17 Jun

Conflict for Furniture Manufacturers

Conflicted manufacturers are rarely good for retail relationships. During this week's Internet Retailer Conference and Exhibition in Boston, Ed Stevens, the CEO of Shoptron, talked about the "biggest roadblock for manufactures selling online is channel conflict." This is a fancy description of the challenge vendors face when trying to figure out how to sell directly to the customer via the net. Stevens went on to say suppliers are concerned about retail partners' retaliation. Mark my words, this situation is changing quickly. As all furniture manufactures struggle to sell enough product to remain viable, they WILL NOT continue to let the estimated 60% of customers looking for branded product who begin their search at the vendor website simply leave without offering to sell them something. This change is coming regardless of retailer feelings! Listen to what three industry executives have said already:
  • "One cannot afford to not be in e-commerce," Ethan Allen Chairman and Chief Executive Farooq Kathwari.
  • "We knew that the longer we waited on the Web, the more risk that someone else would be capturing that demand," Jason Camp, senior vice president of retail at Bassett Furniture Industries.
  • "We estimate between 60% and 70% of people spend some time on the Web before or during the purchase process," said La-Z-Boy Chief Marketing Officer Doug Collier. With "more than a few million" visitors to its site each year, Collier said, "La-Z-Boy wants to convert as many of those to sales as possible."
These gentlemen are not talking about being your partner. They are devising a company strategy to be your competitor. Finally, I want you know understand where I come from. I believe these vendors are 100% right in their belief that they must sell online or go broke. However, I equally believe the furniture retail community had better do the same! Did any of you ever believe 2,000 auto retailers would be closed down because their suppliers changed the rules of the game? I didn't! The 100,000 American families who worked for these retailers didn't either. Draw a line in the sand. Decide your future. Don't let the vendor dictate what happens to your family business. They are busy worrying about their own skin.

3 thoughts on “Conflict for Furniture Manufacturers

  1. High Style Interiors & Gifts

    This is a great post! This has been a sticky-wicky for a long time. It’s dog eat dog out there right now and all levels are feeling the crunch. What is the solution? I suggest MFGs start offering deeper discounts to their dealers who then should pass the discounts on to the consumers. Let’s try resetting the whole economic platform.

  2. Tom McMinn

    Most of the so-called manufacturers in the business are now nothing but distributors, and as they fear their territory being invaded by direct vertical integration out of China, they are moving to invade the teritory of the retailers. I am reminded of many years ago when Edgar Broyhill starting selling furniture out of a catalog. It was touted then as the end of the retailer. After 2 years and a return rate of 42% he was out of the business. It’s simple. An internet sales model works great for items that are easily handled, shipped and easily returned. Furniture is none of this. If this could be made to work on a wide scale, then the 800 numbers would have driven us all out of business. Unless you set up national showrooms where folks can go look, or provide money back guarantees and send someone to pick up their mistakes, they will not buy furniture readily off the internet. The distributors want to use our showrooms and then sell direct. When they do that, they will cease to have distribution. You can sell items that are easily found. Tempurpedic does this already. Others could adopt their model. Folks, truthfully there is no easy solution to this. If there was Warren Buffet would have figured it out already.


Leave a Reply

Your email address will not be published. Required fields are marked *