HIGH POINT — For the multi-million and billion-dollar companies that make up Furniture Today’s Top 100, getting there and staying there involves myriad skills including diligence, attention to detail and innovation in the face of adversity.
In 2023 especially, a year that saw four-fifths of retailers lose ground in furniture sales, having a strategy to address the tough times and maybe even grow a bit was of paramount importance.
Commenting on the challenges presented in 2023 that carried over to this year, Michael Melaro, chief retail officer at , an 18-store Ashley operator based in Weston Mills, N.Y., which was No. 71 on this year’s Top 100 list, said: “In an economy like this, the only way to win is gaining market share.”
Helping to achieve that, he said, was the addition of a distribution center in Ohio as well as new stores, like Wellsville’s 2024 openings in New Philadelphia, Ohio, and Batavia, N.Y. And the opportunity for further growth is possible, he said, with share to be gained in Cleveland and parts of New York as well as via Ashley outlet stores and remodels.
Along with organic growth, Melaro said retailers have to adapt to the times. “One of the selling points years ago was not having a middle man,” he said, pointing out that consumers were content to place orders and wait several weeks for furniture knowing the tradeoff to extra time was a lower price.
But online sales and e-commerce delivery models have changed expectations. “To be taken seriously, you have to offer product faster,” he said. “Our goal is to be an in-stock dealer.”
Melaro pointed to several other strategies The Wellsville Group, which saw sales grow by nearly 4% in 2023, has been using to keep the bottom line in the black, including identifying and catering to potential repeat customers; growing its bedding sales per guest number; and assessing and tweaking product assortment on a store-by-store basis.
They’ve also added some private events that Melaro called “$1 million days,” which have performed on a sales level like many traditional tent-pole events.
“We have built our culture around our CXM (customer experience management) program,” he explained. “We know the most likely customer to buy is the one who bought recently. The mentality has shifted to ‘love the one you’re with.’”
Newcomer to the Top 100, 21-store in Arlington, Texas, has innovated by using a pop-up location strategy to both test markets and to make closer connections with the communities it already serves.
Mylene Mitchell Canales, marketing director, said its Oklahoma City store — it’s first outside of Texas — started with a pop-up. There is also one in Grand Prairie, Texas, serving its existing Dallas/Fort Worth audience. These 1,500-square-foot uni
ts offer a boutique-like experience with seasonal or themed merchandise.
The business, which started 20 years ago, is focused on growth, explained Rafael Canales, executive vice president-purchases and the youngest of the nine siblings who run the family company. “We’ve expanded in south Texas and Oklahoma and we’re looking for ways to grow in other states,” he said.
Canales said the plan is to add three stores this year as well as reinvest in the existing showrooms and upgrade the e-commerce website. “We’re doing more home décor, such as art and rugs,” added Mitchell Canales, “to try to create a better experience for shoppers.”
The business has been successful marketing living room furniture, including oversize sectionals, but has seen its sales led by bedroom furniture, said Canales. Advertising living room pieces often draws people in, but modern bedrooms have become top sellers, he said.
One advantage Canales has seen for his family’s business, which grew sales by about 9% in 2023, is that they were able to sell off the excess inventory from the pandemic to make space for new products. “Other retailers still had a lot of excess inventory,” he noted.
While Canales Furniture has a strategy that includes growth through new stores, for single-store retailer in Jamestown, N.C., No. 47 among the Top 100, success is more about tapping into the new customers who are coming into its market.
“There’s a lot of movement of consumers into the Southeast region,” explained Jeff Harris, CEO and president. “They are finding more house for their money.”
To mine this burgeoning customer base, Harris said they’ve become more assertive on advertising, social media and networking to be “top of mind with consumers. We’re finding creative ways to get the word out.”
Furnitureland South, which also grew by 4% in 2023 and is seeing early 2024 sales up 30% year-over-year, has continued to innovate on customer service, investing in artificial intelligence, technology and hiring for positions like design consultants, said Harris. All of this, he said, feeds into giving consumers a great shopping experience.
“It’s a fashion business,” he said. “We have continued to invest in our displays and our products, all those things that make a room inviting.”
All categories have performed well, Harris said, but customers are investing in their outdoor experiences to the point where he’s been told Furnitureland South needs to develop a separate building for outdoor furniture. Mattresses, rugs, lighting and art also are focuses for shoppers these days, he said.
Another item on Furnitureland South’s agenda is the debut of its first online store via a new website that is expected to launch in the fourth quarter, said Harris. “We’re trying to curate the best of Furnitureland South. We’ll still tell a quality story and include white-glove delivery.” The idea behind it, he said, is to both supplement existing business and reach a new audience.
Although they haven’t yet projected sales for the website, Harris noted: “The real goal is to market to those people who go to our website; invite them into our store. It’s such a tactile product, they will want to come see it and feel it. And we will continue to promote that.”
Two other Top 100 retailers, No. 87 and No. 91 Boston Interiors, both pointed to current economic conditions such as high interest and mortgage rates, as creating challenges in 2023 and into this year as well.
“Last year we saw a decrease in traffic and some of that is from the economy and interest rates,” said Jacob Jones, president at La-Z-Boy Southeast/Tipperary Sales in Evans, Ga. While the year has started flat, he’s encouraged that mortgage rates will drop and people will buy and furnish new homes. “And even if they don’t buy a new home, they still need to update their existing one,” he added.
Providing a better customer experience goes a long way toward keeping business on a solid footing, and part of that, said Jones, includes updating stores and promoting their in-store design program. He also noted that La-Z-Boy’s corporate advertising program, “Long Live the Lazy,” has created some buzz for his business.
Case goods has been a growth category, said Jones, and “recliners still do well for us.”
At Boston Interiors, President Peter Theran said even though traffic remains tight, they’ve invested heavily in their design services and, as a result, “the average ticket is through the roof.”
“Our business is very upholstery heavy,” he said, noting motion is growing while dining and bedroom sales remain solid. He said customers, who are trending younger, “are starting to see furniture as something you invest in. People do want nice things.”
To reach this audience, Boston Interiors has made what Theran called “subtle changes” in its marketing, spending less on TV and direct marketing and growing its digital presence. “We do have a transactional website, although the real purpose is to get people into the showrooms.”
Expansion is in Boston Interiors’ plans, said Theran, with targeted locations in mind, but with the high cost of construction “we’re sitting on the sidelines until it normalizes a bit.”