Buyers want quick hits.

By Clint Engel

Seek products that offer help soon

LAS VEGAS - The continuing economic slide has some furniture buyers heading to the Las Vegas Market this week thinking a little more short-term than usual.

They want bargains and quick hits. They need value now - something they can advertise quickly, with a price or value story to draw traffic into their stores.

Several say this is not the time to buy containers, and instead will be searching for suppliers with the best domestic warehouse programs and quick-ship capability.

Some noted that Las Vegas is a premier market for home accents and bedding and will shop hard in both categories, and also will look for contemporary home furnishings in all categories, which continues to gain appeal.

Mark Mueller, marketing director of the family-owned Mueller Furniture in Belleville, Ill., said his store's open-to-buy 'really comes down to what kind of success our upcoming promotions have.

'Usually you can forecast out a little bit longer, but now really everything is more day-to-day,' he said. Although he said business was up in January from a year ago, 'You just don't know what's coming.'

Mueller was getting ready to run a three-times-a-year 'Half Off Sale,' which usually is a strong promotion. But in this economy, said he's not taking anything for granted.

'It's not just furniture,' he said. 'Consumers are expecting to get something for nothing right now.'

That said, Mueller has a few things on his shopping list, including transitional styles in furniture that integrates today's electronics, like TV consoles with iPod docks and wire management systems. He wants to see what's new in home office 'nano-desks' - smaller-scale pieces made for laptops, with wire management systems and easy Internet connection capability.

In upholstery, he said the trend is toward smaller-scale transitional sofas, at least for his customers.

'The day of the 94-inch sofa has come and gone,' said Mueller, who will look for more 80-inch track arm sofas in transitional styles that lean toward casual contemporary.

Mueller expressed frustration with suppliers that have been transitioning their production overseas, saying it has often led to headaches in quality and style. He said his emphasis is on 'stability' - companies that aren't going through the logistical shifts that can 'affect us getting the product to customers undamaged and on time.'

Among his stops here will be the Howard Miller showroom - where he has been impressed with the Ty Pennington-licensed line and is eager to see what's new - as well as Aspenhome and Mueller mainstays Broyhill and Flexsteel.

'What's important to me? Vendors who can deliver quickly out of U.S. warehouses,' said Jeff Hosking, president and CEO of the 90-store Columbus, Ohio-based PMD Furniture Direct.

'I'm not looking to buy containers. I'm looking to companies that make a commitment to inventory product and deliver it quickly with little or no damage,' he said.

Hosking, who said his network of primarily licensed stores showed a same-store sales gain last year (though store count and total sales were down), said price is always important, but secondary to the importance of turning inventory quickly. PMD turns its inventory 15 to 20 times a year, he said.

'That's one of the reasons why we think we're successful,' Hosking said. 'I think the industry got bogged down in the last five years looking at price.'

Too many retailers buy containers full of furniture without factoring in the cash that is tied up waiting on the goods and selling them through, he said.

'If the industry had focused on inventory turns and looked at things like (gross margin return on investment) instead of looking at price all the time, I think it would be a healthier retail climate,' he said.

Buying group AVB/BrandSource is thinking along the same lines. 'Having vendors with inventory in the U.S. - that's where our focus is,' said Michael Allen, executive vice president of home furnishings.

'Retailers right now don't want to stock up on boatloads of inventory.'

Allen added that BrandSource members who are promoting regularly and constantly giving consumers a reason to buy are having some success.

That has meant getting away from some of the long-term credit promotions the industry has used for so long, he said. Credit approval rates have dropped to the point where dealers have had to move back to basics - promotions that include premiums, for instances, such as a set of steak knives. BrandSource has a

sweepstakes promotion planned for later this year for the same reason.

In Las Vegas, Allen and the group's buyers will shop existing suppliers for 'promotions and specials our members can offer that show significant value to their customers - again getting back to that need to give them a reason to come in,' he said.

They'll look for hot values in casual dining, recliners and other traffic-building items. They'll check in with program partners Coaster, Ashley, Broyhill, Catnapper, Hillsdale Furniture and others.

Some of the largest furniture stores are less concerned with U.S. warehousing by suppliers. It can be a plus, but in some cases it can be a negative because some suppliers don't manage warehousing very well, said Carlos Capo, vice president of merchandising for Miami Gardens, Fla.-based El Dorado.

He said his goal in Las Vegas is to find items in styles and categories not well covered with the current lineup and some looks that may 'be different from what we have, but not too different.'

In a tough economy, 'people are not willing to go that wild,' Capo said.

At the same time, he said, there's a fine line between conservative and boring. He was disappointed during the High Point Market in October, because El Dorado was looking for new goods but didn't find much that fit the 'a little bit different' theme.

'Hopefully in Vegas we'll have a little better luck,' he said.

Capo added that in a tough economy, the emphasis on categories changes. Formal living room, bedroom and formal dining room become secondary because cash-strapped consumers are more likely to postpone those purchases. Motion, entertainment and casual dining become more important, he said.

At the 12-store American Furniture Warehouse in greater Denver, sales were off about 10% last year and this year isn't looking much better yet, said President CEO Jake Jabs.

'We don't have a lot of open to buy,' he said. 'I think what we're mainly looking for is some deals. They're floating around.'

Jabs expects to find better pricing in Las Vegas this time partly because oil prices have crashed from their highs this past summer. And while Las Vegas has not been a great upholstery market for AFW, Jabs said he will look at what's new from several importers, including Cheers Man Wah and Emerald Home Furnishings, in search of sofas he can retail for $299 and motion upholstery at $399.

The retailer has been selling a recliner from China priced at $149, and Jabs said he'd like to find more at that price point.

Jabs also said Las Vegas has become the best home accent market and his accessories buyer Judy LaMontagne was pushing to come in a day early. In home entertainment, AFW's case goods buyer will be looking for more contemporary and smaller units for the new widescreen televisions.

The retailer also will look for more contemporary goods in bedroom and better-quality bedrooms with hand carving that Jabs said fell away as antidumping duties were imposed on China.

Bruce Berman, CEO of Lombard, Ill-based The RoomPlace, said his buyers will spend more time on the bedding category in Las Vegas because it's now the dominant bedding market. He'll also look for contemporary lines.

'I can say with 100% certainty there will be things in Las Vegas we will see that we think are better than what we're carrying,' said Berman. 'I've never been to a market where it was zero.'