Improve Your Furniture Buying Process in 2007

Furniture World Magazine

It is almost 2007. What are your plans and goals for the New Year? The furniture business is more complex today than at any time in our past. The competitive issues that did not exist for the average store are now driving us all to be more creative to capture the consumer's interest and dollars. Finding great sales associates, training and reducing turnover becomes more and more challenging. Factories that once were your friend and partner are now catering to the majors, and flowing containers can be beyond the capabilities of the single store operator. We can all look deep into the business and find the issues we individually fight each and every day to maintain our business. But let me ask you again....What are your plans and goals for the New Year??? Hopefully, your planning started last summer for 2007. But if not, you must commit to proper planning from this day forward. If you are not constantly moving forward, someone else, with a little more vision, a bit more planning, and is a bit more aggressive, is probably moving in on your hard earned market share. STEP 1: PLAN TO PLAN! Planning takes time, energy and commitment. Impossible to do if you do not remove yourself from the everyday concerns and operations of the business. I've spent so much time with so many great people that love and live their business, they don't find the time to plan. Let me suggest this: Plan on attending more furniture markets this year. Not for a week, but for 2-3 days each. Vegas... High Point...Tupelo... You decide which work best for you, but go to a market at least once a quarter this year. I know that sounds like a lot, but I never returned from a market without finding a gem that improved my business. More importantly, the creative mind works best at this time. You are focused on your business... not on the business of running your business. Plan on finding a new partner each and every market, or expand a great relationship with a present partner. Each and every quarter, attend a market and improve your business. You'll be glad you did. Stop worrying about which market will be best...Vegas or High that.... They have more time than you. YOU make the market. If you plan for success, you can find it at each and every market. Plan these markets today. Get them on your calendar and get your room and travel reserved. This will be the best start of a plan for 2007 you can make. And take your top sales associate to one. What a great reward for a successful year to take your top associate to the market. Not only will he/she be proud to go, but you will have instant access to what his or her consumers have been saying. STEP 2: PLAN FOR YOUR FIRST MARKET OF 2006! This is much easier, now that your are committed to a market each quarter. No need to re-invent the wheel. Let's plan to determine our strongest and weakest category, and attack them right now. Even in your strongest area, you have 10% that should be dropped today to prepare for replacement. Plan to make those drops today. Start closing them out. This way, you won't need to take drastic mark downs to move them out. Just stop buying them, let them run out, and then mark down the floor sample. Since you'll be attending a market again in 3 months, there isn't quite the rush you once had. Now for your weak category. Plan on a hard review. Should I even be in this portion of the business? Can the square footage be better suited for goods from my winners??? Gather information and opinions from your associates, customers and reps. Fix this category this market. One way or another. STEP 3: PLAN TO ADDRESS THE HEART OF YOUR BUSINESS: Step 1 & 2 have prepared you for step 3. The heart of your business is really the merchandise that you will be putting into your customer's homes. The presentation of that merchandise is so critical to the success of your business. Plan to improve your visual display in 2006. Properly displayed stores and layouts make an average sales associate better and a great one hit figures you never dreamed of. Great display excites people from a subconscious viewpoint that triggers them to buy...Higher average tickets and a higher closing rate than ever before. Try this little exercise: Increase your average ticket by 5%, and increase your closing ratio by 5%. How much does your annual volume increase with just these small changes? Let's use a store that delivers 4 million annually, at an average ticket of $675.00. 1. Closed sales total 5,925 ( 493 sales monthly; 123 weekly; 17 daily). 2. Closing ratio of 25%.......We "walked" over 17,000 potential sales! 3. Increase closes by 5% = 296 more sales. 4. Increase average ticket by 5% = $33.75 more per ticket, Total = $708.75 New numbers: 1. Closed sales total 6,221. 2. x's average ticket of $708.75 = $4,409,133. So... 5 + 5 = $409,133. Take a hard look at your displays. Did you capture the look and feel that existed at the market, or did you just throw it on the floor and hope it turned. Have you accessorized it properly to max the turns and also sell some add ons in the process. The average store must have a visual coordinator to maintain the look and feel to close more and more sales. Plan to improve your displays constantly , starting today. Plan Now to go after your display and merchandising to develop more sales and profit. _________________________________ Rick Paice is owner of design center associates, a full service store planning firm , located in New York State. A veteran of the ndustry, Rick was Vice President of Merchandising and Store Development for Raymour and Flanigan, now ranked 13th on the Top 100 list. You can check out his website at www.designcenterassociates.net or call him at 315-952-7373. Today Rick spends all his time designing and consulting with up and coming retailers.