May 2011 Western Retailer by Western Retailer Magazine

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

western

May 2011

Succeeding by offering a contemporary style in a traditional marketplace Member Profile: Concept : : Home

Spokane, Washington

est.1944

Western Home Furnishings Association

www.WHFA.org

committed to STYLE

Emerald Home Furnishings NEW IN STOCK THIS MONTH

3025 Pionner Way E Tacoma, WA 98443

(253) 922-1400

www.emeraldhome.com

Table ofCONTENTS

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

western retailer

EDITORIAL STAFF Managing Editor: Melissa Dressler................................ mdressler@whfa.org

featured articles It’s All About Sales & Marketing The Power of eCommerce 10

DESIGN AND LAYOUT: Lisa Tilley................................................. ltilley@whfa.org Advertising Manager: Cindi Williams..............................cwilliams@whfa.org 2011 WHFA OFFICERS AND EXECUTIVE COMMITTEE WHFA PRESIDENT Angel Lopez - Dearden’s, Los Angeles, CA........................................(213) 362-9600

It’s All About Sales & Marketing Creating Brand Loyalty Through Email 14 OPerational excellence To be or not to be a Recycler 18

PRESIDENT ELECT Chris Sanders - Everton Mattress Factory, Inc., Twin Falls, ID..........(208) 326-3407 VICE PRESIDENT Valerie Watters - Valerie’s Furniture and Accents, Cave Creek, AZ....(480) 483-3327 TREASURER Lael Thompson - Broyhill Home Collections, Aurora, CO...................(303) 360-9653

IT’S ALL ABOUT SALES & MARKETING Location-Based Marketing 22 HR update Social Networking Policies & 25 New WHD Program

SECRETARY Chuck Kill - Bedmart, Tucson, AZ.......................................................(520) 887-7039 EXECUTIVE COMMITTEE CHAIR Claudia LeClair - Fiesta Home Furnishings, Scottsdale, AZ...............(480) 951-3239 PAST PRESIDENTS Marty Cramer - Cramer’s Home Furnishings, Ellensburg, WA...........(509) 933-2172 George Nader - Nader’s La Popular, Gardena, CA............................(310) 327-8585 EXECUTIVE director Sharron Bradley - WHFA, Roseville, CA.............................................(916) 784-7677

Operational excellence 26 The Real Estate Market is Ready

AT LARGE EXECUTIVE COMMITTEE MEMBers Gary Absalonson - Walker’s Furniture Inc., Spokane, WA.................(509) 533-5500

regional furniture markets 28

Howard Haimsohn - Lawrance Contemporary, San Diego, CA.......... (619) 291-1911 Marvin Kerby - Kerby’s Furniture, Mesa, AZ.......................................(480) 834-3888 Karen Kohlman - West Harvard Furniture, Roseburg. OR.................(541) 673-4221 WHFA/NHFA Liaison David Harkness - Harkness Furniture, Tacoma, WA...........................(253) 473-1234 WHFA Board Members

in every issue

Carol Bell - Contents, Tucson, AZ......................................................(520) 881-6900 Gene DeMeerleer - Furniture West, LaGrande, OR...........................(541) 963-5440 Chris Ehgoetz - Michael Alan, Lake Havasu City, AZ........................(928) 855-6067

Industry Beat: Retailers of the Year & Bill Clinton . . . . . . . . . . . . . . . 9

Mark Flegel - Flegel’s Home Furniture, Menlo Park, CA....................(650) 326-9661 Greg Follett – Follett’s Furniture, Lewiston, ID...................................(208) 743-0177 Eric Foucrier - Linder’s Furniture Mart, Garden Grove, CA................(714) 210-4848

Member Profile: Concept : : Home. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Travis Garrish - Forma Furniture, Fort Collins, CO.............................(970) 204-9700 Giff Gates - Gates Furniture, Grants Pass, OR..................................(541) 476-4627 John Grootegoed - Elite Leather, Chino, CA......................................(800) 826-9971

Program of the Month: Empower Your Business with WHFA’s Insurance Program . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Eric Harms - Black’s Home Furnishings, Yreka, CA...........................(530) 842-3876 Tim Koerner - Koerner Furniture, Coeur D’Alene, ID..........................(208) 666-1525 Jeff Lindsley - Lindsley’s Home Furnishings, Grangeville, ID.............(208) 983-1040 Mark Navarra - Jerome’s, San Diego, CA..........................................(858) 753-1549

contact

Michael Nermon - Ergo Customized Comfort, Irvine, CA...................(949) 833-0338 Cherie Rose - The Rose Collection, Los Gatos, CA...........................(408) 395-7773 Scott Selden - Selden’s - Tacoma, WA...............................................(253) 922-5700

Phone:

Mike Shuel - Meredith Furniture, Yakima, WA....................................(509) 452-6221 Tom Slater - Slater’s Home Furnishings, Modesto, CA......................(209) 522-9097 Polly Teeter – Del-Teet, Bellevue, WA.................................................(425) 462-1500 WESTERN HOME FURNISHINGS ASSOCIATION STAFF

(800) 422-3778 (12 western states) (916) 784-7677 www.WHFA.org (916) 784-7697 500 Giuseppe Court, Suite 6 Roseville, CA 95678 www.facebook.com/WesternRetailer www.twitter.com/WesternRetailer

est.1944

Western Home Furnishings Association

Executive Director: Sharron Bradley................................................(916) 960-0345 Asst. Exec./Membership Director: Kaprice Crawford.....................(916) 960-0346 Business Manager: Janice Carlson..................................................(916) 960-0347

Online: Fax: Mail: Facebook: Twitter:

Events Manager: Cindi Williams.......................................................(916) 960-0277 Operations/Warehouse Manager: Jef Spencer...............................(916) 960-0386 Editor/Communications Coordinator: Melissa Dressler.................(916) 960-0385

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

Graphic Designer & Project Manager: Lisa Tilley...........................(916) 960-0349 Member Services Rep: Michael Hill..................................................(916) 960-0263 Member Services Rep: Adam Gardner............................................(916) 960-0291 Accounting Assistant: Melody King.................................................(916) 960-2476 est.1944

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

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WHFA

ACADEMY

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RRC RETAILER

RESOURCE CENTER

M AY 2 0 11

president’sMESSAGE

s the Baby Boomers prepare to exit Stage Left, there is a new generation that is taking Center Stage. In this issue you will read more about Generation Y and I know it will be an eye-opener for many of us. When I was preparing to write this letter I started to do some research on Generation Y, also called the Millennial Generation, and Echo Boomers. Some other unique characteristics of this group that are note worthy: The oldest members are in their early 30s (the youngest are approaching adulthood). As retailers, this is of importance because they are in the household creation mode which brings with it opportunities to capture them as lifetime customers. Generation Y presents tremendous opportunities because they are greater in number than the Baby Boomer generation, so as they progress through the lifecycle they will impact the way retailers adapt to this new customer group. For example this group is very socially conscious; therefore, they will tend to buy from those companies that are active in their communities and have in place programs that address the environment.

Angel Lopez 2011 WHFA President

They are the most ethnically and racially diverse cohort of youth in the nation’s history: 18.5 percent are Hispanic; 14.2 percent are Black; 4.3 percent are Asian; 3.2 percent are of mixed race; and 59.8 percent are White. This is going to require that we be prepared to market to this diverse customer base with messages that are relevant to each of the target groups. The Baby Boomers are still trying to master Microsoft Office while the Echo Boomers see social networking as a normal, everyday activity and Internet use as routine (i.e., tweeting, texting, Facebook, YouTube and Wikipedia). As retailers we need to ensure that we are prepared to use the mediums that this generation uses to communicate and seek information. I am sure most of you already have Generation Y employees, so you have already seen that they have different goals and aspirations from the Baby Boomer Generation. They have high expectations of their employers, seek out new challenges and are not afraid to question authority; however, Generation Y is loyal, committed and wants to be included and involved. They appreciate being kept in the loop and seek frequent praise and reassurance. Generation Y may benefit greatly from mentors who can help guide and develop their young careers. I am excited about the impact that this generation will have and I, for one, am very confident that as we move on, we are leaving our industry and for that matter, our country in good hands.

Dearden’s Furniture Los Angeles, CA (213) 362-9600 angel.lopez@deardens.com

ON THE COVER

Concept : : Home & Owner Heather Hanley Photo by Diane Maehl Photography For complete story, see page 16.

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

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M AY 2 0 11

editor’s MESSAGE The Next Generation is NOW

ix years ago when I started in this industry, I heard quite a few grumblings about how Generation Y was too young to be a serious furniture shopper. Many retailers believed they didn’t have to market to this group of customers because they weren’t purchasing homes or furniture. Well, today, the next generation is upon us. Generation Y ranges from 34 to 17 years old and are 85 million strong, 120 percent larger than the size of the Baby Boomer generation. This generation is now your customer, employee, colleague and possibly boss. As I am sure you know by now, each generation has very different influencers that make them a certain type of consumer. This is true with Generation Y, with technology and the Internet influencing how they communicate, shop, date and much more. Melissa Dressler Western Retailer Managing Editor

As I was reviewing the articles for this issue, I noticed an underlying theme: the next generation and the future of our industry. Our member profile this month is on Concept : : Home in Spokane, Wash. Concept : : Home is owned by Heather Hanley who is in her early 30s and transitioned into the family business 10 years ago. While her father still comes into work every day, she is the primary leader of two successful retail stores—and she is a part of the next generation of our industry. Another article in this issue might make you reconsider the prospect of eCommerce. I know many of you believe that a person needs to feel fabric prior to purchasing a sofa, but it has been shown that Generation Y (and Generation X) will buy furniture online. Just think of what your store might be missing out on through online sales! With the sudden impact of the next generation being upon us, I also thought I would share a group that has been developed for young home furnishings professionals called Next Generation-NOW. This group is the brainchild of a few members of the original Next Generation group that existed 20 years ago. These members saw the need to resurrect the group. Last August, Next Generation-NOW hosted its first cocktail party during the Las Vegas Market and was an immediate success. Honestly, I never knew there were so many young people in the home furnishings industry. Marketed towards the next generation of home furnishings professionals, this group’s primary focus is to educate and cultivate the skills of the next generation of our industry. Whether a person is transitioning into a leadership position within a family business or just wants to develop new skills and industry knowledge, Next Generation-NOW is here to educate them and connect them with other young home furnishings professionals. This group is just getting underway and has an eager committee that will be producing webinars, mentoring functions, cocktail parties and much more. Stay tuned to see where this Next Generation takes us. I hope you enjoy this issue and please contact me if you are interested in learning more about Next Generation-NOW.

(916) 960-0385 MDressler@whfa.org

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PO Box 969

•

Conover, NC 28613 • 800.937.3876 • ZenithCompanies.com Contact WHFA at www.WHFA.org or (800) 422-3778

Industry Beat

industryBEAT Home Furnishings Industry salute NHFA Retailers of the Year 2011 Fiesta Furnishings & Rotmans Fiesta Furnishings in Scottsdale, Ariz., led by Claudia LeClair, and Rotmans in Worcester, Mass., led by Steve Rotman, are National Home Furnishings Association’s Retailers of the Year for 2011. Fiesta is the honoree in the category of annual sales of $10 million or less while Rotmans is the honoree with annual sales over $10 million.

Fiesta Furnishings Claudia LeClair started doing business from her garage in 1988. She began importing accessory items from Mexico and selling them wholesale to local stores and hotels, and within a year had rented a warehouse and began selling at trade shows around the country. In 1995 Fiesta Furnishings was born when she and her husband Ralph decided to “go retail.” Claudia has served for seven years on the Board of Directors of Western Home Furnishings Association, most recently as 2010 President. She has been a member of an Impact Performance group for five years and a member of The Contemporary Design Group. Claudia was one of eight retailers invited by Vanguard Furniture to attend a Summit Partnership Meeting to discuss innovative ideas for the industry, and she participated in a panel discussion during the American Home Furnishings Alliance annual meeting in 2010. Claudia is a strong believer in continuing education, and often attends home furnishings conferences along with key staff members. Claudia and her business serve the community through a variety of activities, including Extreme Makeover Home Edition; holding charitable events for the local furniture bank Bridging Arizona; donating furniture for the family areas of Serenity Hospice; participating in fundraisers each year for The Friends of American Cancer Center, Sleep America Charities, Habitat for Humanity, Child Help, and Free Arts of Arizona. Claudia serves on the board of Arizona Institute for Breast Health and designates 50 percent of sales in a part of the store to go to this organization. She is a member of Sojourner Truth Society, an organization focused on overcoming domestic violence. Claudia and Ralph have donated their home for tours to generate money for charities, including Crisis Nursery, Friends of Mexican and Free Arts of Arizona. John Art, Moore Marketing Mastermind from Starbucks and Rotmans Whole Foods Having been associated with the furniture and carpet business since the mid-1950s, in 1964 Murray and Ida Rotman started Rotmans at its present location in the former Whittall Carpet Mill complex in downtown Worcester, Mass. They were joined by their son Steven in 1962, followed by sons Barry in 1966 and Bernie in 1980. Murray Rotman, who was a nominee for the Furniture Hall of Fame, passed away in the spring of 2004. Ida, now in her 90’s, is still partially active in the business. The business continues to flourish with sons Barry, Steve and Bernie at the helm.

President Bill Clinton

Scheduled as Keynote Speaker for Summer 2011 Las Vegas Market World Market Center Las Vegas is rolling out the red carpet for President Bill Clinton, who will be the keynote speaker for the Summer 2011 Las Vegas Market, Aug. 1-5. President Clinton’s speech, “A Conversation with Bill Clinton,” will focus on the challenge of globalization, emphasize our growing interdependence, and point the way toward a common future based on shared goals and values. Following his keynote address, President Clinton will participate in a moderated question and answer session. All registered Las Vegas Market attendees will have the exclusive opportunity to attend the keynote, sponsored by World Market Center and the iComfort® Sleep System by Serta®. Complimentary and exclusively for registered attendees of Las Vegas Market, the private event will take place during Market’s opening night, Monday, Aug. 1 at 6:45 p.m. on the World Market Center campus and will be accompanied by a special reception for all attendees. Online registration for Summer Market is now open and offers attendees the opportunity to reserve their spot at the keynote event. “Globalization has changed the furnishings industry more significantly than anything else in our time,” said Robert Maricich, World Market Center Las Vegas president and chief executive officer. “It indisputably has created...

page 29 Contact WHFA at www.WHFA.org or (800) 422-3778

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It’s All About Sales & Marketing

The Power of eCommerce When Selling to the Hot Buyers Generation X— highly educated and spending money on big ticket items, such as furnishings, home improvement, children’s needs, sports and leisure items. ...“If you don’t have a website you’re basically invisible.”

o you have a successful business and want to ensure its future success? How secure are you right now? Maybe you think your brick and mortar store is all you need. Think again. Times are changing and you’ve got to follow the trends of today to survive in tomorrow’s marketplace. Many retailers are changing their eCommerce selling strategies to entice today’s key purchasers: the ‘Under 45s’, Generation X and Y (a.k.a. the Millennials). Keep reading as we outline the top features required in order for your eCommerce solution to gain the attention of the Generation X and Y buyers, while also being a revenue generator. This article provides insight as to how you can increase selling power and market to the younger generations with your online presence. Sure, you have a website, but are you selling online? If you are not, you are missing out and here’s why. The younger generations have the buying power now and the first place they usually look, before even stepping foot into a store, is on the Web. Technology is a part of their daily lives; it defines these generations. Without an online retail presence, you’re losing valuable customers.

The Importance of a Retail Website is Not to be Ignored Michelle Beres Skyta Marketing Communications Specialist STORIS Management Systems

Rich Mitton, director of IT, at Mathis Brothers Furniture recently stated, “There are many customers, especially those in California, who don’t necessarily want to drive to a store. They prefer buying from our site. If they have visited one of our stores, had the Mathis Brothers’ experience and purchased furniture, then they are even more comfortable adding those extra pieces by just buying them online. eCommerce has been a great improvement to our overall business. It’s an evolution.” Today, it’s so easy to search for a company, business, retail store, etc. on the web and find exactly what you are looking for quickly. The competition is out there creating a brand and making a name for themselves, and making money doing it. A television commercial for Verizon that is currently running in the New York tri-state area features a local retailer who searches for her company name on the Web and is surprised to find that it’s not listed. This is because she doesn’t have a website or any other presence on the Internet. The Verizon rep tells her, “If you don’t have a website, you’re basically invisible.” He then shows her how to create a small business website to promote her business. In the end the setup was easy, and she is happily branding her retail business via the Web.

Who are the Hot Buyers? Take a look into the lives of your hot buyers; the statistics may surprise you. Generation X makes up 75 percent the size of the Baby Boom generation, and just 68 percent the size of Generation Y, according to the Retail & Consumer Insights report. Born 1966-1976, they are 10

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It’s All About Sales & Marketing

entering their peak earning years. This generation is highly-educated and uses caution when purchasing. They are spending money on big ticket items for their children entering college. They are buying practical products, such as home improvement equipment, furnishings, children’s needs, sports and leisure items. Generation Y, also known as the Millennials, or the Echo Boomers, are the largest generation compared with the Baby Boomers and Generation X. Born 1977-1994, they are 120 percent the size of the Baby Boom generation, and 170 percent of Generation X. They make up 85 million of the country’s population (Retail & Consumer Insights). This generation was born into technology and image matters to them. They are the primary influencers of all generations because they have information at their fingertips via mobile phones, iPads, YouTube, etc. Constant technological advances are normal to these generations. They are always ready to seize the next big item, the latest trends and to make an upgrade.

Why Do They Buy? Retailers should understand the needs of their consumers and adapt to each of the different generations. Know how to target these consumers and gain their trust. While the Baby Boomer generation responds to newspaper, radio, print, and TV ads, Generations X & Y respond to mobile technology and social media. Generation X wants you to help them, not sell them. They are looking to gain more for their money. If you provide evidence as to why your product will benefit them more than your competitor’s and prove it, they will buy. Post testimonials of your products online. These buyers like to research first. The more information you have online, the better the opportunity for you to make sales. Turn your website into a retail atmosphere. Offer easy access to your products and services. Generation Y consumers are connected to technology. They shop together in groups. They respond to word of mouth. You have to go where they are: Facebook, Twitter, mobile, school, etc. They care about communities. Be a part of their lifestyle. Build loyalty. Enable customers to use their mobile phones to obtain information on a product, download coupons, discounts, etc. Contact WHFA at www.WHFA.org or (800) 422-3778

Come on and Get Social Facebook, Twitter, YouTube—it’s the Social Network, so get on board. You have to embrace the trends and go where the buyers of today are spending their time. According to www.laptopmag.com, Twitter has gained over 190 million users since its inception in 2006. The average Facebook user has 130 friends, and there are more than 500 million active users today. The average user is connected to 80 community pages, groups, and events. Imagine what kind of marketing impact this can have for your website and your brand. Create website appeal by making it easy for them to click and buy. Performance matters when it comes to your website. Make your site easy to manage and browse. Become interactive by adding virtual screen options, such as a room planner where one can select a product and preview it in a room for size, color and style. Enable customers to “check-in” with Facebook Places through their mobile phones and reward them for “advertising” your company. Their network of friends can instantly see the places they’ve checked into, triggering more potential customers to notice your brand and strike an interest in visiting your store.

Generation Y

• 90-100 percent Email • 80-90 percent Social network & watch videos • 60-69 percent Buy Products & Instant Message

Generation X

• 90-100 percent Email • 60-69 percent Buy products, Social Network & Watch Videos • 50-59 percent Instant Message

Activity

Teens 12-17

Gen Y 18-33

Gen X 34-45

All Online Adults 18+

Go Online

93 percent

95 percent

86 percent

79 percent

Teens, Gen Y and Gen X more likely to engage in the following activities compared with older users: Email

73 percent

96 percent

94 percent

Social Network

73 percent

83 percent

62 percent

61 percent

Text Messaging

67 percent

66 percent

52 percent

47 percent

Buy a product

48 pecent

68 percent

66 percent

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It’s All About Sales & Marketing

Gen X Gen Y

Social Network Text Messaging Purchase Online

20% 40% 60% 80% 100% 120%

Start a following on Twitter with tweets that grab the consumer’s attention. Twitter runs in realtime, so your response is instantaneous. Offer a one day sale and highlight deals in your tweets. Focus on your local community of followers. You can offer specials to those who follow you on Twitter and in turn, convince them to buy online or in the store. Keep them engaged and coming back. Give them coupons; offer discounts for referring or sharing with a friend, or donate a portion of their purchase to charity. Create loyalty programs so that they return and invite their friends to shop your store. Social media is huge for advertising in retail.

Post Pricing on Your Products It’s an instant turn-off to buyers if you don’t have price tags for your products on your website. You are automatically running the risk of losing the potential buyer’s trust. What do you have to hide? Your competitors are listing price tags. If your products are expensive, but well worth the quality, give them the opportunity to shop. If you prove your quality and offer the essential reasons they should purchase your products, young consumers will buy. “eCommerce was a big move for us because we’ve always been so guarded in protecting our retail pricing. Ironically enough, we found out that people don’t like to look at websites without pricing. So we had to look at the hard facts and make a change for our customers. The younger

generations (X & Y) are shopping online and that’s how it’s going to be in the future,” stated Nestor Reyes, Director of IT at City Mattress.

Why is My Website Important to Them? Consumers feel secure with your business when they can find you on the web. Having a website places your business a step above the competition. Offering the option to buy online makes life easier, and saves the shopper time. Reyes continues, “Having an online store is a lot less expensive than opening an actual retail store location. It’s a great compliment to our store network because people like to research online first. Then they will come to our store with papers in hand ready to purchase. It also makes it easy to manage products. In store, we update our pricing and it populates directly into our website. We don’t have to update pricing in separate locations. It’s the wave of the future.” Other smart retailers have jumped on board the eCommerce platform because they know that it can only increase their branding, sales and staying power. The Consumer Behavior Report of Online Purchasing Trends by Generation reported that 69 percent of consumers purchase online as much as they do in store. Also noted, 96 percent of online consumers are confident that the site is safe and secure for purchasing. If your website is suspicious, slow, or quirky, they won’t buy. Web performance can be a killer. If your online retail site is not up to speed, Gen X & Y are not going to stay. They want it to be easy and fast. They are multi-taskers.

It’s All About Sales & Marketing

The average Facebook user has 130 friends, and there are more than 500 million active users today. The average

Top 100 retailer American Furniture Warehouse has been an innovator with their eCommerce website. They understand that reaching out to the key buyers is important, and they’ve created a website that is consumer friendly. “We’ve been using an eCommerce platform for years. It’s nice to have real-time inventory and order information on our website, and it’s seamless to our store operations. Online sales are really growing for us as we’re projecting record sales online this year,” confirmed Jake Jabs, owner of American Furniture Warehouse.

user is connected to 80 community pages,

Why My Website is Important to Them • 18 percent of traditional TV campaigns generate a positive ROI

groups, and events.

• 90 percent skip commercials via TiVo or DVR

Imagine what kind

• 78 percent of consumers trust peer recommendations

of marketing impact this can have for your website and your brand.

• 14 percent trust ads

The Future is Now What’s next is already here. Interactive displays in store and online are sweeping the consumers off their feet. This technology offers the ability to use touch screens to find products, view them room by room, share the look with family or friends, and even check into the store online for a coupon. Are you convinced yet? Sure you’d like to keep marketing to the Baby Boom Generation. They respond to TV commercials, newspaper and print ads. But the up-andcoming buyers do not. They skip TV commercials on recorded shows, using TiVo and DVR technology. They view content on iPhones, iPads, and the web. Gen X is emailing and instant messaging, while Gen Y is texting, blogging, tweeting and so on... The best way to succeed is to stay at the forefront of technology, by connecting and interacting with these active buyers. Michelle Beres Skyta has over 10 years of industry experience with Advertising and PR. She has been with STORIS Management Systems, a leading retail software solutions and services provider for Big Ticket retailers, for the past five years. Currently, a Marketing Communications Specialist, Michelle is a Millennial embracing new technology and social advancements. She holds a degree in Mass Communications and Media from Ramapo College of New Jersey. For additional information please contact Michelle at (888) 478-6747 x286 or mlb@storis.com.

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

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M AY 2 0 11

It’s All About Sales & Marketing

Creating Brand Loyalty Through Email The Ins & Outs of Sending Emails Commercial

vs.

Transactional EMAILS

Commercial emails must follow all the rules of the CAN-SPAM Act, while transaction emails must only provide a truthful header. What’s the difference? •

•

Commercial emails are intended to result in a sale between your business and the customer and that is their only purpose. Transactional emails are those that confirm or facilitate a commercial transaction agreed upon by the recipient; provide general product information; discuss a change in store policy; talk about employment opportunities; or deliver a good or service as part of the agreed upon transaction.

Jeff Bennett Online Specialist Grey Suit Retail

M AY 2 0 11

ou’re doing everything right to market and brand your business. Radio and TV ads? Check. Direct mail? Yes. A website? Naturally. Email marketing? Of course! But here’s something you may never have considered. Every time you send an email to your customers, there’s a big chance they have no clue who in the heck it’s coming from. Here’s why. If your business sends bulk email or one-on-one correspondence from a generic email address such as info@abcfurniture.com or sales@ abcfurniture.com, you’re alienating customers. Your customers may be asking themselves, “Who’s Info?” or “Can I call stop in and talk to Sales?” The digital divide caused by impersonal electronic mail is intensified when the sender is a nameless, faceless department. Think of your email address as your digital John Hancock, a firm handshake through cyberspace. It should foster a sense of security and trust for your customer. You wouldn’t put ‘Info’ on your salesperson’s nametag, would you? Your email address shouldn’t leave your customers scratching their head in bewilderment wondering who they’re actually communicating with at info@abcfurniture.com. The easiest way to assure your customer that a real, live person will read their message is to use real, live names on all email addresses. If Larry is your sales manager, give Larry an email address such as larry@abcfurniture.com. Identify Larry as the sales manager on your website and provide his email address for all customer inquiries. And if you don’t want to overwhelm poor Larry, you can have messages sent to Larry’s address forwarded to several different email addresses to ensure that every customer receives a prompt and appropriate response. Brand loyalty and confidence will blossom in your customers when they know they can turn to real people for questions instead of an automated team of Info and Sales bots. Beyond good customer service, there’s a law that regulates sender names. The CAN-SPAM Act, enforced by the Federal Trade Commission’s Bureau of Consumer Protection, creates rules for all commercial and transactional emails. It gives recipients the right to opt out and request

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you stop sending them email. Even if you don’t participate in bulk email blasts, the CAN-SPAM Act covers all commercial messages, which are defined as “any electronic mail message the primary purpose of which is the commercial advertisement or promotion of a commercial product or service.” Even emails that promote content on your website fall into this category of commercial emails and must comply with the rules established by the CAN-SPAM Act. Now, these rules aren’t harsh. They don’t ask you to disclose your date-of-birth, social security number or anything like that. In fact, most of us naturally adhere to CAN-SPAM guidelines by being truthful and conscientious senders. The rules simply state that all commercial emails must:

• Use truthful heading information.

The “To,” “Reply-To,” and “From” lines must be accurate and identify the business sending the message.

• Use truthful subject lines. The subject line cannot be deceiving and it must mirror the content in the message.

• State your message is an advertisement.

There is a lot of breathing room here for interpretation. But there must be no shadow of a doubt in the recipient’s mind that your email is an advertisement.

• Disclose your business’s physical

address. Simply provide a valid postal address.

• Tell recipients how to stop receiving

your email. If you’re sending bulk mail, be sure to visibly allow customers to ‘unsubscribe’.

• Quickly honor opt-out requests. You

must honor a recipient’s opt-out request within 10 business days. Your opt-out mechanism must be in place for each message for 30 days after the message is sent.

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

It’s All About Sales & Marketing

If you hire a third party for email marketing, monitor their activities. Both your company and the third party can be held responsible for not complying with the law. If you don’t use email marketing, you may believe most of the aforementioned rules are not applicable to you—but keep this in mind: If a customer calls your store and Larry—or the unknown sales force behind sales@abcfurniture.com—follows up with an email promoting the store’s latest big bargains and sizzling savings, this email is considered a commercial email. However, if Larry follows up with an email discussing item dimensions or warranty information, this email would be considered a transactional email. Emails are a fantastic way to brand your business and promote your store. Remind your customers that a real, living and breathing sales force stands ready to care for their needs by using staff names in email addresses and follow the CAN-SPAM Act to avoid penalties in your email marketing. Jeff Bennett is an online specialist for Grey Suit Retail, the furniture industry’s only SaaS platform that fully integrates a website, an eCommerce shopping cart, email marketing, traditional marketing, blogging, analytics, and now Craigslist in one simple yet powerful tool that gives you complete control of your online strategy. Call (800) 549-9606 ext. 6, email jeff@greysuitretail.com or go to www.greysuitretail.com to see for yourself how everything we do is designed to help you sell more stuff, keep more customers and make more money.

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EVENT PROMOTIONS THAT SPEAK FOR THEMSELVES

Everything was above board and done very very professionally. It was exceptional.... It was a home run from the beginning all the way through to the very end. Mickey Warsaw Lewis Furniture, Portsmouth, OH

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NUMBER #1 IN HIGH IMPACT EVENTS! Trust your promotion to the people with the most experience.

PFP maintained the Samuels name in the community. The sale definitely met my expectations. I would recommend PFP to anyone.

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Harry Samuels, President Samuels Furniture, Memphis, TN

Our unique business model is designed to generate superior cash flow for our clients. No matter what size your business is, trust the leader in high-impact furniture promotions.

Call or Click Today! 800-472-5242 www.PFPromotions.com

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

High Impact Events Since 1962

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Concept : : Home Spokane, Washington

hen customers enter through the front door of Concept : : Home, they often feel like they have been transported to Seattle, Los Angeles or New York—not Spokane, Washington. The boutique store offers contemporary home furnishings amongst brick walls, with urban music playing overhead, and gives Spokane shoppers a unique shopping experience that they used to have to travel at least four hours—and over one large mountain pass—for. “When you go to LA or Seattle, most of the furniture stores are contemporary. Then, when you come further inland, the stores become more traditional,” said Concept : : Home’s owner, Heather Hanley. “For those people who are relocating inland but still want a more contemporary look, and not the typical furniture store version of contemporary, they used to have to travel to larger, urban cities. We are trying to be the source of contemporary furniture for the people living in Spokane so they no longer have to travel to Seattle.” When Heather opened Concept : : Home in 2008, she was not new to the retail business—her family has been working in retail since the 1950s when they opened a television store that eventually started selling home furnishings. Over the years, this business evolved from Acme TV to The Tin Roof, and the product lines shifted. Ten years ago, Heather moved back from California and became the owner of the family business.

Melissa Dressler Western Retailer Managing Editor

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Located in a downtown building that Heather owns, Concept : : Home, which occupies 5,000 square feet of the bottom floor, was a completely new business venture, “My father and I wanted to buy a downtown building—I have had the idea since I moved back from California in 2000,” she said. “One day a copy of the MLS book popped into my lap, and there was a great building that was perfect for a condo conversion. We bought the building with the intent of putting a new store on the bottom floor and converting the upper two floors into lofts—and I would live in one of the lofts.” The idea for Concept : : Home was then born shortly after Heather participated in furnishing a very contemporary home that was showcased on the Street of Dreams. While The Tin Roof offered a few contemporary and transitional pieces, Heather saw that there was a great need and market in the

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

Member Profile Spokane area for a contemporary boutique store. “There really aren’t any other contemporary stores in town,” she said. “Even half of our best selling pieces at The Tin Roof are fairly contemporary pieces.” Along with having a unique product line for the Spokane area, Heather has created unique opportunities for potential customers to shop. After attending an educational session by Mary Liz Curtin, who owns a home furnishings store called Leon & Lulu in Michigan, Heather decided to open Concept : : Home up to local businesses, nonprofits and customers to host parties. “It is sort of like opening up your living room for people to have a party, but instead we have 10 living rooms,” Heather said. “We have had birthday parties, meetings and gatherings in the space. For most events, we will provide the space and the group provides the party. If the event is for a nonprofit and a purchase is made during it, a portion of the sale goes to that nonprofit—just like Leon & Lulu. We do about two events a month as well as participate in our downtown First Fridays. We always have a great turnout for that since we are amongst all of these art galleries and art displays really well in our showroom.”

At a Glance

Another unique way Heather shows Concept : : Home’s product is by creating room settings for local functions. One charity recently approached Heather and asked her to set up a hip, LA-type club atmosphere in the area where they were hosting a cocktail reception. Heather and her team created this great lounge area and were able to get their furniture, and name, in front of possible customers.

Store Location: Spokane, Washington Type of Store:

Boutique

Year Founded:

2008

Outside of hosting events, Heather has found unique ways to connect with her customers. She recently tried a deal with the company Groupon, and while she didn’t sell many Groupons, it did create buzz about the business. Heather has also found Facebook to be an effective way of connecting with her customers. “I am a big fan of Facebook. I think it is a great way to interact with your customers and clientele without being obnoxious about it. They choose whether or not they are going to read your posts. It is a way for them to be able to connect with you without having to get an email every day like Restoration Hardware and Pottery Barn do,” Heather added.

Top Suppliers:

Stylus Sofas, American Leather, Amisco, Star International WHFA Member Since:

2002

Store Website:

www.concepthomefurniture.com

As for the future, Heather feels they have discovered the type of contemporary furniture the people of Spokane will buy, so her goal is to focus on marketing and gaining more business. She has found that one of her largest competitors is the Internet—even though the quality of products being sold on these sites is much less than what Concept : : Home sells. Heather eventually would consider adding an ecommerce portion to the business but wants to commit to doing one thing at a time in order to create the best possible product. With two successful businesses, and a downtown loft building, under her belt, there is nothing stopping Heather and the continued success of Concept : : Home and The Tin Roof. Contact WHFA at www.WHFA.org or (800) 422-3778

All Photos by Diane Maehl Photography

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Operational Excellence

To be or not to be a

furniture world can attest to this; numerous designers and products are taking advantage of reused materials and the value or green chic they create. So, what’s a retailer to do?

alue, profit, community support, increase in customers… these all sound like great ideas for anyone in the retail sector, right? So, why is the first thought when it comes to recycling that it is a money-losing proposition? Retailers today who are not creating a green culture will find themselves irrelevant in the future.

Many companies that want your scrap materials are not only willing to pay for them, BUT they will help provide equipment and training for the best processes for recycling. For decades, the corrugated and paper industry installed balers or even shredders in locations generating enough volume to support those investments. This is also true in the metals and plastics areas for retailers and DC’s. Many of you are already successful, bravo to you.

This article will focus on the recycling and materials recovery side of retailing and distribution/ warehouses. Hopefully, your company is actively involved in energy saving programs and using space as efficiently as possible in your facilities. Today’s biggest environmental impact on the planet (and species) is in buildings.

As many of us are painfully aware, materials prices have been going up. This includes fuel, textiles, woods and packaging. The same is true for the markets seeking out scrap materials. It is a global marketplace and many global markets lack natural and manmade materials with which to create products or equipment. This has placed a strain on resources and created demands here in North America and overseas. Many Americans are still removed from lifestyles that not only demand conservation, they require it. It is these demands which are fueling the needs for the recovery of materials from a greater variety of feed streams. Scrap has long been the tool which fed innovation and creativity. Without scrap materials, many of history’s greatest inventions would not exist (The automobile, personal computer, light bulb to name a few). The

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One example to mention is a firm named MCS Industries based in Easton, Pa. They manufacture picture frames and mirrors here in North America and in Asia. They provide their products within the retail furniture industry for sale or perhaps in displays, as part of your product staging. MCS manufactures many of their products using recycled EPS/Styrofoam from packaging. Taking it a step further, they even built equipment to facilitate the recovery of these bulky lightweight materials at the retail and warehouse level. By working with EPS scrap sources, MCS will create a chain of custody so that retailers can use this solution, not only to reduce waste, but to verify metrics in sustainability goals for your community or stockholders. Retailers and warehouses want to make the best use of their space a.k.a. footprint. One way is to maximize recycling strategies, which are often volume driven by teaming with smaller venues or sources of scrap. If you already have a baler, why not offer customers, local colleges or smaller businesses a drop-off option at your facility? The logistics can be outlined and requirements established to avoid being a landfill, but you can sell these collected materials along with your in-house partner scrap

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

and get a better price by offering full truckload quantities. Many firms will work with groups servicing people with disabilities to sort and then bale or load these scrap materials. Grant money is often available, and I have found that the families and friends of those workers become customers for life. Pitney Bowes is one such company that has had great success in this area, and Goodwill (the nation’s biggest recycler) is known worldwide for the success they have created by these partnerships.

Helpful Links:

I believe that retailers and many other firms have some sort of success story in regards to recycling and waste reduction. Yet, they do a poor job in promoting or telling these stories. SHOUT them out. These recycling solutions should be a part of your marketing and sales. A LEED* accredited customer would prefer to buy from a source that has made the same commitment to being sustainable. Remind them that the creation of the furniture certainly is important in being green; but how the entire supply chain is dealt with, plays a major factor in that determination.

www.mcsframes.com www.Balconesresources.com www.isri.org www.resource-recycling.com

By offering an option for them to return any packaging or perhaps taking it back after delivery can lend itself to broadening your customer base.

www.ronsherga.com www.usgbc.org/LEED/ LEED is an acronym for Leadership in Energy and Environmental Design

I know in certain urban areas, package removal is a hassle and can be an added cost. Here again, some of you are doing your part in these efforts. I hope you will respond to this article by sharing your stories of success. Please keep in mind that I realize space can be limited and floor space means dollars. Efficient scrap and materials removal will help with justifying that space and when you are selling these materials, the programs add to the bottom line. A number of states offer grant money and tax relief for equipment or programs that use size reduction or add employees to issues dealing with recycling initiatives. I would also ask that you consider recruiting students as interns to be a part of these recycling efforts.

One of the fastest growing areas in business & our culture is sustainability. Since it is a fairly new area and one still seeking to define itself, experience is often lacking. By allowing students to play a role and overcome challenges and find or create markets for your recyclables, you will provide them a head start on their resume. Events such as “Recyclemania” within colleges and universities

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

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As you do these programs or pursue and achieve steps of success, invite local reporters. They hunger for greentype stories and your business will get free publicity.

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have proven enormously successful in their collection results and in expectations of what can be done as individuals and groups.

hauler and have evolved in to a creative solution provider and for all materials. Plastics are now the fastest growing segment of their business.

As you do these programs or pursue and achieve steps of success, invite local reporters. They hunger for green-type stories and your business will get free publicity. I cannot think of a group or community not interested in at least hearing about initiatives to be less wasteful. Even your current waste service provider will look to be a part of the solution. It might mean they make less money on tipping fees, but they also could be a possible customer for your recyclables. In Texas, Balcones Resources provides just such assistance in everything from paper to plastics and E scrap to document destruction. They even built an alternative energy facility for making fuel from comingled materials that once only went to landfills. They started as a simple waste

So, as you look to refine existing strategies or seek to implement a totally grass roots program, you will not find a better time. Company leaders must play a key role and employee incentives to encourage innovation in recycling should be created. Work with and develop strategic partners and donâ&#x20AC;&#x2122;t look to be overly ambitious. You will reap the success and the only question you will ask is â&#x20AC;&#x153;what took us so long?â&#x20AC;?

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Ron Sherga has been involved in recycling for over 40 years. He has managed, owned or advised in the recovery of more than 5 billion pounds of scrap materials. His pro business visionary thinking and speaking skills have made him a recognized leader in recycling and energy management. More can be learned about Ron at www.ronsherga.com.

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

s your insurance coverage customized to meet the needs of your business? If you answered NO, your association can help! WHFA’s insurance carriers know the needs of home furnishings retailers. From your Business Insurance to your Workers’ Compensation, the WHFA insurance programs can meet your needs and make sure you are properly covered, all at competitive rates. WHFA becomes your one-stop-shop for Business, Auto, Workers’ Compensation, Health or Employment Practices Liability Insurance.

Business Insurance

Workers’ Compensation Insurance

WHFA has one of the strongest business insurance programs specifically designed for furniture retailers. Argo Select is an A-rated insurance company with over 40 years experience, dedicated to retail operations. Argo Select offers industry experience and solid financial protection.

In today’s highly competitive environment, you need every advantage to succeed, especially when it comes to workers’ compensation insurance. With national brokers at your service, you will receive competitive workers’ compensation insurance quotes from a variety of “A” carriers such as: Fireman’s Fund, Safeco, Golden Eagle, CNA and California State Compensation Insurance Fund.

With Argo Select you receive business coverage designed exclusively to fit your store’s individual needs. Their retail-specific loss prevention advice and customized services help prevent claims from occurring. They know retail business and are a specialist in this field.

Health Insurance As an employer in this competitive marketplace, it’s important to offer an attractive benefits package to employees. This is not always easy—with so many different people and so many different needs, it’s important to offer packages that are not “one-size-fits-all” and still be cost-effective. Does your company have the time, resources and experience to put together a benefits package tailored to the needs of your employees? WHFA’s broker Aita and Associates has been providing WHFA member’s health insurance options for over 15-plus years. Contact WHFA at www.WHFA.org or (800) 422-3778

“I am delighted that I switched to Argonaut Business Insurance through WHFA. In the past, I have always declined outside insurance companies since I have had a wonderful long-time relationship with my local agent who has helped us through some very challenging claims. The program through WHFA has allowed the best of both worlds—we received a quote substantially lower and can still obtain it through our local carrier. I would recommend everyone to get a quote and don’t hesitate on making a change. The service and pricing for us has been outstanding.” - Dave Harkness, Harkness Furniture, Tacoma, WA

Kaprice Crawford Membership Director WHFA

“Having the WHFA Health Insurance through Aita and Associates on your side is like having a family member in the medical insurance business. They are honest and someone you can trust to take special care of the thing you value the most—your health.” - George Nader, Nader’s La Popular, Gardena, CA

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It’s All About Sales & Marketing

Drive Customers into your store with location-based marketing

hat if people came into your store because they found you on their phones as they were eating at the restaurant across the street from your location? What if you could bring new customers into your store who were just walking by, who had no intention of stopping in? What if you could increase customer retention by over 40 percent just by publishing a deal that your customers received on their phones? These types of opportunities exist through location-based marketing, the new way to market in a mobile world. This type of marketing is a valuable customer acquisition tool for local brick-and-mortar stores. It’s also a great way to engage with your customers in a fun and game-like fashion. Crystal Vilkaitis Director of Social Media SnapRetail

The best way to be in front of your customers at the right place and the right time is by embracing this new marketing & creating a check-in deal that customers can receive on their phones. It’s best for store owners who want to gain new customers, generating store exposure and building customer loyalty. With over 200 million Facebook users accessing their account from their mobile phone paired with the explosive growth of smartphone sales, it’s hard to ignore the growing opportunity to get in front of your consumers via their phones. People are “checking in” to restaurants, stores, events, movie theaters and even their churches to broadcast current locations to their online networks and occasionally include a tip or meet up with friends. This is all made possible through mobile applications like Facebook Places, Foursquare, Loopt, Whrrl and Gowalla to name a few. Location-based marketing is a new form of advertising that uses GPS-tracking technologies within smartphones, targeting consumers on their mobile devices. Through these mobile applications, users will be able to see what

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businesses are nearby and will be informed of specific deals those businesses are offering during that time. Users are compelled to check into businesses for special offers such as coupons, free products and gifts, and more simply to inform their online networks of their whereabouts from day-to-day. People pay attention to where we eat, shop and hang out. We are 78 percent more likely to trust peer recommendations and suggestions than advertisements from businesses. When someone sees a friend on Facebook received a great deal at your store simply by checking in, they may be inclined to buy from you, as well. They may feel you are more trustworthy since they know someone who shops there. This is especially important for home furnishing retailers. Your inventory may be high-ticket items and things we want to last for years. We’re looking for reliable companies that will sell something of quality and guarantee their products, and standby their warrantees. You, as a business owner, might not be checking in to your favorite coffee shop or local grocery store, and might not even own a smartphone, but your customers are and do. Here are five steps to help you create your location-based marketing plan.

Choose a platform. With several

available and new ones being added to the marketplace regularly, it’s important to know about each and then select what would be best for your store. I suggest that you add your store information on as many location-based services as possible (make sure to verify everything is correct and updated), but it is not necessary to manage an account on every single application platform. Knowing the number of users is a great place to start. Facebook is the largest with more than 600 million users; this platform is an obvious choice to create a check-in deal. Foursquare has over 5 million users checking in to local businesses and Gowalla has over 600,000. Ensuring that there are users of these applications within your area is an important first step to make sure there are people who will see your offer. Even though size does matter, it’s also important Contact WHFA at www.WHFA.org or (800) 422-3778

It’s All About Sales & Marketing

to know where the company is based. Example: Gowalla’s headquarters is in Austin, Texas, which means they have a lot of activity and users in that area. If your store is in Austin, I would suggest creating an offer on that platform.

creating a monthly deal and track which one had the best response. From the results, you can start focusing your promotions around those types of offers. I also suggest creating a marketing calendar highlighting when your deal starts and expires. This will help you stay organized and will ensure you don’t forget to switch out an offer.

Also, decide what kind of approach you want to take. If you want to have a little more fun with your deal and encourage frequent buyers, you might want to offer something irresistible to the Mayor through a Foursquare special. If you’re not familiar, the person who checks into a location the most on Foursquare becomes “the Mayor” of that location. Offering Mayor specials is a great way to increase loyalty and engagement. Maybe even feature the Mayor’s picture at your cash register so everyone who is paying can ask who that person is and why they are the “Mayor” of your store. This might create some healthy competition where they might start checking in more regularly to try to steal the Mayor crown.

Promote your deal. Once you’ve chosen a platform(s) and activated your deal, make sure you announce the deal to your networks. Send an email to your database about how they can receive a special deal just by checking into your store. Post to your Facebook page encouraging your network to come in and take advantage of the exclusive offer. Use your social media platforms to promote your deals to increase more people coming into your store for your special offer.

Create your offer. When brainstorming your upcoming offer, factor in what your sales goals are. If you want to just bring people into the store, offering a general deal like 20 percent off a single item or $25 off a $100 purchase or more is a great place to start. If you want to highlight a specific product you might want to discount that item only. Also try offering gifts that include a new product line you are trying to gain exposure for. Whatever your offer includes, make sure you spend some time strategizing it first, ensuring it is in line with your overall store goals.

Facebook, visit http://facebook.com/deals/checkin/business Foursquare visit http://foursquare.com/business/ Gowalla visit http://gowalla.com/business

Define restrictions. Before creating your deal, determine if there are any restrictions, like a limited-amount offered, available for the first check-in only, or only redeemable when checking in with friends. It’s important to define these terms before you create the deal so you are clear and don’t confuse your customers. Make it as easy as possible for them to buy! Establish timelines. I suggest crafting

deals around current promotions you’re already running within the store. Keeping all of your marketing efforts consistent will help customers know exactly what they are being offered. If you don’t do a lot of in-store promotions, try

Mobile marketing allows you to increase customers by bringing new people into your store when they check-in to businesses near you and see your special offer. This type of marketing will also build customer loyalty and frequent buyers by giving them a reason to come into your store and not your competitors. This is a great new tool for retail store owners to market their physical locations and drive customers into their stores. To learn more about creating a check-in deal on:

Crystal Vilkaitis is the Director of Social Media for SnapRetail, which helps independent retailers market their stores through email, Facebook and Twitter. Crystal has been using social media since early 2007 where she doubled and tripled web sales, increased traffic by over 2700 percent and was recently featured in Fast Company’s Most Influential Person Online campaign ranking in the top 2 percent. Crystal works specifically with independent retailers teaching them how to use Facebook, Twitter, Foursquare, QR Codes and other social media tools to bring traffic into their stores and strengthen the relationship with their customers. For more information visit http://snapretail.com or contact Crystal at (970) 6910225, crystal.vilkaitis@snapretail.com.

10 1:06

Jan 7, 20

Jan 7, 2010 1:06 PM

Just got a txt from Dearden’s across the st. big sale!

There are over 300 million mobile subscribers.

arketing Mobile m r e m su n o is c making initiated st o m it the ve form responsi g ever. etin of mark SEND

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

HR Update

Social Networking Policies & New WHD Program

e want to alert you to some recent court, legislative and regulatory agency decisions that will have a significant impact upon employers in California and in other states. Two of the most recent employment law issues that caught our attention were the recent ruling by the National Labor Relations Board against a company specific to their social networking policies (Facebook/Twitter, etc.) and the new Department of Labor program designed to assist workers with wage and hour claims by connecting them to a private attorney to handle their case.

Social networking sites have become mainstream and are here to stay, creating challenges for employers managing their company policies on employee use of social networking both within & outside of the workplace. The recent National Labor Relations Board (NLRB) ruling that Facebook postings are “protected” in many instances and overbroad policies are unlawful is just one additional—and urgent—sign for employers that they need to develop properly drafted, very specific company policies addressing the use of social networking sites. Social networking poses many potentially challenging issues for employers and owners in many other areas, including hiring discrimination, defamation, privacy and confidentiality, infringement upon Federal Trade Commission marketing guidelines, termination of employment, workplace violence/ workplace security and harassment. American Consulting Group consultants strongly encourages all our clients to be extremely diligent about updating both their company employee handbook and social networking policies. By properly updating these critical employment documents, employers can protect against legal exposure and also provide their HR administrative function with the guidelines to effectively deal with any challenges that arise specific to social networking issues. Bottom line, the time for employers to properly develop their own company-specific social networking policy is now, rather than in response to threatened litigation or some other challenge. Additionally, the federal Department of Labor’s Wage and Hour Division (WHD) recently announced a new program Contact WHFA at www.WHFA.org or (800) 422-3778

to assist workers in pursuing wage and hour claims against their current or former employers by connecting them with private attorneys. What this means is many workers with claims specific to laws such as the Family Medical Leave Act (FMLA) and the federal Fair Labor Standards Act (FLSA) will be receiving notification that due to the “high volume of claims and lack of agency resources,” the WHD will provide them with contact information for private attorneys with expertise in wage and hour or protected leave laws. The WHD has also stated that they will provide assistance to both the employee and their attorney in obtaining any relevant case information that may be advantageous while pursuing legal action against the employer. In the past, many complaints filed the WHD would get lost in the bureaucracy and ultimately would be dismissed. With the advent of this new program, however, we believe it is reasonable to assume that many more FMLA and wage and hour related lawsuits will now be filed against employers by attorneys who are referred by the WHD. In summary, stepped up regulatory enforcement specific to employment and workplace safety compliance is a continuing trend at both the federal and state level. The newly implemented WHD/DOL program described here is just one of many similar programs we expect to be implemented in the coming year. One of the most effective defenses to protect against compliance exposures is for businesses to perform a complete HR “audit” of their company that includes all of the company’s wage and hour practices and employment policies, including social networking. Lastly, every company employee handbook should be updated or at least reviewed annually. As Senior Vice President for The American Consulting Group’s HR & Safety Advisory Group, Eric Martin assists organizations on a broad range of human resources, employee relations, health, safety and environmental compliance issues. Eric has over 28 years of business background including 21 years of experience specific to Human Resources and Workplace Health & Safety Consulting. Prior to joining ACG, Eric was the Senior Director of Business for Strategic HR Services in Newport Beach, California. For more information, contact Eric at emartin@american-consulting.com.

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Operational Excellence

The Real Estate Market is ready for you

ertainly the last three years have taken their toll on all aspects of the economy, including commercial real estate. Always one of the largest fixed expenses of any brick and mortar furniture operation, the decline in commercial real estate purchase and lease rates has created an opportunity for growth that hasn’t existed in the past 40 years. If your business has survived the Great Recession and is showing signs of stability or, dare we say it, growth, then this is the perfect time for selective expansion. There is perhaps no asset as illustrative of the laws of supply and demand as real estate. When businesses are successful and growing, rental rates rise to levels that often bear little economic relation to the land and construction costs associated with creating them. The period of 2000 – 2007 was a perfect example of this type of greed-flation, where landlords had the ability to demand rents that could not be supported by the true replacement value of the asset. Jewelry, clothing and specialty retailers drove rental rates up by taking prime properties and in essence financing their improvements with the landlord through large tenant improvement allowances and aggressive free rent periods. Once the Great Recession arrived, these same retailers could not maintain the high sales volumes required to support the equally large rents, and vacancies occurred. Vacancies have occurred in all grades of commercial real estate, but the effect has been greatest at the bottom level and least at the top. Unless you’re looking for real estate in Dubai, there is no more land being created and the last two years saw very little in the way of new development of shopping centers or other commercial buildings. This means that in general the more desirable “Grade A” properties have not dropped in value as much as the Grade B and Grade C properties because there are still enough successful retailers in the market to fill the small number of truly Grade A retail locations. The value of these elite properties has dropped, however, and depending on the level of greed-flation in your particular prime markets, the drop could be significant.

The greatest opportunity generally lies in the Grade B properties. There are several reasons for this. First, every time a new Grade A property is developed or remodeled, it potentially drops prior Grade A properties to a Grade B level. One of the interesting occurrences in the Great Recession was that, even though the shopper was not spending as deep as they did before, when a new Grade A center opened, the continually fickle shoppers changed allegiance and started going to the new location. This created vacancies in the prior Grade A center and in essence turned it into a Grade B player. Second, as vacancies occurred throughout the market, the focus by most national retailers was still to locate in Grade A locations, so retailers that were in Grade B locations moved to the new vacancies in the Grade A Centers. The net result of these dynamics is that rates in the Grade B centers moved down significantly resulting in the strongest rate/value opportunity in most markets. In most markets the rental rates in these properties are 1995+ rates and some free rent, some landlord tenant improvement assistance and some landlord repair and maintenance assistance can be expected in your lease.

Doug Kays Real Estate Broker

If your business runs on pure expense control, then the cheapest rents reside in the Grade C properties. To most of us, that is like trying to win a game just by playing amazing defense, but for some companies it works. Grade C opportunities abound in every market, and if you focus on maintaining an above average advertising budget to drive the customers to your off-thepath location, you may build a successful operation. Rents in Grade C properties are at 1970 - 1980 levels and come with free rent, but seldom with any help from the landlord with tenant improvements and the buildings often have deferred maintenance issues. Proper location selection is imperative and emotional decisions need to be avoided at all costs. A location needs to be the right size, in appropriate condition, have the right ceiling heights and interior configuration, have the shipping/receiving components that you need for your business, be energy wise to keep costs under control, have great visibility, have no prior negative images for

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western retailer

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the consumer, be cost effective for your use, have the right demographic profile for your business and have the proper balance between good cotenants/competition and bad co-tenants/too much competition.

While we all believe we have the ability to know a great location when we see one—the truth is we don’t. We are all swayed by comments from friends and family and from our past experiences. Be sure to get knowledgeable assistance from a competent, experienced commercial real estate agent. Just like dentists aren’t doctors, residential agents do not have the knowledge, experience or informational tools to properly help you find and evaluate a great retail store location. Likewise, make sure that your commercial agent truly understands your business. I am reminded of the retailer I visited recently who was making deliveries out of her front door on a rainy day and inadvertently blocked a customer who was trying to enter the building. I asked the retailer if she had a rear delivery area and she replied, “No, when I found the building I called an agent and he helped me through the lease, but he never came to the building. He never advised me there was no delivery area and I never thought to ask”. If your business is healthy and you believe that you are ready to expand, you have picked the perfect time. There has been a significant increase in leasing activity in the past four months and rental rates appear to have stabilized. If the activity level remains strong, the rental rates will begin to increase. Once again, the Grade B properties are the best rate/ value and represent the best overall opportunity, but there are Grade A properties available in most markets if you’re willing to react in a timely manner. Doug Kays graduated from Southwestern University of Law in 1979 and passed the California Bar in 1980, although he is not actively in the practice of law at this time. He obtained his Real Estate Brokers license in 1988. He served as operations VP and general counsel for McMahan’s Furniture from 1980 until 1995, when he became VP of operations for the Western U.S. for Heilig-Meyers Furniture. In 2000, he opened and operated his own eight store chain (Premiere Home Furnishings) which he operated until he opened a full-time real estate brokerage business in 2005. He can be reached at DKays@dougkays.com.

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

western retailer

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The Benefits of Regional Furniture Markets Most furniture retailers attend at least one furniture market every year to purchase new products, reorder existing pieces and meet with their vendors. New products freshen up your showroom floor and can give you new sales opportunities. Whether it is High Point or Las Vegas, attending Market is necessary for all home furnishings retailers. Along with the two major markets, there are many opportunities for home furnishings retailers to attend regional markets. Here are four reasons why you should attend a regional furniture market this year: Accessibility: Many of the regional markets come to cities near your business and are easy to shop in just one day, and then return back to your store. It is often hard to take a lot of time away from the storeâ&#x20AC;&#x201D; especially if you are a small operationâ&#x20AC;&#x201D;so regional furniture markets might be the best opportunity for you to find new products. Ease: Many regional markets have all furniture, bedding, lighting, and decorative accessory vendors all under one roof. It is an easy one-stop-shop for livening your product line. Expense: With the cost of gas soaring close to $4 in most areas (or if you live in California or Hawaii, it has been over $4 for quite some time), you know that the cost of gas is driving up the overall costs of travel. The convenience of regional markets allows you to take a quick car ride to the show. This is a great opportunity for you to see new products without having to spend a ton of money on gas or an airline ticket.

Regional Furniture Markets Karel Expo Management

The KEM regional markets are held in Long Beach, California, Edison, New Jersey, Dallas Texas and Orlando, Florida

http://kemexpo.com

Seattle Gift Show

Seattle, Washington www.seattlegiftshow.com

L.A. Mart

Los Angeles, California www.lamart.com

San Francisco Design Center San Francisco, California www.sfdesigncenter.com

Deals: If you skip Markets, you might be skipping out on great deals. Many vendors offer Market specials to the retailers who attend. By not attending, you might be giving your competitor an exclusive new product without even knowing it. For information about Karel Expo Management, or assistance with pre-registration, housing or exhibiting space, please call (305) 792-9990, email info@kemexpo.com or visit http://kemexpo.com/.

Visit the regional markets to find decorative accessories to liven up your product line.

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western retailer

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Industry Beat

industryBEAT 2011 retailer, cont

Throughout the years, Rotmans expanded into additional parts of the complex, and the store’s slogan was “Seven Stores on Five Floors under One Roof.” The store experienced dramatic growth in the 1980s and became known as the largest single store operation of its kind in the Northeast, with a new slogan, “New England’s Largest Furniture and Carpet Store.” Rotmans completed a $2 million expansion that doubled showroom and warehouse space to 200,000 square feet, creating new galleries and displays along with a Design Center. They also added the “Café Fantastique,” an exciting venue for children’s programs, concerts and “Home Beautiful” seminars. Rotmans’ reputation is that of a family-oriented and honest company, known for their outstanding customer service and involvement in community services and activities. The Rotman family feels it is important to give back to the community that has made them successful. One of Rotmans most innovative community service programs is its “Furniture Exchange” program, partnering with the Donations Clearing House of the Central Massachusetts Housing Alliance to get furniture donated by customers to families in need throughout Worcester County. Rotmans also developed a free home furnishings package for victims of environmental, fire or storm damage. The store is also active in Genesis House, Jewish Family Services, Edward Street Child Care, Walk for the Homeless and United Way. They partnered with Extreme Makeover Home Edition in both 2007 and 2008. NHFA’s prestigious Retailer of the Year Awards was presented during the Spring High Point Market Furniture Industry Awards Gala. The award, signified by a crystal obelisk, is the highest honor the 90-year old trade association can bestow upon a member.

Claudia LeClair and Diane Ray

Clinton, cont

... new challenges as well as opportunities for our industry. Thanks to Serta, the event’s co-sponsor, we can provide our attendees with this once-in-alifetime opportunity to hear directly from President Clinton, a world leader and one of the foremost experts on globalization and the economy. Home furnishings professionals at Las Vegas Market will benefit from President Clinton’s insights and solutions on the most pressing economic and social issues in the U.S. and abroad.” Retailers, designers, manufacturers and industry professionals planning to attend Las Vegas Market this August are encouraged to plan in advance and register online in order to receive their badges before the show. When registering, attendees are also encouraged to book their hotel rooms through World Market Center’s online hotel block to ensure discounted rates. For more information, visit www.lasvegasmarket.com.

Steve Rotman and Jeff Child

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

western retailer

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Advertisers Index Please support the advertisers that support your magazine. Advertiser

Page

Phone/Website

American Express............................................................... 24.............................................(800) 710-9837 Emerald Home Furnishings..............................................2..............................................(800) 685-6646 FurnitureDealer.net........................................................... 27.............................................(651) 287-0700 Furniture Wizard...............................................................4&20..........................................(619) 869-7200 MicroD........................................................................... back cover....................................(800) 964-3876 Planned Furniture Promotions...................................... 15.............................................(800) 472-5242 PROFITsystems ................................................................... 31.............................................(800) 888-5565 Surya.........................................................................................7..............................................(877) 275-7847 TruckSkin ............................................................................. 30.............................................(877) 866-7546 Zenith Global Logistics......................................................8..............................................(800) 937-3876

Advertising Inquiries & Rates Contact:

Cindi Williams, WHFA Events Manager, 500 Giuseppe Court, Ste. 6, Roseville, CA 95678 Phone: (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. May 2011, 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

www.whfa.org 30

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western retailer

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

Wouldn’t it be great if you could get business software that would…

• Increase productivity of your employees by simplifying tasks and automating processes? • Increase profitability by focusing on the items, categories, and vendors that produce the greatest GMROI rather than just meeting an inventory stock level? • Measure salesperson effectiveness so you can set and meet profitability goals? • Identify sale trends and anticipate future ordering needs? • Monitor goals, close ratio, revenue per up, average sale size, and gross margin? • Reduce your IT expense?

You Can!

PROFITprofessional is the business software designed by furniture retailers for furniture retailers. When you use PROFITprofessional, you can start monitoring the metrics that matter.

Call for a Demo and a Free Needs Analysis

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www.profitsystems.com

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