BOLD 2025 PREDICTIONS
Amazing but true predictions for furniture & bedding retailers
by Gordon Hecht
If you’re wondering how hot dogs, old spinning bratwurst, inflation, AI and recent slow traffic will affect your furniture & bedding business, read on!
They used to be a staple at the supermarket checkout. Right next to the Dentyne and Hershey’s Krackel bars stood the tabloid newspapers. The National Enquirer and Weekly World News featured headlines like “Elvis found working at Wal-Mart” and “Taylor Dumps Travis for ALF.”
Sure, I glanced at them and probably turned a page or two while waiting to pay for my twelve-pack and Twinkies. My favorite issues would arrive around this time of the year with the tabloids’ prognostications for the upcoming year.
In the spirit of those forecasts from years past, here are my predictions for 2025.
Future of Artificial Intelligence
Customers get turned off. Early in 2024, I heard a lot of buzz about a guy named Al. At the time, I didn’t know if people were talking about Al Pacino, Al Gore or Albert Einstein. It turns out the buzz was about artificial intelligence.
AI is being used in a lot of business applications. It’s supposed to speed processes and reduce the need for actual intelligent humans. You’ve probably experienced it when calling a customer service line or using the chat feature on a website.
I’ve found that most current human-AI interactions are one-sided and generally result in an endless loop of questions, choices, and button-pushing. The final step is often frustration, which ends any reasonable path to purchasing.
On the other hand, I hear that the AI landscape is evolving rapidly. At the recent High Point Market, a beta version of whole-language AI described as an “artificially intelligent personal retail liaison” was introduced that promised to have back-and-forth personal conversations with furniture shoppers via text, chat and voice. The newest buzz is that it will be able to make personalized product recommendations and have a deep knowledge of furniture, store policies and store culture. They say the result will be more natural and productive conversations that prioritize and pass on high-value leads to drive appointments with real people.
Prediction: I will believe it when I experience it myself. Until then, I predict that businesses with real people answering phones and texts will see real increases in sales volume. Companies using some of the current AI models to make first contact with shoppers will enjoy artificial savings but have a degraded customer experience and lose customers at the margins.
Show Up
The upcoming year will offer furniture dealers many opportunities to find exciting new products. Of course, there are the High Point and Las Vegas Furniture markets, buying group conventions, regional shows, manufacturer’s open houses, and road shows.
This year was marked by high retail inventory and slower retail traffic. Many mid-sized and smaller retailers skipped shows. Larger retailers, however, were out in force before official opening dates. I predict that in 2025, more independent furniture and bedding retailers will come to their senses and show up. Those who attend may get early access to new merchandise if the “big guys” don’t scoop up distribution first. Doing so will provide advantages in planning advertising and merchandising in advance of product shipments.
Prediction: Despite slow traffic at the July Vegas show and less than stellar October High Point traffic, I predict more owners, buyers, and retail gurus will show up as traffic increases and interest rates continue to decrease. They will see the cost of travel as an investment in their shops.
Those who skip shows and stay locked within their own four walls will miss out on upgrading their inventory and discovering new sources of supply, technology and ideas. They can look out the front window and see traffic racing past their store to shop the competition.
The Hot Dog Roller Grill
You may have noticed that convenience stores are entering the fast-food business. This is a smart move, as Mickey D’s meals cost around $10.
One of the largest C-store chains has introduced a rule regarding hot food displays. Any fare not sold within two hours must be tossed in the trash. Every shopper is entitled to a fresh offering. Old spinning hot dogs, bratwurst, and egg rolls don’t sell and take up space from items that will move.
It’s a lesson in inventory management that applies to the retail world. Each new year brings hot new products that are updated to sell to today’s shoppers.
Prediction: the brightest retailers will continue to pare down stale inventory and clear warehouses to make room for the many new introductions aggressive manufacturers offer. When it comes down to the last floor samples, savvy business owners mark them to rock-bottom blowout prices so that no inventory is over 180 days old. That allows retailers to show more new, exciting and promotable traffic builders.
Retailers that don’t do this will lazily tag floor samples at 10-25% off and sit on them until Rose Bowl 2026, never getting the chance to create revenue with the industry’s best offerings.
Don’t Take it Personnel-ly
Even though our industry has seen a loosening in the tight employment market, attracting and hiring good candidates over the last 36 months has been challenging. I predict the 2025 labor market will be friendlier to furniture and bedding retailers.
Next year, there is a high likelihood that your best employee will leave. Or your worst employee will stay! Whether or not that prediction comes true is up to you, your organization, and your company culture.
Remember that the people who work for you experienced inflation of 7% in 2021, 6.5% in 2022, 3.4% in 2023 and 2.4% this past year. Nobody can put that genie back in the bottle. The result is that even your most loyal workers may be enticed to switch companies if offered a few more bucks. Salespeople who work on commission see income rise with price increases. Hourly people do not.
When staffing is at a minimum, it becomes more difficult to cut lower-producing people. Sometimes, retailers just want a warm body in place.
Prediction: More store owners will prioritize recruiting 24/7/365 over the next 12 months. They will work to fill their files with resumes and applications by promoting their company on hiring websites, store websites, social media, good old-fashioned face-to-face recruiting and store signage. They will offer recruiting bonuses to current staff members and provide cash or other incentives to current and past customers who refer candidates.
In 2025, more retailers will move compensation for every position in their company toward performance-based pay. Sure, commissions and bonuses for salespeople are a must, but it’s a good idea to spread those bonuses more broadly as sales goals are achieved. Also, extra compensation should be offered for drivers and helpers who deliver bulky items like adjustable bed bases and motion sectional sofas.
Further, in 2025, owners and managers will invest more time in training, reviewing and coaching their teams for maximum performance. Reward the better and best employees and cut those who can’t make the grade.
One Final Prediction
I wish I had a Magic 8 Ball with all the answers. Will 2025 bring surprises? I’m willing to predict that it will. But one thing that never changes is that it’s always survival of the fittest in retail furniture and bedding. Winning at retail favors those who are most able to adapt to change.
Retailers that continue investing in advertising, people, physical structures, inventory, technology, visual merchandising, corporate culture and community goodwill will survive. Those who don’t may not see 2026.
HIGHLIGHTS
“Despite slow traffic at the July Vegas show and less than stellar October High Point traffic, I predict more owners, buyers, and retail gurus will show up.”
“Next year, there is a high likelihood that your best employee will leave. Or your worst employee will stay!”
