THE BUSINESS NEWSPAPER OF THE FURNITURE INDUSTRY Nov. 14 2011 Vol. 36 No. 10 $10 Giordano at RoomStore Named CEO to replace retiring Kimbrell By Heath E. Combs RICHMOND, Va. Steve Giordano has left his CEO post at The RoomPlace and has been named CEO and a board member at The RoomStore here, replacing Curtis Kimbrell. Kimbrell has retired from Richmond-based The Giordano RoomStore, said Steve Gidumal, a member of the company s board of directors. Giordano joined RoomStore, a publicly held Top 100 company, on Nov. 9. Kimbrell had been president and CEO since 2001. see Giordano, p27 Leather leads in upholstery By Stephanie Nickell HIGH POINT When it comes to upholstered furniture, leather leads the way across all product categories and especially in highend price points. That s one of the findings from the 2011 Furniture/Today Upholstery Fabric and Style Survey, where furniture retailers were asked to report unit sales of upholstered furniture. The survey found that leathers, suedes and microdeniers accounted for half or more of the market share in stationary sofa, motion sofa and reclining chair categories and nearly 100% in home theater seating. Those high percentages make it clear that leathers and performance fabrics are still see Upholstery, p16 Industry Numbers American Furniture sales fall By Larry Thomas ECRU, Miss. Promotional upholstery producer American Furniture recorded a third-quarter operating loss of $2.51 million as sales tumbled 26.2%, its parent company reported. According to a Securities and Exchange Commission filing by parent company Compass Diversified Holdings, about two-thirds of the decline was due to decreased sales to American s two largest see American, p34 Bedding Today... 23 Casual Living... 12 Consumer Views... 14 www.furnituretoday.com I N D E X Opinion/Staff listing... 26 People Today... 8 Industry numbers... 34 NFM eyes Dallas store Complex would be retailer s largest yet By Clint Engel American opening draws crowd By Clint Engel GRAND JUNCTION, Colo. American Furniture Warehouse took a cue from Ikea, giving away furniture and other gifts during the grand opening of its newest store here. The strategy was effective as the Englewood, Colo.- based Top 100 company drew a huge crowd and a lot of media attention. AFW officially opened the 100,000-square-foot showroom with attached 50,000- see AFW, p27 By David Perry DALLAS Nebraska Furniture Mart could be coming to Dallas with its largest store to date anchoring a major commercial development. NFM Executive Vice President Bob Batt confirmed last week that the Omaha, Neb.- based retailer, part of Berkshire Hathaway s furniture division, has tentative plans to build a 1.8 million-square-foot complex with a 546,000- square-foot showroom in The Colony, Texas, a north Dr. Breus shares sleep tips at store SUMMERLIN, Nev. Sleep Doctor Michael Breus shared some important and sometimes surprising sleep tips with consumers at the R.C. Willey store here. Breus has partnered with International Bedding on a line of latex beds, and he helped R.C. Willey introduce the line with his appearance at the retailer s store here outside Las Vegas. The nationally known sleep expert known as the Sleep Doctor conducted a see Playbook, p24 Dallas suburb. Batt said the store would be part of a $1.5 billion project the retailer would develop on 433 acres along State way 121 that would also include other retailers, hotels, a convention center, see NFM, p33 A traditional Ashley living room group (the sofa s $599) sits across from the recliner gallery in American Furniture Warehouse s new Grand Junction, Colo., store, which has an open format with few interior walls.
16 FURNITURE TODAY NOVEMBER 14, 2011 www.furnituretoday.com Upholstery from p1 exceedingly important for consumers. Not surprisingly, leathers and suedes also accounted for the highest market share in terms of units, in the $2,000 and above price point at 41% for stationary sofas and 58% for motion sofas. In the highest price point for reclining chairs, leathers and suedes held a 60% market share and in the highest price point for home theater seating, leathers and suedes held a 99% market share. The contemporary style maintained its lead across all upholstery styles with 46% of the market share in the 2011 survey. styles held the next highest market share with 26% across all product categories and prices. While the industry has focused more on bringing casual styles into the home, the casual and upholstery style category accounted for 23%, and the country upholstery style had market share. The traditional style held on with 31% of the unit market share for stationery, 19% for motion, 21% for reclining chairs and 23% for home theater seating. Perhaps due to the recession, eco-friendly materials were down across all product categories. In 2009, retailers said eco-friendly materials accounted for 12% of the market share in stationary sofas, 6% and 7% in motion sofas and reclining categories, respectively. In 2011, retailers reported a sharp decline in market share for eco-friendly materials in the stationary category with of unit sales, while motion and reclining had less dramatic decreases to and 3%, respectively. Mid-level prices, including and upper- price points, held the majority market share across all product categories. The price points together held a 67% market share for motion sofas, 6 market share for home theater seating, 59% market share for reclining chairs and 5 market share for stationary sofas. -level prices had the best showing in the home theater seating category with 31% market share. In the lowest price points, leathers and suedes held the majority unit market share for stationary sofas at 30% and home theater seating at 92%. Microdeniers edged out leathers and suedes in the lower price points for motion sofas at 33% and reclining chairs at 37%. While leathers and suedes lead the way in fabric construction, contemporary is tops for style families across all product categories. The contemporary style is most popular in home theater seating with 71% of the market share, followed by 56% of the market share in reclining chairs. is leading in motion and stationary sofas with 50% and 36% of the market share, respectively. The contemporary style dominates the market share in promotional price points across all product categories. For stationary sofas the contemporary style held 5 of all units sold and a whopping 67% of motion sofas in the lowest price points. leads the way at promotional for reclining chairs and home theater seating with 70% and 76% market share, respectively. At the high-end for stationary sofas, the traditional style held the greatest market share at 48%. The traditional style also held large unit market shares in motion sofas with 32% in the $2,200 and above price point. All upholstery fabric constructions Combining stationary sofas, motion sofas, reclining chairs and home theater seating for all price points All upholstery styles Combining stationary sofas, motion sofas, reclining chairs and home theater seating for all price points 26% 23% 46% <1% Other styles Methodology Furniture/Today s exclusive report, the Upholstery Fabric and Style Survey, reflects the answers of furniture stores operating 375 U.S. storefronts. Their unit sales of upholstery were used as the basis for the market share for the fabric constructions and styles. Contacted by mail and online during May and June, retailers based responses on 2010 unit sales in stationary sofas, motion sofas, reclining chairs and home theater seats at low,, upper- and high price points. To determine market share, responses were weighted to reflect a retailer s unit sales in each product category and at each price point level. For example, the response from a retailer with annual sales of $20 million in stationary sofas was given greater weight than sales from a store generating $5 million for that category. Survey results represent 375 storefronts carrying Stationary upholstery... 100% Motion upholstery... 91% Reclining chairs... 96% Home theater seating... 43% Upholstery made up 46% of responding retailers 2010 total furniture sales. Style groups The major style groups have been updated and changed from the last time Furniture/Today published an Upholstery Fabric and Style Survey in October 2009. An overview of each group, including representative and specific styles for each are: Transitional, Coastal, Rustic, Wicker and other lifestyle or casual styles Architectural Modern, Art Deco, Asian/Oriental, Industrial, Mid-Century Modern, Retro/Post-Modern, Scandinavian, Urban/Loft American, English and French, Cottage/Lodge, Mediterranean, Mission/Arts & Crafts, Pennsylvania Dutch, Shaker American, English and German, Campaign and Plantation, Colonial, Formal French and Italian, Neoclassic, Victorian Leathers/suedes 36% Microdeniers 24% 2010 upholstery sales Stationary upholstery... 58% Motion upholstery... 20% Reclining chairs... 17% Home theater seating... 2% All other upholstery... 3% The Upholstery Fabric and Style Survey was conducted and analyzed by Director of Research Dana French. Fabric constructions Chenilles Jacquards/dobbies Leathers/suedes includes leather and vinyl combinations, bicast and bonded Microdeniers Chenilles 16% Textures 8% Velvets/piles 7% Prints 4% Vinyls Jacquards/dobbies 3% 2% Prints excludes printed velvets Textures other than chenilles, jacquards and dobbies Velvets/piles include flocked, jacquard, tufted, woven, knitted and printed velvets; excludes chenilles Vinyls includes all coated fabrics
www.furnituretoday.com FURNITURE TODAY NOVEMBER 14, 2011 17 Stationary sofas Stationary sofa fabric constructions Leathers/suedes 31% Low $599 and below $600 to $999 $1,000 to $1,999 $2,000 and above Leathers/suedes 30% 2 3 41% Microdeniers 27% 26% 13% 13% Chenilles 23% 18% 17% 10% Microdeniers 22% Textures 9% 13% 14% 13% Velvets/piles 9% 6% 6% Chenilles 19% Textures 11% Prints 1% 4% 8% 10% Jacquards/dobbies <1% 2% 7% Vinyls 3% 2% <1% Velvets/piles 7% Prints 4% Jacquards/dobbies 3% Vinyls 3% Stationary sofa style families Low $599 and below $600 to $999 $1,000 to $1,999 $2,000 and above 5 30% 24% 18% 26% 31% 36% 19% 36% 37% 48% 24% 28% 24% 28% 2% 6% 14% 6% Other styles <1% <1% 1% <1% 7% <1% Other styles Stationary sofa price points Eco-friendly stationary sofas Low 3 30% 2 10% 9
20 FURNITURE TODAY NOVEMBER 14, 2011 www.furnituretoday.com Motion sofas Motion sofa fabric constructions Leathers/suedes 36% Low $799 and below $800 to $1,399 $1,400 to $2,199 $2,200 and above Leathers/suedes 29% 33% 48% 58% Microdeniers 33% 34% 26% 17% Chenilles 26% 19% 12% 11% Velvets/piles 4% 6% 4% Microdeniers 31% Textures 4% 4% 3% 4% Vinyls 4% 3% 2% <1% Chenilles 19% Prints <1% 1% 1% 3% Jacquards/dobbies <1% <1% 3% 3% Velvets/piles Textures 4% Vinyls 3% Prints 1% Jacquards/dobbies 1% Motion sofa style families Low $799 and below $800 to $1,399 $1,400 to $2,199 $2,200 and above 2 50% 67% 47% 42% 42% 22% 27% 23% 20% 10% 19% 26% 32% 1% 7% 9% 6% 19% 6% Motion sofa price points Eco-friendly motion sofas Low 26% 48% 19% 7% 9
www.furnituretoday.com FURNITURE TODAY NOVEMBER 14, 2011 21 Reclining chairs Reclining chair fabric constructions Leathers/suedes 30% Low $499 Leathers/suedes 18% 27% 52% 60% Microdeniers 37% 26% 14% 8% Velvets/piles 17% 14% 6% Microdeniers 27% Velvets/piles 13% Chenilles 12% Chenilles 12% 1 7% 8% Textures 9% 7% 7% 8% Jacquards/dobbies <1% 4% 8% 7% Vinyls <1% <1% Prints 2% 2% 6% 4% Textures 8% Jacquards/dobbies 4% Vinyls 4% Prints 2% Reclining chair style families Low $499 21% 56% 70% 49% 4 44% 7% 31% 2 26% 19% 1 21% 22% 4% 9% 8% 18% Recliner price points Eco-friendly recliners 41% 3% Low 3 18% 6% 97%
22 FURNITURE TODAY NOVEMBER 14, 2011 www.furnituretoday.com Home theater seating Home theater fabric constructions Low $499 Leathers/suedes 92% 93% 97% 99% Microdeniers <1% 2% 1% 1% Velvets/piles 1% 1% 1% <1% Leathers/suedes 97% Vinyls 6% 2% <1% <1% Chenilles 1% <1% 1% <1% Textures <1% 2% <1% <1% Microdeniers 1% Velvets/piles 1% Vinyls 1% Chenilles <1% Textures <1% Prints <1% Jacquards/dobbies <1% Prints <1% <1% <1% <1% Jacquards/dobbies <1% <1% <1% <1% Home theater style families Low $499 76% 76% 68% 70% 71% 18% 14% 2 28% 2% 7% 7% 2% 4% 3% <1% <1% 23% Home theater price points Eco-friendly home theater seats 1% 31% 4% 20% Low 4 4% 96%