HIGH POINT — With the stimulus payments long gone, inflation at the doorstep and consumer behavior purportedly shifting away from home-related purchases, what worked to achieve double-digit growth for furniture retailers in 2021 may not be the formula for 2022.
For Furniture Today’s most recent Top 100 U.S. Furniture Stores, see the May 23 issue.
In recent interviews with Furniture Today, some Top 100 retailers shared how they are anticipating another successful year by planning for changing economic scenarios, engaging with employees and taking proactive steps to build business.
Lesson 1: Plan, then plan again
“We’re in a state of planning, forecasting and reforecasting,” said Charlie Malouf, president and CEO of Broad River Retail, Fort Mills, S.C. Just as a bank may stress test the numbers of its customers, Malouf said he runs his own internal stress tests related to factors such as margin compression, sales declines and the impact of inflation “to see what options we have to maintain a sustainable, healthy business.”
Included in those options is a four-pronged retail growth strategy the targets investing in current stores, filling in space within current markets with more stores, exploring new concepts within current markets and identifying completely new markets.
Setting realistic goals based on economic indicators is carrying Steinhafels into 2022 with optimism for low double-digit growth, according to Andrew Steinhafel, president of the Waukesha, Wis.-based retailer. “The things that affect consumer confidence are the signals we use to adjust our forecast,” he explained, adding “it’s easier to scale up over the forecast” than it is to adjust it downward.
Lesson 2: Make people a priority
At Broad River, Malouf said they’ve instituted a series of measures to recognize the hard work of employees during and coming out of the pandemic. If 2020 was about survival, 2022 is about thriving, he said.
Project Thrive, as it is called, addresses inflation with a cost-of-living adjustment and increased mileage reimbursements while also providing an extra paid time off day, a change in how PTO is handled and improved parental leave.
The company sought employee input through a companywide engagement survey that achieved 90% participation. The survey, said Malouf, “provides a feedback loop so we can get better.” That has been followed up with regular town hall meetings to foster even more communication.
Steinhafel said his company, which is 100% employee-owned, is “extremely focused on communicating what that means for them. It’s a huge employee benefit.” Additionally, the retailer has been improving its associate experience, which it has seen pay off with better staffing lately vs. the previous 18 months.
Lesson 3: Don’t stand still
Following up on the launch of an omnichannel platform through its website earlier this year, Steinhafel said the company has the “outlandish target” to grow its e-commerce to 10%. In 2021, Steinhafel’s reported online sales accounted for 6% of its business.
Although it’s a stretch goal, Steinhafel said it’s also a key opportunity for the business.
With the acknowledgement that sales may not be as easy to come by this year as they were in 2021, Sam Zavary, CEO at Houston-based Exclusive Furniture, has ramped up training.
“We felt this would be a challenging year, so we’ve brought in our salespeople to train them,” he said, offering a professional trainer-led program “to sharpen the saw” and weekly, hour-long seminars.
The training sessions, he said, “go through promotions, course corrections; we talk about the top salespeople. It’s one of the only reasons we closed (the first quarter) with a 13.8% increase over last year.”
See also: Top 100’s reveal factors that drove explosive growth in 2021; some may surprise you