed home interior that will satisfy this consumer. When selling to this consumer, speak to quality, design, durability and green aspects of home furnishings and decor. Think outdoor living rooms, fireplaces, wine storage and bars, art and items associated with cooking, entertaining and spa in the home. The important thing to this consumer is quality without showiness. The Jones’ be damned.

Krisann Parker-Brown is the author of the blog “Design Minds”. She is the merchandising manager for Hearth and Home Technologies, the leading manufacturer and retailer of fireplaces and hearth systems; Heat & Glo (www.heatnglo.com), Heatilator (www.heatilator.com) and Quadra-Fire (www.quadrafire.com) hearth systems. Contact her at brownkr@hearthnhome.com or (952) 985-6537. Design Minds Blog: http://designmindsathearthandhome.blogspot.com/ Twitter: http://twitter.com/kparkerbrown Linked In: http://www.linkedin.com/in/ krisannparkerbrown

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JUNE 2009

The Current Trend is Wait to Sell

– Think Again!

Tom Hunter Sunbelt of San Francisco/Oakland

f you are thinking of selling your business but have been hesitant due to “market conditions”, you should understand that the current market conditions for small and medium-sized businesses are about the same as during any other market. Prices that would be pushed down due to financial performance are being buoyed by unusually strong demand. Businesses are being listed and sold every day, for fair prices, just like always. The best performers sell for more, but there is a market for almost every business that is performing reasonably well, especially if there is a solid track record prior to the current economic downturn. Selling is never easy, but as the discussion below illustrates, if now is your time, let it go now.

For stronger earnings realization, you will have to hold on longer than you think. Most financial buyers (buyers looking to primarily derive income from the business) want to see a strong earnings track record, usually over a three-year period. If, like most owners, you’ve experienced a downturn over the past year or 18 months, producing a more attractive earnings picture than what you have today may take several years. And here’s why: Buyers typically look at Seller’s Discretionary Earnings (SDE). SDE is a calculated number that demonstrates how much potential a business has to produce cash available for the owner’s 22

JUNE 2009

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discretionary use. It is calculated using earnings and other financial data over a few years, typically three. SDE becomes a very important value indicator that buyers use to compare similar businesses, as well as companies across different industries and regions. If you are like most of us and expect earnings this year to be no better or worse than last year, and don’t really expect improvement until 2010, you’ll be better off selling now because you can use earnings performance from 2 to 3 years ago when (hopefully) things were better. If you wait, and the economic recovery materializes as hoped for in 2010, you’ll have to wait until 2013 to list your business to avoid including this depressed year (2009) in computing SDE. Add to that the 9 to 12 months it can easily take to close a deal, and any retirement or other transitional plans you have made are on hold for 4 to 5 years.

Don’t wait for the market. Sell when the time is right for you. No one says selling your business to another will be easy. It can be one of the most difficult, gut-wrenching decisions you will ever make. Your business is a lot like your child. You’ve poured most of your time, energy and money into it for what may seem like forever. Whether you started it or bought it, it is something you’ve nurtured as it became a part of your life. And, you’ve watched it grow up into something you Contact WHFA at www.WHFA.org or (800) 422-3778.

can be proud of. For many entrepreneurs and owners, selling the business feels like when a child leaves home. But it can also be the best, most positive life-changing event in your adult life. Hopefully, the decision and process of selling your company is only part of an overall exit strategy and plan. They say that only two things are certain in life: death and taxes. If you are a business owner, you need to add a third certainty: you will exit your business. And with proper planning, you can most likely exit on your terms. An effective exit strategy usually involves assembling a team of professionals including an attorney, taxation specialist, financial advisor, estate planner and business broker. And although an exit strategy and plan can be developed quickly, a more effective planning process is one started well in advance of the business sale event. Ideally, exit planning and strategizing begins when the business is started or acquired, allowing for the business to be developed and be managed with an exit strategy execution as the logical final step in the owner’s involvement with the evolution of the business.

The Market May be Challenging, But You Can Sell Now There are buyers out there for your business and there are lots of them. Yes, many buyers can be categorized as bargain shoppers, or even “bottom feeders”, looking for the distressed business, an owner in financial trouble, and a business that needs a quick capital infusion or operational shot-in-the-arm to make a struggling business into a solid performer with a bright future. And there is plenty of capital for small business investment. Distrust with real estate and Wall Street investment vehicles has made small and medium-sized business opportunities look more attractive. Continuing layoffs have put thousands of skilled corporate middle and upper-management people out of work and seriously looking for lifestyle and working life change, and a chance to control their own destiny. Add to that severance packages and new programs for rolling retirement savings from 401(K)’s and IRA’s into self-directed funds available for investing in small businesses, essentially creating one’s own job. This has added motivated, qualified buyers into the small business acquisition marketplace. These buyers are ready to rumble. To take advantage of these conditions, the business seller needs to get his or her business “house in order” and make the business more attractive. For example: • Clean the place up. This includes not only physically cleaning everything you can think of and see, but also includes organizing and streamlining work areas and the processes within. • Document everything. Make sure to review processes and procedures, manuals, customer and supplier lists, marketing, growth and expansion plans and even updated business plans. • Update the company records. The most important and obvious area here is financials, but don’t forget employee related records of all types such as performance appraisals, payroll and benefit information and employee handbooks. • Keep running your business. The most important thing you can do is resist the urge to “check out” mentally. Stay involved while preparing the business for sale and during the listing and escrow periods. One of the numerous indispensible services a Business Broker provides is handling the buyer screening process while ensuring confidentiality, so that the selling owner can continue to concentrate on running the company. Contact WHFA at www.WHFA.org or (800) 422-3778.

Even if your business has suffered a recent financial setback where there was once reasonably good performance, astute buyers will recognize a well organized business with potential to emerge strong once again. There is always a market for a business in this situation. That being said, a business that has withstood the recent downturn, and maintained or improved financial performance can command a premium in today’s market and will be highly sought.

Go For It! Just as when you started or acquired your company, after all the strategizing, analysis and planning, it takes that leap of faith to list and close the deal on your business. But to make the positive transition you desire, you need to exit on your own terms. Plan, fix up, list, sell and walk away. What you created will live on. And above all, don’t let this market, or any market stand in your way.

Sunbelt of San Francisco/Oakland specializes in serving the buyers and sellers of small business in the San Francisco/ Oakland area. Our comprehensive services and resources provide professional guidance for business valuations, 401k rollovers, buyer financing and exit strategy and planning. Tom Hunter, MBA, has brought to business brokerage a deep understanding of the challenges and opportunities unique to the “Main Street” business owner, as well as a gift for creative marketing. For more information, call (510) 523-0232 or email Tom at thunter@sunbeltnetwork.com.

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PROFESSIONALS IN SELLING BUSINESSES Sunbelt Business Brokers have been assisting owners with the sale of their businesses for over 30 years. As the worldâ&#x20AC;&#x2122;s largest business brokerage network, with offices worldwide, we sell more than 3,000 companies each year.

PROFESSIONALS IN HOME FURNISHINGS Sunbelt Business Brokers of San Francisco is distinguished within this network by our focus on working with American home furnishings retailers, distributors and manufacturers. Our specialist, a Member of the WHFA, has more than 10 years of professional experience in ownership, management and business sale transactions related to home furnishings.

PROFESSIONALS WORKING FOR YOU If you are considering the sale of your business within the next year or so, or believe that right now is the right time to sell, contact our home furnishings business specialist for a confidential, noobligation consultation to learn more about the process and the market value of your business today. Our professional team can guide you through every aspect of the transition, from developing an exit strategy, through the marketing of your business, sale and financing negotiations, and post-closing considerations.

Pro

CONTACT A PROFESSIONAL: Tom Hunter, MBA, WHFA Member (925) 457-7797 thunter@sunbeltnetwork.com Sunbelt Business Brokers of San Francisco info@sunbeltsanfrancisco.com (510) 523-0232 www.sunbeltsanfrancisco.com

The place to go to buy or sell a business.

Understanding the

Furniture Purchase Decision

ow do consumers make household furniture purchase decisions? This is a question over which many retailers speculate. To better understand the process of consumer purchase decisions, Mississippi State University researcher Nicole Ponder Lueg surveyed 2,000 consumers. Lueg, an associate professor in the marketing, quantitative analysis and business law department of the College of Business, conducted the national survey. Both qualitative research consisting of indepth interviews with potential furniture buyers and quantitative research from the survey provided an insight into the consumer purchase decision process. To develop the questionnaire, Mississippi State University consumer behavior students interviewed 12 consumers at different stages of their household life cycle. The participants included single, young, married, full nest and empty nest consumers; representing several different occupations. Themes identified in the interviews included the importance of price and affordability, quality of product and the ability to differentiate based on quality and durability, sentimental value, joint-decision making and use of the Internet in furniture shopping. After interviewing the select group of consumers, an online survey consisting of 121 questions was made available to the public. The survey, based on 2,012 adults participating in an online consumer research panel, found that furniture purchases are driven more by actual state than desired state. This may surprise retailers. Most retailers think that today’s consumer doesn’t expect their furniture to last as long as they did in the past and that people want to replace their furniture more often. However, the survey found that most individuals purchase furniture because Contact WHFA at www.WHFA.org or (800) 422-3778.

of a “need” rather than a “want”. Consumers also expect their furniture to last for a long time. Eighty-seven percent of respondents agreed and 44 percent strongly agreed with the statement, “I expect my furniture to last for many years.” Interestingly, only a third of respondents agreed with the statement, “I like to replace some of my furniture every few years.” Another misconception within the industry is the idea that in married households, the wife almost always makes the decision to purchase new furniture. Survey results indicate that initiation of the decision to purchase is typically wife-dominant, but perhaps not as dominant as one would think. About 50 percent of the time, the wife initiates the decision and 25 percent of the time it is a joint decision. In married households, 76 percent consult with their spouse before making a purchase decision, 70 percent say their spouse takes an active role in shopping and 79 percent said that they consider the needs of the entire family when starting the furniture buying process. Not only is the decision a shared one, the information gathering process is also usually done at home. Fifty-one percent of the respondents reported searching for information on the Internet, 45 percent gathered information from catalogs and/or sales brochures, and 42 percent reported watching home decorating themed programs on television. These programs can be successfully used to create “need” in the minds of consumers, which often leads to purchase decisions. Creating this need can be an important step in the purchase decision as 35 percent of respondents indicated that they enjoy shopping for furniture even though they did not have a specific need in mind. As expected, the Internet is a valuable source of western retailer

Nicole Ponder associate professor College of Business and Industry, Mississippi State

JUNE 2009

information for consumers. Consumers search online for information about brands, styles and price. One of the great things about the Internet is that it allows consumers to immediately compare different brands and products. As might be expected, more young people utilize the Internet for furniture shopping than older consumers. Sixty-one percent of respondents under the age of 35 indicated that they searched for furniture-related information and comparisons online. In contrast, 73 percent of those aged 55 and older indicated that they did not search online. While the Internet is a popular method for gathering information, most consumers are reluctant to actually purchase online. Overall, 43 percent of respondents said they like to look at different brands online and 46 percent said they do research online before going to furniture stores. However, 78 percent indicated they want to touch and feel a piece of furniture before purchasing. Not surprising, 70 percent said they would never buy upholstered furniture without sitting on it. One thing that furniture retailers do not have to worry about is buyer’s remorse. Less than 18 percent of respondents reported experiencing buyer’s remorse about a furniture purchase. Surprisingly, income level had no effect on consumer’s feelings about their purchase. Buyer’s remorse, is more likely to occur for products that are considered important to the consumer because of

the relative high cost and sentimental value to the consumer. While furniture is often a big ticket item and is extremely important to consumers because it is often a personal reflection of them and their home, most of our respondents did not indicate having this problem. Additional survey responses include: • 38 percent indicated that they did not feel knowledgeable about furniture, • 25 percent indicated they intended to shop for furniture online over the next few years and • 33 percent said they wished it was easier to purchase furniture online, indicating that they might consider it if the process was improved. The study provides insights to customers — a retailer’s No. 1 priority. Furniture retailers and marketers can use this study to understand the entire furniture purchase process and develop the best possible strategies for reaching and serving their target market. A complete copy of the report may be ordered from the Franklin Furniture Institute (662) 325-8453 or director@ffi.msstate.edu. Nicole Ponder is an associate professor in the College of Business and Industry at Mississippi State. Regarding business-to-consumer relationships, Ponder’s research focuses on identifying factors that create value, satisfaction and loyalty for customers. Her work has been nationally recognized, as evidenced by several honors. She was named a finalist for the Article of the Decade Award given by the Academy of Marketing Science Review in 2006 and received the South-Western, Lamb/Hair/McDaniel Award, Best Paper in Conference, SMA in 2005, and the SMA Conference Best Paper in Track Award (Marketing Strategy) in 2005.

June is Safety Month Protect your most important business asset, your employees! Keeping your staff safe promotes a healthy and productive work environment. Let WHFA help by providing safety supplies.

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est.1944

Western Home Furnishings Association

JUNE 2009

Call Jef Spencer, warehouse manager, today to place an order. (916) 960-0386 • (800) 422-3778 • www.WHFA.org

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Contact WHFA at www.WHFA.org or (800) 422-3778.

Safety Corner

Do Your Employees Know What To Do If Thereâ&#x20AC;&#x2122;s An Accident?

hat would happen today, if there was an accident at your workplace? Would employees and management know what to do? Would the injured person get the best possible care? When an accident happens, a first aid program that meets the requirements of the law and is tailored to the type and size of the workplace can literally make the difference between life and death, or between recovery and permanent disablement. Employers should insure that all employees know where emergency information is posted at the work site. The emergency notice should state the phone numbers of the closest ambulance service, fire/rescue unit, police station and hospital. The amount of time it takes to look up one of these important numbers can make a big difference to a seriously injured person. The location of first aid equipment and rescue equipment should also be posted prominently. All work sites should have a person with first aid or medical training readily available in case of an emergency. First aid equipment and supplies, including a variety of dressings and instruments, as well as an up-to-date first aid manual, should be stored where they can be reached quickly and easily in case of an accident. These supplies should be inspected frequently, making sure they are kept in sanitary and usable condition and re-stocked after use. Larger workplaces may need more than one, fully-equipped first aid kit. In isolated work sites, emergency supplies and an action plan are especially important. At least one person trained in emergency first aid should always be on-site. If first aid is not given properly, it can sometimes hurt rather than help an injured or ill person, or even be harmful to the person giving the first aid. All workers should know who on-site is trained to give first aid, where the emergency first aid equipment is located, and what medical professional or medical facility should be contacted if a medical emergency should occur.

For more safety information visit the SAFETY SPOT at www.whfa.org > Resources > Safety Spot

For more information contact Kaprice Crawford your Association Safety Director at (800) 422-3778.

Contact WHFA at www.WHFA.org or (800) 422-3778.

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JUNE 2009

Soy Love Helping Consumers Make A Difference Today’s Green Trend

Nicole Crews writer

he majority of folks want to do the right thing, which today means doing our part to help the environment. For consumers, this desire translates to “doing good with dollars,” representing a new and significant opportunity for retailers of home furnishings. Fortunately, furniture manufacturers are doing their part to supply stores with a host of eco-friendly options. But most shoppers need help sorting through the available information about what makes a product “green.” Any commitment by retailers to educate both floor sales staff and consumers is sure to be rewarded. Expect a positive return on any investment in time spent answering common questions: Which items are eco-friendly? What makes a product sustainable? Are there different levels of green? How can my purchase make a difference? Here, information can power the sale.

Reduce, Reuse, Recycle and another “R” word: Renewable. While there are many components in a furniture product that can meet sustainable criteria, in the world of “soft” goods, including upholstery and bedding, the use of soy-based foams for seat cushions and mattresses have the advantage of being made in part with a renewable resource. Technological strides in commercial chemistry have created some of the most compelling reasons to go green. “BiOH® polyols have been used commercially to make soy-based foams since 2005 and are widely available from the majority of foam manufacturers in North America. The acceptance and incorporation of soy-based foams over time demonstrates that these products perform,” says Dave Simpson, National Sales Manager for BiOH polyols. Traditional polyurethane foam is petroleumbased. BiOH polyols are made from soybean oil. “BiOH polyols replace a portion of the 28

JUNE 2009

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petroleum-based ingredients for foam. We are always working with our customers to increase the percentage of renewable content and still maintain product performance,” says Jessica Koster, marketing manager, BiOH polyols. “I honestly think that this is the next big opportunity,” says Koster, “it’s great because it means consumers are not sacrificing anything and actually doing something good at the same time.” “American consumers are more informed about making better choices than ever before,” she adds, “This is not a niche market because today everyone cares about the environment.” Beyond the technology, Koster believes that there is something very emotion-driven about home furnishings purchases and adding a green layer to that ups the emotional ante. People want to feel good about making a difference. Who Is Implementing the New Technology? Soy foam implementation in particular is taking hold with many manufacturers: Lee Industries, Klaussner Furniture, Lane Furniture, Broyhill, American Leather, Precedent’s ECollection, La-Z-Boy, Harden, Alan White, Cisco Brothers and Natura World, to name a few. The question that arises is why these and other companies and industries are drawn to the trend. “Many of our customers want to make environmentally-friendly choices, but don’t want to sacrifice quality or comfort to do so,” says Doug Collier, chief marketing officer for La-ZBoy. “We launched the EcoComfort™ by La-ZBoy collection in fall of 2008 to give consumers a comfortable, high-quality furniture option that leaves a smaller environmental footprint.  The line includes a selection of popular sofas, recliners and chairs with a soy-based foam cushion and dozens of eco-friendly fabrics to choose from.” Collier goes on, “The soy foam cushions are a main point of all of our EcoComfort by La-ZBoy communications.  We are letting consumers know that even though these cushions meet our strict standards for comfort, they are created in part from a renewable resource and ultimately leave a smaller environmental footprint.”  Another company telling the soy story is Lane Contact WHFA at www.WHFA.org or (800) 422-3778.

Furniture. “Lane’s EnviroSmart initiative is an effort to make the world a better place by providing comfortable and stylish furniture that includes components that are made in part with plant based ingredients,” says Greg Roy, EVP of sales and marketing at Lane. “Choosing these products helps the North American farmer, lessens the demand for fossil fuel and ensures a smaller environmental footprint. The mattress industry is responding with just as much as enthusiasm as the furniture industry. “Our whole company direction is working toward sustainable, chemical free products and natural ingredients,” says Larry Klein, executive vice president of sales at Natura World. “We are looking to create a healthier place to live and grow.” The company, which even goes so far as to create pillow-fill from recycled soda bottles, sees soy as the go-to substance of the future. “Soybased polyurethane foam reduces petrochemical use drastically and the technology there is only going to get better,” says Klein. Good news on the economic front is always welcome and word amongst manufacturers is that soy also equals good business. “The beauty of soy foam is two-fold,” says Jay Foscue, senior vice president of merchandising at Klaussner Furniture. “Using soy reduces manufacturing costs and it also allows us to be good corporate citizens by doing the right thing for the environment.” “Right now you can really only use about 20 percent soy in the foam and maintain the performance, but Cargill is a leader in the research and is taking the technology to the next level,” he says. “The best thing is that customers are excited about it. They are latching onto the idea and that’s good for everyone — including our environment.”

Spreading the Word The term greenwashing was coined by New York environmentalist Jay Westerveld and is used to describe the practice of companies disingenuously touting their goods as sustainable and thus environmentally friendly. The advent of the term and ongoing consumer watchdog movement associated with it has created a more skeptical — and thus more educated consumer when it comes to purchasing decisions with environmental impact. “Research indicates consumers are hungry for accurate information regarding environmental claims. They want to make fact-based purchase decisions and are skeptical about greenwashing,” says BiOH’s Koster. Education is the key and it is happening from material manufacturer to furniture and bedding manufacturer to retailer to consumer. “We supply various training tools, and do what we can to communicate in a transparent and easy to understand way what we are doing,” says Koster. Retailers and manufactures agree that a lot more questions are getting asked in today’s growing green market and that having answers is the key to selling through. “Consumers, more and more, are trying to integrate green living into product consumption so we produce fact tags for our product and publish it in our literature to continue in that education process,” says Klein of Natura World, Canada’s largest bedding manufacturer. Greg Roy of Lane agrees that education is critical at every level. “Lane’s EnviroSmart product has been very well received by both furniture dealers and the end consumer. Lane will continue to bring forth environment friendly products that meet consumer demand.”

Summary It appears that despite a sagging economy, manufacturers are committed to making sustainable furniture part of their present and future. That said, getting the word out is a necessary component for creating consumer trust via education. Targeting environmental impact, family health and resource conservation as topics to discuss with customers — and explaining various certifications for green products are sure to pay off.

Nicole Crews is a home furnishings trend writer who has written for Country Inns Magazine, InStyle Magazine, Home Fashion Report and Industry Update, among others.

Contact WHFA at www.WHFA.org or (800) 422-3778.

What Retailers Are Saying Furniture retailers — especially those on the West Coast where the market has a long history of environmental awareness — are enthusiastic yet realistic about the current sustainable furniture market. Five years ago there was a sense of urgency to get the products out there because of demand, but in today’s economy, many retailers are taking the long view and investing in what they see as stock in the future of the environment. “We carry both Precedent and Harden which implement soy foam technology into their manufacturing,” says Jeff Parker of Beaverton, Oregon’s Jeff Parker, owner Parker Furniture, Parker Furniture “and we have made it part of our marketing through POP advertising and postcards.” Parker adds, “It’s an exciting trend though I think that it came about around the same time the economy began its downturn so we’ve yet to see its real impact. I think once things turn around it will really take off.” Parker believes that companies like Precedent, who offer the whole package, are investing in the future as well. “Their ECollection takes it full circle with soy foam, sustainable fabrics and finishes. And while that whole package increases the price point, I think that won’t really matter to the “E” customer down the line,” he says. Doug Sharples, owner of retailer Better Bilt in Seattle, WA, whose store carries Lane, CR Home and Harden, agrees. He says, “There is a trend happening here but it is new enough that we are still educating the consumer. It’s definitely being brought up quite a bit by the sales reps that call on me. I think the more we get the word out there, the more of a response we will get.” The bottom line is that while people may be holding their wallets tighter to their chest these days, many are intent upon making better choices about where their furniture and its components come from when they are ready to buy. They are part of a growing group of citizens who hope to make a positive impact on the bigger place we call home. - nc

western retailer

JUNE 2009

Educate Your Customers On Sustainability with only

$29.95

Green is in the news and in the awakening consciousness of the consumer. With it comes confusion as to what we can do and what is really “green”. This continuous loop DVD will help educate your customers and your sales staff about the true components of sustainability in the products you sell. Living green happens when we understand what actions we can take and the power of our conscious decisions. To do that we need to end the confusion.

Chris & Holly Barbo, owners of Barbo Furniture in Bellingham, WA, began designing and manufacturing sustainable furniture in 1979 — long before “green” entered the mainstream of the marketplace. A former educator, Holly Barbo is committed to the concept of sustainable furniture and developed the Green Scale to identify the components of sustainability with an illustration that is simple and easy to understand.

To order a copy of It Can Be Easy Being Green (800) 422-3778 or visit www.whfa.org.

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JUNE 2009

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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 Retailer are not necessarily those of Western Home Furnishings Association. Western Retailer magazine is copyrighted by Western Home Furnishings Association. June 2009, all rights reserved.

Western Retailer:

Read by furniture retailers in the West

distribution: Western Retailer 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.

marketing philosophy: Western Retailer 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.

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