by There’s good news and there’s bad news.
The good news is that people in the Upper Midwest enjoy their patios as much as everyone else in the U.S. does; the bad news is that they don’t have as much time to enjoy them as do their neighbors in the South and West.
Since its beginnings in 1978, Furniture Mart USA has grown to 46 stores across three brands – Ashley HomeStore, Furniture Mart, and Unclaimed Freight Furniture – across South Dakota, North Dakota, Minnesota and Iowa, with two more locations over the border into Illinois and Wisconsin, respectively.
The store’s business locations mean that they have to move fast to take advantage of a selling season that is optimal from April through September. Aaron Fisher, who is vice president of merchandising for the chain, said that once the July 4th holiday ends, the chain is in closeout mode so that inventory levels can get to a manageable number during the winter months.
“We have carried outdoor furniture for more than 20 years now,” says Aaron Fisher, VP of merchandising. “We got into the category because the demand was there. Anything furniture-related we sell or have tried to sell over the years. Outdoor is a very popular category but it’s also very competitive and extremely time-sensitive in our neck of the woods.”
Because of the time-sensitive nature, supply chain challenges have been especially difficult.
“Lead times ballooned like all other major categories and when you have such a small window to present and capture sales, you’re forecasting and guessing have to be above and beyond,” Fisher says. “Planning 12-14 months on speculation is difficult enough, then add in container issues and supply chain issues and it’s very difficult to hit the sales floor with full force.”
To meet the challenge, Furniture Mart USA broadened its assortment from certain manufacturing partners and purchased initial inventory levels double and triple the amount it ordinarily would. With the plan to have stock in inventory in April, the company had containers ship in November the previous year, so that it could use its warehouse capacity and be ready for the season.
“I would say we were 50-60% successful in rolling out a decent program with a good 40% staggered up until most recently,” Fisher says.
Outdoor amounts to between 4 percent to 6 percent of its annual sales and is on the high end of those percentages when product is flowing and inventory levels are high. It doesn’t dramatically fall off when the weather turns but at the same time, there isn’t as much velocity to be concerned with carrying inventory year-round.
The stores carry Ashley, Ebel and a little bit of Steve Silver currently; and in the past, it has carried 300 South Main, Agio and many other vendors over the years. The company is in internal discussions to narrow down its outdoor assortment but go deeper on the inventory.
Selling It
“We merchandise outdoor the same as the rest of our categories, “Fisher explains. “Prices will eventually and inevitably be sharper as we look to move out. We are big on both cash and financing. We are very flexible with our customers. We’ve been pushing long-term financing more aggressively the last 12 months. And we’re trying to focus our people in on finding the best solutions for the customer.”
On the sales and marketing fronts, Furniture Mart USA went with the tried-and-true: A top-level discount at the beginning of the season, which made up for what it might lose in sales with velocity, while at the same time, moving through as much inventory as possible.
“With marketing, we’ll try pretty much anything,” Fisher says. “Digital has been a very large push for us over the past 12-18 months. We are focusing more and more of our budget down that avenue. Return On Ad Spend (ROAS) is crucially important when evaluating programs. Eyeballs, awareness, and traffic all are important to know where you are at, where you want to be and measure against efforts to improve everything.”
To that end, Furniture Mart USA recently launched its very first catalog for the Furniture Mart division, which has generated a lot of new interest and enlightened a lot of prospective customers on who and what Furniture Mart can offer. The catalog did so well that they are planning a second one for this fall.
“Our goal, as an organization, is to provide value,” Fisher says. “We try to have the best buys possible without sacrificing quality, size/scale, or attractiveness. Everything is measured and we react from there. Inventory is and continues to be crucial. We buy heavy and deep so that we can have it for when our customers want it, so they’re not waiting for 3-6-12 months to get that satisfaction/gratification.”
Any advice for furniture retailers looking to go into outdoor?
“My biggest piece of advice is to plan and make space for the product,” Fisher explains. “It’s difficult to be 2-3 weeks early, it’s extremely difficult to be 2-3 months early but the opportunities are fleeting, and every customer is important. The necessity to have it on hand when the customer wants it is more viable and real than ever before. Know your customers, know your weather for your season and make the deal.”
