by Indiana retailer edits lineup, takes cue from e-commerce in re-engineering of business
INDIANAPOLIS — Count Kittle’s Furniture among the home furnishings retailers that aren’t wasting a good crisis.
The eight-store Indiana retailer used the downtime from pandemic-related store closings to rethink and reinvent nearly everything about its business, and as a result, it’s emerging as a tighter, smarter and more nimble player, better equipped to handle whatever comes its way in the future.
The primarily midpriced Kittle’s will soon freshen and reset its entire floor. The retailer intends to become an even more important customer to fewer core suppliers. It will take full advantage of a website refresh that better connects its digital footprint to its physical stores. It’s getting more for its ad dollars. And it has learned delivery strategies from pure-play e-commerce companies that are helping simplify its own delivery and backend processes while it better serves the customer the way she wants to be served.
“When all of this hit, it hit everybody like a ton of bricks,” said Kittle’s CEO Eric Easter, referring to the COVID-19 pandemic and the ensuing store closures that cut sales down to a trickle.
“People who normally don’t embrace change or don’t want to be part of change were being compelled to change. Given that reality … we set about rethinking who we are and how to leverage this opportunity so that we can come out of this a better company, serving our customers better than we ever have before.”
The one simple goal along the way, he said, is “to not just survive, but to prosper.”
Easter hinted at what’s now happening back in April when he said the hard economic lockdown caused by the coronavirus pandemic was forcing long-established, traditional businesses such as Kittle’s to think like a startup. The crisis was like nothing the retailer, or any other company for that matter, had ever dealt with before. There was a lot of uncertainty, and it still persists. Easter said he didn’t know exactly what the new landscape would look like, “but we did know that we were going to have to respond quickly to whatever those changes are, whatever the new reality is. It’s going to be very fluid. So we need to be fluid, too.”
Kittle’s went about rethinking nearly every aspect of the business, with the exception of some important legacies areas — such as its reputation in the markets it serves for providing quality home furnishings and a top-notch service experience. But beyond that, the retailer was game for change.
Making room for new merchandise
And one of the best ways to demonstrate tangibly that it was changing was to show it on the floors. So in mid-May when all of its stores were finally reopened, the company began promoting a total sell-off of its inventory, in preparation for a fall reset. Kittle’s opened just ahead of Memorial Day, weaving and refreshing the “Summer Sell-Off” event into its holiday promotions, revising and adapting discount offers and product categories as it went.
It incorporated the latest iteration in June, one featuring a message from its chairman. “Jim Kittle says: ‘Fill every store & sell it all,’” is among the first things website visitors see, and during an important July 4 holiday period, the company added urgency to the event with additional discounts.
The promotion has served Kittle’s well for a number of reasons. At a time when the furniture supply chain in stressed, with demand grossly outstripping supply, the event sent a clear message to consumers that whatever they see on the floor is available immediately.
“We felt there were probably going to be supply issues, which there certainly are right now,” Easter told Home News Now. “Every factory we deal with is way out — double, triple normal shipping times. So it made sense to use this opportunity to clean up our inventory, sell off our floor samples and create great value for our customers.”
Summer sales soaring
The promotion has been very successful, Easter added, noting that sales have exceeded expectations. The retailer enjoyed its best June ever and July was following in June’s footsteps when HNN talked to Easter mid-month. Customers coming into the store these days are not wanting to shop around. They’re coming with clear intentions of buying if the product and service are right, he said.
“As a result — and everybody’s experiencing this — the close rate is through the roof right now. We’ve talked to others in the industry and observed our competition; there are struggles getting product, for sure. So having this sell-off shows we have plenty of product to sell right now. The customer can have it immediately, so they’re taken out of the market.”
New edited lineup coming this fall
The success of the inventory sell-off has put Kittle’s in a position to totally reset every store, Easter said. Initially, the plan was to reintroduce a new lineup in late summer, but the retailer will likely push that back to fall given the industry’s ongoing supply issues.
“We’re going to come back with fewer slots and less cluttered stores because we don’t think clutter is what people want to see now,” Easter said, estimating Kittle’s floors will be 25% lighter product-wise, while the vendor base gets sliced in half.
“This gets back to being simpler and nimble,” he said. “It’s about becoming more important to fewer people. It means fewer vendors for our sales associates to have to learn and know. It means stronger, better relationships with those vendors we move forward with — up-front selection of product and backend service of product.” Easter said Kittle’s has always had strong vendor relationships, “but we only see them being strengthened now as we cull a lot out of the mix.”
He declined to disclose the sources that will go by the wayside but mentioned several that have been, and will continue to be, important, including Klaussner, Vaughan-Bassett, Daniel’s Amish, Canadel, Smith Brothers of Berne, Bernhardt, Bassett and more. Kittle’s will stock everything consumers see while continuing to maintain robust custom order options.
Efficiencies on the backend
Another big change already well under way is occurring on the delivery front. Kittle’s has operated a separate third-party logistics business for the past three years, delivering home furnishings for certain e-commerce players. The retailer has always offered 100% white glove delivery, but it learned through the 3PL business that outdoor drop-off, in-the-box delivery works just fine for a surprisingly large number of customers.
So during the pandemic, the retailer added the scaled-back drop-off service to its own delivery menu, and it’s been a “big win,” Easter said.
Today, Kittle’s deliveries break down this way: 60% white glove; 40% drop-off, in-the-box. While it has lowered the price on its white-glove service, a large percentage of customers still are opting for drop-off. As for return rates, Easter said if there is a percentage increase, it’s not significant.
“It’s one more thing that has simplified our processes,” he said. “When you don’t have to unbox, detail and inspect every item that goes out, it saves so much time and effort in our distribution center.
Online adjustments
Kittle’s had just updated its website right before the coronavirus crisis and is in the midst of reinventing there, too. It added a tab, for instance, where visitors can set in-store appointments, but that’s really just the beginning.
“We have a team right now working on the website and the integration with our stores,” Easter said. “We don’t just view online in terms of what we sell on the website. It’s obviously the front door, but there are other things that feed into the brick and mortar — whether its phone calls, chat or something else — and we’re putting together a complete digital strategy.” Kittle’s expects to be executing this full strategy sometime within the next 90 days, a deadline it pulled forward given the rapidly changing marketplace and business climate.
The company’s marketing maneuvers are more efficient now, too. Digital has become an increasingly important part of the mix and its “sell-off” message is resonating online, but it’s more than this driving the improvements, he said. In television and direct mail, which remain the retailer’s largest advertising channels, the company is managing to get more bang for its buck, he said. The spend is about the same in television, for instance, but the reach and frequency are significantly greater.
Built to last
In March, when the pandemic forced the shutdown of all of its stores, Kittle’s furloughed all but a skeleton crew. It has come back as a smaller organization — about 180 people, some 20% fewer heads than it had going into the crisis. Easter adds that it’s smaller, but much more productive, and not just because it has layered more sales on a smaller staff but, “because we changed processes, we changed responsibilities,” and the team has risen to the occasion.
“This was an opportunity to reimagine, rethink, restart.”
Eric Easter, Kittle’s
While uncertainty lingers, Easter said he believes the strong business Kittle’s and other have seen recently will last awhile, despite some of the disturbing headwinds, including new soaring coronavirus cases in many states; the recent expiration of the federal government’s bump in unemployment benefit assistance, and a jobs market that has yet to fully recover and may be years away from full recovery.
For starters, Easter doesn’t think the nation will see another fullscale lockdown like the one that happened in March. But he also thinks there’s been a fundamental shift in the consumer’s mindset because of this “significant emotional event.”
“The home is more important now than it was 120 days ago in terms of priority for people,” he said. “They spent more time in it than they wanted to, but once they did, they realized: ‘I might as well get it the way I want it.’”
On top of this, the competition for that disposable dollar is severely hampered these days. Consumers aren’t eating out as much as they use to. They’re not flying. They’re not staying in hotels like they were before.
“That frees up dollars,” Easter said. “I think for the foreseeable future, there’s a very open window for our industry, and I don’t think it’s going to close for a while.”
Typically, Easter said, when you’re operating an established business, you’re running at a certain speed with a set infrastructure in place. It’s a top-down approach. “If you’re wanting to change things, you’re battling that rigid infrastructure.”
But the pandemic disruption actually gave Kittle’s the opportunity to pause that approach and manage in the other direction, “to build up and really address our needs and staff and processes, and question processes from the bottom up, almost like a startup,” he said. “And I think our company has done a really good job of taking advantage of that and putting ourselves in a very good position to prosper going forward.
“Rarely does a company that’s 88 years old like ours get a chance to restart,” he said. “This was an opportunity to reimagine, rethink, restart.”
“People who normally don’t embrace change or don’t want to be part of change were being compelled to change. Given that reality … we set about rethinking who we are and how to leverage this opportunity so that we can come out of this a better company, serving our customers better than we ever have before.”
Eric Easte
“When all of this hit, it hit everybody like a ton of bricks,” said Kittle’s CEO Eric Easter, referring to the COVID-19 pandemic and the ensuing store closures that cut sales down to a trickle.
“People who normally don’t embrace change or don’t want to be part of change were being compelled to change. Given that reality … we set about rethinking who we are and how to leverage this opportunity so that we can come out of this a better company, serving our customers better than we ever have before.”
The one simple goal along the way, he said, is “to not just survive, but to prosper.”
Easter hinted at what’s now happening back in April when he said the hard economic lockdown caused by the coronavirus pandemic was forcing long-established, traditional businesses such as Kittle’s to think like a startup. The crisis was like nothing the retailer, or any other company for that matter, had ever dealt with before. There was a lot of uncertainty, and it still persists. Easter said he didn’t know exactly what the new landscape would look like, “but we did know that we were going to have to respond quickly to whatever those changes are, whatever the new reality is. It’s going to be very fluid. So we need to be fluid, too.”
Kittle’s went about rethinking nearly every aspect of the business, with the exception of some important legacies areas — such as its reputation in the markets it serves for providing quality home furnishings and a top-notch service experience. But beyond that, the retailer was game for change.
Making room for new merchandise
And one of the best ways to demonstrate tangibly that it was changing was to show it on the floors. So in mid-May when all of its stores were finally reopened, the company began promoting a total sell-off of its inventory, in preparation for a fall reset. Kittle’s opened just ahead of Memorial Day, weaving and refreshing the “Summer Sell-Off” event into its holiday promotions, revising and adapting discount offers and product categories as it went.
It incorporated the latest iteration in June, one featuring a message from its chairman. “Jim Kittle says: ‘Fill every store & sell it all,’” is among the first things website visitors see, and during an important July 4 holiday period, the company added urgency to the event with additional discounts.
The promotion has served Kittle’s well for a number of reasons. At a time when the furniture supply chain in stressed, with demand grossly outstripping supply, the event sent a clear message to consumers that whatever they see on the floor is available immediately.
“We felt there were probably going to be supply issues, which there certainly are right now,” Easter told Home News Now. “Every factory we deal with is way out — double, triple normal shipping times. So it made sense to use this opportunity to clean up our inventory, sell off our floor samples and create great value for our customers.”
Summer sales soaring
The promotion has been very successful, Easter added, noting that sales have exceeded expectations. The retailer enjoyed its best June ever and July was following in June’s footsteps when HNN talked to Easter mid-month. Customers coming into the store these days are not wanting to shop around. They’re coming with clear intentions of buying if the product and service are right, he said.
“As a result — and everybody’s experiencing this — the close rate is through the roof right now. We’ve talked to others in the industry and observed our competition; there are struggles getting product, for sure. So having this sell-off shows we have plenty of product to sell right now. The customer can have it immediately, so they’re taken out of the market.”
New edited lineup coming this fall
The success of the inventory sell-off has put Kittle’s in a position to totally reset every store, Easter said. Initially, the plan was to reintroduce a new lineup in late summer, but the retailer will likely push that back to fall given the industry’s ongoing supply issues.
“We’re going to come back with fewer slots and less cluttered stores because we don’t think clutter is what people want to see now,” Easter said, estimating Kittle’s floors will be 25% lighter product-wise, while the vendor base gets sliced in half.
“This gets back to being simpler and nimble,” he said. “It’s about becoming more important to fewer people. It means fewer vendors for our sales associates to have to learn and know. It means stronger, better relationships with those vendors we move forward with — up-front selection of product and backend service of product.” Easter said Kittle’s has always had strong vendor relationships, “but we only see them being strengthened now as we cull a lot out of the mix.”
He declined to disclose the sources that will go by the wayside but mentioned several that have been, and will continue to be, important, including Klaussner, Vaughan-Bassett, Daniel’s Amish, Canadel, Smith Brothers of Berne, Bernhardt, Bassett and more. Kittle’s will stock everything consumers see while continuing to maintain robust custom order options.
Efficiencies on the backend
Another big change already well under way is occurring on the delivery front. Kittle’s has operated a separate third-party logistics business for the past three years, delivering home furnishings for certain e-commerce players. The retailer has always offered 100% white glove delivery, but it learned through the 3PL business that outdoor drop-off, in-the-box delivery works just fine for a surprisingly large number of customers.
So during the pandemic, the retailer added the scaled-back drop-off service to its own delivery menu, and it’s been a “big win,” Easter said.
Today, Kittle’s deliveries break down this way: 60% white glove; 40% drop-off, in-the-box. While it has lowered the price on its white-glove service, a large percentage of customers still are opting for drop-off. As for return rates, Easter said if there is a percentage increase, it’s not significant.
“It’s one more thing that has simplified our processes,” he said. “When you don’t have to unbox, detail and inspect every item that goes out, it saves so much time and effort in our distribution center.
Online adjustments
Kittle’s had just updated its website right before the coronavirus crisis and is in the midst of reinventing there, too. It added a tab, for instance, where visitors can set in-store appointments, but that’s really just the beginning.
“We have a team right now working on the website and the integration with our stores,” Easter said. “We don’t just view online in terms of what we sell on the website. It’s obviously the front door, but there are other things that feed into the brick and mortar — whether its phone calls, chat or something else — and we’re putting together a complete digital strategy.” Kittle’s expects to be executing this full strategy sometime within the next 90 days, a deadline it pulled forward given the rapidly changing marketplace and business climate.
The company’s marketing maneuvers are more efficient now, too. Digital has become an increasingly important part of the mix and its “sell-off” message is resonating online, but it’s more than this driving the improvements, he said. In television and direct mail, which remain the retailer’s largest advertising channels, the company is managing to get more bang for its buck, he said. The spend is about the same in television, for instance, but the reach and frequency are significantly greater.
Built to last
In March, when the pandemic forced the shutdown of all of its stores, Kittle’s furloughed all but a skeleton crew. It has come back as a smaller organization — about 180 people, some 20% fewer heads than it had going into the crisis. Easter adds that it’s smaller, but much more productive, and not just because it has layered more sales on a smaller staff but, “because we changed processes, we changed responsibilities,” and the team has risen to the occasion.
“This was an opportunity to reimagine, rethink, restart.”
Eric Easter, Kittle’s
While uncertainty lingers, Easter said he believes the strong business Kittle’s and other have seen recently will last awhile, despite some of the disturbing headwinds, including new soaring coronavirus cases in many states; the recent expiration of the federal government’s bump in unemployment benefit assistance, and a jobs market that has yet to fully recover and may be years away from full recovery.
For starters, Easter doesn’t think the nation will see another fullscale lockdown like the one that happened in March. But he also thinks there’s been a fundamental shift in the consumer’s mindset because of this “significant emotional event.”
“The home is more important now than it was 120 days ago in terms of priority for people,” he said. “They spent more time in it than they wanted to, but once they did, they realized: ‘I might as well get it the way I want it.’”
On top of this, the competition for that disposable dollar is severely hampered these days. Consumers aren’t eating out as much as they use to. They’re not flying. They’re not staying in hotels like they were before.
“That frees up dollars,” Easter said. “I think for the foreseeable future, there’s a very open window for our industry, and I don’t think it’s going to close for a while.”
Typically, Easter said, when you’re operating an established business, you’re running at a certain speed with a set infrastructure in place. It’s a top-down approach. “If you’re wanting to change things, you’re battling that rigid infrastructure.”
But the pandemic disruption actually gave Kittle’s the opportunity to pause that approach and manage in the other direction, “to build up and really address our needs and staff and processes, and question processes from the bottom up, almost like a startup,” he said. “And I think our company has done a really good job of taking advantage of that and putting ourselves in a very good position to prosper going forward.
“Rarely does a company that’s 88 years old like ours get a chance to restart,” he said. “This was an opportunity to reimagine, rethink, restart.”
